The Health Care Security Ordinance Is About Spending, Not Just Offering Insurance
San Francisco's Health Care Security Ordinance (HCSO) requires covered employers to make qualifying health care expenditures for covered employees. The required expenditure is calculated using applicable rules and rates, including the employee's eligible paid hours.
Covered employers also have reporting, notice, and recordkeeping responsibilities. The annual report is submitted to the city's Office of Labor Standards Enforcement (OLSE).
This requirement can create problems in two ways. First, offering a health plan does not automatically mean an employer has met its expenditure obligation for every covered employee. Part-time employees may need particular attention. Second, the reporting requirement is separate from the spending requirement. Meeting the expenditure obligation does not necessarily eliminate the duty to submit a report.
HCSO expenditure rates and filing deadlines can change. Check the current requirements directly with the San Francisco Office of Labor Standards Enforcement before calculating your obligations or preparing the annual report.
Paid Parental Leave Adds to California's State Benefit
California Paid Family Leave provides partial wage replacement to eligible employees taking qualifying leave. San Francisco's Paid Parental Leave Ordinance can require covered employers to provide supplemental pay to eligible employees bonding with a new child.
The local requirement is designed to supplement the state benefit, subject to the ordinance's coverage rules, payment limits, and other conditions. Employers must understand when the employee receives state benefits and how to calculate any required supplemental payment.
HR and payroll should coordinate the employee's leave dates, state benefit information, required forms, and company parental leave policy. Establish a consistent procedure before an employee begins leave so the supplemental payment is calculated and documented correctly.
Predictable Scheduling Rules for Covered Retail Employers
San Francisco's Formula Retail Employee Rights Ordinances establish scheduling requirements for certain covered retail employers. Depending on coverage and the circumstances, the rules can require employers to:
- Provide written work schedules in advance.
- Pay additional compensation for certain schedule changes made on short notice.
- Provide required compensation when certain scheduled or on-call shifts are canceled.
- Offer additional available hours to existing part-time employees before hiring new employees, subject to applicable requirements.
Retail and food businesses entering San Francisco may bring scheduling practices that do not meet local requirements. Employers should review whether their locations, ownership structure, number of locations, and business type fall within the applicable definitions.
Train store managers and scheduling staff to document schedule changes, employee availability, shift cancellations, and any additional compensation owed. Waiting until a payroll complaint arises can make it harder to reconstruct what happened.
Fair Chance Hiring and the Salary History Ban
San Francisco's Fair Chance Ordinance limits when and how covered employers may inquire about or use an applicant's criminal history. Applicable requirements may include restrictions on the timing of inquiries, individualized assessments, notices, and opportunities for applicants to respond.
San Francisco also restricts employers from asking about an applicant's salary history or using past compensation to determine pay. Separately, California law generally requires employers with 15 or more employees to include pay scales in job postings, and employers must provide a position's pay scale to an applicant upon reasonable request.
These rules affect job advertisements, application forms, interviews, background checks, and hiring decisions. Recruiters and hiring managers need training alongside HR staff so prohibited questions are not asked during the selection process.
Public Health Emergency Leave
San Francisco has a Public Health Emergency Leave Ordinance that provides covered employees with leave for qualifying circumstances associated with a declared public health emergency. Depending on the applicable rules, qualifying events can include certain emergency-related conditions and qualifying air quality events.
This leave is distinct from ordinary paid sick leave. Employers need to understand when the ordinance applies, how eligibility and available hours are calculated, and how the leave interacts with other benefits and leave requirements.
Because emergency leave rules and applicable declarations can change, review the current city guidance before updating your policy or denying a leave request.