To receive Supplemental Compensation, an employee must apply for both PFL benefits (by applying to the EDD) and PPLO benefits (by submitting required documentation to you).

The PFL program allows employees to receive PFL benefits intermittently. The employee does not have to use the benefits consecutively for eight weeks but, instead, may spread the benefits out in separate increments over a 12-month period as the employee takes bonding leave. For more information on PFL benefits, see the HR Library's Paid Family Leave Defined page.

• The PPLO and PFL are wage replacement programs; they are not forms of protected leave. For more information on protected leave for purposes of bonding with a new child, see “Child Bonding” on the HR Library's FMLA and CFRA Qualifying Reasons page.

You can find more information regarding the PPLO on the city's PPLO webpage, including Rules Implementing the PPLO and detailed Frequently Asked Questions (FAQs). You can also contact the San Francisco Office of Labor Standards Enforcement (OLSE) by phone at (415) 554-4190, or by email at pplo@sfgov.org.

The PPLO was amended effective July 1, 2020, to expand the required duration of Supplemental Compensation from six weeks to eight weeks to align with the expansion of PFL benefits under California law. Employers referring to the Rules Implementing the PPLO should keep in mind that these rules were published prior to the PPLO amendment and may, in some instances, not reflect current law.

Employers Covered Under the Paid Parental Leave Ordinance

A covered employer (employer) under the PPLO includes all employers (except governmental entities) within San Francisco regularly employing 20 or more employees, regardless of location.2

The number of employees includes full-time, part-time, seasonal, temporary and commissioned employees. The number of employees includes employees who are on paid or unpaid leave.3

If the size of your business fluctuates from week to week, the number of employees you “regularly employ” is determined by taking the average number of employees in the “PPLO Lookback Period,” which is the three monthly pay periods, six bi-weekly or semi-monthly pay periods, or 12 weekly pay periods preceding the first day of leave.4

If an employee begins receiving PFL benefits before a business qualifies as a covered employer but the business qualifies as a covered employer at some point during the employee's leave period, the employer is required to provide Supplemental Compensation only for the portion of the leave period that occurs after the date the business became a covered employer.5

If an employee takes intermittent leave, you must determine whether you are a covered employer for each increment of leave.6

You are not required to provide Supplemental Compensation under the PPLO if your existing policy provides employees at least eight weeks fully paid parental leave within any 12-month period for bonding with a new child.7

Employees Entitled to the Benefit

A covered employee (employee) under the PPLO is an employee who:8

• Started employment with you at least 180 days prior to the start of the leave period;
• Performs at least eight hours of work per week for you in San Francisco;
• Works at least 40 percent of their total work hours in San Francisco; and
• Is receiving paid family leave benefits under the PFL program for the purpose of bonding with a new child.

The PPLO does not apply to employees covered by a valid collective bargaining agreement if the ordinance requirements are explicitly waived in clear and unambiguous terms.9

Rehires and Employee Eligibility

If an employee separates from employment before completing at least 180 days of employment and returns to work for the same employer within one year, the employee's prior days of employment must be counted toward the PPLO 180-day eligibility period.

If an employee separates from employment after completing at least 180 days of employment and returns to work for the same employer within one year, the employee is not required to complete a new 180-day eligibility period for coverage under the PPLO.10

Intermittent Leave and Employee Eligibility

An employee taking intermittent bonding leave must have completed 180 days of employment with you prior to the start of an increment of leave to be eligible for Supplemental Compensation during that particular increment of leave. For example, if an employee takes two weeks of bonding leave before completing 180 days of employment, the employee is not eligible for Supplemental Compensation under the PPLO, even if they are eligible for PFL benefits.

However, if the same employee later takes six additional weeks of bonding leave after completing 180 days of employment, the employee will be eligible for both PFL benefits and Supplemental Compensation.11

If an employee's regular work hours and/or location change between increments of leave and the employee works less than eight hours per week or less than 40 percent of the employee's working hours are in San Francisco, the employee is ineligible for Supplemental Compensation during the subsequent increments of leave.12

If an employee's work hours and/or location fluctuate from week to week, calculate whether the employee works at least eight hours per week and whether at least 40 percent of the employee's working hours are in San Francisco. Your calculations should be based on the employee's hours during the calendar quarter (e.g., three monthly pay periods, six bi-weekly or semi-monthly pay periods or 12 weekly pay periods) immediately preceding the relevant increment of leave.13

You must not change an employee's work hours or location during an intermittent leave period to avoid your obligation to pay Supplemental Compensation under the PPLO.

Requirements for Receiving Supplemental Compensation

Before you must pay Supplemental Compensation under the PPLO, the employee must submit a request form, provide the PFL weekly benefit amount and agree to use up to two weeks of vacation leave, following the procedures described below.

When an employee informs you that they are expecting a newborn, adopted or foster child, or inquires about paid parental leave, you must provide the employee a copy of the “San Francisco Paid Parental Leave Form” (PPL form) within a reasonable time. The current PPL form can be found on the city's website.14

Submit a San Francisco Paid Parental Leave Form

Employees must complete and submit the PPL form to their employer to receive Supplemental Compensation under the PPLO. On the PPL form, the employee must:

• Indicate how the employee will provide you with notice of the PFL benefit amount (s)he will receive from EDD (See provide the weekly benefit amount, below);
• Agree to reimburse the full amount of Supplemental Compensation received from you if the employee voluntarily separates from employment within 90 days of the end of the leave period and you request reimbursement in writing;15 and
• Report wages from other employer(s), if any, and submit a copy of the completed PPL form to each employer.

Provide the PFL Weekly Benefit Amount

After an employee applies to the EDD for PFL benefits, the EDD sends the employee a “Notice of Computation” form showing the weekly PFL benefit amount for which the employee is eligible.

To receive Supplemental Compensation, an employee must either:

1. Provide you with a copy of the Notice of Computation as soon as it is received and notify you when they receive the first PFL payment from the EDD; or
2. Provide the state with written authorization to disclose the weekly PFL benefit amount to you upon your request and then notify you on the PPL form that the employee has granted such permission to EDD. You must then contact the EDD to obtain the employee's PFL weekly benefit amount.

Employers also may require employees to provide a form, called the "Notice of Payment," that the employee receives with their first PFL payment from the EDD. This notice documents the amount of the employee's weekly PFL payment.16 If the employee plans to take bonding leave and receive PFL benefits intermittently, the employee must notify you of the schedule of intermittent leave that they provided to the EDD.17

Agree to Use Vacation Leave

• Effective January 1, 2025, state law no longer allows employers to require employees to take up to two weeks of accrued, unused vacation time prior to receipt of PFL benefits.

If you provide paid vacation and the employee has accrued vacation leave available, the employee must agree to allow you to apply up to two weeks of unused vacation leave that the employee has accrued as of the start of the bonding leave to help meet your obligation to provide Supplemental Compensation.18 If the employee does not agree, you are not required to pay Supplemental Compensation.19

For part-time employees, a “week” is a regularly scheduled week of work.

You may not require an employee to use accrued, unused sick leave to cover the cost of the Supplemental Compensation.

If you have a paid time off (PTO) policy that differentiates between vacation and sick time, you may require that the employee agree to use up to two weeks of accrued, unused PTO that is designated as vacation time to help meet your obligation to provide Supplemental Compensation. You may not, however, require the employee to use PTO time that is designated as sick time. If your PTO policy does not distinguish between or track vacation or sick time, you may require the employee to agree to use up to two weeks of accrued, unused PTO to help meet your obligation to provide Supplemental Compensation, but only to the extent the employee's accrued, unused PTO balance exceeds 72 hours.20

Amount of Supplemental Compensation

When a covered employee takes bonding leave and receives PFL benefits, the PPLO requires you to provide Supplemental Compensation in an amount equal to 100 percent of the employee's gross weekly wages, less the amount of PFL benefits, up to a cap for employees receiving the Maximum Weekly Benefit Amount under the PFL law (see Maximum Weekly Benefit Limitation, below).21 The total amount of Supplemental Compensation the employee receives from all employers, combined with PFL benefits, may not exceed 100 percent of the employee's current normal gross weekly wages.

For example, if the PFL program replaces 75 percent of an employee's weekly wages, the PPLO requires the employer to pay the remaining 25 percent of the employee's weekly wages.

If an employee's weekly wage fluctuates, calculate the employee's normal gross wages based on an average of the employee's weekly earnings during the calendar quarter (e.g., three monthly pay periods, six bi-weekly or semi-monthly pay periods, or 12 weekly pay periods) immediately preceding the start of the period in which the employee receives PFL benefits (the PPLO Lookback Period).

For purposes of the PPLO, tips or gratuities are not considered “wages” and should not be included as part of the employee's normal gross weekly wages when calculating the amount of Supplemental Compensation.22 You can find instructions for calculating the Supplemental Compensation amount on the city's website.

Intermittent Leave and the Supplemental Compensation Amount

When an employee takes intermittent leave and the employee's normal gross weekly wages increase or remain the same over the course of the bonding leave, you need to calculate the Supplemental Compensation amount only once. The calculation is based on the employee's normal gross weekly wages prior to the first increment of leave. You should not increase the Supplemental Compensation amount after the bonding leave begins.

When an employee takes intermittent leave and the employee's normal gross weekly wages decrease after the employee starts the first increment of leave, you may recalculate the Supplemental Compensation amount to ensure the employee does not receive more than 100 percent of their normal gross weekly wages during any increment of leave.

You must not change an employee's wages during an intermittent leave period to reduce your Supplemental Compensation obligation under the PPLO.

If an employee receives PFL benefits in increments of less than one week, you must pay the Supplemental Compensation using an average hourly Supplemental Compensation rate. This amount is calculated by dividing the weekly Supplemental Compensation by the average number of hours the employee worked during the PPLO Lookback Period.

Maximum Weekly Benefit Limitation

The PFL law places a cap on the weekly benefit amount for high-wage earners (the maximum weekly benefit). If an employee receives the maximum weekly benefit under the PFL law, the Supplemental Compensation you provide should not be calculated to reach 100 percent of the employee's total normal gross weekly wage. Instead, the amount of Supplemental Compensation is proportionally capped.23

You can find more information on the current maximum weekly benefit under the PFL law at the Employment Development Department and on the city's website.

Multiple Employers

If an eligible employee works for more than one employer, the Supplemental Compensation amount will be apportioned among the covered employers based on the percentage of the total gross weekly wages the employee receives from each employer. For example, if an employee earns $700 per week working for your business and $300 per week from another employer for a combined total of $1,000 per week, you will pay only 70 percent of the Supplemental Compensation and the other employer will pay the remaining 30 percent.

If the employee works for a covered employer and a non-covered employer, the covered employer is responsible only for its percentage of the employee's total gross weekly wages.

The employee must provide you with information on the PPL form pertaining to wages received from other employers during the 90 days prior to the leave period. If an employee fails to comply with this requirement, you are not obligated to provide the employee with Supplemental Compensation.24

Timing of Supplemental Compensation Payments

The EDD allows employees to apply for PFL benefits either before or during bonding leave. If an employee does not apply for PFL benefits in advance of the leave, the employee will not be eligible for Supplemental Compensation until after the leave begins.

If an employee satisfies the requirements for receiving Supplemental Compensation before or during the period in which the employee receives PFL benefits, you must make the first Supplemental Compensation payment on the payday for the next full pay period following the date on which the employee satisfies the requirements.

You must make subsequent payments on your regular pay schedule. The employee must receive the total Supplemental Compensation amount no later than 30 days after receiving all PFL benefits that are due.

If an employee satisfies the requirements for receiving Supplemental Compensation after the employee received all PFL benefits, you must pay the total Supplemental Compensation amount no later than 30 days after the employee satisfies the requirements.25

Employee Leaves Employment

An employer's obligation to provide Supplemental Compensation applies when the employee receives PFL benefits for bonding with a new child. If you terminate an employee during bonding leave, you must continue paying Supplemental Compensation to the employee during the remainder of the period the employee receives PFL benefits.

If you terminate an employee before bonding leave commences but after the employee notifies you of their intent to use PFL and Supplemental Compensation benefits, it will be presumed that you terminated the employee to avoid paying Supplemental Compensation to the employee. You will have to offer clear and convincing evidence to rebut this presumption.26

If the employee voluntarily separates from employment within 90 days of the end of bonding leave, the employee must reimburse the full amount of Supplemental Compensation received. You must request such reimbursement in writing.27

Posting, Notice and Recordkeeping Requirements

The PPLO requires you to post a notice informing employees of their rights.28 The notice must be posted in a conspicuous place at any workplace or job site where employees work. You must post this notice in English, Spanish, Chinese and any language spoken by at least five percent of the employees at the workplace or job site. The OLSE will enforce the notice requirements.29

• San Francisco Labor Law Posters

If you have an employee handbook that describes personal or parental leave available to employees, you must include a description of the rights to Supplemental Compensation under the PPLO in your employee handbook.30

You must maintain records documenting Supplemental Compensation paid to employees for a period of three years.31 You must allow the OLSE reasonable access to the required records. If you do not keep adequate records, or you do not allow the OLSE reasonable access, it will be presumed that you violated the PPLO. You will have to offer evidence to rebut this presumption.

Enforcement

The OLSE enforces the PPLO.32 The OLSE may conduct investigations and take administrative action to enforce the PPLO. If the OLSE determines that an employer violated the PPLO, the OLSE may order relief including unpaid Supplemental Compensation, interest on amounts owed, an additional amount of three times the amount of unlawfully withheld Supplemental Compensation (with a minimum of $250), and penalties of $50 to each person whose rights were violated, for each day, or part of a day, of the violation. In addition, to the remedies listed below, the OLSE may also order the employer to pay the city a sum of up to $50 per day for each person whose rights were violated. The city may also request revocation or suspension of certificates, permits or licenses until violations are remedied.33

Aggrieved employees may not file a civil lawsuit for any violation of the ordinance without first providing the OLSE with written notice of their intent to file a lawsuit, including a statement of the grounds for the complaint. The lawsuit may not be filed if, within 90 days:

1. The city bringing a civil action; or
2. The OLSE informs the person or entity in writing that it has found probable cause of a violation and intends to initiate administrative enforcement or that it has determined no violation occurred.34

Remedies for violations of the PPLO in civil actions may include the relief described above, plus reinstatement, back pay and attorneys' fees and costs.

Retaliation

The PPLO protects employees against retaliation for exercising any of their rights under the PPLO.35 For example, employees have the right to file formal complaints or inform other employees of their rights.

If an employer takes adverse action against an employee within 90 days after the employee asserted rights protected by the PPLO, it will be presumed this action was retaliatory. The employer will have to offer evidence to rebut this presumption.

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1. San Francisco Labor and Employment Code (L.E.C.), secs. 14.1-14.15

2. San Francisco L.E.C. sec. 14.3, Paid Parental Leave Ordinance (PPLO) FAQ (January 2024), No. 2(a)

3. Rules Implementing the PPLO (December 23, 2016), Rule 2.1

4. Rules Implementing the PPLO (December 23, 2016), Rule 2.2

5. San Francisco L.E.C. sec. 14.4(b)(1)(A); Rules Implementing the PPLO (December 23, 2016), Rule 3

6. Rules Implementing the PPLO (December 23, 2016), Rule 8.6

7. San Francisco L.E.C. sec.14.4(d)

8. San Francisco L.E.C. sec. 14.3

9. San Francisco L.E.C. sec. 14.9

10. San Francisco L.E.C. sec.14.3; Rules Implementing the PPLO (December 23, 2016), Rule 1

11. Rules Implementing the PPLO (December 23, 2016), Rule 8.2

12. Rules Implementing the PPLO (December 23, 2016), Rule 8.3(a)

13. Rules Implementing the PPLO (December 23, 2016), Rule 8.3(b)

14. Rules Implementing the PPLO (December 23, 2016), Rule 4

15. San Francisco L.E.C. sec. 14.4(e); Rules Implementing the PPLO (December 23, 2016), Rule 5.1

16. San Francisco L.E.C. sec. 14.4(c); Rules Implementing the PPLO (December 23, 2016), Rule 5.2

17. Rules Implementing the PPLO (December 23, 2016), Rule 8.1

18. San Francisco L.E.C. sec. 14.4(b)(5)

19. PPLO FAQ (January 2025), No. 5(a)

20. PPLO FAQ (January 2024), No. 5(d)

21. San Francisco L.E.C. sec. 14.4(b)(1), (2)

22. San Francisco L.E.C. sec. 14.4(b); Rules Implementing the PPLO (December 23, 2016), Rule 7; PPLO FAQ (January 2024), No. 4(b)

23. San Francisco L.E.C. sec. 14.4(b)(2), PPLO FAQ (January 2024), No. 4(a)

24. San Francisco L.E.C.sec. 14.4(b)(1)(D); Rules Implementing the PPLO (December 23, 2016), Rule 5.3

25. Rules Implementing the PPLO (December 23, 2016), Rule 6

26. San Francisco L.E.C. sec. 14.4(b)(3)-(4)

27. San Francisco L.E.C. sec. 14.4(e)

28. San Francisco L.E.C. sec. 14.5(b)

29. San Francisco L.E.C. sec. 14.8

30. Rules Implementing the PPLO (December 23, 2016), Rule 4

31. San Francisco L.E.C. sec. 14.6

32. San Francisco L.E.C. sec. 14.8

33. San Francisco L.E.C. sec. 14.8(b)

34. San Francisco L.E.C. sec. 14.8(c)

35. San Francisco L.E.C. sec. 14.7