PART 4.6. Hospital and Skilled Nursing Facility COVID-19 Worker Retention Pay [1490. - 1495.]

Cal. Labor Code - LAB 4.6.

in effect

Cal. Labor Code - LAB § 1490. Section 1490.

(a) The Legislature finds and declares that stability in the California health care workforce will further its efforts to manage the COVID-19 pandemic and address other public health issues that face Californians. (b) The Legislature further finds and declares that providing California health care workers in 24 hour care facilities with retention payments, as appropriated and available, will advance California’s effort to promote stability and retention in California’s health care workforce.

Cal. Labor Code - LAB § 1491. Section 1491.

For purposes of this part, the following definitions apply: (a) “Covered entity” means a person or entity that owns or operates a qualifying facility, including the Regents of the University of California. (b) “Covered Services Employer” means a person or entity meeting both of the following: (1) Directly employs or exercises control over the wages, hours, or working conditions. (2) Provides onsite services such as clerical, dietary, environmental services, laundry, security, engineering, facilities management, administrative, or billing staff through a contract with a qualifying facility or provides nurse practitioners or physician assistants at a qualifying facility through a professional corporation where the professional corporation is the employer of record. (c) “Date of record” means a date determined by the department that is no later than 45 days after end of the qualifying work period. (d) “Department” means the State Department of Health Care Services. (e) “Eligible full-time employee” means a person who meets both of the following: (1) Is employed by a covered entity or covered services employer as of the date of record and is not a manager or supervisor. (2) Was compensated for at least 400 in-person hours performed on the site of a qualifying facility during the qualifying work period for a single covered entity or covered services employer, or is considered to be a full-time employee on the site of a qualifying facility by the covered entity or covered services employer. (f) “Eligible part-time employee” means a person who meets both of the following: (1) Is employed by a covered entity or covered services employer as of the date of record and is not a supervisor or manager. (2) Was compensated for at least 100 in-person hours, but less than 400 in-person hours, performed on the site of a qualifying facility during the qualifying work period for a single covered entity or covered services employer, or is considered to be a part-time employee by the covered entity or covered services employer, and is not considered to be an eligible full-time employee on the site of a qualifying facility by the covered entity or covered services employer. (g) “Eligible physician” means a person who meets both of the following: (1) Is a physician or surgeon, licensed by California state law. (2) Primarily provides in-person patient care work in a clinical or medical department, or works as a member of the patient care team during the qualifying work period and on the date of record, at a qualifying facility or is an employee under Section 2401 of the Business and Professions Code of a covered entity or physician entity working primarily in-person on the site of a qualifying facility during the qualifying work period and on the date of record. (h) “Managers and supervisors” means persons who meet all of the following: (1) Whose duties and responsibilities involve the management of the enterprise in which they are employed or of a customarily recognized department or subdivision thereof. (2) Who customarily and regularly directs the work of two or more other employees of the enterprise in which they are employed or of a customarily recognized department or subdivision thereof. (3) Who has the authority to hire or fire other employees or whose suggestions and recommendations as to the hiring or firing and as to the advancement and promotion or any other change of status of other employees will be given particular weight. (4) Who customarily and regularly exercises discretion and independent judgment. (5) Who is primarily engaged in duties which meet the test of the exemption. The activities constituting exempt work and nonexempt work shall be construed in the same manner as such items are construed in the following regulations under the Fair Labor Standards Act effective as of the date of this order: Sections 541.102, 541.104-111, and 541.115-116 of Title 29 of the Code of Federal Regulations. Exempt work shall include, for example, all work that is directly and closely related to exempt work and work which is properly viewed as a means for carrying out exempt functions. The work actually performed by the employee during the course of the work week must, first and foremost, be examined and the amount of time the employee spends on such work, together with the employer’s realistic expectations and the realistic requirements of the job, shall be considered in determining whether the employee satisfies this requirement. (6) Who must earn a monthly salary equivalent to no less than two times the state minimum wage for full-time employment. Full-time employment is defined in subdivision (c) of Section 515 as 40 hours per week. (i) “Matching retention payments” means monetary compensation other than salaries, wages, and overtime paid to an eligible full-time employee or eligible part-time employee that was paid on or after December 1, 2021, or will be paid on or before December, 31, 2022, and meets any of the following criteria: (1) The compensation was or is paid as hazard or bonus pay as a result of the COVID-19 pandemic. (2) The compensation was or is paid as a bonus based on performance or financial targets or a payout resulting from performance sharing programs designed to provide employees with a share in performance gains. (3) The compensation was or is paid in response to operational needs of the covered entity or covered services employer, including, but not limited to, staffing shortages or recruitment needs. (j) “Physician entity” means any legal entity that contracts with a qualifying facility to provide physician services, including, but not limited to, professional medical corporations and sole proprietorships. (k) “Qualifying facility” means a health facility that is not a state facility and is licensed as one of the following: (1) A general acute care hospital as defined in subdivision (a) of Section 1250 of the Health and Safety Code. (2) An acute psychiatric hospital as defined in subdivision (b) of Section 1250 of the Health and Safety Code. (3) A skilled nursing facility as defined in subdivision (c) of Section 1250 of the Health and Safety Code. (4) A clinic organized under subdivision (l) of Section 1206 of the Health and Safety Code that is affiliated, owned, or controlled by a person or entity that owns or operates a facility described in paragraph (1). (5) A clinic organized under subdivision (b), (d), or (r) of Section 1206 of the Health and Safety Code that is affiliated, owned, or controlled by a person or entity that owns or operates a facility described in Paragraph (1) or Parts 405 and 491 of Title 42 of the United States Code. (6) A physician organization that is part of a fully integrated delivery system that includes a physician organization, health facility or health system, and a nonprofit health care service plan that provides medical services to enrollees in a specific geographic region of the state through an affiliate hospital system and an exclusive contract between the nonprofit health care service plan and a single physician organization in each geographic region to provide those medical services. (7) A designated public hospital system that is comprised of a designated public hospital, as defined in subdivision (f) of Section 14184.10 of the Welfare and Institutions Code, and its affiliated governmental health and behavioral health provider entities, including nonhospital settings. A single designated public hospital system may include multiple designated public hospitals under common government ownership. (l) “Qualifying work period” means a 91-day period identified by the department beginning no later than 30 days after the enactment of this section. (m) “State facility” means a health facility that is owned or operated by this state or any state department, authority, bureau, commission, or officer, other than a health facility owned or operated by the Regents of the University of California. A health facility owned or operated by the Regents of the University of California is not be considered a state facility.

Cal. Labor Code - LAB § 1492. Section 1492.

(a) Upon appropriation by the Legislature, the department shall provide funding to participant covered entities, covered services employers, and physician entities to make retention payments to their eligible employees or eligible physicians, and shall make retention payments directly to eligible physicians who are not employees of a covered entity or physician entity, for the public purposes specified in Section 1490. The department may provide up to one thousand five hundred dollars ($1,500) for each eligible full-time employee, one thousand two hundred and fifty dollars ($1,250) for each eligible part-time employee, or one thousand dollars ($1,000) for each eligible physician, subject to the methodology described in subdivision (d) and the aggregate amount of funding available for this purpose. (b) As a condition of receipt of funding pursuant to this section, a covered entity, covered services employer or a physician entity shall submit to the department the following information for each eligible full-time employee, eligible part-time employee, or eligible physician employed by, or otherwise affiliated with, a covered entity, covered services employer, or physician entity, by a date specified by the department: (1) Name of the eligible full-time employee, eligible part-time employee, or, if applicable, eligible physician employed by, or otherwise affiliated with, a covered entity or physician entity. (2) Mailing address of the eligible full-time employee, eligible part-time employee, or, if applicable, eligible physician employed by, or otherwise affiliated with, the covered entity or physician entity. (3) The total amount of matching retention payments that the covered entity or covered services employer paid or will pay to the eligible full-time employee or eligible part-time employee. A covered entity or covered services employer is not obligated to make a matching retention payment. (4) Number of hours for which the covered entity or covered services employer compensated the eligible full-time employee or eligible part-time employee during the qualifying work period. (5) If a covered entity, a list of eligible physicians that are employed by the covered entity, contracted with or employed by a physician entity under contract with the covered entity, or described in subparagraph (A) of paragraph (2) of subdivision (g) of Section 1491. (6) If a covered services employer, a list of covered entities that the covered services employer contracts with for specified services staff. (7) Any other information as required by the department for purposes of implementing this part. (c) Following the deadline specified by the department for submissions by a covered entity, covered services employer, or physician entity pursuant to subdivision (b), the department shall determine the amount of the retention payment to be paid by each participant covered entity, covered services employer, or physician entity to each eligible employee or eligible physician, and the amount of retention payment to be paid by the department to each eligible physician who is not an employee of a covered entity or employed by or contracted with a physician entity, based on available funding and the total number of eligible full-time employees, eligible part-time employees, and eligible physicians reported pursuant to subdivision (b). The amount of the retention payment shall be calculated as follows, subject to available funding and reduced on a pro rata basis if necessary: (1) For an eligible full-time employee, the state payment amount shall be one thousand dollars ($1,000) plus the amount of matching retention payment paid to the eligible full-time employee by the covered entity or covered services employer, up to a total maximum state payment of one thousand five hundred dollars ($1,500). (2) For an eligible part-time employee, the state payment amount shall be seven hundred and fifty dollars ($750) plus the amount of matching retention payment paid to the eligible part-time employee by the covered entity or covered services employer, up to a total maximum state payment of one thousand two hundred and fifty dollars ($1,250). (3) For an eligible physician, the state payment amount shall be one thousand dollars ($1,000). (4) The department may reduce the payment amounts described in paragraphs (1), (2), or (3) on a pro rata basis to reflect the total amount of funding appropriated to the department and the total number of eligible full-time employees, eligible part-time employees, and eligible physicians reported. (5) To the extent feasible, the department shall adopt a methodology so that a single eligible full-time employee, eligible part-time employee, or eligible physician affiliated with multiple covered entities, covered services employers, or physician entities does not receive more than one retention payment. (d) (1) The department shall determine the conditions and data reporting requirements for participant covered entities, covered services employers, and physician entities to be eligible to receive funding for retention payments. (2) The covered entity, covered services employer, or physician entity shall provide all funding to their eligible employees and eligible physicians within 60 days of receipt from the department. The covered entity, covered services employer, or physician entity shall attest, in a form and manner specified by the department and under penalty of perjury, that all funding received pursuant to this section was provided within 60 days of receipt from the department. (3) The covered entity, covered services employer, or physician entity shall immediately return to the department any funding received pursuant to this section that is not distributed within 60 days of receipt from the department. The department shall return the funds to the original appropriation and the Department of Finance may transfer any unspent or returned funds from the original appropriation to the General Fund. (4) The covered entity, covered services employer, or physician entity shall report to the department within 90 days of receipt of funds information on the number of eligible employees or eligible physicians paid by profession type, the total amount of payments made including covered entity or covered services employer matching funds for eligible employees, and information on the timing of payments. (5) The covered employer, covered services employer, or physician entity shall not use the funding to supplant other payments from the covered employer, covered services employer, or physician entity to the eligible full-time employee, eligible part-time employee, or eligible physician. (e) (1) The department may make payments described in this section to covered entities and eligible physicians using the existing Medi-Cal Checkwrite system. Except as required by federal law, any payments made pursuant to this section shall be exempt from any adjustments or deductions made by the department to Medi-Cal payments made to covered entities or eligible physicians, including, but not limited to, provider withholds or provider payment reductions. (2) Payments made pursuant to this section to covered entities, covered services employers, physician entities, or eligible physicians shall not be considered as payments for patient care or medical services. (3) The Department of Health Care Access and Information, in consultation with appropriate stakeholders, shall release a technical letter to instruct covered entities, physician entities, and eligible physicians in how to report this revenue through the established health care financial reports, including, but not limited to, those required under Section 128810 of the Health and Safety Code, or Section 97040 of Title 22 of the California Code of Regulations. (f) The department may enter into exclusive or nonexclusive contracts, or amend existing contracts, on a bid or negotiated basis for purposes of implementing this part. Contracts entered into or amended pursuant to this subdivision shall be exempt from Chapter 6 (commencing with Section 14825) of Part 5.5 of Division 3 of Title 2 of the Government Code, Section 19130 of the Government Code, Part 2 (commencing with Section 10100) of Division 2 of the Public Contract Code, and from the State Administrative and State Contracting manuals, and shall be exempt from the review or approval of any division of the Department of General Services. (g) Notwithstanding Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code, the department and the Department of Health Care Access and Information may implement, interpret, or make specific this part, in whole or in part, by means of information notices or other similar instructions, without taking any further regulatory action. (h) The Legislature finds and declares that this section is a state law within the meaning of Section 1621(d) of Title 8 of the United States Code. (i) This part shall be implemented only to the extent that the department determines that federal financial participation under the Medi-Cal program is not jeopardized.

Cal. Labor Code - LAB § 1493. Section 1493.

(a) In the event of a dispute about the status of an employee as a full-time eligible employee, part-time eligible employee, the retention payment amount, or the covered entity’s or covered service employer’s failure to make a retention payment, the employee or a labor organization that represents the employee may write to the employer and request a review of the employee’s eligibility status, retention payment amount, or the employer’s failure to make a retention payment. The employer shall have 30 days to review the employee’s request, disclose to the employee the amount received from the department subject to the methodology described in subdivision (d) of Section 1492, and cure any alleged deficiency without damages. (b) If the covered entity or covered services employer does not conclude the retention payment review described in subdivision (a) within 30 days of receipt of the review request, or the employer does not cure the alleged deficiency within 30 days of receipt of the review request, and the alleged deficiency is five hundred dollars ($500) or less the employee may file a complaint with the Labor Commissioner as provided in Section 98. If the Labor Commissioner finds that the covered entity or covered services employer is liable for failing to make a required retention payment, the covered entity or covered services employer shall be ordered to make full payment of the unpaid amount, plus interest at the rate of interest specified in subdivision (b) of Section 3289 of the Civil Code, which shall accrue from the date that the retention payment funds were transmitted to the covered entity or covered services employer by the department as provided in Section 1492. A covered entity or covered services employer that willfully fails to make a full retention payment after receiving a request for review described in subdivision (a) shall be liable to the employee for liquidated damages in an amount equal to the unpaid amount. (c) If the covered entity or covered services employer does not conclude the retention payment review described in subdivision (a) within 30 days of receipt of the review request, or does not cure the alleged deficiency within 30 days of receipt of the review request, and the alleged deficiency is greater than five hundred dollars ($500) the employee may file a complaint with the Labor Commissioner as provided in Section 98 or the employee may file a civil action in court to recover the deficiency. If the Labor Commissioner or court finds that the covered entity or covered services employer is liable for failing to make a required retention payment, or designate an employee for such payment, the covered entity or covered services employer shall be ordered to make full payment of the unpaid amount, plus interest at the rate of interest specified in subdivision (b) of Section 3289 of the Civil Code, which shall accrue from the date that the retention payment funds were transmitted to the covered entity or covered services employer by the department as provided in Section 1492 or from the date a covered employer or covered services employer should have designated an employee for such payment. A covered entity or covered services employer that willfully fails to make a full retention payment after receiving a request for review described in subdivision (a) shall be liable to the employee for liquidated damages in an amount equal to the unpaid amount. In any civil action brought by an employee for the nonpayment of retention payments, the court shall award reasonable attorney’s fees and costs to a prevailing employee. (d) Notwithstanding any other law, the Department shall not be liable for any payment, interest, liquidated damages or attorney’s fees and costs awarded to an employee pursuant to this section, and shall not be required to indemnify a covered entity or covered services employer for any such liability they incur pursuant to this section. (e) The Labor Commissioner shall enforce this part, including investigating an alleged violation, and ordering appropriate temporary relief to mitigate the violation or to maintain the status quo pending the completion of a full investigation or hearing through the procedures set forth in Sections 98, 98.3, or 1197.1, including by issuance of a citation against an employer who violates this article, and by filing a civil action. If a citation is issued, the procedures for issuing, contesting, and enforcing judgments for citations and civil penalties issued by the Labor Commissioner shall be the same as those set out in Section 1197.1, as appropriate.

Cal. Labor Code - LAB § 1494. Section 1494.

(a) In the event of a dispute about the status of an eligible physician, the retention payment amount, or the physician entity’s failure to make a retention payment, the physician may write to the physician entity and request a review of the physician’s eligibility status, retention payment amount, or the physician entity’s failure to make a retention payment. The physician entity shall have 30 days to review the physician’s request, disclose to the physician the amount received from the department subject to the methodology described in subdivision (d) of Section 1492, and cure any alleged deficiency without penalty. (b) If the physician entity does not conclude the retention payment review described in subdivision (a) within 30 days of receipt of the review request, or the physician entity does not cure the alleged deficiency within 30 days of receipt of the review request, the employee may file a complaint with the department. If the department finds that the physician entity failed to make a required retention payment, the physician entity shall be ordered to make full payment of the unpaid amount, plus interest at the rate of interest specified in subdivision (b) of Section 3289 of the Civil Code, which shall accrue from the date that the retention payment funds were transmitted to the physician entity by the department as provided in Section 1492. A physician employer that willfully fails to make a full retention payment after receiving a request for review described in subdivision (a) shall be liable to the employee for liquidated damages in an amount equal to the unpaid amount. (c) Notwithstanding any other law, the department shall not be required to indemnify a physician entity for any liability it incurs pursuant to subdivision (b).

Cal. Labor Code - LAB § 1495. Section 1495.

(a) In serving as a conduit for the retention payments under this part, covered entities, covered services employers, and physician entities are carrying out a state program. This part does not create a private right of action in any civil litigation against covered entities, covered services employers, and physician entities regarding the administration of the retention payment program and in the receipt and transmittal of retention payment program funds. (b) Notwithstanding any other law, retention payments described in this part are not wages as defined in Section 200. (c) Except as provided in Sections 1493 and 1494, and notwithstanding any other law, covered entities, covered services employers, physician entities, and the department shall not be liable for damages awarded under Section 3294 of the Civil Code, Sections 2698 to 2699.5, or other damages imposed primarily for the sake of example and by way of punishing the defendant, in any civil litigation related to the retention payments described in this part.

Source: CA Legislative Counsel Bulk DataURL: https://downloads.leginfo.legislature.ca.gov/pubinfo_2025.zipFetched: 6/27/2026