- California Gov. Gavin Newsom signed two bills into law on Tuesday. SB 114 grants up to 80 hours of sick leave to workers facing COVID-19 related absences, and SB 113 exempts restaurants from including Restaurant Revitalization Fund grants in state taxes. SB 113 will also provide $150 million in grants to the state's Small Business COVID-19 relief program, with individual grants capped at $25,000, according to a statement from Newsom's office.
- The sick leave provisions will be in effect until Sept. 30. SB 114 only applies to workplaces with more than 25 workers, and grants employees paid leave to care for family members who test positive for COVID-19, to quarantine if they test positive for COVID-19 or get vaccinated.
- The tax protections in SB 113 mirror federal policy, which already exempted RRF money from federal taxes. The tax cut will total roughly $500 million over the coming years, according to the statement.
While California's new restaurant grant fund is dwarfed by the RRF's past grant allocations, totaling $28.6 billion, the Golden State's financial aid could help restaurants struggling to keep their doors open.
Recent data from the Independent Restaurant Coalition data shows that of the eateries that didn't receive RRF support, 28% face eviction and 42% risk filing for bankruptcy or have filed for bankruptcy. Comparatively, only 10% of restaurants that received RRF grants are at risk of eviction, and only 20% risk filing for or have filed for bankruptcy.
SB 113 also includes $5.5 billion in tax credits and deductions for businesses by restoring business tax credits for research and development and the net operating loss deduction for businesses which were suspended for tax years 2020, 2021 and 2022.
SB 114's coverage of vaccination appointments in paid COVID-19-related sick leave may help encourage more workers to get vaccinated, which could result in more stable staffing for restaurants as the labor crisis persists amid elevated COVID-19 case rates. The Washington Post reported in August that workers who received paid time off to recover from vaccinations were more likely to get vaccinated.
Nearly 75% of restaurant workers are vaccinated, according to a recent survey of restaurant workers by the Restaurant Opportunities Center, and 20% of unvaccinated restaurant workers plan on getting vaccinated in the near future. Expanded sick leave could also help retain workers, as the ROC reports 58% of restaurant workers are concerned about contracting COVID-19 on the job or transmitting the virus to a loved one.
The sick leave provision may also have a positive public health impact for California by making it easier for workers to stay home when sick. The ROC survey indicates that as many as one in 10 restaurant employees went to work with COVID-19 symptoms, largely because of a fear of retaliation for absences and a lack of paid leave.