Last month, San Francisco announced that it would waive the annual employer reporting related to the San Francisco Health Care Security Ordinance (HCSO). The HCSO is a City ordinance requiring employers with San Francisco employees to meet specific healthcare expenditure-related obligations. Typically, one of the obligations employers must meet is submitting an annual reporting form to the San Francisco Office of Labor Standards Enforcement (OLSE) by April 30 of the year following the end of the previous calendar year. The waiver means that employers do not need to file the annual reporting form but must continue to comply with the other requirements of the HCSO.
The HCSO requires employers with San Francisco-based employees to meet four obligations.
Under the HCSO, employers with a total of 20 or more workers worldwide must satisfy the Employer Spending Requirement (ESR) by calculating and making required healthcare expenditures on behalf of all covered employees. The ordinance defines “covered employees” as employees who work eight or more hours per week in San Francisco (this includes remote employees based in San Francisco) and have been employed for more than 90 days. To satisfy the employer spending requirements for 2020, large employers with greater than 100 workers are required to spend at least $3.08 per payable hour on behalf of all covered employees who regularly work at least eight hours per week. Any employees earning greater than $104,761 annually ($50.37) hourly with a managerial, supervisorial or confidential position are exempt from the HCSO and are not included in the calculation.
Employers must also maintain records sufficient to establish compliance with the ESR and post the 2021 HCSO Poster.
Employers must retain records for a period of four years for each employee’s dates of employment. The required records include itemized pay statements; the employee’s address, telephone number and date of the first day of work; records of the healthcare expenditures made; and copies of the Employee Health Care Payment Confirmations provided to employees when making Health Care Expenditures by contributing to the SF City Option. In addition, employers must post the HCSO poster in all workplaces or job sites with covered employees.
The expenditure, record retention and posting requirements remain, but San Francisco waived the reporting requirement for 2020.
The annual reporting form is a web-based form that employers must submit online before the annual deadline. Earlier this year, the city extended the reporting deadline from April 30, 2021, to October 31, 2021. However, on May 4, 2021, the OLSE announced that the City of San Francisco would waive the 2020 calendar year reporting requirement due to the COVID-19 public health crisis.
Employers can review the OLSE’s HCSO site and the legislative record for details on the reporting waiver. Anyone with questions regarding the HCSO can email or call (415) 554-7892. Interested individuals can also sign up for email updates to receive periodic updates about the HCSO and other San Francisco labor laws.
EPIC offers this material for general information only. EPIC does not intend this material to be, nor may any person receiving this information construe or rely on this material as, tax or legal advice. The matters addressed in this document and any related discussions or correspondence should be reviewed and discussed with legal counsel prior to acting or relying on these materials.
Sign up for our Compliance Matters Newsletter
You’ll receive our monthly newsletter, as well as special compliance alerts and invitations to our compliance webinars
