Starting January 1, 2025, California workers will see significant changes to the state’s Paid Family Leave (PFL) program. Assembly Bill 2123, signed into law by Governor Gavin Newsom, removes the long-standing requirement for employees to exhaust vacation time before receiving wage replacement benefits under PFL. This change offers more flexibility for workers who need to care for family members, bond with a new child, or address military-related family needs.

The End of the Vacation Leave Requirement

Under current rules, employers can require employees to use up to two weeks of earned but unused vacation leave before accessing PFL benefits. Starting January 1, 2025, this provision will no longer apply. Employees will now have the option to immediately tap into PFL benefits without depleting their vacation days.

This shift is expected to ease the financial burden for workers who depend on PFL during critical life events, such as caring for a sick family member or bonding with a newborn.

Other Key Features of PFL Remain

While the vacation leave requirement is being removed, the core aspects of California’s PFL program remain intact:

• Eligibility: Workers can receive PFL benefits for up to eight weeks to:
  • Care for seriously ill family members.
  • Bond with a child within the first year of birth, adoption, or foster placement.
  • Address qualifying military exigencies.
• Concurrent Leave Rules: Employees eligible for leave under the Family and Medical Leave Act (FMLA) and the California Family Rights Act (CFRA) must take their PFL leave concurrently with those programs.

Why This Change Matters

For many workers, the previous vacation leave requirement created unnecessary stress, especially for those with limited paid time off. Removing this hurdle makes PFL more accessible and ensures workers can retain vacation days for rest, recovery, or other personal needs.

What Employers Should Know

Employers must update their leave policies and inform employees about this change. While the law does not take effect until January 1, 2025, early communication and policy adjustments will ensure compliance and a smooth transition.

Human resource departments should also review current FMLA and CFRA procedures to ensure alignment with the updated PFL regulations.

Looking Ahead

As California continues to lead the way in paid family leave policies, AB 2123 reflects a commitment to supporting workers during critical family events. If you or your employees plan to take PFL leave in 2025, this change may provide much-needed relief and flexibility.

Click here to learn if you're eligible for benefits under California’s Paid Family Leave program.