California’s Paid Family Leave Program: What Employers Need to Know

There’s no federal paid leave in the United States, but California is one of 13 states that has its own paid leave program. Fortunately for employees, California’s program is one of the most robust—but it’s also one of the most complicated. 

If you’re a business owner in the Golden State, it’s crucial to understand the ins and outs of state leave so you can maintain compliance and give your employees the benefits they deserve. 

Keep reading for a complete overview of California’s paid leave, including how many weeks employees are allowed to take, what your responsibilities are as an employer, and how paid leave intersects with job protection laws. 

What is California’s paid leave program? 

California’s paid family leave (PFL) program gives eligible employees short-term wage replacement benefits if they need to take time off work for one of these three reasons: 

1. To bond with a new child (this applies to birth mothers transitioning from pregnancy disability, as well as new mothers, fathers, and foster or adoptive parents)

2. To care for a family member who’s seriously ill

3. To support a family member’s military deployment to another country

The PFL program is run by the California Employment Development Department (EDD) and funded through state disability insurance (SDI) contributions. Under the program, eligible employees receive a portion of their salary as weekly benefit payments; they can receive payments for up to eight weeks over a 12-month period of time. 

The exact amount of benefits—called a weekly benefit amount (WBA)—depends on the employee’s annual income. Most employees receive a weekly benefit equal to 70-90% of the wages they earned in the period five to 18 months before their claim start date (aka the date their disability begins). 

The minimum weekly benefit is $50, and the maximum is $1,765. The EDD has a calculator that employees can use to estimate their WBA. 

Keep in mind that California’s PFL program gives employees wage benefits for up to eight weeks, but not job protection. More on that later. 

Who qualifies for California’s PFL program?

Every employer in the state, regardless of the size of their business, has to comply with California’s paid leave program for their eligible employees. To be eligible for PFL benefits, employees have to meet all the following requirements: 

• Be unable to do their regular work

• Have lost wages due to bonding with a new child, caring for a seriously ill family member, or supporting a military family member deploying to another country

• Be employed or actively looking for work when their leave starts

• Have earned at least $300 and paid into California’s state disability insurance (CASDI) in the last 18 months

• Submit the necessary documents to the EDD

There are also a few factors that don’t affect an employee’s eligibility for PFL benefits: 

• Citizenship and immigration status: Employees don’t need to be US citizens or have a Social Security number to take PFL in California.

• Part-time or full-time work status: Both types of employees can take PFL as long as they meet the eligibility requirements listed above. 

• How long they’ve worked at their job: All employees who meet the eligibility requirements, regardless of whether they’ve been in their current role for one month or five years, can take PFL.

Can sole proprietors take paid leave?

If you don’t have an employer, don’t worry—you still have options for taking paid leave. Sole proprietors, independent contractors, and other self-employed people (like owners of a general partnership or limited liability partnership) can take PFL benefits under California’s Disability Insurance Elected Coverage (DIEC) program. 

DIEC gives eligible self-employed workers disability insurance (DI) benefits and PFL benefits as long as you: 1) Opt into the program at least six months before you need to claim benefits and 2) pay contributions for at least four of the 12 months prior to applying for benefits. 

If you opt into DIEC and need to take time off for bonding, caregiving, or military assistance, you can get weekly PFL payments for up to eight weeks in a 12-month period. As with W-2 employees, your weekly benefit amount as a self-employed person depends on your income. 

To participate in the program, you have to meet all the following eligibility requirements:

• Own a business, be self-employed, or work as an independent contractor in a non-seasonal operation

• Have a net profit of at least $4,600 a year

• Have a valid license if your work requires one

• Be able to perform all your normal duties on a full-time basis at the time you submit your application

• Receive most of your income from trade, business, or independent contract work

• Stay in the program for two complete calendar years unless you close your business or move out of state 

You also have to pay into the program via an annual premium (paid in four equal installments), which is based on your previous year’s net profits. For 2026, the formula is: 

Net Profit x 8.84% = 2026 Annual Premium

You can apply for the DIEC program here. 

How does California’s PFL program work with FMLA and CFRA?

California’s PFL program isn’t the same thing as the federal Family and Medical Leave Act (FMLA) or the California Family Rights Act (CFRA). 

FMLA is a federal law that requires all US employers with at least 50 employees to offer eligible employees 12 weeks of unpaid, job-protected leave for bonding purposes, caregiving duties, medical reasons, and military exigency leave. 

CFRA is a California state law that guarantees eligible Californian workers up to 12 weeks of job-protected leave if they have to take time off to manage or recover from a serious health condition; care for a family member who has a serious health condition; or bond with a new child.   

In California, some of your employees might be eligible for all three types of leave: PFL, CFRA leave, and FMLA leave. The programs run concurrently, and lots of protections will overlap. 

Importantly, though, the protections don’t stack on top of one another. For example, your employees won’t receive 24 weeks of job-protected leave (12 weeks of FMLA and 12 weeks of CFRA) just because both state and federal laws apply.   

Let’s imagine one of your employees needs to take parental leave. They’ll receive 12 weeks total of job-protected leave from the FMLA and CFRA, as well as up to eight weeks of benefit payments from California’s PFL program. 

So, your employee might take a full 12 weeks away from work, but only receive state payments for eight of those weeks. 

What’s the difference between PFL, FMLA, and CFRA?

The leave programs differ when it comes to job protection, payments, length of leave, and eligibility. Here’s a breakdown of the different programs: 

What is California’s pregnancy disability leave? 

To complicate matters, California also has a pregnancy disability leave (PDL) separate from CFRA and PFL. Under PDL, California employees disabled by pregnancy, childbirth, or a related medical condition can take up to four months of job-protected temporary disability leave per pregnancy. The actual time off can be taken before or after birth. 

Employees on PDL will receive weekly disability payments from the state and continue to receive any group health benefits they’ve already been receiving. 

What are my PFL obligations as an employer? 

If you have employees in California who qualify for PFL, you don’t have to pay their weekly benefit payments during leave, but you do have other obligations. Make sure you take care of the following:

1. Withhold SDI contributions and send them to the EDD

California’s PFL program is funded through individual SDI contributions, which you withhold from your employees’ paychecks. The SDI contribution rate in 2026 is 1.3%, so you’ll need to withhold 1.3% from each of your employees’ gross wages and deduct it from their paychecks.

This usually shows up as CASDI on employee paystubs.  

Then you need to submit the withheld money to the EDD through their Employer Services Online page. Finally, you need to file quarterly reports—via forms DE 9 and DE 9C—to report your employees’ total wages and the amount of SDI you withheld.  

For details on form deadlines and instructions, check out the 2026 California Employer’s Guide. 

2. Educate your employees about their rights

It’s critical to let your employees know they’re eligible for PFL through the state. Include a description of California’s PFL program (as well as FMLA and CFRA) in your employee handbook, and make sure your HR specialist is up to speed on state policies and laws. 

Supporting your employees through the process of applying for state benefits—by providing resources, answering questions, or having one-on-one meetings—can go a long way toward easing their stress and overwhelm during big life changes. 

3. Post leave notices in the workplace

Just like with labor law posters, you need to post notices about SDI and PFL in your workplace. The Notice to Employees: Unemployment Insurance/Disability Insurance/Paid Family Leave poster tells employees they have the right to claim unemployment insurance, disability insurance, and PFL benefits. Put it somewhere visible and accessible. 

There are also a couple brochures you need to give certain employees:

• Disability Insurance Provisions: For new hires; employees who request pregnancy or childbirth-related leave; and employees who request leave for a non-work-related illness, injury, or surgery 

• Paid Family Leave Benefits: For new hires; and employees who request leave to bond with a new child, care for a seriously ill family member, or support a military family member deploying 

You can download and print DI forms and PFL forms for free. 

4. Respond to employee claims for PFL benefits

When your employees file claims to receive disability or PFL benefits from the state, the EDD will send you a notice. You’ll have to fill out a form verifying that the information your employee claimed (usually the reason for their leave and their tentative leave dates) is correct. 

You have to complete and return the paper form verifying your employee’s claim within two working days. 

5. Pay wages if you employ people in San Francisco

If you employ people who live in San Francisco, you have an extra responsibility: you’re required to pay supplemental wages to employees on PFL. The San Francisco Paid Parental Leave Ordinance (PPLO) applies to employers with 20 or more employees worldwide. 

Any San Francisco-based employees who take PFL to bond with a new child—whether through childbirth, adoption, or fostering—are eligible for the SF program. Under the program, they’ll receive their weekly benefit payments from the state, plus paid parental leave benefits from their employer up to a certain amount.

In 2026, the cap is $2,522. You can use this calculator to determine exactly how much you’ll have to pay your SF employees.   

6. Keep your records

It’s a good idea to hold onto all payroll and personnel records related to leave for at least three years. Think: payroll receipts, paystubs, official employee requests for leave, documentation of leave start and end dates, and copies of EDD claim verification forms. 

What happens if I don’t comply with PFL? 

You’re not allowed to stop or discourage your employees from taking PFL, nor can you threaten or discriminate against them for requesting or taking a leave of absence of any kind. 

If you don’t grant your employees the PFL, CFRA leave, or FMLA leave they’re entitled to, you could be losing a great employee at best—and navigating an expensive lawsuit at worst. Employees have the right to sue for unlawful denial or retaliation, and to try to recoup any wages they lost. 

What will paid leave cost me? 

Because paid leave is partially covered by California, you don’t have to pay for your employees’ leave (unless, of course, your employees live in SF). Your eligible employees will get 70-90% of their usual wages for up to eight weeks—without a dime from your business. 

That means you have two options as an employer: 

1. Provide zero additional compensation to employees on leave

2. Top up your employees’ weekly benefit payments to 100%

The second option obviously costs more, but it’s still significantly more affordable than paying for leave entirely out of your company’s pocket. Giving your employees 100% of their usual wages is also an easy way to show them you value both their work contributions and their personal well-being. 

When you’re deciding how much to top up, consider your industry’s standards, competition, employee demographic, and workplace culture. If your bottom line can handle the cost, it pays dividends—in employee loyalty and long-term retention—to financially support your employees through major life changes.  

Whatever route you take, though, be sure to factor in the cost of time. Your payroll and HR teams will have to track employee leaves, manage state benefits paperwork, and coordinate with employees. Depending on your workforce and employee population, managing employee leaves could take a couple of hours a week—or quickly turn into a full-time job. 

If you don’t have the bandwidth to manage leaves internally, you may need to hire an employee leave management vendor. 

Do I need to change my existing employee leave policy? 

If you haven’t updated your company’s employee leave policy in a while, a refresh might be in order. Your written leave policy should be clear, thorough, inclusive, and aligned with state and federal laws. 

Make sure you: 

• Explain that employees are guaranteed up to 12 weeks of unpaid, job-protected leave under the CFRA and FMLA laws 

• Include eligibility information for California’s PFL program

• Explain whether or not you provide payment top-ups

• Describe your rules for extenuating circumstances (like extended leaves)

Paid leave pays off

California’s leave program is the best of both worlds for you and your employees. With PFL, your employees get the financial support they deserve—and you get to recoup wage replacement costs from the state. 

If you’re a California-based employer (or have employees living in the Golden State), we’ve got a ton of state-specific resources for you: on hiring, starting a new business, tax responsibilities, state tax incentives, and more.