On September 29, 2022, California Governor Gavin Newsom signed Assembly Bill (AB) 152, which extends the COVID-19 Supplemental Paid Sick Leave (SPSL) program until December 31, 2022. That means businesses with 26 or more employees have to keep paying for sick leave if they have team members out with COVID.
But there's some good news for the small businesses required to adhere to the SPSL.
AB 152 created a program called the Small Business and Nonprofit COVID-19 Supplemental Paid Sick Leave Relief Grant Program. It gives small businesses and nonprofits in California the opportunity to get reimbursed for COVID-19 sick leave.
Before AB 152, small businesses had to foot the bill for sick leave when team members were out with COVID. With the new law, they can get some help offsetting those costs.
So, let’s dig into the details, including who’s eligible and what documents you’ll need to provide.
What Is the Small Business and Nonprofit COVID-19 SPSL Relief Grant Program?
The SPSL relief grant program reimburses small businesses and nonprofits in California up to $50,000 for the costs associated with providing paid COVID sick leave to employees. These costs need to be incurred between Jan. 1, 2022 and Dec. 31, 2022.
What Small Businesses and Nonprofits Are Eligible?
To get this grant, small businesses and nonprofits have to meet these eligibility requirements:
- Began operating before June 1, 2021
- Be registered as a “C’ or “S” corporation, an LLC, partnership, limited partnership, or a registered 501(c)(3), 501(c)(6), or 501(c)(19) entity
- Be active and operating
- Employ 26 to 49 workers (That's because if you have less than 26 employees, you're not required by California law to pay for COVID sick leave.)
What Documents Do I Need for the SPSL Grant?
The good news is that the paperwork for getting an SPSL grant is fairly painless. You probably already have the essential papers on hand. Here’s what you’ll need:
- Payroll records that show you provided COVID-19 SPSL from Jan. 1 to Dec. 31, 2022
- A signed affidavit attesting to your employee count
- Organizing documents, like a 2020 and 2021 tax return, Form 990, and official filings with the Secretary of State
If a small business or nonprofit fails to meet these criteria after being given a grant, the government can reclaim the money.
Application for the SPSL Relief Grant
So, how does the application process work?
While the new portal isn’t up and running, we can get an idea based on similar COVID business relief grants.
Small business owners will most likely be able to submit proof of employee payroll records and business filings online. Once the application is processed, you’ll get the money in your business bank account.
Stay tuned for more information on the grant process!
Are there Any Businesses that Aren’t Eligible?
It’s possible that your business checks all the eligibility requirements. But it’s just as important to see who can’t apply to be 100% sure you're a qualified small business.
Employers that aren't eligible for a grant include:
- Businesses and nonprofits that don’t operate in California
- Nonprofits that aren’t registered as 501(c)(3), 501(c)(6), or 501(c)(19) entities
- Government entities, except for Native American tribes
- Organizations that focus on lobbying activity
- Passive businesses
- Investment companies
- Investors who file a Schedule E when filing taxes
- Financial institutions
- Illegal businesses
- Businesses that have customer restrictions for any reason except the capacity
- Speculative businesses
- Companies with an owner who has 10% equity interest if that owner has been convicted of a crime within three years or if they are currently indicted
- Affiliate companies as defined by Section 121.103 of Title 13 of the Code of Federal Regulations
California COVID Sick Pay 101
In case you’re curious about California’s COVID sick pay program in general, here’s a quick overview:
Originally passed in February 2022, the Supplemental Paid Sick Leave Program entitles full-time employees to up to 80 hours of paid leave broken down into two banks:
Bank One (40 Hours of SPSL): Isolation, Vaccines, Childcare
- Quarantine
- Isolation period
- Vaccine and booster appointments for yourself or family members
- Recovering from symptoms or vaccine side effects
- Getting a COVID test or medical diagnosis
- Caring for a family member in quarantine or isolation
- Caring for a child when the school or childcare has closed due to COVID
Bank Two (40 Hours of SPSL): Positive Cases
- Employee has tested positive for COVID-19
- Family member had a positive test
- Employee or family member is unable to work remotely
Originally, the SPSL program was set to expire in September, but thanks to AB 152 it’s been extended through the end of the year. Legislators also added a few new elements to the SPSL law, aside from creating the grant program.
Now California employers can ask for a third COVID-19 test within 24 hours of a second diagnostic test that was positive. They can also refuse paid sick leave to employees who won’t comply with required tests.
California Business Relief is Coming
While paid sick leave laws help protect public health during the coronavirus pandemic, they can also put businesses in a tough spot financially. That’s why it’s good to see some relief from California’s legislators and the governor’s office.
The California SPSL grant program will help small businesses and nonprofit organizations reduce the financial burden of paying for COVID sick leave.
You can get up to $50,000 toward the costs of paying for this leave and, as long as you qualify, the grant application process should be simple.
Curious what that will entail? Check back with us and we’ll take you through the application as soon as the portal is up and running!
1. Introducing Yourself
Your introductory email needs to pack a lot of information into a small package. Try something like this:
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Hello Jane,
My name is John Doe and I work for ABC Agency, where we provide business insurance policies to many of Dallas' rockstar small businesses.
Congratulations on your new business, Jane's Bakery. Are you wondering if you have all the insurance you need? Or if your policies will really cover you in a pinch?
At ABC Agency, we pride ourselves on providing robust, comprehensive coverage options to companies like yours with flexible, pay-as-you-go plans.
Are you available this week to talk more about how we can help? I can help you find the most affordable rates and the best policies out there.
I look forward to speaking with you soon.
Cheers,
John Doe
2. Presenting a Quote
Once you've met with your potential client, a quick reply with their quote will get the ball rolling.
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Hi Jane,
Thanks so much for meeting with me this morning. I loved touring Jane's Bakery–I can still smell those delicious chocolate chip cookies baking! You have a great location, and I'm sure you're going to do great on Front St.
After reviewing my notes, I've pulled together an insurance quote for you (attached). I recommend a business owner's policy. A BOP includes several insurance products in one: liability, property insurance, and business interruption insurance. It offers robust coverage at a competitive price.
I'll call you in a few days to see what you think about this insurance plan. In the meantime, if you have any questions, don't hesitate to email me or call me at [phone number].
Again, thank you for your time today. I look forward to working with you in the future.
Cheers,
John Doe
3. Thanks for Purchasing a Policy
Gratitude is important! It's never a bad idea to thank your clients for their business.
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Hi Jane,
Thank you for choosing a business owner's policy with ABC Agency. We know it's so important to get the right coverage for your business, and we are honoured you've placed your trust in us.
We're excited to work closely with you, and our no. 1 goal is to make sure you're business is always protected.
Do you have any questions? We are here to help. Reach out whenever something comes to mind.
Thank you again for choosing ABC Agency to insure Jane's Bakery.
Cheers,
John Doe
4. Welcome Email
A welcome email helps clients feel like you're there to help–and can softly pitch other insurance products you offer.
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Dear Jane,
Welcome to the ABC family! We are thrilled to have you as a new customer and can't wait to meet all of your insurance needs.
As an independent insurance agency, we work with multiple insurance providers to find the best coverage options for all our customers. If you need any other type of insurance–like [include additional offerings unique to your agency, like life insurance, health insurance, home insurance or anything else]–we can help you too.
Do you want to discuss any of these policies?
Cheers,
John Doe
5. Introducing a New Product
A happy client may want to expand their business with you.
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Hello Jane,
I hope all is well with you and Jane's Bakery. I stopped in yesterday for a blueberry muffin and coffee, and they were delicious. I loved the hint of cinnamon in the muffin! Was that your idea?
I wanted you to be the first to know we are now offering commercial vehicle insurance to our policyholders. Auto insurance for your catering vans is super important since your personal car insurance won't cover them.
We're offering this insurance coverage solely to our current business clients at the moment and have some very competitive rates.
Would you like me to work up a quote for you?
As always, thanks so much for being a part of the ABC family.
Cheers,
John Doe
6. Asking For Referrals
Once your relationship is established and comfortable, let your clients help you grow.
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Hi Jane,
You've been a valuable member of the ABC family for two years now, and we so appreciate your business–not to mention the muffins you supply for our monthly meetings!
Because you are a valued policyholder, I wanted to ask a quick favour. I know you are active in the local Chamber of Commerce, and I'm hoping you might know some colleagues who would benefit from working with our insurance company.
Referrals are one of the most effective ways to connect with our community since people really trust their friends, family and colleagues. Is there anyone you'd recommend I speak with?
Remember that in addition to business insurance products, we offer everything from life insurance policies to pet insurance.
As a thank you for your help, we will send you an Amazon gift card of $100 when your referrals buy insurance from us.
Thanks so much for your help!
Cheers,
John Doe
7. Policy Renewal
If your client needs to renew their policy with you, send an email like this:
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Hi Jane,
I hope you're doing well! What a year it's been—from being listed as one of the top 5 bakeries in Dallas to being an official vendor for the city—you have so much to be proud of.
Just a heads up that your business owner's policy is up for renewal soon and will expire on June 15, 2023.
If you're still happy with the coverage, we can easily renew it for you.
Do you have some time to chat this week?
Looking forward to serving you again!
Cheers,
John Doe