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California PFL Employer Supplemental Pay Calculator

Source: San Francisco Paid Parental Leave Ordinance (PPLO) and California Paid Family Leave (SB 951), San Francisco Office of Labor Standards Enforcement (OLSE) and California EDD, 2026
Last verified: July 2026
Official source: San Francisco OLSE — PPLO Information

Use this free calculator to determine the exact amount your employer must pay to supplement California Paid Family Leave (PFL) benefits under the San Francisco Paid Parental Leave Ordinance (PPLO). Enter the employee's normal weekly wage and EDD Weekly Benefit Amount (WBA) to get the supplemental compensation in seconds. Updated for official 2026 rates: $2,522/week PPLO cap, $1,765/week EDD WBA maximum, and the 70/90% SB 951 two-tier wage replacement rates (90% for workers earning ≤$65,000/year; 70% for higher earners).

Supplemental Pay Calculator

Average weekly wages during lookback period (include reported tips per OLSE rules)
From employee's Notice of Computation (DE 429D)
Typically 100% for full wage replacement
Select the year the leave falls under
Check if employee has multiple jobs
Disclaimer: This calculator provides an informational estimate based on the published rules and rates for San Francisco, California, USA as of July 2026. It does not constitute tax, legal, or financial advice. Individual circumstances — including personal exemptions, deductions, regional rules, and special situations — may produce different results. For decisions involving tax obligations, payroll processing, or financial planning, consult a qualified professional licensed in your jurisdiction.
Updated for 2026 rates ($2,522/week cap)
San Francisco PPLO compliant
Handles multi-employer scenarios
Tips included per OLSE rules
Free & no registration required

Instant Answer: Supplemental Pay by Wage & Year

See the exact supplemental pay amounts for common wage scenarios. Under SB 951 (effective January 1, 2025), the CA PFL wage replacement rate is 90% for workers whose average weekly wage (AWW) is at or below $1,252/week (70% of the 2026 SAWW of $1,789 — approximately ≤$65,000/year), and 70% for all other workers. The EDD WBA is capped at $1,765/week in 2026. The table below applies these official rates and the $2,522 PPLO weekly cap. Always use the actual WBA from the employee's DE 429D — the EDD calculates the exact WBA from the employee's highest-quarter base period wages, not simply a flat percentage of current wages.

Normal Weekly Wage 2026 EDD WBA Rate 2026 EDD WBA 2026 Supplemental Pay (100% top-off) 2026 Total Weekly Compensation
$600 90% (lower earner) $540 $60 $600
$800 90% (lower earner) $720 $80 $800
$1,000 90% (lower earner) $900 $100 $1,000
$1,200 90% (lower earner) $1,080 $120 $1,200
$1,500 70% (higher earner) $1,050 $450 $1,500
$2,000 70% (higher earner) $1,400 $600 $2,000
$2,500 70% (higher earner) $1,750 $750 $2,500
$3,000 70% (higher earner) $1,765 (WBA cap) $757 $2,522 (weekly PPLO cap)
$3,500 70% (higher earner) $1,765 (WBA cap) $757 $2,522 (weekly PPLO cap)
$4,000 70% (higher earner) $1,765 (WBA cap) $757 $2,522 (weekly PPLO cap)
$5,000 70% (higher earner) $1,765 (WBA cap) $757 $2,522 (weekly PPLO cap)

How to read this table: The 2026 supplemental pay column shows the amount the employer must pay to top off the state benefit to 100% of normal wages each week, subject to the $2,522 weekly PPLO cap. For wages above ~$2,522/week, the employer's supplement is capped at $757/week because the combined total (state WBA of $1,765 + employer supplement of $757) equals the $2,522 weekly ceiling.

Important: The $2,522 PPLO cap is a weekly maximum on the combined state + employer benefit — it is not an annual total. The 2026 CA PFL rate is 90% for workers whose AWW is at or below $1,252/week (= 70% of the 2026 SAWW of $1,789; roughly ≤$65,000/year) and 70% for workers above that threshold (SB 951, effective January 1, 2025). Actual WBA amounts are determined by the EDD from the employee's highest-quarter base period wages — always use the figure on the DE 429D.

Instant Top-Up Examples by City & Leave Duration

Weekly Salary City / Ordinance PFL Benefit (est.) Top-Up / Week Total (8 wks)
$1,200 California (voluntary) $1,080 (90%) $120 $960
$2,000 California $1,400 (70%) $600 $4,800
$2,500 California $1,750 (70%) $750 $6,000
$3,000 California $1,765 (max) $1,235 $9,880
$2,500 San Francisco (PPLO) $1,750 (70%) $750 $6,000
$3,500 San Francisco (PPLO) $1,765 (max) $757 $6,056
$4,000 San Francisco (PPLO) $1,765 (max) $757 $6,056
$2,500 Oakland (voluntary) $1,750 (70%) $750 $6,000
$2,000 Berkeley (voluntary) $1,400 (70%) $600 $4,800

These examples are estimates using the 2026 EDD benefit formula (90% for wages ≤ $1,252/week; 70% for higher earners, capped at $1,765/week; SF PPLO total capped at $2,522/week). Oakland and Berkeley have no mandatory PPLO — figures shown are voluntary employer top-ups. Always use the exact PFL benefit amount from the employee's Notice of Computation for accurate calculations.

Real-World Calculation Scenarios

Scenario 1: Single Employer, Higher Earner

  • Normal Weekly Wage: $1,500 (incl. tips if any)
  • EDD WBA (2026): $1,050 (70% — above threshold)
  • Employer Share: 100%
  • Supplemental Pay: $1,500 − $1,050 = $450/week
  • Total Weekly: $1,500 (100% wage replacement)
  • Weekly cap check: $1,500 < $2,522 ✓

Scenario 2: Single Employer, Lower Earner

  • Normal Weekly Wage: $900 (incl. tips if any)
  • EDD WBA (2026): $810 (90% — at/below threshold)
  • Employer Share: 100%
  • Supplemental Pay: $900 − $810 = $90/week
  • Total Weekly: $900 (100% wage replacement)
  • Weekly cap check: $900 < $2,522 ✓

Scenario 3: Multiple Employers (50/50 Split)

  • Total Weekly Wage: $2,000 ($1,000 + $1,000)
  • EDD WBA (2026): $1,400 (70%)
  • Total Supplemental Pay: $2,000 − $1,400 = $600
  • Employer A's Share: $600 × ($1,000 / $2,000) = $300/week
  • Employer B's Share: $600 × ($1,000 / $2,000) = $300/week
  • Weekly cap check: $2,000 < $2,522 ✓

Scenario 4: High Earner, Weekly Cap Applied

  • Normal Weekly Wage: $5,000
  • EDD WBA (2026): $1,765 (WBA cap)
  • Weekly PPLO cap: $2,522 total combined
  • Max Supplemental Pay: $2,522 − $1,765 = $757/week
  • Total Weekly (capped): $1,765 + $757 = $2,522
  • Note: Employee does not receive full wage replacement above the weekly cap

Scenario 5: Part-Time Employee

  • Normal Weekly Wage: $600 (incl. tips if any)
  • EDD WBA (2026): $540 (90% — lower earner)
  • Employer Share: 100%
  • Supplemental Pay: $600 − $540 = $60/week
  • Total Weekly: $600 (100% wage replacement)

Scenario 6: Fluctuating Wages (Lookback Period)

  • Lookback period: 6 bi-weekly, 6 semi-monthly, or 12 weekly pay periods
  • Wages ranged from: $800 to $1,600/week
  • Average Weekly Wage: $1,200
  • EDD WBA (2026): $840 (70% — above threshold)
  • Supplemental Pay: $1,200 − $840 = $360/week
  • Total Weekly: $1,200 (based on average wage)

What Is California PFL Employer Supplemental Pay?

California PFL employer supplemental pay is the amount an employer must pay to bring an employee's state Paid Family Leave (PFL) benefit up to 100% of their normal weekly wage, subject to a weekly cap. Under SB 951 (effective January 1, 2025), the state pays 90% of wages for lower earners (average weekly wage ≤$1,252/week — approximately ≤$65,000/year in 2026) or 70% for higher earners, up to $1,765 per week maximum in 2026. Employers pay the difference, up to the PPLO weekly maximum of $2,522 in 2026. To see how these rates compare with California SDI (disability insurance), use our VDI vs CASDI Calculator 2026.

This requirement comes from the San Francisco Paid Parental Leave Ordinance (PPLO), not state law. The ordinance applies to employers with employees working in San Francisco. Employers must supplement the state benefit so the employee receives full wage replacement during PFL leave, subject to the $2,522 weekly cap in 2026.

Key Compliance Insight

Employer supplemental pay is a wage — not a benefit. This means it is taxable as wages (subject to federal income tax, Social Security, Medicare, and FUTA) and must be reported on the employee's W-2. Estimate total employer tax liability with our California Employer Payroll Tax Calculator. The state CA PFL benefit is taxable on the employee's federal return (reported on Form 1099-G from the EDD) but is exempt from California state income tax.

The formula is straightforward: Supplemental Pay = (Normal Weekly Wage − EDD WBA) × Employer Share Percentage, subject to the weekly PPLO cap. For most employers, the share percentage is 100% — meaning they pay the full gap between what the state provides and the employee's normal pay, up to the cap. Normal weekly wages include reported tips per official OLSE guidance. Use our California Paycheck Calculator to estimate normal weekly wages.

For example, if a higher-earning employee normally earns $1,500 per week and receives $1,050 from the state (70% in 2026), the employer pays $450 per week. The employee receives $1,500 total, keeping their full paycheck intact while on PFL leave.

Key Takeaways

Voluntary Employer Top-Up vs. SF PPLO — What's the Difference?

Not all PFL top-ups come from the San Francisco ordinance. Two distinct situations exist: a voluntary statewide top-up (any employer, any city, no cap) and the mandatory SF PPLO top-up (San Francisco only, child bonding leave only, capped).

Voluntary Employer Top-Up (Statewide)

Any California employer can choose to supplement PFL benefits. There is no legal cap on voluntary top-ups; you can pay up to 100% (or even more) of the employee's regular wages. This is often used as a retention tool or to comply with company policy.

Mandatory SF PPLO Top-Up (San Francisco Only — Child Bonding Leave Only)

San Francisco's Paid Parental Leave Ordinance (PPLO) requires employers with 20 or more employees worldwide who have employees working in San Francisco to provide supplemental compensation so that eligible employees receive at least the city's weekly cap during child bonding leave. For 2026, the SF PPLO weekly cap is $2,522. This obligation is mandatory and carries penalties for non-compliance.

Important: The SF PPLO applies only to child bonding leave (birth, adoption, or foster placement). It does not apply when an employee takes PFL to care for a seriously ill family member. Additionally, the PPLO only covers employers with 20 or more employees worldwide. Employees must have worked for the employer for at least 180 days and must work at least 8 hours per week in San Francisco with at least 40% of their hours within city limits.

⚠️ Oakland and Berkeley Are NOT Mandatory PPLO Cities

Neither Oakland nor Berkeley has a mandatory paid parental leave ordinance equivalent to San Francisco's PPLO. Employers in those cities are not legally required to top up PFL benefits by local ordinance. Any top-up in those cities is voluntary.

Feature Voluntary Top-Up SF PPLO (San Francisco Only)
Applicability Statewide (any employer, any city) Employers with 20+ employees worldwide, employees working in San Francisco
Leave type covered Any PFL reason Child bonding leave only (not care for ill family member)
Requirement Optional Mandatory by city law
Cap None (can top up to 100% or more) Max weekly total pay: $2,522
Penalties for non-compliance None Fines, lawsuits
Documentation Internal policy City-specific reporting requirements; SF PPLO form required
Cities with mandatory ordinance N/A San Francisco only

Who Is Eligible for Supplemental Compensation?

Eligibility for supplemental compensation depends on three factors: the employer's size and location, the employee's tenure and work location, and the employee's eligibility for California PFL benefits.

Employer Requirements

  • 20+ employees globally — Regardless of where they work
  • At least one employee working in San Francisco — For 8+ hours per week
  • Must comply with PPLO — Including posting posters, providing handbooks, and filing forms

Employee Requirements (All Four Must Be Met)

  • Eligible for CA PFL — Must meet state requirements for Paid Family Leave
  • 180+ days of employment — With the same employer before leave starts
  • 8+ hours per week in San Francisco — Minimum hours in SF geographic boundaries
  • At least 40% of total weekly hours in San Francisco — Employees working 8 hours in SF but spending most of their time outside SF may not qualify
  • Provides Notice of Computation (DE 429D) — The EDD's official benefit determination

Employees do not need to request supplemental compensation — employers are legally required to provide it once they receive the employee's Notice of Computation from the EDD. The employer must calculate the correct amount and include it in the employee's regular pay.

⚠️ Common Eligibility Mistakes

If the employee does not apply for PFL or is denied benefits, the employer has no obligation to pay supplemental compensation. The supplement is tied directly to the state benefit. Once the state benefit ends, the employer's supplement obligation ends as well.

How to Calculate Supplemental Pay: Step-by-Step

Follow these steps to calculate the correct supplemental pay amount. The process is identical for all employers — only the numbers change based on the employee's wages and the benefit year.

1

Get the EDD Notice of Computation (DE 429D)

The employee must provide this form from the EDD. It shows their exact Weekly Benefit Amount (WBA) — the dollar amount the state will pay each week. The WBA is calculated from the employee's highest-quarter base period wages: 90% for earners whose average weekly wage (AWW) is at or below $1,252/week (70% of the 2026 SAWW of $1,789) or 70% for higher earners — in both cases capped at $1,765/week in 2026. The EDD calculates the exact WBA; employers should always use the figure on the DE 429D, not estimate it.

Example: Higher earner averaging $1,500/wk → WBA = $1,050 (70% × $1,500). Lower earner averaging $900/wk → WBA = $810 (90% × $900).
2

Determine the Employee's Normal Weekly Wage

This is the average weekly wages during the PPLO lookback period — either 6 bi-weekly, 6 semi-monthly, or 12 weekly pay periods immediately preceding the leave. Per official OLSE guidance, include reported tips in this calculation. Exclude any pay periods where the employee was on unpaid or partially paid leave. If you need help determining normal wages, try our California Hourly Paycheck Calculator.

Example: Normal Weekly Wage = $1,500 (base wages + reported tips)
3

Apply the Formula

Subtract the EDD WBA from the normal weekly wage, then multiply by the employer share percentage (usually 100%).

Supplemental Pay = (Normal Weekly Wage − EDD WBA) × Employer Share %
$1,500 − $1,050 = $450 × 100% = $450/week
4

Apply the Weekly Cap

Check the weekly cap for the benefit year. The cap limits the combined total of the state PFL benefit plus the employer supplement per week. If the employee's combined benefits exceed the weekly cap, the employer supplement is reduced so the total equals the cap. The $2,522 cap is a weekly ceiling, not an annual total.

2026 Weekly Cap: $2,522 per week (combined state WBA + employer supplement)
Example (high earner): Max supplement = $2,522 − $1,765 WBA = $757/week
5

Pay Within a Reasonable Time (~15 Days)

Once you receive the Notice of Computation, pay the supplemental amount within a reasonable time — OLSE guidance generally treats ~15 days as the standard. The payment should be included in the employee's regular payroll.

Deadline: ~15 days from receipt of DE 429D

Important: The supplemental pay calculation must be done for each pay period the employee is on leave. If the employee's normal weekly wage changes (e.g., bonuses, commissions), recalculate the supplement for that period.

2025 vs 2026 PPLO Rates & Caps

The San Francisco PPLO weekly cap changes annually. This is the maximum combined weekly amount of state PFL benefits and employer supplemental compensation an employee can receive each week on leave. For 2026, the cap is $2,522 per week — a 5% increase from 2025's $2,402.

Year PPLO Cap (Weekly Max) EDD WBA Cap (Weekly) Wage Replacement Rate Key Change
2024 $2,700/week $1,620/week 60% (flat rate, all earners) Higher weekly cap; flat 60% rate before SB 951 tiered rates took effect
2025 $2,402/week $1,681/week 90% earners ≤ $1,159/wk (70% of 2024 SAWW $1,704); 70% all others (SB 951 effective Jan 1, 2025) SB 951 tiered rates debuted; weekly cap decreased from 2024
2026 $2,522/week $1,765/week 90% earners ≤ $1,252/wk (70% of 2026 SAWW $1,789); 70% all others Weekly cap and EDD WBA maximum both increased; 90% threshold widens to ≈$65K/yr

What These Caps Mean for Employers

2026 SDI & PFL Program Facts

How the 2025–2026 Change Affects Employers

For 2025, the PPLO weekly cap dropped to $2,402 from $2,700 in 2024, while the wage replacement rate increased from 60% to 70–90%. For 2026, both the weekly cap ($2,522) and the WBA maximum ($1,765) increased. This means:

2025 Impact
  • State pays 70–90% (vs 60% flat in 2024)
  • Employer supplement is smaller for most employees (higher state rate)
  • Weekly cap: $2,402/week
  • EDD WBA max: $1,681/week
2026 Impact
  • State continues tiered 70–90% rate
  • Weekly cap increased to $2,522/week
  • EDD WBA max increased to $1,765/week
  • Max employer supplement for capped employees: $757/week

Example (high earner whose WBA hits the annual EDD cap): In 2025, the EDD WBA maximum was $1,681/week and the PPLO weekly cap was $2,402, giving a maximum employer supplement of $2,402 − $1,681 = $721/week. In 2026, the EDD WBA maximum rose to $1,765 and the PPLO weekly cap rose to $2,522, giving a maximum employer supplement of $2,522 − $1,765 = $757/week — a $36/week increase for employees who hit the cap in both years.

Pro Tip: Set Up Rate Alerts

The PPLO weekly cap changes annually, typically announced in late fall for the following year. Set a calendar reminder to check the SF.gov PPLO page each November so you can update your calculations before the new year starts.

Special Scenarios: Multiple Employers, Tips & Fluctuating Wages

Most employees have straightforward wage structures. But some situations require additional care. Here's how to handle the most common edge cases.

Multiple Employers

When an employee has multiple jobs, the total supplemental pay is split proportionally among employers based on each employer's contribution to the employee's normal weekly wage.

Example: Employee with Two Jobs

  • Total Normal Weekly Wage: $2,000 ($1,000 from Employer A, $1,000 from Employer B)
  • EDD WBA (2026): $1,400 (70% of combined wages)
  • Total Supplemental Pay: $2,000 − $1,400 = $600 (below $2,522 weekly cap ✓)
  • Employer A's Share: $600 × ($1,000 / $2,000) = $300/week
  • Employer B's Share: $600 × ($1,000 / $2,000) = $300/week

Each employer pays their proportional share based on wages paid, not hours worked.

⚠️ Important: Uneven Wage Distribution

If the employee's wages are unevenly split (e.g., 75/25), the proportional share formula still applies. Each employer pays based on their percentage of total wages. Employers should request the employee's total wage information via the SF Paid Parental Leave Form to calculate accurately.

Tips and Gratuities

Per official OLSE guidance, reported tips are included in the employee's normal weekly wage calculation for PPLO purposes. The OLSE's SF Paid Parental Leave Form explicitly instructs employees to include their reported tips when reporting normal gross weekly wages to each employer. Employers use this figure — inclusive of tips — when calculating the supplement.

Example: Employee with Tips

  • Normal Weekly Wage: $1,100 (base wages $900 + reported tips $200)
  • EDD WBA (2026): $770 (70% of $1,100 — higher earner)
  • Supplemental Pay: $1,100 − $770 = $330/week
  • Total Weekly: $770 state + $330 employer = $1,100 (full wage replacement)

Both the state benefit and the employer supplement calculation use the same normal weekly wage figure, which includes reported tips.

⚠️ Important: Note on "No Tips" OLSE Instruction Sheets

OLSE publishes separate calculation instruction sheets labeled "No Tips" (for employees without tips) and others that address tipped employees. The "No Tips" instruction sheet is specifically for employees who have no tip income. If your employee receives tips, use the appropriate calculation sheet and include reported tips in the normal weekly wage figure.

Fluctuating Wages

For employees with variable pay (overtime, commissions, bonuses), use the PPLO lookback period to calculate the normal weekly wage. The PPLO lookback period contains either 6 bi-weekly pay periods, 6 semi-monthly pay periods, or 12 weekly pay periods immediately preceding the start of the employee's CA PFL period.

Example: Fluctuating Wages (Lookback Period)

  • Lookback: 12 weekly pay periods (or 6 bi-weekly, or 6 semi-monthly)
  • Wages ranged from: $800 to $1,600/week
  • Average Weekly Wage: $1,200
  • EDD WBA (2026): $840 (70% — above the threshold)
  • Supplemental Pay: ($1,200 − $840) × 100% = $360/week
  • Total Weekly: $1,200 (based on average wage)

For weekly and bi-weekly pay, divide the sum of wages by 12. For semi-monthly pay, divide by 13. Exclude any pay periods where the employee was on unpaid or partially paid leave; substitute earlier pay periods up to 26 weeks back instead.

⚠️ Important: Commission and Bonus Treatment

Commissions and bonuses may be included when they qualify as "wages" under California law and are part of the employee's regular compensation during the lookback period. Consult the employee's employment agreement and payroll records to determine what counts as "normal" wages.

Intermittent Leave

Employees may take PFL leave in non-consecutive blocks. In these cases, the employer must recalculate the supplemental pay for each leave period based on the employee's current wages and the EDD WBA applicable to that period.

Example: Intermittent Leave

  • Leave Period 1 (Week 1): Normal Wage $1,500, WBA $1,050, Supplement $450/week
  • Return to work (2 weeks)
  • Leave Period 2 (Week 4): Normal Wage $1,500 (unchanged), WBA $1,050, Supplement $450/week
  • Total Employer Supplement: $450 + $450 = $900 (over 2 weeks of leave)

Re-calculate for each leave period. If wages change between leave periods, the supplement amount will change accordingly.

⚠️ Important: Weekly Cap Applies Each Week

The $2,522 weekly PPLO cap applies each individual week of leave. Track the combined state + employer benefit each week to ensure it does not exceed the weekly cap. There is no "carry-over" of unused weekly cap headroom between different weeks of intermittent leave.

Employer Compliance Checklist

Use this checklist to ensure you're meeting all San Francisco PPLO requirements. Missing even one step can lead to compliance issues and potential penalties.

Before Leave Starts

  • Display PPLO poster — Must be posted in a conspicuous location accessible to all employees in San Francisco.
  • Update employee handbook — Include PPLO information and employee rights summary.
  • Provide Notice of Rights — Give employees the SF PPLO Notice of Rights form (available on SF.gov).
  • Confirm 20+ employee threshold — Count all global employees, including those outside California.

When Leave Begins

  • Receive Notice of Computation (DE 429D) — Employee must provide this from the EDD before the supplement is due.
  • Calculate normal weekly wage — Use PPLO lookback period (6 bi-weekly, 6 semi-monthly, or 12 weekly pay periods). Include reported tips.
  • Calculate supplemental pay — Apply formula: (Normal Weekly Wage − EDD WBA) × Employer Share %.
  • Apply weekly cap — Check 2026 weekly cap: $2,522/week combined. Ensure the state WBA + employer supplement does not exceed this each week.

During Leave

  • Pay within ~15 days — Once you receive DE 429D, pay the supplement within a reasonable time (OLSE standard ~15 days).
  • Recalculate for each pay period — If wages or benefits change, update the supplement.
  • Monitor weekly cap each week — Ensure combined state + employer benefit does not exceed the $2,522/week ceiling.
  • Include in payroll — Treat supplement as regular wages (subject to federal income tax, FICA, FUTA — but not CA SDI).

After Leave

  • Maintain records — Keep all records (wage calculations, DE 429D, payment dates) for at least 3 years.
  • Report on W-2 — Supplemental pay must be included in Box 1 (wages) on the employee's W-2.
  • Review for next leave period — If the employee takes future leave, repeat the calculation process.

📥 Need a Printable Version?

Bookmark this page and return to this checklist whenever an employee takes PFL leave. For a printer-friendly version, use your browser's print function and select "Save as PDF."

⚠️ Compliance Warning

Failure to comply with the San Francisco PPLO can result in penalties, wage claims, and legal liability. Employers found in violation may face payment of any PPLO shortfall multiplied by three (or $250, whichever is greater), plus administrative penalties, civil penalties, and suspension of business permits. Use this calculator and checklist as a guide, but consult legal counsel for complex cases.

Legal Requirements & Compliance

Beyond the PPLO calculation itself, several state and city rules govern how top-up payments must be administered.

Key Legal Rules

Always consult with an employment attorney or HR professional for specific compliance advice tailored to your situation.

Tax Treatment of Supplemental Pay: What Employers Must Know

This is where PPLO compliance gets complicated. Both the state CA PFL benefit and the employer supplemental pay carry tax obligations — but they are treated differently. Understanding the distinction is critical to avoid payroll errors.

Key Tax Distinction

State CA PFL benefit: Taxable on the employee's federal return. The EDD issues a Form 1099-G for PFL payments. Employees must report PFL benefits as income on their federal Form 1040. PFL benefits are exempt from California state income tax.

Employer supplemental pay: Taxable as wages on both federal and California returns. Subject to federal income tax withholding, Social Security, Medicare, and FUTA. Must be reported on the employee's W-2 in Box 1. Not subject to California SDI withholding — use our California CASDI / SDI Tax Calculator to understand SDI rates and limits.

Tax Treatment Comparison: State PFL vs. Employer Supplement

Tax Category State CA PFL Benefit Employer Supplemental Pay
Federal Income Tax ✅ Taxable federally (reported on 1099-G) ✅ Taxable — subject to withholding
Social Security (FICA) ❌ Not subject to FICA ✅ Taxable — subject to withholding
Medicare ❌ Not subject to Medicare ✅ Taxable — subject to withholding
California State Income Tax ❌ Exempt from CA state income tax ✅ Taxable — subject to CA income tax withholding
California SDI ❌ Not subject to CA SDI ❌ Not subject to SDI (employee already pays through regular wages)
FUTA (Federal Unemployment) ❌ Not subject to FUTA ✅ Taxable — employer pays
Reported on W-2 Box 1 ❌ No — reported on Form 1099-G instead ✅ Yes — included as wages

What This Means for Payroll Processing

1. Calculate the supplement

Use the calculator above to determine the exact supplemental amount. This is the gross wage for the supplement.

2. Apply standard withholding

Withhold federal income tax, Social Security, and Medicare based on the employee's W-4. This is the same as regular wages. Also withhold California state income tax.

3. Report on W-2

Include the supplemental pay in Box 1 (Wages, tips, other compensation). The state PFL benefit from the EDD is reported separately on Form 1099-G — do not add it to the W-2.

4. No SDI withholding

Do not withhold California SDI from the supplemental pay. The employee already pays SDI through their regular wages.

Real-World Tax Example

An employee takes PFL leave. Here's how taxes apply to each payment:

State CA PFL Payment (from EDD)

  • Amount: $1,050/week
  • Federal income tax: Taxable (employee reports on Form 1040 via 1099-G)
  • CA state income tax: Exempt
  • FICA/Medicare: Not withheld
  • W-2 reporting: Not on W-2 — on Form 1099-G from EDD

Employer Supplement (from employer)

  • Amount: $450/week
  • Federal income tax withheld (22%): ~$99
  • Medicare (1.45%): ~$6.53
  • Social Security (6.2%): ~$27.90
  • CA income tax withheld: Yes (per DE 4)
  • W-2 reporting: $450 in Box 1

Note: The employee's take-home from the employer supplement is less than the gross amount due to tax withholding. The employer must also pay the employer portion of FICA (7.65%) and FUTA on the supplement. Employees may owe federal income tax on their state PFL benefit at tax time if they did not elect voluntary withholding with the EDD.

Common Payroll Mistakes to Avoid

⚠️ Important Tax Disclaimer

This guidance is based on general tax principles and may not apply to all situations. Tax laws change frequently, and individual circumstances vary. Consult a qualified tax professional or payroll specialist for advice specific to your employees.

Additional resources: The IRS Publication 15-A (Employer's Supplemental Tax Guide), the EDD's 1099-G FAQ page, and California FTB guidance provide official information on wage withholding and PFL tax treatment.

Frequently Asked Questions

Quick answers to the most common questions about California PFL employer supplemental pay and the San Francisco Paid Parental Leave Ordinance.

The 2026 PPLO cap is $2,522 per week. This is the maximum combined weekly amount of state PFL benefits plus employer supplemental compensation an employee can receive each week while on leave. It is a weekly ceiling, not an annual total — it applies afresh each week of leave taken.

For example, an employee whose state WBA is $1,765 (the maximum) can receive a maximum employer supplement of $2,522 − $1,765 = $757 per week. The weekly cap increased from $2,402 in 2025.

Supplemental Pay = (Normal Weekly Wage − EDD WBA) × Employer Share Percentage, subject to the weekly PPLO cap.

The EDD WBA (Weekly Benefit Amount) comes from the employee's Notice of Computation (DE 429D). The combined total of state PFL benefit + employer supplement cannot exceed the $2,522 weekly PPLO cap in 2026. Normal weekly wages include reported tips per OLSE guidance.

Example: Normal Weekly Wage $1,500, EDD WBA $1,050 (70%), Employer Share 100% → Supplemental Pay = ($1,500 − $1,050) × 100% = $450/week. Total combined $1,500 is below the $2,522 weekly cap ✓.

Employees must meet all four requirements:

  • Eligible for CA PFL: Must meet state requirements for Paid Family Leave for new child bonding
  • 180+ days of employment: With the same employer before Paid Family Leave starts
  • 8+ hours per week in San Francisco: Minimum weekly hours within SF geographic boundaries
  • At least 40% of total weekly hours in San Francisco: Employees who work 8 hours in SF but do most of their work elsewhere may not qualify

Employers must have 20+ employees globally (regardless of location) to be covered by the ordinance. Employees who do not apply for CA PFL or are denied do not receive the employer supplement.

No. Supplemental compensation is only required if the employee is receiving California PFL benefits. If the employee doesn't apply for PFL or is denied benefits, the employer has no supplement obligation.

The supplement is tied directly to the state benefit. Once the state benefit ends, the employer's supplement obligation ends as well.

Total Supplemental Pay = (Total Normal Weekly Wage − EDD WBA) × Employer Share %, subject to the weekly PPLO cap on the combined total.

Each employer's share is proportional to their wages:

Employer's Share = Total Supplemental Pay × (Employer's Wage ÷ Total Wages)

Example: Total wages $2,000 (Employer A $1,000, Employer B $1,000), EDD WBA $1,400, Total Supplement $600 (below $2,522 cap ✓) → Each employer pays $300/week.

Yes. Per official OLSE guidance, reported tips are included in the normal weekly wage calculation for PPLO purposes. The SF Paid Parental Leave Form explicitly instructs employees to "include reported tips" when reporting their normal gross weekly wages to each employer.

Employers use the tip-inclusive normal weekly wage figure when calculating the supplemental compensation. The OLSE publishes separate "No Tips" calculation instruction sheets specifically for employees who have no tip income.

Use the PPLO lookback period to calculate an average normal weekly wage. The lookback period contains either:

  • 6 bi-weekly pay periods (divide sum by 12)
  • 6 semi-monthly pay periods (divide sum by 13)
  • 12 weekly pay periods (divide sum by 12)

Use the period type that matches how the employee is paid. Exclude any pay periods where the employee was on unpaid or partially paid leave — substitute earlier pay periods (up to 26 weeks back) instead.

Example: If wages ranged from $800 to $1,600 over 12 weekly pay periods, the average is $1,200/week. The supplement is calculated on the average wage.

Employer supplemental pay is taxable as wages. It is subject to:

  • Federal income tax (withhold based on employee's W-4)
  • Social Security (FICA) — both employee and employer portions
  • Medicare — both employee and employer portions
  • California state income tax withholding
  • FUTA (employer pays)

Not subject to: California SDI (the employee already pays through regular wages).

The state CA PFL benefit (from the EDD) is also taxable — but only at the federal level. Employees receive a Form 1099-G from the EDD and must report PFL benefits on their federal Form 1040. CA PFL benefits are exempt from California state income tax.

Report the employer supplement in W-2 Box 1 as wages. Do not include the state EDD payment on the W-2.

Errors can lead to:

  • Wage claims — Employees can file claims for unpaid wages
  • Penalties — PPLO violations carry penalties including payment of any shortfall multiplied by three, or $250, whichever is greater
  • Legal liability — Employers can be sued for wage theft, and OLSE can seek suspension of business permits

Use a validated calculator (like the one on this page) and consult legal counsel for complex cases. The San Francisco Office of Labor Standards Enforcement (OLSE) can also provide guidance at 415-554-4190 or pplo@sfgov.org.

No — employers may no longer require employees to use vacation before receiving state CA PFL benefits. Under AB 2123 (effective January 1, 2025), California law fully eliminates the employer option to require employees to use any accrued vacation as a condition of, or prior to, accessing state PFL benefits from the EDD. This change applies to any PFL event commencing on or after January 1, 2025.

Key points:

  • State PFL (EDD): Employers cannot require vacation use before or as a condition of the state EDD PFL benefit. Employees may voluntarily choose to use vacation to supplement their PFL pay — but that decision belongs to the employee.
  • SF PPLO supplement: AB 2123 should not directly impact PPLO compliance (per employment law analysis by Lexology/Littler). Under the PPLO, employers may apply an employee's voluntarily used accrued vacation toward meeting their own PPLO supplemental compensation obligation — effectively offsetting some of the supplement the employer owes — but cannot impose vacation use as a mandatory condition.
  • Practical effect: Because employees now reach PPLO leave with more vacation intact (since it was not burned as a gateway), employers should review how voluntary vacation integration interacts with their PPLO calculations.

Consult legal counsel to ensure your leave and vacation policies are correctly structured under both AB 2123 and the SF PPLO ordinance.

Employers must maintain the following records for at least 3 years:

  • Normal weekly wage calculations and lookback period data (including tip records)
  • EDD Notice of Computation (DE 429D) from the employee
  • Supplemental pay calculation worksheets
  • Payment dates and amounts
  • Any correspondence with the employee about PPLO

These records must be available for inspection by the San Francisco Office of Labor Standards Enforcement (OLSE).

Employers must pay supplemental compensation within a reasonable time after receiving the employee's Notice of Computation (DE 429D) — OLSE guidance generally treats ~15 days as the standard.

The supplement should be included in the employee's regular payroll cycle whenever possible. If the employee is on leave, coordinate with your payroll system to ensure timely payment.

Yes. The San Francisco Paid Parental Leave Ordinance applies to employers with employees working in San Francisco, regardless of where the employer is headquartered. Coverage is based on the employee's work location.

If an employer has any employees working 8+ hours per week in San Francisco (and performing 40%+ of their total weekly hours in SF), and the employer has 20+ employees globally, the PPLO applies — even if the employer is based in another city or state. Fully remote workers outside of SF do not trigger coverage.

CA PFL (state): Provides wage replacement through the EDD. Pays 90% of wages for lower earners (AWW ≤$1,252/week, i.e., roughly ≤$65,000/year in 2026) or 70% for higher earners, up to $1,765/week maximum in 2026. The $1,252/week threshold equals 70% of the 2026 State Average Weekly Wage (SAWW) of $1,789. Administered by the EDD. Taxable on the employee's federal return (Form 1099-G); exempt from California state income tax.

SF PPLO (city): Requires employers to supplement the state benefit to reach 100% of the employee's normal wages, subject to a weekly cap of $2,522 in 2026. Applies only to employers with employees working in San Francisco. The supplement is taxable as regular wages (federal and CA income tax, FICA, FUTA).

Both apply simultaneously. The employer supplement bridges the gap between the state benefit and full wage replacement, up to the weekly PPLO cap.

The PPLO weekly cap updates annually. The 2026 weekly cap is $2,522. Here's how to stay current:

  • Check SF.gov each November: The new cap is typically announced in late fall
  • Use the calculator on this page: It automatically uses the correct year's rates
  • Update payroll systems: Ensure your payroll software uses the current weekly cap
  • Set a calendar reminder: Review PPLO rates annually before the new year

Our calculator is updated with 2026 rates. Always verify you're using the current year's weekly cap when calculating supplemental pay.

The PPLO lookback period is the timeframe used to calculate an employee's normal weekly wage. It is the period immediately preceding the start of the employee's CA PFL period (or preceding pregnancy disability leave for new mothers). The lookback period contains one of:

  • 6 bi-weekly pay periods → divide total wages by 12
  • 6 semi-monthly pay periods → divide total wages by 13
  • 12 weekly pay periods → divide total wages by 12

The lookback period matters because it determines the employee's average wage for the supplement calculation. Exclude any pay periods where the employee was on unpaid or partially paid leave; use earlier pay periods (up to 26 weeks back) in their place.

Example: If an employee typically earns $1,500 but had one unusually low week of $800, the 12-week average smooths out the fluctuation and produces a more representative figure.

The Notice of Computation (DE 429D) is the official EDD form that shows the employee's Weekly Benefit Amount (WBA). It is mailed to the employee after they apply for PFL.

The employee must provide this form to their employer. It is required because:

  • It confirms the employee is receiving PFL benefits (triggering the employer's obligation)
  • It states the exact WBA amount needed for the supplement calculation
  • Receipt of the form triggers the employer's ~15-day payment deadline

Without the DE 429D, employers cannot accurately calculate the supplement. Employees should provide this form as soon as they receive it.

Employees may take PFL leave in non-consecutive blocks. In these cases, the employer must recalculate the supplemental pay for each leave period.

Process:

  • Recalculate based on the employee's current wages and the EDD WBA for that period
  • Apply the $2,522 weekly cap each week — combined state + employer benefit cannot exceed the cap in any given week
  • There is no annual aggregate cap; the $2,522 applies fresh each week of leave taken

Example: If an employee takes 4 weeks of PFL, returns to work for 2 weeks, then takes 4 more weeks, each leave period requires a new calculation. The weekly cap applies independently to each week.

No, not by state law. Employers are not required by California state law to supplement PFL benefits. However, San Francisco's Paid Parental Leave Ordinance (PPLO) requires employers with 20 or more employees worldwide to provide supplemental compensation for child bonding leave, up to a weekly cap of $2,522 in 2026. Many employers choose to offer voluntary top-ups as a competitive benefit. Oakland and Berkeley do not have equivalent mandatory ordinances.

No. Oakland and Berkeley do not have mandatory paid parental leave ordinances equivalent to San Francisco's PPLO. Only San Francisco requires employers (with 20+ employees worldwide) to top up PFL benefits for child bonding. Employers in Oakland and Berkeley may voluntarily offer top-ups, but are not legally obligated to do so by any local ordinance.

No. California Paid Family Leave (PFL) has no waiting period — payment begins on the first day of qualifying leave. This is different from California State Disability Insurance (SDI), which has a 7-day unpaid waiting period. If an employee first receives SDI (e.g., pregnancy disability leave) and then transitions to PFL for baby bonding, the SDI waiting period is credited and does not need to be served again. The employer top-up applies from the first day of PFL benefits.

Methodology: How This Calculator Works

This calculator is built on the official San Francisco Paid Parental Leave Ordinance (PPLO) calculation methodology as published by the San Francisco Office of Labor Standards Enforcement (OLSE). Every formula and rate used in this tool is derived directly from official government sources.

Calculation Formula

Supplemental Pay = (Normal Weekly Wage − EDD WBA) × Employer Share Percentage, subject to the weekly PPLO cap on combined benefits.

This formula is sourced from the San Francisco OLSE PPLO calculation instructions. The calculator applies this formula in real-time using the inputs you provide, then checks the result against the weekly cap.

Rate Sources (All Verified Official)

  • 2026 PPLO Weekly Cap ($2,522/week): OLSE confirmed via Larkin Company; OLSE official 2026 calculation PDF [Dec 2025]; sf.gov PPLO page
  • 2025 PPLO Weekly Cap ($2,402/week): SF.gov PPLO official page
  • 2024 PPLO Weekly Cap ($2,700/week): SF.gov PPLO official page
  • EDD WBA Max 2026 ($1,765/week): EDD Contribution Rates & Benefit Amounts page (edd.ca.gov, live); EDD Quick Stats PDF [2026]
  • EDD WBA Max 2025 ($1,681/week): EDD Contribution Rates & Benefit Amounts page
  • EDD WBA Max 2024 ($1,620/week): EDD Quick Stats PDF (CY 2024)
  • 2026 SAWW ($1,789/week): CA DIR DWC Newsline 2025-116 (Nov 21, 2025); EDD forecast confirmed
  • 90% threshold 2026 (AWW ≤ $1,252/wk): 70% × $1,789 SAWW = $1,252.30; per SB 951 formula; confirmed by EDD PFL benefit payment page
  • Wage Replacement Rates: 60% flat (2024, pre-SB 951 tiers); 70% / 90% tiered (2025–2026, SB 951 effective Jan 1, 2025)
  • AB 2123 vacation rule: Signed Sep 29, 2024; effective Jan 1, 2025; confirmed by SHRM, Littler, Lexology, Hinshaw

Data Verification

All rates and caps used in this calculator have been verified against the following official sources:

  • San Francisco OLSE — Official PPLO guidance, calculation PDFs, and rate sheets
  • California EDD — PFL benefit amounts, WBA cap, and 1099-G tax guidance
  • IRS Publication 15-A — Tax withholding guidance for supplemental wages
  • SB 951 (signed 2022, effective 2025) — Two-tier PFL rate structure

How the Weekly Cap Is Applied

The $2,522 PPLO cap is a weekly maximum on the combined total (state WBA + employer supplement). The calculator enforces this by capping the combined total at the weekly ceiling, then computing the maximum employer supplement as: Weekly Cap − State WBA. This cap applies each week of leave, not as an annual aggregate.

Limitations

This calculator provides estimates based on standard PPLO rules. Individual circumstances may vary. The tool does not account for:

  • The exact EDD WBA tier (70% vs 90%) — enter the actual WBA from the DE 429D
  • Employer-specific policies that may differ from standard PPLO
  • Complex legal interpretations or disputes
  • Changes in rates or laws that occur after the calculator's last update

Update Frequency

This calculator is updated annually when new PPLO rates are announced (typically in November for the following year). The current version uses 2026 rates and is accurate as of the date of publication.

Last Updated: July 29, 2026

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