§ 14.1. SHORT TITLE; DEFINITIONS.

(a) Short Title. This Chapter shall be known and may be cited as the "San Francisco Health Care Security Ordinance."

(b) Definitions. For purposes of this Chapter, the following terms shall have the following meanings:

"City" means the City and County of San Francisco.

"Covered Employee" means any person who works in the City where such person qualifies as an employee entitled to payment of a minimum wage from an Employer under the Minimum Wage Ordinance, Chapter 12R of the Administrative Code, and has performed work for compensation for his or her Employer for ninety (90) calendar days, provided, however, that:

(1) "At least eight (8) hours" shall be substituted for "at least two (2) hours" where such term appears in Section 12R.3(a);

(2) The term "Covered Employee" shall not include persons who are managerial, supervisorial, or confidential employees, unless such employees earn annually under $88,212 in 2014 and, for subsequent years, the figure as set by the administering agency;

(3) The term "Covered Employee" shall not include those persons who are eligible to receive benefits under Medicare or TRICARE/CHAMPUS;

(4) The term "Covered Employee" shall not include those persons who are "Covered Employees" as defined in Section 12Q.2.9 of the Health Care Accountability Ordinance, Chapter 12Q of the Administrative Code, if the Employer meets the requirements set forth in Section 12Q.3 for those employees; and

(5) The term "Covered Employee" shall not include those persons who are employed by a nonprofit corporation for up to one year as trainees in a bona fide training program consistent with Federal law, which training program enables the trainee to advance into a permanent position, provided that the trainee does not replace, displace, or lower the wage or benefits of any existing position or employee.

(6) Nor shall the term "Covered Employee" include those persons whose Employers verify that they are receiving Health Care Services through another Employer, either as an employee or by virtue of being the spouse, domestic partner, child, or other dependent of another person; provided that the Employer obtains from those persons a voluntary written waiver of the Health Care Expenditure requirements of this Chapter and that such waiver is revocable by those persons at any time.

"Covered Employer" means any Medium-sized or Large Business as defined below engaging in business within the City that is required to obtain a valid San Francisco business registration certificate from the San Francisco Tax Collector's office or, in the case of a nonprofit corporation, an Employer for which an average of fifty (50) or more persons per week perform work for compensation during a quarter. Small Businesses are not Covered Employers and are exempt from the health care spending requirements under Section 14.3.

"Employer" means an employing unit as defined in Section 135 of the California Unemployment Insurance Code or any Person defined in Section 18 of the California Labor Code. "Employer" shall include all members of a "controlled group of corporations" as defined in Section 1563(a) of the United States Internal Revenue Code, and the determination shall be made without regard to Sections 1563(a)(4) and 1563(e)(3)(C) of the Internal Revenue Code.

"Employer Spending Requirement" means the sum total of Required Health Care Expenditures that a Covered Employer must make for all of its Covered Employees.

"Health Access Program" means a public health benefit program administered by the Department of Public Health; comprised of Healthy San Francisco and Medical Reimbursement Accounts; and intended to increase every participant's access to Health Care Services.

"Health Care Expenditure" means an amount paid by a Covered Employer to a Covered Employee or a trustee or a third party on behalf of a Covered Employee for the purpose of providing or reimbursing the cost of Health Care Services for Covered Employees and/or their spouses, domestic partners. children. or other dependents. "Health Care Expenditure" also means an amount paid by a Covered Employer to the City on behalf of a Covered Employee to establish his or her eligibility to participate in the Health Access Program in the manner and according to the terms set by the Department of Public Health. "Health Care Expenditure" shall not include any amount otherwise required to be paid by Federal, State, or local law.

"Health Care Expenditure Rate" means the amount of Health Care Expenditure that a Covered Employer shall be required to make for each Hour Payable for each of its Covered Employees. The Health Care Expenditure Rate shall be determined annually based on the "average contribution" for a full-time employee to the City Health Service System pursuant to Section A8.423 of the San Francisco Charter based on the annual ten county survey amount for the applicable fiscal year, with such average contribution prorated on an hourly basis by dividing the monthly average contribution by one hundred seventy-two (172) (the number of hours worked in a month by a full-time employee). The Health Care Expenditure Rate shall be seventy-five percent (75%) of the annual ten county survey amount for the applicable calendar year for Large Businesses and fifty percent (50%) for Medium-sized Businesses.

"Health Care Services" means medical care, services, or goods that may qualify as tax deductible medical care expenses under Section 213 of the Internal Revenue Code, or medical care, services, or goods having substantially the same purpose or effect as such deductible expenses.

"Healthy San Francisco" means a Department of Public Health program to provide health care for uninsured San Francisco residents who meet the eligibility criteria established by the Department of Public Health.

"Hour Payable" or "Hours Payable" means a work hour or work hours for which a person is paid wages or is entitled to be paid wages for work performed within the City, including paid vacation hours and paid sick leave hours, but not exceeding 172 hours in a single month, and without regard to the date such wages are actually paid. For salaried persons, "Hours Payable" shall be calculated based on a 40-hour work week for a full-time employee. "Hours Payable" does not include hours worked prior to the first day of the calendar month that begins on or after the date that is ninety (90) calendar days after the date of hire.

"Irrevocable Health Care Expenditure" or "Irrevocable Expenditure" means any amount of Health Care Expenditure that has not been retained by and cannot at any time be recovered by or returned to the Covered Employer.

"Large Business" means an Employer for which an average of one hundred (100) or more persons per week perform work for compensation during a quarter.

"Medical Reimbursement Account" means a public health benefit administered by the Department of Public Health, funded in whole or in part by Health Care Expenditures made by Covered Employers to the City under Section 14.3, from which eligible Covered Employees may obtain reimbursement for Health Care Services as determined by the Department of Public Health.

"Medium-sized Business" means an Employer for which an average of between twenty (20) and ninety-nine (99) persons per week perform work for compensation during a quarter.

"OLSE" means the Office of Labor Standards Enforcement or any successor City entity charged with enforcing the obligations of Employers under this Chapter.

"Person" means any natural person, corporation, sole proprietorship, partnership, association, joint venture, limited liability company, or other legal entity.

"Required Health Care Expenditure" means the Health Care Expenditure that a Covered Employer is required to make to or on behalf of a Covered Employee.

"Revocable Health Care Expenditure" or "Revocable Expenditure" means any amount of Health Care Expenditure that has been allocated for use by a Covered Employee but retained by the Covered Employer, or any amount that has been paid to a trustee or third party but that may at some time be recovered by or returned to the Covered Employer.

"Small Business" means an Employer for which an average of fewer than twenty (20) persons per week perform work for compensation during a quarter.

(Added by Ord. 218-06, File No. 051919, App. 8/4/2006; amended by Ord. 69-07, File No. 070255, App. 4/2/2007; Ord. , File No. 111030, App. 11/22/2011, Eff. 12/22/2011, Oper. 1/1/2012; Ord. , File No. 140317, App. 6/26/2014, Eff. 7/26/2014)