The clock is ticking. You’ve reached the halfway mark on your maternity leave, and you realize you can’t do it. You cannot hand your baby off to someone else and spend hours away from him. 

You can’t imagine pumping milk at work to give to someone else. They get to see your son’s sleepy, sated face when his stomach is full. You want to be there for every minute and milestone as he grows. Before you quit your job, make sure you understand the possible implications.

Quitting your job while collecting California’s paid family leave (PFL) or taking up to 12 weeks of job-protected leave through the California Family Rights Act (CFRA) has five financial and legal implications you cannot afford to overlook.

Contractual Obligations and Required Notice

At-will employment is standard across much of the U.S., including California. This means an employer can terminate you for any reason, as long as it’s not an illegal reason, such as discrimination or retaliation. You also have the right to quit at any time.

However, at-will employment does not apply if you have a contract with your employer. Contractual obligations must be met. For example:

• Mandatory Notice: Your collective bargaining agreement states that you must give two weeks’ notice, and your employer must do the same, allowing you to find another job. You’re required to tell them that your last day will be in two or more weeks.
• Unearned Bonuses: You signed an employment contract that gave you a $1,000 sign-on bonus if you agreed to stay with the company for two years. Your employer may be allowed to request some of that back if you quit before the two years are up.

While you may be under no obligation to give your employer notice, it’s a good idea to provide written notice. It gives HR time to organize the necessary forms, provide information about any COBRA benefits, and ensure you have the correct paperwork to end benefits like dental, health, and short-term disability insurance.

Eligibility for State Benefits

The California Employment Development Department (EDD) provides state-funded benefits like PFL for bonding and State Disability Insurance (SDI) for your recovery after pregnancy. These benefits are funded through payroll deductions. You pay into this program with each paycheck you earn.

Because you’ve already paid into this program, you never have to pay it back. However, quitting your job means losing any future PFL benefits tied to that employer. As soon as your employment is officially terminated, those benefits end. 

By quitting to transition into the role of a stay-at-home parent, you also forfeit the option to receive California Unemployment Insurance (UI) benefits. When you’re a stay-at-home parent, you have to tighten your budget. That is why we recommend talking to your employer to see whether you can work remotely while your baby is young.

Sometimes, people think they qualify for unemployment simply for being unemployed. It’s not the case. You have obligations to meet, including actively searching for jobs and being unemployed for a reason beyond your control. Wanting to stay home with your new baby isn’t a qualifying reason.

Health Insurance Premium “Clawbacks”

What is a “clawback?” It’s a legal provision that requires compensation or benefits to be repaid if certain terms aren’t met.

Under the Family and Medical Leave Act (FMLA) and CRFA, employers must continue paying the premiums on group health insurance plans while you’re on unpaid pregnancy leave. If you quit your job, clawback provisions may be used to get back the premiums your employer paid. 

There’s an exception. If you used up accrued vacation or PTO to cover your pregnancy leave, you’re exempt from clawback provisions.

California Assembly Bill 1697 prohibits “stay or pay” restrictions on employment contracts, but it’s a newer law. It will not be enforced on contracts signed before January 1, 2027. Until then, the best way to avoid it is by returning to work for at least 30 days to meet the FMLA/CFRA rules. 

Repayment of Supplemental Maternity Benefits

To attract and retain exceptional employees, some California employers offer employer-funded “Top-Off” pay to bring California’s PFL (usually around 70% to 90% of your weekly income) or SDI closer to your full salary. 

If your employer did and you accepted it, read your company’s policy on supplemental maternity benefits carefully. You may have rules to follow.

• Return-to-Work Requirements: Many employers who provide top-off benefits have strict contractual terms requiring you to return to work after 30 or 90 days. If you suddenly quit before returning, you could be required to pay back that money. 
• Significant Repayments: Suppose you received $500 extra from your employer and quit during your 10th week of maternity leave. You could be required to pay $5,000 (10 x $500) back for breach of contract.

Before quitting, make sure the penalty you’d pay is affordable. Newborns are a significant expense, so it might be better to return to work and then quit after you’ve met your return-to-work obligation.

Final Paycheck Deadlines

California’s strict rules on your final paycheck protect you from long delays if you opt to quit and stay home with your baby. How and when you resign determines how fast you’ll get that final pay.

Accrued PTO and Vacation: Under California law, earned, unused vacation time and PTO are wages you’ve earned. Your employer has to include this time in your final check. 

Quitting With Notice: If you give at least 72 hours’ advance notice, your employer must have your final paycheck ready when you go to your place of employment.

Quitting Without Notice: If you quit effective immediately without prior warning, your employer has 72 hours from the time you give notice to make your final check available.

If you request that your final paycheck be sent by mail, the postmark must comply with the 72-hour rule. If your employer fails to follow the 72-hour rule, they can be penalized under California Labor Code Section 203. It equates to a full day’s pay for every day the check is late (up to 30 days). 

Did your employer refuse to pay you within 72 hours, or did they pay long after the deadline? An employment attorney can help you recover the full wages and penalties owed.

Shegerian Conniff has more than 13 years of experience in all areas of employment law. We offer free case consultations to California workers. Don’t delay. Talk to our office if you believe your employer violated your rights when you quit your job during maternity leave.