If an employee is temporarily disabled by illness or injury arising out of and in the course of state employment, he or she shall become entitled, regardless of his or her period of service, to receive industrial disability leave and payments, in lieu of workers’ compensation temporary disability payments and payment under Section 89527, for a period not exceeding 52 weeks within two years from the first day of disability. The payments shall be in the amount of the employee’s full pay less withholding based on his or her exemptions in effect on the date of his or her disability for federal income taxes, state income taxes, and social security taxes not to exceed 22 working days of disability subject to Section 89529.08. Thereafter, the payment shall be two-thirds of full pay. Payments shall be additionally adjusted to offset disability benefits, excluding those disability benefits payable from the State Teachers’ Retirement System, the employee may receive from other employer-subsidized programs, except that no adjustment will be made for benefits to which the employee’s family is entitled up to a maximum of three-quarters of full pay. Contributions to the Public Employees’ Retirement System or the State Teachers’ Retirement System shall be deducted in the amount based on full pay. Discretionary deductions of the employee including those for coverage under a state health benefits plan in which the employee is enrolled shall continue to be deducted unless canceled by the employee. State employer contributions to the Public Employees’ Retirement System and state employer normal retirement contributions to the State Teachers’ Retirement System shall be made on the basis of full pay and state contributions pursuant to Sections 22871 and 22885 of the Government Code because of the employee’s enrollment in a health benefits plan shall continue.

(Amended by Stats. 2004, Ch. 69, Sec. 3. Effective June 24, 2004.)