SF HCSO Employer Annual Reporting Form Due May 1
By Karen Hooper | Published April 2, 2026
Executive Summary
The San Francisco Office of Labor Standards Enforcement (OLSE) has opened the Health Care Security Ordinance (HCSO) Employer Annual Reporting Form (ARF) website. All covered employers must submit the required reporting on the 2025 calendar year by May 1, 2026.
Employers required to complete the reporting will find many useful resources on the ARF website, including instructions, previews, an educational webinar with slides, FAQs, and the reporting form itself.
Which Employers are Required to Complete the ARF?
San Francisco HCSO covered employers are required to complete the ARF. “Covered employers” are defined as an employer who in 2025:
Employed one or more workers within the geographic boundaries of the City and County of San Francisco (generally those individuals with zip codes beginning with 941xx);
Was required to obtain a valid San Francisco business registration certificate pursuant to Article 12 of the Business and Tax Regulations Code, and
Employed 20 or more persons worldwide (for profit) or a nonprofit organization that employed 50 or more persons worldwide.
Where Can Employers Find Information on the ARF?
The ARF is now available on the HCSO website along with instructions, previews of the reporting entries, and a recorded webinar:
ARF Due by May 1 (Extended from April 30)
The OLSE has once again extended the deadline to complete the ARF to Friday, May 1.
Note: Failure to timely complete the ARF can subject the employer to a penalty of $500 per quarter.
What Information Do Employers Need to Complete the ARF?
San Francisco HCSO ARF content requirements 2025 calendar year:
Seven-digit San Francisco Business Account Number
Total number of employees in each quarter (nationwide)
Number of employees covered by the HCSO in each quarter (only employees who work in SF)
Total health care expenditures made by the employer for SF employees in each quarter of 2025, including:
Total quarterly employer payments for SF employees’ health insurance (medical, dental, vision);
Total quarterly contributions to the SF City Option; and
Total quarterly employer HSA contributions.
Note: The ARF also asks employers to complete information related to the Fair Chance Ordinance, which requires employers to follow rules regarding applicants’ and employees’ arrest and conviction record.
HCSO Covered Employees
Employers must make the required HCSO health care expenditures for “covered employees,” defined as employees who:
Are entitled to be paid the minimum wage,
Have been employed by the employer for at least 90 days,
Perform at least 8 hours of work per week in San Francisco, and
Do not meet any of the exemption criteria outlined below.
Note: The HCSO does not apply to properly classified independent contractors reported via Form 1099 (i.e., workers who are properly not classified as Form W-2 common law employees).
Which Employees are Exempt or Excluded from Eligibility Under the HCSO
There are five categories of exempt employees:
Employees who sign the HCSO Voluntary Waiver Form.
Employees who qualify as Managers, supervisors, or confidential employees AND earn more than the applicable salary exemption amount ($125,405 in 2025, $128,861 in 2026).
Employees who are documented to be eligible for Medicare or TRICARE.
Employees who are employed by a nonprofit corporation as a trainee in a bona fide training program.
Employees who receive health care benefits pursuant to the San Francisco Health Care Accountability Ordinance (HCAO)
Note: Employers are not required to make health care expenditure for any exempt category of employees, nor are they required to report on those employees in the ARF. Only information for covered employees, as defined above, is included in the ARF.
Reminder: First Quarter HCSO Expenditures Due by April 30
Covered employers making City Option contributions must make payment within 30 days after the end of each calendar quarter via the Employer Portal. Failure to make the required contributions comes with a potential OLSE administrative penalty of $100 for each employee for each quarter that the violation occurs.
For more details: The 2026 San Francisco HCSO Expenditure Rates
Reminder: Remote and Hybrid Employees Working in San Francisco
While employers are not required to make health care expenditures for employees who work outside the geographic boundaries of San Francisco, covered employers are required to make health care expenditures for remote employees who live in San Francisco and work from home. For any employees who are working on a hybrid or “drop-in” inconsistent basis in San Francisco, employers should institute procedures to track hours worked in the City to correctly calculate the required spend.
For more details: SF HCSO Compliance in the Work-From-Home Era
Reminder: The SF HCSO Free Plan Rule
Employers are not required to make quarterly contributions to the City Option for employees who waive free coverage if the following conditions apply:
The plan offered to the employee requires no premium contributions from the employee for at least one tier;
That free plan tier is a fully insured medical plan option; and
That free plan tier premium amount satisfies the minimum HCSO expenditure requirement at the time it is offered to the employee.
FAQ guidance provides that employers should retain documentation verifying the cost of the free plan, that it was offered to the employee at no cost, and that the employee waived the plan.
Note: Employers relying on this Free Plan Rule must still file the ARF.
More SF HCSO Information
For more information on all of the HCSO requirements directly from the City, check out the San Francisco OLSE’s official HCSO website.
For more information from the Newfront team, see our Newfront San Francisco Health Care Security Ordinance (HCSO) Guide.
Disclaimer: The intent of this analysis is to provide the recipient with general information regarding the status of, and/or potential concerns related to, the recipient’s current employee benefits issues. This analysis does not necessarily fully address the recipient’s specific issue, and it should not be construed as, nor is it intended to provide, legal advice. Furthermore, this message does not establish an attorney-client relationship. Questions regarding specific issues should be addressed to the person(s) who provide legal advice to the recipient regarding employee benefits issues (e.g., the recipient’s general counsel or an attorney hired by the recipient who specializes in employee benefits law).
Karen Hooper
VP, Senior Compliance Manager
Karen Hooper, CEBS, CMS, Fellow, is a Vice President and Senior Compliance Manager working closely with the Lead Benefit Counsel in Newfront's Employee Benefits division. She works closely with internal staff and clients regarding compliance issues, providing information, education and training.
