BILL ANALYSIS AB 1000 Page 1 Date of Hearing: May 13, 2009 ASSEMBLY COMMITTEE ON APPROPRIATIONS Kevin De Leon, Chair AB 1000 (Ma) - As Introduced: February 27, 2009 Policy Committee: Labor and Employment Vote: 4-2 Judiciary 7-3 Urgency: No State Mandated Local Program: No Reimbursable: SUMMARY This bill requires employers to provide paid sick days for employees meeting certain criteria. Specifically, this bill: 1)Provides that an employee who works in California for seven or more days in a calendar year is entitled to paid sick days, compensated at the some wage as the employee normally earns during regular work hours. 2)Specifies that paid sick days accrue at the rate of no less than one hour for every 30 hours worked. Provides that an employee would be entitled to use accrued sick days beginning on the 90th calendar day of employment. 3)Limits the use of paid sick days to 40 hours per year for small businesses (10 or less employees) or 72 hours per year for other businesses. 4)Requires that sick leave be provided to an employee and/or the employee's family member for the diagnosis, care, or treatment of and existing health condition, and for victims of domestic violence or sexual assault. 5)Defines family member to include a child, parent, spouse, registered domestic partner, grandparent, grandchild, sibling, step child, or a legal ward. 6)Provides that the sick leave requirements specified in the bill do not apply to an employee covered by a valid collective bargaining agreement that includes paid sick days and AB 1000 Page 2 arbitration procedures. Provides that the requirements do not apply to employees in the construction industry covered by a valid collective bargaining agreement that meets various conditions but does not necessarily include sick leave. FISCAL EFFECT 1)The Division of Labor Standards Enforcement within the Department of Industrial Relations anticipates that it would incur costs of $875,000 in 2009-10, $559,000 in 2010-11, and $464,000 in 2011-12 and thereafter (special funds) associated with rulemaking and ongoing investigation and enforcement of complaints. 2)Major costs to state and local governments in California, particularly for employee-related costs in-home supportive services and child care programs. As an example, the accrued sick leave would increase costs for IHSS by about $13 million per year, which would be borne by a combination of federal, state, and local funds. COMMENTS 1)Background . Existing California law provides for various forms of unpaid and, in some circumstances, paid leave for employees. Current law does not, however generally require employers to provide paid sick leave. In 2006, San Francisco voters approved Proposition F, the first law in the nation that requires employers to provide sick leave. That measure is enforced by the San Francisco Office of Labor Standards Enforcement. 2)Rationale . The bill is intended to address the current situation in which numerous Californians are not provided paid sick days through their employer. The author asserts that the bill is a win-win for both workers and employers, citing a study that claims allowance of paid sick days can reduce employer costs related to high turnover. 3)Opponents (numerous public and private employer associations) claim that the ever-increasing burden of costly mandates on employers can cumulatively result in lower wages, reducing available health insurance, limiting training programs, and even job loss or reduced work hours. They further assert that AB 1000 Page 3 declining tax base leads to decreases in state revenues, further job loss, and increased demand for unemployment insurance. 4)Prior legislation . AB 2716 (Ma) of 2008 was identical to this bill. That bill was held in the Senate Appropriations Committee. Analysis Prepared by : Brad Williams / APPR. / (916) 319-2081