BILL ANALYSIS                                                                                                                                                                                                    



                                                                       



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          |SENATE RULES COMMITTEE            |                  AB 1625|
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                                 THIRD READING


          Bill No:  AB 1625
          Author:   John A. Perez (D)
          Amended:  10/7/10 in Senate
          Vote:     27  Urgency 

           
          PRIOR VOTE NOT RELEVANT


           SUBJECT  :    State employees:  Memorandum of Understanding

           SOURCE  :     Author


           DIGEST  :    This bill provides legislative ratification for  
          a Memorandum of Understanding between the Administration  
          and the numerous bargaining units represented by the  
          Service Employees International Union, Local 1000.

           Senate Floor Amendments  of 10/7/10 delete the prior version  
          of the bill expressing the intent of the Legislature to  
          enact statutory changes relating to the Budget Act of 2010  
          and replace it with the current content regarding  
          ratification of a Memorandum of Understanding.

           ANALYSIS  :    This bill provides legislative ratification  
          for a Memorandum of Understanding (MOU) between the  
          Administration and the following state bargaining units  
          (BUs) represented by the Service Employees International  
          Union (SEIU), Local 1000:

          BU 1 (Professional, Administrative, Financial and Staff  
          Services)
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          BU 3 (Professional Educators and Librarians)
          BU 4 (Office and Allied)
          BU 11 (Engineering and Scientific Technicians)
          BU 14 (Printing and Allied Trades)
          BU 15 (Allied Services)
          BU 17 (Registered Nurses)
          BU 20 (Medical and Social Services)
          BU 21 (Educational Consultant and Library)

          Number of employees:  approximately 95,000 full-time  
          equivalents

           Existing Law

           1.Establishes the Ralph C. Dills Act, which requires the  
            State to collectively bargain with official  
            representatives of employee groups (i.e., bargaining  
            units) regarding wages and working conditions, and to  
            define negotiated agreements in a MOU.

          2.Requires that any MOU between the State and an official  
            representative must be ratified by the Legislature.

          3.Establishes the Public Employees Retirement Law, which  
            provides health and retirement benefits for state  
            employees.

          4.Establishes five separate retirement classes for state  
            employees:  State Miscellaneous and Industrial (which  
            receive substantially the same benefits), State Safety,  
            State Peace Officer/Firefighter, and State Patrol.

          5.Specifies that if the provisions of certain statutes are  
            in conflict with a MOU, the terms of the MOU shall  
            prevail.

          Specifically, this bill:

          1.  Retirement

              A.     Benefit Formula Calculation

                (  1)      Effective the pay period following  
                   ratification by both parties, BU 1, 3, 4, 11, 14,  







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                   15, 17, 20 and 21 Miscellaneous and Industrial  
                   First Tier retirement members, first employed by  
                   the state, will be subject to the "New 2010 First  
                   Tier Retirement Formula" of 2% at age 60 (from  
                   current 2% at 55).

                (2)      Effective the pay period following  
                   ratification by both parties, BU 1, 3, 4, 11, 14,  
                   15, 17, 20 and 21 State Safety retirement members,  
                   first employed by the state, will be subject to  
                   the "New 2010 First Tier Retirement Formula" of 2%  
                   at age 55 (from current 2.5% at 55).
                 
              B.     Employee Contribution Formula

                 (1)      Effective the pay period following  
                   ratification by both parties, current BU 1, 3, 4,  
                   11, 14, 15, 17, 20 and 21 Miscellaneous and  
                   Industrial members of the First Tier retirement  
                   category shall have their contribution increased  
                   from 5% to 8% of monthly compensation over $513.

                (2)      Effective the pay period following  
                   ratification by both parties, current BU 1, 3, 4,  
                   11, 14, 15, 17, 20 and 21 State Safety retirement  
                   members shall have their contributions increased  
                   from 6% to 9% of monthly compensation over $317.

          2.  Compensation

              A.     Adjusted Pay Ranges  
              
                (  1)      Effective July 1, 2013, all BU 1, 3, 4, 11,  
                   14, 15, 17, 20 and 21 represented classifications  
                   (excluding Seasonal Clerks and BU 3  
                   classifications in the California Department of  
                   Corrections and Rehabilitation (CDCR) who work on  
                   an academic calendar) shall be adjusted by  
                   increasing the maximum step of the pay range by  
                   3%.  This only applies to BU 1, 3, 4, 11, 14, 15,  
                   17, 20 and 21 employees who reach the top step of  
                   the pay range.

                (2)      Effective July 1, 2013, all BU 3 represented  







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                   classification in CDCR who work an academic  
                   calendar shall receive a 3% salary differential.   
                   This only applies to BU 3 employees in CDCR who  
                   work an academic calendar who reach step 6 or  
                   higher of the pay range.

                (3)      Effective July 1, 2013, the Seasonal Clerk  
                   classification shall have 50 cents added to each  
                   salary rate.
                 
              B.     Personal Leave Program (PLP 2010)

                 (1)     Effective the pay period following  
                  ratification by both parties, the Personal Leave  
                  Program (PLP 2010) will apply to BU 1, 3, 4, 11,  
                  14, 15, 17, 20 and 21 employees.  This program  
                  shall remain in effect for 12 months.
           
           3.  Health Benefits

              A.     Employer Contribution

                 (1)      Effective the pay period following  
                   ratification by both parties, the State's monthly  
                   contribution to the health insurance portion of  
                   the BU 1, 4, 11, 14, 15, 17, 20 and 21 employee's  
                   allowance shall be an amount equal to 80 percent  
                   of the weighted average of the premiums for the  
                   four Basic health benefit plans with the largest  
                   enrollment (the 80/80 formula).

                (2)      Effective the pay period following  
                   ratification by both parties, the State's monthly  
                   contribution to the health insurance portion of BU  
                   3 employee's allowance will be set at a dollar  
                   amount that equals the 80/80 formula.  The amounts  
                   shall be increased pursuant to the formulas on  
                   January 1, 2011, January 1, 2012, and January 1,  
                   2013.

             4.    Miscellaneous

                A.      The State will not implement a new furlough  
                  program for BU 1, 3, 4, 11, 14, 15, 17, 20 and 21  







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                  employees during the 12 full months following  
                  ratification by both parties.

               B.      The State and SEIU Local 1000 agree to present  
                  to the Legislature, as part of the legislation  
                  implementing the MOU, a provision to appropriate  
                  funds to cover the economic terms of this agreement  
                  through July 1, 2013.

               C.      The State and SEIU Local 1000 agree to delete  
                  Lincoln's Birthday and Columbus Day as recognized  
                  holidays.

               D.      Employees that work on January 1st, the last  
                  Monday in May, July 4th, the first Monday in  
                  September, Thanksgiving Day or Christmas shall  
                  receive one and one-half times the employee's  
                  regular rate of pay and up to eight hours of  
                  holiday credit for all hours worked on the holiday.
                
                E.      This bill increases the employee contribution  
                  to their retirement for excluded and exempt  
                  employees.

          5.  Duration

             July 1, 2010, through July l1, 2013.

           FISCAL EFFECT  :    Appropriation:  Yes   Fiscal Com.:  Yes    
          Local:  No

          CPM:cm  10/7/10   Senate Floor Analyses 

                       SUPPORT/OPPOSITION:  NONE RECEIVED

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