BILL ANALYSIS
SENATE PUBLIC EMPLOYMENT & RETIREMENT BILL NO: AB 1625
Lou Correa, Chair Hearing date: October 7, 2010
AB 1625 (J. P?rez) as amended 10/7/10 FISCAL: YES
RATIFICATION OF MOU BETWEEN THE STATE AND STATE BARGAINING
UNITS REPRESENTED BY SEIU LOCAL 1000
HISTORY :
Sponsor: Service Employees International Union (SEIU),
Local 1000
Prior legislation: AB 88 (Assembly PER&SS Committee)
2009
Senate Floor
ASSEMBLY VOTES :
Not relevant: New bill with October 7, 2010 amendments.
SUMMARY :
This is an urgency bill that 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)
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
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Date: 10/7/10 Page 1
equivalents
BACKGROUND AND ANALYSIS :
1) Existing law
a) 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 an MOU;
b) requires that any MOU between the State and an official
representative must be ratified by the Legislature;
c) establishes the Public Employees Retirement Law, which
provides health and retirement benefits for state
employees;
d) establishes 5 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; and
e) specifies that if the provisions of certain statutes
are in conflict with an MOU, the terms of the MOU shall
prevail.
2) This bill
Would provide the statutorily required legislative approval
of the MOU agreed to between the administration and the state
employee bargaining units represented by SEIU Local, 1000.
Specifically, the MOU contains the following information
provided by the Department of Personnel Administration (DPA):
a)Retirement:
i. Benefit Formula Calculation
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Date: 10/7/10 Page 2
Effective the pay period following ratification by
both parties, Bargaining Unit 1, 3, 4, 11, 14, 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).
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).
ii. Employee Pension Contribution
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 in the First
Tier retirement category shall have their contribution
increased from 5% to 8% of monthly compensation over
$513.
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
contribution increased from 6% to 9% of monthly
compensation over $317.
b) Compensation
i. Adjusted Pay Ranges
Effective July 1, 2013 all BU 1, 3, 4, 11, 14,
15, 17, 20 & 21 represented classifications (excluding
Seasonal Clerks and BU 3 classifications in CDCR who
work 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
and21 employees who reach the top step of the pay
range.
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Date: 10/7/10 Page 3
Effective July 1, 2013 all BU 3 represented
classifications 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.
Effective July 1, 2013 the Seasonal Clerk
classification shall have 50 cents added to each
salary rate.
c) Personal Leave Program (PLP 2010)
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 twelve months.
d) Health Benefits
i. Employer Contribution
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 eighty percent of the weighted average
of the premiums for the four Basic health benefit
plans with the largest enrollment (the 80/80 formula).
Effective the pay period following ratification
by both parties, the State's monthly contribution to
the health insurance portion of the 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 above on January 1, 2011,
January 1, 2012, and January 1, 2013.
e) Miscellaneous
The State will not implement a new furlough program for
BU 1, 3, 4, 11, 14, 15, 17, 20 and 21 employees during
the twelve full months following ratification by both
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Date: 10/7/10 Page 4
parties.
The State and SEIU Local 1000 agree to present to the
Legislature, as part of the legislation implementing this
MOU, a provision to appropriate funds to cover the
economic terms of this agreement through July 1, 2013.
The State and SEIU Local 1000 agreed to delete
Lincoln's Birthday and Columbus Day as recognized
holidays.
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.
f) Increased Employee Contributions (Exempt and Excluded
Employees )
Exempt and Excluded employees would contribute more to
their retirement as follows:
------------------------------------------------------------
|Classification |Contribution Rate |
|-----------------------+------------------------------------|
|State Miscellaneous |9% of pay after the first $317 (for |
|and Industrial |those not included in the federal |
| |system.) |
| | |
| |8% of pay after the first $513 (for |
| |those included in the federal |
| |system.) |
|-----------------------+------------------------------------|
|State Miscellaneous |10% of pay after the first $317 |
|and Industrial |(for those not included in the |
|(Bargaining Unit 2) |federal system.) |
| | |
| |9% of pay after the first $513 (for |
| |those included in the federal |
| |system.) |
|-----------------------+------------------------------------|
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Date: 10/7/10 Page 5
|State Safety |9% of pay after the $317, or in |
| |excess of $513 |
| | |
|-----------------------+------------------------------------|
|Peace Officer / |11% of pay after the first $863 |
|Firefighter | |
|(Bargaining Unit 6) | |
|-----------------------+------------------------------------|
|Peace Officer / |11% of pay after the first $513 |
|Firefighter | |
|(Bargaining Unit 7) | |
------------------------------------------------------------
g) Duration
Three years - July 1, 2010, through July 1, 2013.
h) Agreement
The complete Tentative Agreement between the State and SEIU
Local 1000 is posted at:
http://www.dpa.ca.gov/bargaining/contracts/index.htm
h) This bill is an URGENCY BILL .
3) FISCAL :
According to the DPA:
Fiscal Year 2010-11 savings are $164.1 million
(General Fund) and $218.4 million (Other Funds) for a
total savings of $382.6 million.
Total savings over the duration of the contract are
$632.3 million ($262.0 million General Fund and $370.3
million Other Funds).
4) SUPPORT :
Service Employees International Union (SEIU), Local 1000
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Date: 10/7/10 Page 6
5) OPPOSITION :
None to date
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Date: 10/7/10 Page 7