BILL ANALYSIS AB 1749 Page 1 Date of Hearing: April 20, 2010 ASSEMBLY COMMITTEE ON JUDICIARY Mike Feuer, Chair AB 1749 (Lowenthal and Strickland) - As Amended: April 5, 2010 SUBJECT : WHISTLEBLOWER PROTECTION: JUDICIAL BRANCH EMPLOYEES KEY ISSUE : SHOULD JUDICIAL BRANCH EMPLOYEES ENJOY GREATER PROTECTIONS AGAINST WHISTLEBLOWING? FISCAL EFFECT : As currently in print this bill is keyed fiscal. SYNOPSIS This bill is sponsored by the authors in response to testimony they heard last fall at a legislative oversight hearing regarding the judicial branch. It would extend to judicial branch employees certain additional rights under the Whistleblower Protection Act to complain about improper governmental activities and protections against retaliation for making those complaints and other protected disclosures. The bill is supported by labor organizations and the Judicial Council. No opposition has been received. SUMMARY : Applies certain whistleblowing protections to the judicial branch. Specifically, this bill : 1)Includes employees and applicants for employment by the Supreme Court, a court of appeal, a superior court, or the Administrative Office of the Courts within the definition of "employee" for the purposes of the California Whistleblower Protection Act, except as specified. 2)Authorizes an employee or applicant for employment with those judiciary entities who files a written complaint alleging actual or attempted acts of reprisal, retaliation, or similar prohibited acts for having made a protected disclosure, to also file a copy of the written complaint with the State Personnel Board, together with a sworn statement that the written complaint is true, under penalty of perjury. 3)Requires the State Personnel Board to investigate any claim filed and make a recommendation regarding the alleged AB 1749 Page 2 retaliation. 4)Provides that any person, other than a judge or justice, who intentionally engages in acts of reprisal, retaliation, or similar prohibited acts against an employee or applicant for employment with those judiciary entities for having made a protected disclosure, is subject to punishment for a misdemeanor, and shall be liable in an action for civil damages brought by the injured party. The bill also would prohibit an employee of those judiciary entities from using his or her official authority or influence in violation of these provisions, and would make that employee liable in an action for civil damages brought by the injured party. EXISTING LAW : 1)Pursuant to the Whistleblower Protection Act (WPA), protects state employees from retaliation by their employer for reporting fraud, waste, abuse of authority, violation of law, or activities that create a threat to public health or safety, or the health or safety of state employees. (Gov. Code Sec. 8547 et seq.) 2)Makes a person who intentionally engages in acts of reprisal or retaliation in violation of the WPA subject to a fine of up to $10,000 and up to a year in county jail, and if that person is a civil service employee, subjects that person to discipline by adverse action. A person injured by such acts may bring an action for damages only after filing a complaint with the SPB and the SPB issued, or failed to issue, findings of its hearings or investigation. (Gov. Code Sec. 8547.8.) 3)Provides a process by which a state employee may file an optional written complaint alleging adverse employment actions such as retaliation, reprisal threats, or coercion, with a supervisor or manager and with the SPB. Existing law requires the SPB to initiate an investigation or a proceeding within 10 working days of submission of a written complaint, and to complete findings of the investigation or hearing within 60 working days thereafter. (Gov. Code Sec. 19683.) 4)Provides that no public or private employer may make, adopt, or enforce any rule, regulation, or policy preventing an AB 1749 Page 3 employee from disclosing information to a government or law enforcement agency, where the employee has reasonable cause to believe that the information discloses a violation of state or federal statute, or a violation or noncompliance with a state or federal rule or regulation. (Labor Code section 1102.5.) 5)Likewise prohibits public and private employers from retaliating against an employee for: disclosing information to a government or law enforcement agency, where the employee has reasonable cause to believe that the information discloses a violation of state or federal statute, or a violation or noncompliance with a state or federal rule or regulation; (b) refusing to participate in an activity that would result in a violation of state or federal statute, or a violation or noncompliance with a state or federal rule or regulation; or (c) having exercised his or her rights to do so in any former employment. (Labor Code section 1102.5.) 6)Provides that any employer who violates this chapter is guilty of a misdemeanor punishable, in the case of an individual, by imprisonment in the county jail not to exceed one year or a fine not to exceed $1,000 or both and, in the case of a corporation, by a fine not to exceed $5,000, and provides that in all prosecutions under this chapter, the employer is responsible for the acts of his managers, officers, agents, and employees. (Labor Code sections 1103-04.) COMMENTS : This bill is sponsored by the joint authors, who explain their rationale as follows: AB 1749 gives Judicial Branch employees the same level of protection against retaliation for reporting wrongdoing as is currently afforded to other employees of the state bureaucracy. The approximately 22,000 employees of Judicial Branch of California government are outside the scope of the existing Whistleblower Protection Act. AB 1749 would expand the Act to include these employees, thereby encouraging them to alert the public when its resources are being misused. All working Californians enjoy some level of protection from retaliation if they report a violation of law by their employer. But that blanket protection granted in the Labor Code does not cover those who report instances of what is AB 1749 Page 4 generically called waste, fraud or abuse, in the non-criminal sense. Because it is in the interest of all Californians to uncover wasteful or inappropriate activities of public officials, the state's Whistleblower Protection Act provides very broad protection so that any employee may feel safe when calling attention to actions they believe are not for the public good. The important functions of the Judicial Branch will cost Californians about $3.7 billion this year. In recent years, the branch, like all areas of government, has sustained significant budget reductions. These reductions have in some cases reduced the public's access to the court system. There are significant disagreements over the setting of budgetary priorities, and in some cases branch employees have suggested that administrators have not used resources in the most appropriate manner. Some employees have suggested making any kind of complaint about the allocation of resources or other branch administrative activity runs the risk of reprisal and retaliation. There are pending court cases around exactly such allegations. AB 1749 makes no judgment on those allegations, but clearly articulates the belief that the cause of transparency in government is best served when government employees feel most free to call attention to actions they believe are not in the public interest. The bill has earned support from the SEIU, which describes it as one proposed improvement that will help bring the judiciary in line with other tax payer funded entities with respect to oversight and accountability. SEIU states, "When employees are free to report suspected law violations regarding government operations or misuse of public funds and be free of retaliation, it only serves the public's best interest and helps to ensure that our tax dollars are being used wisely and prudently." The bill is likewise supported by the Judicial Council "because it will promote transparency and accountability within the branch in a manner that appropriately acknowledges the integrity and independence of the judicial branch." The Judicial Council notes, "The courts and the AOC are entrusted with a significant share of state taxpayer dollars, and it is appropriate that judicial branch entities are held accountable for their AB 1749 Page 5 expenditure of those funds in a manner analogous to the other branches. AB 1749 will promote that result and ensure that there is no appearance that judicial branch expenditures are lacking in accountability or transparency." The Judicial Council also notes, "By creating a unique procedure for consideration of retaliation complaints, which vests final decision-making authority for complaints filed with the employer and the State Personnel Board within the judicial branch, AB 1749 clearly acknowledges that an independent co-equal branch of government must have independent authority to oversee its employees." Existing Whistleblower Protections Are Believed To Be Inadequate. The authors note, and the Judicial Council acknowledges, that employees of the judicial branch are protected by current provisions of the Labor Code prohibiting both public and private employers from making, adopting or enforcing any rule, regulation, or policy preventing an employee from disclosing information to a government or law enforcement agency, where the employee has reasonable cause to believe that the information discloses a violation of state or federal statute, or a violation or noncompliance with a state or federal rule or regulation, and prohibiting retaliation against an employee for: disclosing information to a government or law enforcement agency, where the employee has reasonable cause to believe that the information discloses a violation of state or federal statute, or a violation or noncompliance with a state or federal rule or regulation; refusing to participate in an activity that would result in a violation of state or federal statute, or a violation or noncompliance with a state or federal rule or regulation; or having exercised his or her rights to do so in any former employment. Surprisingly to some, however, judicial branch employees are not believed to be covered by the broader protections of the WPA that extend to reports of such improper governmental activity as coercion, conversion, malicious prosecution, misuse of government property, or willful omission to perform duty, activity that is economically wasteful, or involves gross misconduct, incompetency, or inefficiency, and illegal orders to violate or assist in violating a federal, state, or local law, rule, or regulation, or an order to work or cause others to work in conditions outside of their line of duty that would unreasonably threaten the health or safety of employees or the public. According to news accounts, in one pending case an AOC AB 1749 Page 6 employee has asserted that WPA does apply to his employment. However, this appears to be thus far a novel and thus far unsupported interpretation. This Bill Would Protect Reports of Wrongdoing Within The Judicial Branch In Many, But Not All, The Ways In Which The WPA Covers Other Agencies Of The State . The bill redefines the term "employee" in the WPA to include persons employed by the Supreme Court, a court of appeal, a superior court, or the Administrative Office of the Courts for certain purposes of the WPA. However, there are some notable differences in the substantive protections it offers, although some of these may well be technical drafting issues rather than intentional policy choices. Excludes Judges and Justices. Perhaps most significantly, the bill excludes sitting judges and justices from all of the criminal and most of the civil liability that attaches to other judicial branch employees under the bill, and to all executive branch employees and appointees under existing law. This may be justified because justices and judges are subject to the broad authority and disciplinary power of the Commission on Judicial Performance (CJP), and the bill buttresses that safeguard by specifically protecting complaints made to the CJP, not just by judicial branch employees but by all persons covered under the WPA. However, it may be noted that this exemption covers more than the adjudicative functions of judicial officers, which are traditionally immune from liability. The exemption also covers the administrative functions of judges with respect to personnel matters, which are not generally not immune from liability, such as under anti-discrimination and anti-retaliation laws. Prohibited Interference Appears To Be More Limited. The bill may also afford judicial branch employees rights that are somewhat narrower than the rights other employees enjoy under the WPA in that section 8547.3 of the WPA prohibits all interference with any of the rights conferred pursuant to the WPA, while proposed section 8547.13(i) of the bill appears to prohibit judicial branch employees from interfering with the "right of that person to disclose to an agency official, designated for that purpose by the agency, or the State Auditor matters within the scope of this article." Thus, the bill appears to exclude interference with the rights afforded to the Bureau of State Audits and the State Personnel Board (SPB) with respect to investigation of complaints and recommended AB 1749 Page 7 corrections under sections 8547.4, 8547.5, 8547.6 and 8547.7. The proper construction of the bill is unclear, however, because both section 8547.3 and 8547.13(i) appear to apply to judicial branch employees. Restrictions On Receipt of Complaints. In addition, the bill appears to restrict the persons to whom judicial branch employees may file their internal complaints more rigidly than for other state employees. The bill specifies that internal complaints may be filed only with the complaining employee's supervisor, manager of "other agency officer designated for that purpose by the agency." The WPA by comparison expressly authorizes complaints to be received by supervisors, managers and "the appointing authority." To the extent that complainants may wish to avoid lodging their charges directly with their supervisor or manager, as may frequently be the case, the bill requires them to know who if anyone else in their agency has been authorized to receive their complaint. Restrictions on SPB's Authority To Order Relief For Violations. With respect to investigations by the SPB, the bill affords the SPB the authority only to make recommendations to court agencies regarding complaints it investigates, and to make such recommendations only regarding whether retaliation resulted in an adverse action regarding the employee and, if so, what steps should be taken to remedy the situation. This differs from existing law in two ways. First, the role of the SPB regarding other employees under the WPA includes the authority to order relief, including discipline against the state employee that violated the law. (Government Code section 19683.) Restricting the authority of the SPB to simply make recommendations is understood to be intentional on the part of the authors because it is important to the Judicial Council, which contends that it is inappropriate to grant an executive branch agency the power to impose decisions regarding judicial branch employees - although it might be noted that other executive branch agencies currently have such authority under existing workplace laws, including existing anti-retaliation rules enforced by the Labor Agency and the Fair Employment and Housing Commission. Secondly, this provision differs in that the SPB has the authority to make recommendations only "regarding whether retaliation resulted in an adverse action." The term "adverse action" has a specific definition in state employment law; it does not include every punitive act. Under the WPA, by contrast, the SPB can find that improper retaliation occurred AB 1749 Page 8 regarding other covered employees even if the retaliation does not take the form of "adverse action." It is not clear whether there is a policy rationale for this limitation regarding judicial branch employees. No Required Time Frames For SPB. In addition, the bill appears to lack the specified time frames under which the SPB is currently required to act in response to complaints it receives from other state agency employees under the WPA. (Compare Government Code section 19683 for state agency employees with section 8547.13(c) regarding judicial branch employees.) Discretionary Discipline For Intentional Violations. Other employees covered by the WPA face mandatory discipline by the SPB for intentional acts of retaliation, in addition to being "subject to" certain potential criminal penalties. (Section 8547.8(b).) Under this bill, however, judicial branch employees who commit intentional violations are said to be "subject to discipline," a term that suggests the imposition of discipline is discretionary, like criminal penalties. (See proposed section 8547.13(d).) This Bill Would Extend Not Only Substantive Rights But An Administrative Processes For Allegations Of Impropriety Regarding The Judicial Branch . As discussed above, the WPA currently provides an SPB complaint process for retaliation against employees and applicants who make a "protected disclosure" and for any person who uses or attempts to use his or her official authority or influence for the purpose of intimidating, threatening, coercing, commanding, or attempting to intimidate, threaten, coerce, or command any person for the purpose of interfering with the rights conferred by the WPA. Under this bill, the administrative process of the SPB would be applied to the judicial branch, albeit with the limitations noted above. Because the authors are naturally concerned about the potential fiscal impact of extending the investigative function of the SPB to the judicial branch, they may wish to consider whether the costs of this administrative process are worth the benefits. Information obtained by the Committee indicates that the SPB process is not especially robust or valuable. From 2003 to 2008, 55 complaints per year were filed on average, but 17 of those were rejected. Of the 38 complaints per year that were accepted, 13 were denied, 19 were still pending, 2 were withdrawn and 3 were resolved by stipulated agreement. This record may suggest that administrative outcomes AB 1749 Page 9 are not sufficiently desirable to warrant the additional cost, keeping in mind that SPB findings and recommendations are only advisory under the bill, and that the protections established by the bill may be independently enforced by a private right of action. Suggested Technical Amendments . As the bill moves forward the authors may wish to consider some drafting issues, including: (1) the use of the term "chapter" in section 8547.13(c) where it appears the term "section" may be intended; and (2) clarifying the exemption with respect to section 8547.4 which is said to apply to court employees only to some extent - perhaps by subdividing that section and explicitly indicating which of the subdivisions applies to the judicial branch. REGISTERED SUPPORT / OPPOSITION : Support AFSCME California Employment Lawyers Association California Labor Federation California Official Court Reporters Association California Protective Parents Association Center for Judicial Excellence Glendale City Employees Association Laborer's Int't Locals 729 and 777 Judicial Council Orange County Employees Association Organization of SMUD Employees Prof. & Tech Engineers, Local 21 San Bernardino Public Employees Association San Diego Court Employees Association San Luis Obispo County Employees Association Santa Rosa City Employees Association SEIU Opposition None on file Analysis Prepared by : Kevin G. Baker / JUD. / (916) 319-2334