BILL ANALYSIS Ó
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THIRD READING
Bill No: AB 55
Author: Gatto (D)
Amended: As introduced
Vote: 21
SENATE LABOR & INDUSTRIAL RELATIONS COMM. : 6-0, 6/8/11
AYES: Lieu, Wyland, DeSaulnier, Leno, Runner, Yee
NO VOTE RECORDED: Padilla
SENATE APPROPRIATIONS COMMITTEE : Senate Rule 28.8
ASSEMBLY FLOOR : 73-0, 5/2/11 (Consent) - See last page for
vote
SUBJECT : Unemployment compensation: employer: motion
picture
Industry
SOURCE : Author
DIGEST : This bill removes the January 1, 2012, sunset
date on the law that allows a motion picture payroll
services company to serve as the employer of motion picture
production workers for purposes of payroll tax reporting
and employee benefits pursuant to the unemployment
insurance and state disability insurance programs.
ANALYSIS :
Existing Law :
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1. Requires each employing unit that meets the requirements
of a motion picture payroll services company and pays
the wages of a motion picture production worker to file
a statement with the Employment Development Department
(EDD) that declares its intent to be the "employer" of
these workers.
2. Defines "employer" as any employing unit that is a
motion picture payroll services company that pays and
controls the payment of wages of a motion picture
production worker for services either to a motion
picture production company or to an allied motion
picture services company.
3. Establishes EDD as the payroll tax collection agency and
the state agency that administers the unemployment
insurance (UI) Program and the state disability
insurance (SDI) Program. The UI Program makes available
benefits to eligible people unemployed through no fault
of their own, and the SDI Program makes available
benefits to eligible people who lose work as a result of
non-occupational injury or illness.
4. Sunsets on January 1, 2012, the law that allows a motion
picture payroll services company to serve as the
employer of motion picture production workers for
purposes of tax reporting and UI and SDI benefit
purposes.
This bill extends the law that allows a motion picture
payroll services company to serve as the employer of motion
picture production workers for purposes of tax reporting
and benefits. Specifically, this bill removes the January
1, 2012, sunset date on the law that allows a motion
picture payroll services company to serve as the employer
of motion picture production workers for purposes of
payroll tax reporting and employee benefits pursuant to the
UI and the SDI programs.
Background
The present law on this topic was enacted by SB 1428
(Scott), Chapter 811, Statutes of 2006, and amended by SB
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1173 (Scott), Chapter 391, Statutes of 2008. When SB 1428
was being considered in 2006, the source of the bill,
Entertainment Partners, stated that the movie industry
employs a unique business model where a company can be
formed to produce a single film and shut down as soon as it
is completed. By using a statutory payroll company, many
of the duties of employers are centralized in a limited
number of entities rather than thousands of individual
production companies. This approach reduces the
administrative work that would otherwise be required of the
film production employers, the employees, and the relevant
state agency (EDD).
FISCAL EFFECT : Appropriation: No Fiscal Com.: Yes
Local: No
SUPPORT : (Verified 6/28/11)
Entertainment Partners
Screen Actors Guild
Motion Pictures Association of American
ARGUMENTS IN SUPPORT : According to Entertainment
Partners, state this bill continues the option for motion
picture payroll services companies to be the statutory
employer of the many production workers involved with the
making of movies, television shows, music videos and
commercials in California. That model has proven
beneficial to the unions and guilds and the workers they
represent, the entertainment industry, and to the state.
Entertainment Partners also states that the stability that
will be created by this bill ensures that the more than
150,000 motion picture production workers which they served
during 2010 will continue to work in a vibrant and
expanding California production environment.
ASSEMBLY FLOOR :
AYES: Achadjian, Alejo, Allen, Ammiano, Atkins, Beall, Bill
Berryhill, Block, Blumenfield, Bonilla, Bradford,
Brownley, Buchanan, Butler, Campos, Carter, Cedillo,
Chesbro, Conway, Cook, Davis, Dickinson, Donnelly, Eng,
Feuer, Fletcher, Fong, Furutani, Garrick, Gatto, Gordon,
Grove, Hagman, Halderman, Hall, Harkey, Hayashi, Hill,
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Huber, Hueso, Huffman, Jeffries, Jones, Knight, Lara,
Logue, Bonnie Lowenthal, Ma, Mansoor, Miller, Mitchell,
Monning, Morrell, Nestande, Nielsen, Norby, Olsen, Pan,
Perea, V. Manuel Pérez, Portantino, Silva, Skinner,
Smyth, Solorio, Swanson, Torres, Valadao, Wagner,
Wieckowski, Williams, Yamada, John A. Pérez
NO VOTE RECORDED: Charles Calderon, Fuentes, Galgiani,
Gorell, Roger Hernández, Mendoza, Vacancy
PQ:do 6/28/11 Senate Floor Analyses
SUPPORT/OPPOSITION: SEE ABOVE
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