BILL ANALYSIS Ó ------------------------------------------------------------ |SENATE RULES COMMITTEE | AB 2271| |Office of Senate Floor Analyses | | |1020 N Street, Suite 524 | | |(916) 651-1520 Fax: (916) | | |327-4478 | | ------------------------------------------------------------ THIRD READING Bill No: AB 2271 Author: Perea (D) Amended: 8/22/12 in Senate Vote: 21 SENATE PUBLIC EMPLOY. & RETIRE. COMMITTEE : 3-1, 6/25/12 AYES: Negrete McLeod, Padilla, Vargas NOES: Walters NO VOTE RECORDED: Gaines SENATE APPROPRIATIONS COMMITTEE : 5-1, 8/6/12 AYES: Kehoe, Alquist, Lieu, Price, Steinberg NOES: Walters NO VOTE RECORDED: Dutton SENATE FLOOR : 29-7, 8/13/12 AYES: Alquist, Blakeslee, Calderon, Cannella, Corbett, Correa, DeSaulnier, Emmerson, Evans, Harman, Hernandez, Huff, Kehoe, Leno, Lieu, Lowenthal, Negrete McLeod, Padilla, Pavley, Price, Rubio, Simitian, Steinberg, Strickland, Vargas, Wolk, Wright, Wyland, Yee NOES: Berryhill, Dutton, Fuller, Gaines, La Malfa, Runner, Walters NO VOTE RECORDED: Anderson, De León, Hancock, Liu ASSEMBLY FLOOR : Not relevant SUBJECT : Franchise Tax Board: seasonal clerks SOURCE : Franchise Tax Board CONTINUED AB 2271 Page 2 DIGEST : This bill provides that, notwithstanding any other law, if the Franchise Tax Board (FTB) determines there is a lack of work for a seasonal clerk employed by the board, the board may (1) pay the clerk a lump-sum payment for accumulated vacation or annual leave credit, (2) by mutual agreement between the board and the clerk, schedule the clerk for vacation or annual leave, (3) allow the clerk to retain his/her vacation or annual leave credit, or (4) effect any combination of the above. Senate Floor Amendments of 8/22/12 ensure that when employees and employer have bargained for how to address treatment of accrued vacation of annual leave credits for seasonal employees that the memorandum of understanding (MOU) incorporating the bargained for agreement prevails over the statutory provision. The Senate Public Employment and Retirement Committee was informed that these amendments were requested by the Governor's Office. ANALYSIS : Under existing law, if an employer discharges an employee, the wages earned and unpaid at the time of discharge are due and payable immediately, as specified. Existing law also provides that, unless otherwise provided for by a collective bargaining agreement, if an employment contract or policy provides for paid vacations, and an employee is terminated, the employer must pay the employee for the employee's unused vested vacation time, as specified. This bill specifically authorizes the FTB to do any one of the following with the accumulated vacation or annual leave credits of seasonal clerks placed on unpaid leave due to a lack of work: Pay the seasonal clerk employee in a lump-sum payment for accumulated vacation/annual leave credits. By mutual agreement, schedule the seasonal clerk employee for vacation/annual leave. Allow the seasonal clerk employee to retain his/her vacation/annual credits. CONTINUED AB 2271 Page 3 Effect a combination of a, b, or c above. Enables the FTB to comply with the collective bargaining agreement with State Bargaining Unit 4. This bill also provides that if the provisions of this bill relating to options on how to treat accrued vacation or annual leave credits upon separation of seasonal employees conflict with the provisions of an MOU, the MOU shall be controlling. Comments The author states that currently FTB "does not have the ability to retain seasonal employees without permanent separation?(and)?seasonal clerks do not have the ability to retain their vacation time and annual leave credits even if they return to the same position in the following year." The FTB, the sponsor of this bill states that as part of a lawsuit settlement and memorandum of understanding, it reached an agreement with the Services Employees International Union (SEIU) to comply with the prompt payment requirements of existing law and to also seek legislative authorization to continue providing opportunities to roll over accrued leave to future years for those seasonal clerks who do not want to cash out their vacation at the end of their seasonal employment period. This bill provides FTB the ability to comply with existing prompt payment statutes and with its commitments under the settlement agreement and the memorandum of understanding. This bill is necessary to implement the memorandum of understanding between FTB and its seasonal clerks. FISCAL EFFECT : Appropriation: No Fiscal Com.: Yes Local: No According to the Senate Appropriations Committee, unknown savings in one year, potentially depleted by costs in future years. SUPPORT : (Verified 8/23/12) Franchise Tax Board (source) CONTINUED AB 2271 Page 4 DLW:d 8/23/12 Senate Floor Analyses SUPPORT/OPPOSITION: SEE ABOVE **** END **** CONTINUED