BILL ANALYSIS Ó ------------------------------------------------------------ |SENATE RULES COMMITTEE | SB 1308| |Office of Senate Floor Analyses | | |1020 N Street, Suite 524 | | |(916) 651-1520 Fax: (916) | | |327-4478 | | ------------------------------------------------------------ UNFINISHED BUSINESS Bill No: SB 1308 Author: Senate Public Employment and Retirement Committee Amended: 8/21/12 Vote: 21 SENATE PUBLIC EMPLOYMENT & RETIRE. COMM : 4-0, 3/26/12 AYES: Negrete McLeod, Walters, Gaines, Vargas NO VOTE RECORDED: Padilla SENATE FLOOR : 37-0, 4/12/12 AYES: Alquist, Anderson, Berryhill, Blakeslee, Calderon, Cannella, Correa, De León, DeSaulnier, Dutton, Emmerson, Evans, Fuller, Gaines, Hancock, Harman, Hernandez, Huff, Kehoe, La Malfa, Leno, Lieu, Liu, Lowenthal, Negrete McLeod, Pavley, Price, Rubio, Simitian, Steinberg, Strickland, Vargas, Walters, Wolk, Wright, Wyland, Yee NO VOTE RECORDED: Corbett, Padilla, Runner ASSEMBLY FLOOR : 74-0, 6/28/12 - See last page for vote SUBJECT : State Human Resources Department: functions SOURCE : Department of Human Resources DIGEST : This bill contains statutory changes included in the Governors plan (GRP 1, 2011) to consolidate the Department of Personnel Administration (DPA) and the State Personnel Board (SPB) into a single agency: the California Department of Human Resources (HR). CONTINUED SB 1308 Page 2 Assembly Amendments specify any bills enacted this year that take effect on or before January 1, 2013, would prevail over this bill. ANALYSIS : The California Constitution establishes SPB and requires SPB to, among other things, enforce the civil service statutes, prescribe probationary periods and classifications, adopt rules authorized by statute, and review disciplinary actions. The Constitution also requires the executive officer of the board to administer the civil service statutes under the rules of SPB. Existing law establishes the Department of Personnel Administration for purposes of managing the nonmerit aspects of the state's personnel system. GRP 1, operative July 1, 2012, creates HR, which is vested with the duties, purposes, responsibilities, and jurisdiction exercised by SPB as its designee with respect to SPB's administrative and ministerial functions. The plan also abolishes the DPA, and transfers the functions and duties performed by the DPA to HR. The plan eliminates certain functions of SPB relating to investigating and hearing complaints of discrimination in the civil service. The plan also authorizes HR to establish disciplinary criteria applicable to adverse actions taken by appointing bodies pursuant to causes of discipline for employees and individuals established pursuant to specified provisions of law. The plan requires SPB to give consideration and respect to any applicable disciplinary criteria established by HR in making certain decisions relating to disciplinary proceedings. This bill is identical to GRP 1 and codifies the statutory changes to law that were put into effect upon passage of GRP 1: 1.Combines the day-to-day staff operations of the DPA and SPB organizations into a new, consolidated agency: HR, and will result in relocating the two former departments into a single location (ideally by July 1, 2013.). 2.Identifies a staff-reduction goal of 15-20 percent following consolidation, which will be achieved over approximately three years through attrition of existing staff in the two departments. SB 1308 Page 3 3.Specifies that the authority of the DPA director is transferred to the HR director, who will be appointed by the Governor and approved by the Senate. 4.Preserves the constitutionally created, five-member State Personnel Board and its constitutional role as an independent and objective merit oversight organization, and retains staff dedicated to the specific work of the Board, including a board-appointed executive officer, an appeals division, and legal staff. SPB will have its own budget, which will not require approval by HR. 5.Transfers appeals of discrimination in state employment that are not based on violations of the merit principle to the Department of Fair Employment and Housing (DFEH) (for example, general complaints of discrimination would go to DFEH; appeals of state examination results based on gender, race, or other protected factors would continue to be heard by SPB). These types of cases comprise fewer than 100 of the 2,500-2,800 cases heard by SPB annually. 6.Preserves intact some of the current operations and divisions within DPA, such as the labor-relations division and certain benefit programs, while combining other functions that overlap with current administration of SPB into two new divisions: the Personnel Management Division and the Statewide Services Division. 7.Includes mostly technical statutory changes, but also includes provisions allowing HR to establish disciplinary criteria applicable to adverse actions taken by appointing bodies, and stating that SPB, in arriving at a decision or proposed decision regarding an appeal on a disciplinary matter, shall give consideration and respect to the disciplinary criteria, as specified, consistent with its discretion and authority. FISCAL EFFECT : Appropriation: No Fiscal Com.: No Local: No The Department of Finance has scored annual savings of $5.5-$5.8 million as a result of the reorganization, chiefly due to position reductions and fully effective when SB 1308 Page 4 consolidation occurs and the two departments become co-located. Staff reductions are expected to be achieved through attrition over the next few years. In addition, it is expected that efficiencies will be achieved in the line agencies with regard to more effective human resources functions, resulting in additional unquantified savings. SUPPORT : (Verified 8/23/12) Department of Human Resources (source) OPPOSITION : (Verified 8/23/12) Association of California State Employees with Disabilities ARGUMENTS IN SUPPORT : According to the Department of Human Resources, this bill replicates the language in GRP 1 that the Little Hoover Commission and the Legislature reviewed last year when they considered the reorganization plan. Overlapping functions will be aligned and outdated processes will be eliminated, providing more efficient and coordinated personnel management. Over the next two fiscal years, HR will eliminate 60 positions (15 percent reduction) and save $8.6 million ($3.7 General Fund). GRP 1 also preserves the independence and constitutional jurisdiction of the Board. Specifically, SPB's five-member Board will maintain oversight and authority over the civil service merit system, disciplinary appeals process, and other constitutionally defined duties. According to the GRP 1 summary provided by the Governor: California state government could not operate without hard-working employees. Unfortunately, due to the bifurcated personnel system, our own bureaucracy makes it difficult to recruit, hire, promote, classify, discipline, train, and reward those employees. It is time to remedy the procedural and organizational problems that confound our system and create one unified state Department of Human Resources. Study after study point out that the state's personnel management system with its redundant responsibilities is outmoded, inefficient, unresponsive, and lacks the organizational focus necessary for the management of SB 1308 Page 5 an effective public service. It wastes money and is a bureaucratic impediment to implementing reforms that would make all state agencies more effective in serving the public. The State of California can no longer afford disjointed, duplicative, and wasteful programs. It is in the public's interest for economy and efficiency in government to consolidate the human resource management functions performed by SPB and DPA into one Department of Human Resources. It is also in the public interest to accomplish this reorganization while preserving the merit principle in state government as required by Article VII of the State Constitution." NOTE: In response to the opposition, the author's office states that this bill is necessary to ensure that the statues accurately reflect changes to law that occurred in 2011 when GRP1 was passed. This bill is exactly, word for word, the language passed in GRP1 in 2011. GRP1 ensured that the SPB would continue to hear discrimination complaints relative to the civil service merit system. It streamlined a duplicative governmental process by eliminating a small number of cases from SPB's docket that were also being heard by DFEH regarding more generalized discrimination in the workplace (i.e., not related to the merit system). Unlike SPB, DFEH can impose civil remedies for cases of discrimination in the workplace. CalHR is currently reaching out to this and other constituent groups in personal meetings to ensure that they understand how the state will continue to ensure non-discrimination, including reasonable accommodation, in the workplace following implementation of GRP1. ARGUMENTS IN OPPOSITION : The Association of California State Employees with Disabilities (ACSED) states in opposition that, "On January 26, 2012, the final report of the California Model Employer Initiative (CMEI) was published. This report is the culmination of a years-long project to make recommendations for much-needed improvements in the procedures for hiring, retention, and upward mobility of persons with disabilities in state government. SB 1308, as written, Section 19702 of the Government Code would be repealed, thereby depriving the State Personnel Board of authority to accept and rule on SB 1308 Page 6 complaints of unlawful discrimination. ACSED believes that, in order to effectively implement the reforms recommended by the CMEI Policy Task Force and make California a model employer of persons with disabilities, it is essential that either SPB or the new Human Resources Agency continue to have authority to handle discrimination complaints." ACSED supports keeping Section 19702 exactly as it appears in current law. They state, "The rationale for repeal of Section 19702 is that the Department of Fair Employment and Housing ÝDFH] could handle discrimination complaints of state employees, since they handle such complaints from the private sector. ACSED would dispute this." ACSED's position is that "rules of state employment are different from the private sector, and in many ways more advanced as far as policies on employees with disabilities. The State Personnel Board has long experience handling these unique issues, whereas DFEH does not, nor do they have the needed staff. There is potential for great harm to employees with disabilities. In addition, if discrimination complaints from employees with disabilities go directly from individual departments to DFEH where cases from all public and private sector employees are mixed, the opportunity for state government-wide consistency of policy in areas such as reasonable accommodation would be diminished. Many discrimination complaints of persons with disabilities do involve problems, or failure of, reasonable accommodation because it is critical to successful job performance for many people. If it is not possible to retain Section 19702 as is, then at a minimum they request an amendment be added to include language clarifying that SPB would still be able to hear complaints alleging denial of reasonable accommodation while on the job, not only during the exam or hiring process or during disciplinary action." ASSEMBLY FLOOR : 74-0, 06/28/12 AYES: Achadjian, Alejo, Allen, Ammiano, Atkins, Beall, Bill Berryhill, Block, Blumenfield, Bonilla, Bradford, Brownley, Buchanan, Butler, Charles Calderon, Campos, Carter, Cedillo, Chesbro, Conway, Cook, Davis, Dickinson, Eng, Feuer, Fletcher, Fong, Fuentes, Furutani, Beth Gaines, Galgiani, Garrick, Gatto, Gordon, Gorell, Grove, Hagman, Hall, Harkey, Hayashi, Roger Hernández, Hill, SB 1308 Page 7 Huber, Hueso, Huffman, Jeffries, Jones, Knight, Lara, Logue, Bonnie Lowenthal, Ma, Mansoor, Mendoza, Miller, Mitchell, Monning, Morrell, Nestande, Nielsen, Norby, Olsen, Pan, Perea, Portantino, Silva, Skinner, Solorio, Swanson, Valadao, Wagner, Wieckowski, Yamada, John A. Pérez NO VOTE RECORDED: Donnelly, Halderman, V. Manuel Pérez, Smyth, Torres, Williams DLW:nd 8/23/12 Senate Floor Analyses SUPPORT/OPPOSITION: SEE ABOVE **** END ****