BILL ANALYSIS                                                                                                                                                                                                    



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          Date of Hearing:  March 25, 2014

                           ASSEMBLY COMMITTEE ON JUDICIARY
                                Bob Wieckowski, Chair
                   AB 1522 (Gonzalez) - As Amended:  March 13, 2014

                              As Proposed to be Amended

           SUBJECT  :  EMPLOYMENT: PAID SICK DAYS

           KEY ISSUE  :  IN ORDER TO PROTECT CO-WORKERS FROM EXPOSURE TO  
          ILLNESS AND PROVIDE FAIR ALTERNATIVES TO WORKING PARENTS WITH  
          SICK CHILDREN, SHOULD EMPLOYERS BE REQUIRED TO PROVIDE AT LEAST  
          3 PAID SICK DAYS FOR ANY EMPLOYEE WHO WORKS FOR SEVEN OR MORE  
          DAYS IN A CALENDAR YEAR?
           
                                      SYNOPSIS
          
          This bill is substantially similar to but less far-reaching than  
          three prior efforts that have been taken up periodically since  
          2008.  The prior measures passed this Committee by votes of 6-3,  
          7-3, and 7-3 respectively but were held on suspense in the  
          Appropriations Committees.  This bill creates the Healthy  
          Families, Healthy Workplaces Act of 2014, which requires  
          employers to provide at least three paid sick days for an  
          employee who works for seven or more days in a calendar year.   
          The employee would have the right to use accrued sick days only  
          after three months of employment.  According to the author, 40  
          percent of all workers in California do not have any paid sick  
          days through their employer.  The author states that this bill  
          appropriately allows workers to earn paid sick days, which they  
          can use for personal illness, to care for a sick family member  
          and to recover from domestic violence or assault.  The author  
          argues that studies have found that providing sick days to  
          workers saves money for businesses by reducing turnover,  
          reducing the spread of illness in the workplace, and improving  
          workers' morale and productivity.  The sponsors state that the  
          lack of paid sick days is a public health hazard.  The sponsors  
          also state that this bill will increase productivity since the  
          productivity of workers with even minor illnesses goes down  
          compared to the productivity of their healthy co-workers.   
          Finally, the author states that this bill will prevent parents  
          from choosing between caring for a sick child and work  









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          obligations.  Opponents representing many large and small  
          business associations, including the National Federation of  
          Independent Business, California Employment Law Council, and the  
          California Chamber of Commerce, argue that this bill would  
          unreasonably expand employers' burdens, costs and liability.   
          Opponents also state that many California employers provide paid  
          sick leave and/or paid vacation time even though current law  
          does not require it.  Opponents conclude that in an already  
          troubled economy California should be seeking ways to stimulate  
          job growth and avoid forcing costly mandates on employers.

           SUMMARY  :  Creates the Healthy Families, Healthy Workplaces Act  
          of 2014, which requires employers to provide paid sick days for  
          an employee who works for seven or more days in a calendar year.  
           Specifically,  this bill  : 

          1)Provides that an employee who works in California for seven or  
            more days in a calendar year is entitled to paid sick days as  
            specified in this bill.

          2)Provides that an employee shall accrue paid sick days at the  
            rate of not less than one hour per every 30 hours worked,  
            beginning at the commencement of employment or the operative  
            date of this bill, whichever is later.

          3)Provides that an employee shall be entitled to use accrued  
            paid sick days beginning on the 90th calendar day of  
            employment, after which the employee may use paid sick days as  
            they are accrued.

          4)Provides that paid sick days shall carry over to the following  
            calendar year, but an employer may limit an employee's use of  
            paid sick days to 24 hours or three days in each calendar  
            year.

          5)Provides that an "employee" does not include:

             a)   An employee covered by a valid collective bargaining  
               agreement that expressly provides for paid sick days or  
               similar policy, as specified.

             b)   An employee in the construction industry covered by a  
               valid collective bargaining agreement that was entered into  









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               before January 1, 2015 or waives the requirements of this  
               bill, as specified.

          6)Provides that "employer" includes the state, political  
            subdivisions of the state, and municipalities.

          7)Provides that a public authority shall comply with these  
            requirements for individuals who perform in-home supportive  
            services, except that the public authority may satisfy these  
            requirements by entering into a collective bargaining  
            agreement that provides an incremental hourly wage adjustment  
            in an amount sufficient to satisfy the accrual requirements of  
            this bill.

          8)Provides that an employer shall provide paid sick days for the  
            following purposes:

             a)   Diagnosis, care, or treatment of an existing health  
               condition of, or preventative care for, an employee or an  
               employee's family member, as defined.

             b)   For an employee who is a victim of domestic violence,  
               sexual assault or stalking, as specified.

          9)Specifies that an employer is not required to provide  
            additional paid sick days if the employer has a paid leave  
            policy or paid time off policy that meets the accrual  
            requirements and other purposes of this section, as specified.

          10)Provides that an employer is not required to provide  
            compensation to an employee for accrued and unused paid sick  
            days upon separation from employment, except that if an  
            employee separates from employment and is rehired within one  
            year, previously accrued and unused paid sick leave shall be  
            reinstated.

          11)Authorizes an employer to lend paid sick days to an employee  
            in advance of accrual, as specified.

          12)Provides that an employer shall not deny an employee the  
            right to use paid sick days or engage in other adverse  
            employment actions, as specified.










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          13)Provides that there shall be a rebuttable presumption of  
            unlawful retaliation if any employer denies an employee the  
            right to use paid sick days or takes other specified adverse  
            action within 90 days of specified protected activities by the  
            employee.

          14)Requires an employer to provide each employee with written  
            notice of these requirements, as specified.

          15)Requires the employer to retain records for five years  
            documenting an employee's hours worked and paid sick days  
            accrued and used, as specified.

          16)Directs the Labor Commissioner to coordinate implementation  
            and enforcement of these requirements and to promulgate  
            guidelines and regulations.

          17)Directs the Labor Commissioner to enforce these requirements,  
            and establishes administrative procedures, enforcement  
            actions, and administrative penalties, as specified.

          18)Authorizes the Labor Commissioner, the Attorney General, a  
            person aggrieved, or an entity a member of which is aggrieved  
            to bring a civil action in a court of competent jurisdiction  
            to recover relief, as specified, including back pay,  
            penalties, liquidated damages and attorney's fees and costs.

          19)Provides that these requirements do not limit or affect any  
            laws guaranteeing the privacy of health information, or  
            information related to domestic violence or sexual assault, as  
            specified.

          20)Provides that these requirements shall not be construed to  
            discourage or prohibit an employer from the adoption or  
            retention of a more generous paid sick days policy.

          21)Provides that these requirements do not lessen the obligation  
            of an employer to comply with a contract, collective  
            bargaining agreement, employment benefit plan, or other  
            agreement providing more generous sick days.

          22)Provides that these requirements establish minimum standards  
            and do not preempt, limit or otherwise affect the  









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            applicability of any other law, regulation, requirement,  
            policy, or standard that provides for greater accrual or use  
            of sick days or that extends other protections to an employee.

          23)Makes related legislative findings and declarations of  
            legislative intent.

           EXISTING LAW  requires, under the Moore-Brown-Roberti California  
          Family Rights Act, employers with 50 or more employees to  
          provide covered employees, upon request, with up to 12 weeks of  
          protected unpaid leave during any 12-month period for the  
          following reasons:

          1)For the birth of a child or the placement of a child in  
            connection with the adoption or placement in foster care of  
            the child with the employee;

          2)To care for a parent, spouse or child with a serious health  
            condition; or,

          3)Because of the employee's own serious health condition.   
            (Government Code Sections 12945.1 et seq.)
           
          FISCAL EFFECT  :  As currently in print this bill is keyed fiscal.

           COMMENTS  :  This bill is substantially similar to, but more  
          limited than, AB 400 of 2011, AB 1000 of 2009, and AB 2716 of  
          2008, each of which passed this Committee by votes of 6-3, 7-3,  
          and 7-3 respectively, only to then be held on suspense in the  
          Appropriations Committees.  It is more limited than prior  
          measures in that it would require employers to afford only a  
          minimum of three sick days, rather than up to 9 days as under  
          the prior measures.

          The bill is intended to address the current situation in which a  
          reported 6 million California workers (or about 40 percent of  
          the workforce) are not provided paid sick days through their  
          employer.  The author's office states that this bill allows  
          workers to earn paid sick days, which they can use for personal  
          illness, to care for a sick family member and to recover from  
          domestic violence or assault.  The author argues that studies  
          have found that providing sick days to workers saves money for  
          businesses by reducing turnover, reducing the spread of illness  









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          in the workplace and improving workers' morale and productivity.  
           The sponsors state that the lack of paid sick days is a public  
          health hazard.  According to supporters, the Centers for Disease  
          Control recommends workers who are ill "stay home from work and  
          school" to prevent the spread of disease in the community and  
          workplace.  Supporters also state that this bill will increase  
          productivity since the productivity of workers with even minor  
          illnesses goes down compared to the productivity of their  
          healthy co-workers.  Finally, supporters state that this bill  
          will prevent parents from choosing between caring for a sick  
          child and work obligations.

           Various Reports and Studies Indicate a Need for Paid Sick Leave  
          and Highlight its Benefits:   According to the Labor Project for  
          Working Families (LPWF), 6 million working Californians do not  
          have paid sick days.  LPWF states that 76% of low-wage workers  
          have no paid sick days and have no choice but to go to work sick  
          and send their sick children to either school or child care.   
          According to LPWF, sick workers risk spreading contagion to the  
          public and are more likely to have an accident on the job.   
          According to a 2003 Kaiser Family Foundation Report, half of all  
          U.S. women forego pay when they stay home to take care of a sick  
          child (Women, Work, and Family Health: A Balancing Act, Henry J.  
          Kaiser Family Foundation, April 2003).  A recent study,  
          conducted by the Institute for Women's Policy Research, which  
          used data collected by the U.S. Bureau of Labor Statistics, U.S.  
          Department of Health and Human Services, California Employment  
          Development Department and U.S. Census Bureau to evaluate the  
          likely impact of one of the previous, almost identical bills  
          found, among other things:  "If this bill becomes law,  
          California employers would pay just $1.3 million annually for  
          wages and associated costs to workers who take leave; savings to  
          employers would total $2.3 million annually, mainly from reduced  
          costs of turnover; and, workers and their families would  
          experience lower expenditures for health-care services, saving  
          $7 million annually."  (Valuing Good Health in California:  The  
          Costs and Benefits of the Healthy Families, Healthy Workplaces  
          Act of 2008, Institute for Women's Policy Research, April 2008.)

          The author cites a Field Research poll from August 2008, which  
          shows that Californians overwhelmingly support guaranteed paid  
          sick days-73% of California adults surveyed stated that they  
          would support a law guaranteeing paid sick days for all  









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          Californian workers.  This support crosses party, gender, and  
          ethnic lines.  Moreover, 76% of those surveyed said that paid  
          sick days should be considered a basic worker right, like a  
          decent wage.

           Proposition F (San Francisco Ordinance Chapter 12W) Requires  
          Paid Sick Leave of All San Francisco Employers  :  In 2006, San  
          Francisco voters approved Proposition F, the first law in the  
          nation that provided workers with the ability to earn and use  
          paid sick days.  That measure was implemented and is enforced by  
          the San Francisco Office of Labor Standards Enforcement (OLSE).   
          In support of the ordinance's efficacy, OLSE's website cites a  
          2011 study of the city's paid sick day ordinance completed by  
          the Women's Policy Research Institute.  The study, which  
          surveyed both San Francisco employers and employees, concluded  
          that the law is functioning well.  It found, among other things,  
          that overall employer profitability did not suffer from the law,  
          with six out of seven employers reporting no negative effects on  
          productivity.  Also, despite the availability of either five or  
          nine sick days under the law, one-quarter of employees of a  
          compliant employer used zero paid sick days, and the average  
          level of use was only three paid sick days during the previous  
          year.  

           Similar Efforts at the National, State and Federal Levels  :  Paid  
          sick days legislation has been proposed at the federal, state  
          and local levels.  For several years, a federal Healthy Families  
          Act has been proposed that would ensure that all employees  
          working 30 or hours more per week have seven paid sick days a  
          year.  At least fourteen states have proposed legislation for  
          paid sick days in recent years, but Connecticut is currently the  
          only state that requires private employers to provide paid sick  
          leave currently, and only for a limited class of employers.   
          There are no federal requirements for paid sick leave for either  
          public or private employers.  As discussed above, a San  
          Francisco ordinance enacted in 2006 provides paid sick days for  
          all workers employed in the city. 

          As with prior measures, this bill would apply to both public and  
          private employers.  In order to avoid any potential confusion on  
          the point, this bill applies to public employers explicitly,  
          although doing so is arguably unnecessary because the term  
          "employer" should be properly understood to apply to all  









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          employers unless otherwise limited.

           ARGUMENTS IN SUPPORT  :  Supporters of this measure, including the  
          California Labor Federation and the SEIU, argue that millions of  
          workers in California cannot take a day off when they or someone  
          in their family falls ill.  Under current state law, nothing  
          requires employers to provide paid sick days, and as a result,  
          roughly 39 percent of the workforce earns no sick leave benefits  
          whatsoever.  That leaves seven million Californians with few  
          options when personal or family needs arise.

          Supporters state that a worker without such leave is either  
          expected to work while sick, risking the health and safety of  
          co-workers and customers, or stay home and forego wages,  
          jeopardizing that worker's own ability to survive.  This  
          impossible choice is as unfair as it is unnecessary and has no  
          place in today's economy.

          They contend that this bill will grant all California workers  
          access to earned sick leave following 90 days of employment.   
          Employees will earn one hour of paid sick time for every 30  
          hours worked, and employers may cap available leave at three  
          days per year.  Sick leave can be used to care for a sick family  
          member or as leave to allow domestic violence and sexual assault  
          survivors time to recover.  The bill allows flexibility for  
          workers and employers covered by a collective bargaining  
          agreement, and the bill includes anti-retaliation language to  
          protect workers claiming this benefit.

           ARGUMENTS IN OPPOSITION  :  Opponents, including the California  
          Chamber of Commerce, argue that while many employers voluntarily  
          offer sick leave for full-time employees, expanding this mandate  
          on all employers will create a huge burden on employers.  For  
          example, many employers currently offer paid sick leave which  
          accrues on a per month or per pay period basis.  However, this  
          bill requires them to completely change their existing policies  
          in order to mirror the accrual rate proposed under this bill.   
          Opponents also contend that the new posting and notice  
          requirements, with additional penalties for noncompliance, put  
          employers at risk of litigation.

          Opponents raise particular concern about some of the enforcement  
          mechanisms contained in this bill, including the private right  









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          of action.  They contend that under this provision, a union may  
          file a lawsuit against an employer on behalf of an employee,  
          thereby significantly expanding the scope and threat of civil  
          litigation against small and large employers.  Opponents also  
          object to various penalties contained in the bill, arguing that,  
          while an employee should be made whole for any violation of the  
          law, the layering of additional penalties, such as treble  
          damages, is simply an unjustified windfall.  Opponents also  
          object to the bill's creation of a rebuttable presumption of  
          retaliation, arguing that the burden will fall on the employer  
          to prove that employment decisions were valid, instead of the  
          burden falling on the employee to prove retaliation.

          Opponents also contend that recent employer surveys of  
          jurisdictions that have adopted paid sick leave policies  
          indicated a negative impact on growth and jobs:

               The Employment Policies Institute recently published a  
               limited study on the effects of Connecticut's Paid Sick  
               Leave law that went into place in 2012 and only applies to  
               larger employers and non-exempt service workers.  Although  
               the survey was admittedly limited in the number of  
               businesses evaluated, the results indicate the new law has  
               had a negative impact on growth and jobs.  Of the 156  
               businesses that responded to the survey, 31 of the  
               businesses had reduced other employee benefits to balance  
               the cost of the paid sick leave; 12 had reduced employee  
               hours; 6 had reduced employee wages; 19 companies had  
               raised their prices; 6 companies had laid off employees;  
               and, 16 companies stated that they would limit their  
               expansion in the state.  Thirty-eight of the businesses  
               surveyed also indicated that they would hire fewer  
               employees as a direct result of the new law, while others  
               stated they planned to offer fewer raises.

          Opponents conclude that rather than mandate new requirements,  
          the Legislature should incentivize employers to offer these  
          additional benefits by reducing costs in other areas.  Among  
          other things, they suggest offsetting the burden on employers to  
          provide paid sick leave by providing small employers with a tax  
          credit for the amount expended each year on paid sick leave.

           PRIOR LEGISLATION  :  AB 400 (Ma) of 2011 and AB 1000 (Ma and  









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          Skinner) of 2009 also aimed at dealing with the issue of paid  
          sick days.  The most significant difference between this bill  
          and the previous bills is that this bill allows employers to  
          limit the amount of paid sick days used by employees to 3 days  
          per year.  Previous bills only allowed employers to limit paid  
          sick day use to five or nine days per year (based on the size of  
          the employer).  Aside from that difference, the bills were  
          substantially the same as this bill in that they would have  
          entitled an employee to paid sick days which would have been  
          accrued at a rate of no less than one hour for every 30 hours  
          worked.  Employers also would have been required to provide paid  
          sick days, upon request, for diagnosis, care, or treatment of  
          health conditions of the employee or an employee's family  
          member, or for leave related to domestic violence or sexual  
          abuse.  The bills would have required employers to satisfy  
          specific posting and notice and recordkeeping requirements.  The  
          bills were held on suspense in the Assembly Appropriations  
          Committee.

          AB 2716 (Ma) of 2008 was identical to AB 1000.  It was held on  
          suspense in the Senate Appropriations Committee.

           Author's Technical Amendment.   To better protect workers who  
          speak a language other than English, the author proposes the  
          following clarifying amendment:

          247. (a) An employer shall give each employee written notice of  
          the requirements of this article in English  , Spanish, Chinese,   
           the languages set forth in Civil Code section 1632,  and any  
          other language spoken by at least 5 percent of the employees.
           
          REGISTERED SUPPORT/OPPOSITION  :  
           
           Support 
           
          Alameda Labor Council
          American Federation of State, County and Municipal Employees
                                       California Catholic Conference
          California Employment Lawyers Association
          California Labor Federation, AFL-CIO
          California Nurses Association
          California Partnership to End Domestic Violence
          California Professional Firefighters









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          California School Employees Association
          California State Council of Service Employees International  
          Union
          Consumer Attorneys of California
          Consumer Federation of California
          Glendale City Employees Association
          Health Officers Association of California
          9 to 5 National Association of Working Women
          Organization of SMUD Employees
          San Bernardino Public Employees
          San Luis Obispo County Employees Association
          Santa Rosa City Employees Association
          United Farm Workers
          Western Center on Law and Poverty

           Opposition 
           
          Acclamation Insurance Management Services
          Air Conditioning Trade Association
          Alhambra Chamber of Commerce
          Allied Managed Care
          Associated Builders and Contractors - San Diego Chapter
          Associated General Contractors
          Association of California Healthcare Districts
          Association of California Water Agencies
          Brawley Chamber of Commerce
          Brea Chamber of Commerce
          California Chamber of Commerce
          California Association of Joint Powers Authorities
          California Association of Licensed Security Agencies, Guards and  
          Associates
          California Association of Winegrape Growers
          California Attractions and Parks Association 
          California Beer & Beverage Distributors
          California Business Properties Association
          California Business Roundtable 
          California Chapter of American Fence Association
          California Employment Law Council
          California Fence Contractors' Association
          California Grocers Association
          California Hotel & Lodging Association  
          California Independent Grocers Association 
          California Manufacturers and Technology Association









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          California Newspaper Publishers Association
          California Professional Association of Specialty Contractors
          California Restaurant Association 
          California Retailers Association
          California Special Districts Association
          California State Association of Counties
          California Travel Association
          California Trucking Association
          Chambers of Commerce Alliance of Ventura & Santa Barbara  
          Counties
          Dana Point Chamber of Commerce
          Desert Hot Springs Chamber of Commerce 
          El Centro Chamber of Commerce
          Engineering Contractors' Association
          Flasher Barricade Association
          Fountain Valley Chamber of Commerce
          Fullerton Chamber of Commerce
          Greater Bakersfield Chamber of Commerce
          Greater Conejo Valley Chamber of Commerce
          Greater Fresno Area Chamber of Commerce
          Greater Riverside Chambers of Commerce
          Greater San Fernando Valley Chamber of Commerce
          Huntington Beach Chamber of Commerce
          League of California Cities
          Lodi Chamber of Commerce
          Long Beach Area Chamber of Commerce
          Marin Builders Association 
          National Federation of Independent Business
          National Right to Work Committee
          Orange County Business Council
          Oxnard Chamber of Commerce
          Palm Desert Area Chamber of Commerce
          Plumbing-Heating-Cooling Contractors Association of California
          Porterville Chamber of Commerce
          Redondo Beach Chamber of Commerce
          Rural County Representatives of California
          San Diego East County Chamber of Commerce
          San Jose Silicon Valley Chamber of Commerce
          Santa Clara Chamber of Commerce and Convention-Visitors Bureau
          Simi Valley Chamber of Commerce
          Southwest California Legislative Council
          Tahoe Chamber of Commerce
          Torrance Area Chamber of Commerce









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          Turlock Chamber of Commerce
          Urban Counties Caucus
          Visalia Chamber of Commerce
          Western Electrical Contractors Association 
          Wine Institute

           Analysis Prepared by  :  Kevin G. Baker / JUD. / (916) 319-2334