BILL ANALYSIS Ó
AB 1792
Page 1
( Without Reference to File )
CONCURRENCE IN SENATE AMENDMENTS
AB 1792 (Gomez)
As Amended August 27, 2014
Majority vote
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|ASSEMBLY: |52-26|(May 28, 2014) |SENATE: | | |
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(vote not available)
Original Committee Reference: INS.
SUMMARY : Requires the preparation of an annual report related
to employers with employee beneficiaries who are enrolled in
public assistance programs, as specified.
The Senate amendments :
1)Define "beneficiary" to mean an individual who has been
enrolled in a public assistance program for six consecutive
months within the preceding budget year.
2)Exclude individuals under 18 years of age enrolled in the
Medi-Cal program from the definition of "beneficiary."
3)Define "employer" to mean an individual or organization that
employs 100 or more beneficiaries in this state.
4)Delete the California Work Opportunity and Responsibility to
Kids Program (CalWORKS) and the CalFresh program from the
definition of "public assistance program" for purposes of the
report requirement.
5)Delay implementation of the report requirement to 2016 and
specify that the annual date of the report shall be the third
week of January.
6)Provide that the report shall list only the top 500 employers
with the most number of employees enrolled in a public
assistance program ranked by number of those employees.
7)Provide that the report shall include the total number of
beneficiaries each employer employs for each public assistance
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program.
8)Provide that the total average cost of state and federally
funded benefits shall exclude administrative costs.
9)Provide that the report shall include the methodology used to
calculate the average total cost of state and federally-funded
benefits.
10)Require the Employment Development Department (EDD) to
determine the total costs to the state, as specified.
11)Prohibit employers from disclosing to any person or entity
that an employee is receiving benefits, unless otherwise
permitted by law, as specified.
12)Require the State Department of Social Services (to the
extent not prohibited by state and federal law) to annually
provide the following information to EDD:
a) The percentage of individuals who are recipients of the
Medi-Cal program who are also recipients of the CalFresh
program.
b) The average individual CalFresh benefit for individuals
who are members of households in which at least one member
is employed.
13)Add a January 1, 2020 sunset to this bill.
14)Add language to avoid a chaptering out conflict with SB 1028
(Jackson) of the current legislative session, and SB 1141
(Hancock) of the current legislative session.
15)Make other technical changes.
AS PASSED BY THE ASSEMBLY , this bill:
1)Defined "beneficiary" to mean an individual employed by an
employer for at least one quarter (or three months) and
enrolled in a public assistance program (unless the individual
is enrolled by reason of disability or being over 65 years of
age or is employed in CalWORKS subsidized employment.
2)Defined "employer" to mean an individual or organization that
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employs 25 or more beneficiaries in this state, as specified,
including the state, a city, county, city and county,
district, or any other governmental employer.
3)Defined "public assistance program" to mean the Medi-Cal
program, CalFresh, and CalWORKS, as specified.
4)Required the Department of Finance (DOF), after obtaining
specified information from EDD, to transmit and post a report
no later than April 15 of each year.
5)Provided that the report shall include the following:
a) The employer's name.
b) The employer's address.
c) The total number of beneficiaries each employer employs.
d) The percentage of the employer's total workforce in the
state that are beneficiaries.
e) The total cost to the state of the aggregated benefits
provided to an identified employer's employees who are
beneficiaries under each public assistance program.
f) The total cost to the state of the aggregated benefits
provided to each identified employer's employees who are
beneficiaries.
6)Provided that DOF, in collaboration with EDD, the State
Department of Health Care Services, and the State Department
of Social Services, shall determine the total costs to the
state described in 5) e) and f) above.
7)Specified that the report, and any list provided to DOF, shall
not include the name or identifying information of the
individual beneficiary.
8)Required the report to remain available to the public online
for at least five years.
9)Provided that this bill shall not be construed to authorize an
employer to discourage or prevent an employee from enrolling
or continuing enrollment in a public assistance program, nor
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to discriminate against an applicant or employee for applying
to be or being enrolled in a public assistance program.
10)Prohibited an employer from discharging or in any manner
discriminating or retaliating against an employee who enrolls
in a public assistance program or refusing to hire a
beneficiary for reason of being enrolled in a public
assistance program.
11)Prohibited an employer from disclosing to a nongovernmental
entity that an employee receives or is applying for public
benefits.
12)Required the Director of EDD to permit the use of specified
information in his or her possession to enable DOF to prepare
and submit the report, as specified.
13)Required, to the extent not prohibited by federal law, the
State Department of Health Care Services and the State
Department of Social Services to annually inform EDD of the
names and social security numbers of all recipients of public
assistance benefits, as specified.
14)Required the State Department of Health Care Services and the
State Department of Social Services to determine the average
per individual cost to the state to provide the benefits of
public assistance programs and inform EDD and DOF in order to
calculate the information required to be reported.
15)Made related and conforming changes.
16)Made related legislative findings and declarations.
FISCAL EFFECT : According to the Senate Appropriations
Committee, this bill would result in annual staff costs of at
least $130,000 to DOF. EDD would incur one-time costs of about
$30,000 and annual costs of $60,000. There would also be
ongoing costs of about $230,000 by the Department of Health Care
Services to analyze Medi-Cal beneficiary data.
COMMENTS : This bill proposes to require DOF, in collaboration
with other state agencies, to identify and compile a list of
employers with employees who are enrolled in public assistance
programs. The legislative findings and declarations of the
measure state that employers that pay low wages and offer no
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benefits shift the burden of keeping workers out of poverty onto
taxpayers. The resulting increase in the numbers of the working
poor stretches the state safety net to the limit and burdens the
state budget, programs and services.
Therefore, this bill states that, in order to promote a deeper
understanding of the causes and sources of underemployment,
poverty level wages, and the economic impacts on Californians
and the state budget, it is appropriate for policymakers to
possess a broader set of empirical data with which to make
informed decisions.
This measure is co-sponsored by the California Labor Federation,
AFL-CIO, the United Food and Commercial Workers Union, and
Service Employees International Union (SEIU) Local 1000. The
sponsors state that, after five years of a brutal recession,
California is finally on the road to economic recovery.
However, the state's economic recovery has been fueled by growth
in low wage, part-time jobs that are rapidly replacing middle
class jobs lost during the recession. Companies that pay
low-wages with no benefits force an increasing number of workers
to rely on public assistance just to make ends meet. Even
working full-time, many minimum wage workers still qualify for
public assistance.
The purpose of public assistance programs is to help workers
through tough times, such as the loss of a job. They were not
designed as a permanent subsidy to low-wage employers who do not
provide the wages or benefits necessary for basic necessities.
Work is supposed to lead to self-sufficiency, not permanently
trap workers in taxpayer funded programs. Yet, taxpayers are
increasingly subsidizing some of the largest and most profitable
corporations in the world that are shifting workers onto public
programs.
The sponsors argue that corporations that shift workers onto
public benefits also put responsible employers at a competitive
disadvantage. Employers that provide health and retirement
benefits and pay living wages have to compete against companies
in the same industries that are profiting by sticking taxpayers
for their workers' health care and food bills. Given that
Medi-Cal is the fastest growing area of public spending,
companies that shift workers onto public benefits put enormous
pressure on the state budget. The more taxpayers subsidize
low-wage employers, the less the state can spend on other budget
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priorities, like education, infrastructure, and public safety.
A coalition of groups, including the California Chamber of
Commerce, opposes this bill and argues that, instead of enacting
policies to help low-income workers or provide the Legislature
with valuable information about how to help employers compete
while providing better wages and health care, this bill creates
a "list of shame" that would expose California employers to
liability, targeted media attacks and protests.
Opponents list a number of factors that they allege influence
use of public assistance programs, but contend that this bill
examines none of them. Instead, they argue that this bill, by
looking only at the number of employees in a given business who
utilize these programs, implies that it is the greed of
corporate executives that leads them to pay lower wages and not
offer health benefits. In asking for a report to highlight
those employers that "create the greatest burden on the state,"
the measure also ignores the fact that even employers who pay
lower wages and do not provide health benefits still contribute
greatly to the state economy and keep millions of Californians
from being completely dependent on public assistance.
Finally, opponents argue that this bill creates new grounds for
litigation by prohibiting retaliation or discrimination against
an employee who enrolls in a public assistance program or
refuses to hire an individual because he or she is enrolled in a
public assistance program. Therefore, they argue that the
measure exposes an employer to costly litigation for alleged
discrimination or retaliation each time it makes an adverse
employment decision that impacts an employee who has enrolled in
one of the three referenced public assistance programs.
California employers are already overwhelmed with employment
litigation.
Analysis Prepared by : Ben Ebbink / L. & E. / (916) 319-2091
FN:
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