BILL ANALYSIS                                                                                                                                                                                                    Ó



                                                                            



           ----------------------------------------------------------------- 
          |SENATE RULES COMMITTEE            |                        SB 761|
          |Office of Senate Floor Analyses   |                              |
          |1020 N Street, Suite 524          |                              |
          |(916) 651-1520         Fax: (916) |                              |
          |327-4478                          |                              |
           ----------------------------------------------------------------- 
           
                                           
                                    THIRD READING


          Bill No:  SB 761
          Author:   DeSaulnier (D)
          Amended:  As introduced
          Vote:     21

           
           SENATE LABOR & INDUSTRIAL RELATIONS COMMITTEE  :  4-1, 4/10/13
          AYES:  Lieu, Leno, Padilla, Yee
          NOES:  Wyland

           SENATE JUDICIARY COMMITTEE  :  5-1, 4/23/13
          AYES:  Evans, Corbett, Jackson, Leno, Monning
          NOES:  Anderson
          NO VOTE RECORDED:  Walters


          SUBJECT  :    Family temporary disability insurance

           SOURCE  :     Legal Aid Society-Employment Law Center


           DIGEST  :    This bill provides that an employer or agent of an  
          employer, who discharges or discriminates against an individual  
          because he or she has applied for, used, or indicated an intent  
          to apply for or use Paid Family Leave (PFL), shall be liable to  
          the individual for actual damages and appropriate equitable  
          relief, including employment or reinstatement.  Authorizes the  
          individual to bring a civil action and, if the individual  
          prevails in the action, authorizes an award of attorney's fees  
          and costs to that individual.

           ANALYSIS  :    Existing law established a family temporary  
          disability insurance program, PFL, that provides up to six weeks  
                                                                CONTINUED





                                                                     SB 761
                                                                     Page  
          2

          of wage replacement benefits to workers who take time off work  
          to care for a seriously ill child, spouse, parent, or domestic  
          partner, or to bond with a minor child in connection with foster  
          care or adoption. 

          Existing law states that an individual is eligible to receive  
          temporary disability insurance benefits equal to one-seventh of  
          his/her weekly benefit amount for each full day during which  
          he/she is unable to work due to caring for a seriously ill or  
          injured family member or bonding with a minor child within one  
          year of the birth or placement of the child in connection with  
          foster care or adoption. 

          Existing law states that no more than six weeks of family  
          temporary disability insurance benefits shall be paid within a  
          12-month period and requires employees to use up to two weeks of  
          accrued vacation leave before they begin receiving benefits. 

          Existing law, under the California Family Rights Act (CFRA),  
          entitles eligible employees of covered employers to take unpaid,  
          job-protected leave for specified family and medical reasons.   
          Eligible employees are entitled to: 


          1. Twelve workweeks of leave in a 12-month period for: 


             A.    Bonding with a newborn or adopted child.


             B.    Caring for a family member with a serious health  
                condition (includes parent, spouse, child, registered  
                domestic partner and same sex spouse).

             C.    The employee's own serious health condition (excluding  
                pregnancy).


          2. Eligible employees must meet the following conditions:


             A.    Worked more than 12 months of service with the  
                employer, and who has at least 1,250 hours of service  
                with the employer during the previous 12 month period.

                                                                CONTINUED





                                                                     SB 761
                                                                     Page  
          3


             B.    Worked at a location in which the employer has at  
                least 50 employees within 75 miles of the employee's  
                worksite.  

          Existing federal law, under the Family and Medical Leave Act  
          (FMLA), also entitles eligible employees to take unpaid,  
          job-protected leave for up to 12 weeks.  This leave, granted  
          under both the state CFRA and the federal FMLA must be taken  
          concurrently. 

          Existing law states that upon granting an employee family leave  
          under CFRA or FMLA, the employer must guarantee reinstatement to  
          the same or comparable position and provide the guarantee in  
          writing upon the request of the employee. 

          Existing law states than an employer shall not refuse to hire,  
          and shall not discharge, suspend, expel, or discriminate  
          against, any individual's exercise of the right to family care  
          leave as underlined in CFRA. 

          Existing federal law under the FMLA prohibits an employer from  
          discriminating or retaliating against an employee or prospective  
          employee for having exercised or attempted to exercise any FMLA  
          right. 

          This bill:

          1. Provides that it is unlawful for an employer or agent of an  
             employer to discharge or in any other manner discriminate  
             against an individual because he/she has applied for, used,  
             or indicated an intent to apply for or use, family temporary  
             disability insurance benefits. 

          2. Makes an employer liable for actual damages and appropriate  
             equitable relief, including employment or reinstatement, if  
             an employer or agent of an employer discharges or  
             discriminates against an individual because he/she has  
             applied for, used, or indicated an intent to apply for or  
             use, family temporary disability insurance benefits. 

          3. Allows an employee or applicant to bring a civil action  
             seeking these remedies and if successful, the court may award  
             the employee or applicant reasonable attorney's fees and  

                                                                CONTINUED





                                                                     SB 761
                                                                     Page  
          4

             costs. 

           Comments
           
           Background on PFL Benefits Program  .  The California PFL Act, the  
          first such paid family leave program in the nation, was  
          established in 2004.  According to the Labor Project for Working  
          Families and UC Berkeley's report:  A Guide to Implementing PFL:  
           Lessons From California, the program was modeled after the  
          State Disability Insurance Program (SDI).  PFL provides up to  
          six weeks of partial pay for employees who take leave from work  
          to care for a child, parent, spouse, or registered domestic  
          partner with a serious health condition or to bond with a  
          newborn baby or new adopted or foster child.  Much like SDI, it  
          is funded through a payroll tax paid entirely by employees and  
          is administered by the same state agency - the Employment  
          Development Department (EDD).  Like disability benefits, an  
          employee that takes family leave can receive a wage replacement  
          of up to 55% of the individual's average weekly salary.  All  
          employees who pay into the State Disability Insurance Fund are  
          covered by PFL.  There are no minimum work hours or time of  
          service requirements, but individuals must have earned at least  
          $300 in wages during the previous 12 months.  


           The Interaction Between FMLA/CFRA and PFL  .  There are various  
          federal and state laws pertaining to family leave - making it  
          important to understand the differences between the statutes as  
          well as how they interact with one another.  The Family and  
          Medical Leave Act (FMLA) is a federal law that is administered  
          by the U.S.  Department of Labor while the CFRA is a state law  
          administered by the Department of Fair Employment and Housing.   
          The state law changed in 1993 to generally conform to the  
          provisions of the FMLA.  Both the FMLA and CFRA allow an  
          eligible employee to take up to a total of twelve job-protected  
          workweeks of leave with employer-paid health, dental, and vision  
          benefits during a "rolling" twelve month period.  The twelve  
          weeks of leave must run concurrently for all purposes aside  
          from: 






                                                                CONTINUED





                                                                     SB 761
                                                                     Page  
          5

          1.Leave to care for a domestic partner (CFRA only) 


          2.Disabilities due to pregnancy or pregnancy-related condition  
            (FMLA only) 


          3.Leave for a qualifying exigency related to a family member's  
            military service (FMLA only) 

          4.Leave to care for an ill or injured service member (FMLA only)  


          If an eligible FMLA/CFRA employee also elects to receive wage  
          replacement benefits from the PFL program then the PFL must be  
          taken concurrently as well. 

          In addition to sharing similar leave provisions and eligibility  
          requirements, both the FMLA and CFRA have anti-retaliation and  
          discrimination provisions. 

           Prior legislation
           
          SB 193 (Marks, Chapter 580, Statutes of 1993) created the CFRA,  
          also known as the Moore-Brown-Roberti Family Rights Act.

          SB 1661 (Kuehl, Chapter 901, Statutes of 2002) created within  
          the SDI program a family temporary disability insurance program  
          to provide up to six weeks of wage replacement benefits to  
          workers who take time off work to care for a seriously ill  
          child, spouse, parent, domestic partner, or bond with a new  
          child. 

          SB 727 (Kuehl, Chapter 797, Statutes of 2003) made conforming  
          and clarifying changes to PFL program that clarified the role of  
          the EDD in maintaining the program, as well as ensuring the  
          accumulation of enough funds to pay for the program.  

           FISCAL EFFECT  :    Appropriation:  No   Fiscal Com.:  No   Local:  
           No

           SUPPORT  :   (Verified  5/23/13)

          Legal Aid Society-Employment Law Center (source)

                                                                CONTINUED





                                                                     SB 761
                                                                     Page  
          6

          9to5 California, National Association of Working Women
          A Better Balance
          American Association of University Women
          Association of California Caregiver Resource Centers
          BreastfeedLA
          California Communities United Institute
          California Labor Federation
          California Senior Legislature
          California WIC Association
          California Women's Law Center
          Cancer Legal Resource Center
          Communication Workers of America, AFL-CIO, District 9
          Congress of California Seniors
          Disability Rights Advocates
          Disability Rights Education & Defense Fund
          Equal Rights Advocates
          Excelligence Learning Corporation
          Family Caregiver Alliance
          Glendale City Employees Association
          Golden Gate University School of Law, Women's Employment Rights  
          Clinic
          Labor Project for Working Families
          Legal Aid Society of San Mateo County
          Los Angeles Alliance for a New Economy
          Mujeres Unidas y Activas
          Organization of SMUD Employees
          Parent Voices
          Restaurant Opportunities Center of Los Angeles
          San Bernardino Public Employees Association
          San Francisco Breastfeeding Coalition
          San Luis Obispo County Employees Association
          Santa Rosa City Employees Association
          SEIU California
          UAW Local 2865
          UC Hastings College of Law
          US Women's Chamber of Commerce
          USC Davis, School of Gerontology
          WIC Breastfeeding Coordinator, Grace Yee 
          Zazie Restaurant

           OPPOSITION  :    (Verified  5/23/13)

          Air Conditioning Trade Association 
          Associated Builders and Contractors of California

                                                                CONTINUED





                                                                     SB 761
                                                                     Page  
          7

          California Bankers Association 
          California Chamber of Commerce 
          California Farm Bureau Federation 
          California Framing Contractors Association 
          California Grocers Association 
          California Independent Grocers Association 
          California Manufacturers and Technology Association 
          California Pool & Spa Industry Education Council
          California Retailers Association 
          Civil Justice Association of California
          National Federation of Independent Business 
          Plumbing-Heating-Cooling Contractors Association of California 
          Southwest California Legislative Council
          Western Electrical Contractors Association

           ARGUMENTS IN SUPPORT  :    According to proponents, although  
          nearly the entire private workforce in California contributes a  
          portion of every paycheck to participate in the PFL program,  
          many workers who would otherwise qualify for PFL benefits are  
          unable to access the program because of a fear that their  
          employer will retaliate against them.  Proponents contend that  
          some guarantee of not being fired for taking family leave  
          benefits is necessary for the program to reach all the families  
          that need financial support in caring for a new child or  
          seriously ill family member.  Proponents point to a recent study  
          that showed nearly 37% of workers who were aware of PFL and  
          needed leave did not apply for PFL due to a fear of being fired,  
          angering their employers, or facing limitations on their future  
          opportunities for advancement.  Proponents also argue that the  
          lack of protection for PFL users disproportionately impacts  
          low-wage workers who pay into the system but are less likely to  
          qualify for job protection under other state and federal laws  
          due to the lack of job security.  

          Further, proponents contend that PFL is good for business.   
          Proponents argue that by allowing employees to access these  
          benefits without fear of employer reprisal would benefit workers  
          and their families as well as their employer.  Proponents point  
          back to the above survey, citing that the vast majority of  
          employers reported that the availability of PFL benefits had  
          either a positive or no noticeable effect on business  
          productivity (90%), profitability (91%), and employee morale  
          (99%).  They also cited that 93% of the surveyed employers  
          reported a positive or no noticeable impact on employee  

                                                                CONTINUED





                                                                     SB 761
                                                                     Page  
          8

          turnover, with 9% reported seeing cost savings due to the  
          decreased turnover and the reduction of benefit costs when  
          employees used PFL instead of (or in combination with)  
          employer-provided paid vacation, sick leave, or disability  
          benefits.

           ARGUMENTS IN OPPOSITION  :    Opponents argue that this bill  
          dramatically alters PFL and transforms it into an additional  
          protective leave.  Opponents maintain that by allowing an  
          employee to sue for alleged discrimination on the basis that an  
          employee applies for, used, or expressed an intent to use PFL,  
          this bill forces an employer to provide an employee with six  
          weeks of leave while receiving PFL or face costly litigation.   
          Opponents bring attention to the requirements for CFRA leave,  
          (50 or more employees, 1250 working hours within 12 months), and  
          argues that under this bill the employee of an employer with  
          fewer than 50 employees will now be able to request six weeks of  
          leave regardless of hours worked.  Opponents argues that given  
          the multiple protected leaves of absence already in California,  
          any expansion of such leaves further impedes California  
          employers' growth and their ability to manage their businesses.   


          Lastly, opponents argues that this bill allows an employee to  
          pursue civil litigation for discrimination, without first  
          exhausting an administrative remedy such as filing a complaint  
          with the Department of Fair Employment and Housing - the process  
          under CFRA.  Opponents maintain this bill sidesteps the  
          administrative requirement and eases the process for potentially  
          frivolous litigation.    
           

          PQ:d  5/23/13   Senate Floor Analyses 

                           SUPPORT/OPPOSITION:  SEE ABOVE

                                   ****  END  ****
          







                                                                CONTINUED