BILL ANALYSIS Ó Senate Committee on Labor and Industrial Relations Ted W. Lieu, Chair Date of Hearing: April 24, 2013 2013-2014 Regular Session Consultant: Deanna D. Ping Fiscal:Yes Urgency: No Bill No: SB 770 Author: Jackson As Introduced: February 22, 2013 SUBJECT Unemployment compensation: disability benefits: paid family leave KEY ISSUE Should the legislature extend the definition of family within the Paid Family Leave program to include seriously ill siblings, grandparents, grandchildren, and parents-in-law? ANALYSIS 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: Twelve workweeks of leave in a 12-month period for: o Bonding with a newborn or adopted child o Caring for a family member with a serious health condition (includes parent, spouse, child, registered domestic partner and same sex spouse) o The employee's own serious health condition (excluding pregnancy). Eligible employees must meet the following conditions: o 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 o worked at a location in which the employer has at least 50 employees within 75 miles of the employee's worksite. Guaranteed reinstatement to the same or comparable position after taking family leave under CFRA and FMLA (Gov Code §12945.2) 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. (§105 of the FMLA and §825.220 of FMLA regulations) Existing law established a family temporary disability insurance program, Paid Family Leave (PFL) that provides up to six weeks 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. (Unemployment Insurance Code §3301) Existing law states that an individual is eligible to receive temporary disability insurance benefits equal to one-seventh of his or her weekly benefit amount for each full day during which he or 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. (Unemployment Insurance Code §3301) This Bill would broaden the definition of family within the Paid Family Leave program to allow workers to receive the partial wage replacement benefits while taking care of seriously ill siblings, grandparents, grandchildren, and parents-in-law. COMMENTS 1. Background on Paid Family Leave Benefits Program The California Paid Family Leave Act (PFLA), the first such Hearing Date: April 24, 2013 SB 770 Consultant: Deanna D. Ping Page 2 Senate Committee on Labor and Industrial Relations 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 Paid Family Leave: Lessons From California, the program was modeled after the California 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 newly 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 paid family leave can receive a wage replacement of up to 55 percent of the individual's average weekly salary. All employees who pay into the State Disability Insurance Fund are covered by Paid Family Leave. 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. 2. The Interaction Between FMLA/CFRA and Paid Family Leave 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 California Family Rights Act (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: Leave to care for a domestic partner (CFRA only) Disabilities due to pregnancy or pregnancy-related condition (FMLA only) Leave for a qualifying exigency related to a family member's military service (FMLA only) Hearing Date: April 24, 2013 SB 770 Consultant: Deanna D. Ping Page 3 Senate Committee on Labor and Industrial Relations 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 Paid Family Leave 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. 3. Need for this bill? PFL is a state-sponsored insurance program that covers employers of any size. PFL provides partial wage replacement for up to six weeks in any 12-month period, allowing an employee to care for a seriously ill or injured family member or bonding with a minor child within one year of the child's birth or placement in connection with foster care or adoption. However, according to the author's office, California's current definition of family for Paid Family Leave excludes siblings, grandparents, grandchildren, and parents-in-law - failing to reflect many Californians' caregiving responsibilities. In February of 2007, the Senate Office of Research published a report on Paid Family Leave titled, Balancing Work and Family. The report stated that between the period of July 1, 2004 and June 30, 2006 the Employment Development Department rejected 10 percent of Paid Family Leave claims because the employee sought leave for an excluded family member. Most of the denied claims were filed for siblings (35 percent), followed by grandparents (19 percent), then mothers- and fathers-in-law (10 percent). SB 770 would broaden the definition of family and enable workers to receive paid leave benefits when caring for these currently excluded family members. 4. Proponent Arguments : Proponents note that California's first-in-the-nation Paid Family Leave program, which nearly the entire private workforce contributes to, provides the six weeks of vital wage Hearing Date: April 24, 2013 SB 770 Consultant: Deanna D. Ping Page 4 Senate Committee on Labor and Industrial Relations replacement benefit that enables workers take leave to bond with a new child or care for a seriously ill family member. However, proponents argue that many workers caring for a seriously ill family member lack access to the program because of the law's overly narrow definition of "family." Proponents contend that the current definition of "family" including, children, parents, spouses, or registered domestic partners fails to account for the diversity of California households and the importance of caregiving by other close family members - illustrated by the fact that California has the second highest percentage of multi-generational households in the country. Proponents bring attention to a recent study on caregivers of Alzheimer's patients that found over 40 percent of caregivers were not covered under the narrow definition in California's Paid Family Leave program, as well as another study that found that nearly 20 percent of primary caregivers for chronically disabled individuals are neither the spouse nor the child of the person receiving care. Proponents maintain that SB 770 will ensure that California workers can care for close family members without jeopardizing their economic well-being. 5. Opponent Arguments : None on file. 6. Prior Legislation : SB 1661 (Kuehl), Chapter 901, Statutes of 2002 - created within the state disability insurance 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 Paid Family Leave program that clarified the role of the Employment Development Department in maintaining the program, as well as ensuring the accumulation of enough funds to pay for the program. Hearing Date: April 24, 2013 SB 770 Consultant: Deanna D. Ping Page 5 Senate Committee on Labor and Industrial Relations SB 727 (Kuehl) of 2007 - would have allowed employees covered by Paid Family Leave to take paid leave to care for grandparents, grandchildren, siblings, and in-laws, as well as clarify existing law to ensure that Paid Family Leave must be taken concurrently with the California Family Medical Leave Act (CFRA) and the federal Family Medical Leave Act (FMLA). Vetoed by Governor Schwarzenegger. SUPPORT Legal Aid Society- Employment Law Center (Sponsor) 9 to 5 Asian Law Caucus A Better Balance Association of California Caregiver Resource Centers Association of Regional Center Agencies BreastfeedLA California Alliance for Retired Americans California Senior Legislature California Women's Law Center California Employment Lawyers Association California Teachers Association Cancer Legal Resource Center Center for WorkLife Law Childcare resource and Referral Network Communications Workers of America Disability Rights Advocates Disability Rights Education and Defense Fund Equal Rights Advocates Excelligence Learning Corporation Family Caregiver Alliance Golden Gate Legal Aid Society San Mateo County Los Angeles Alliance for a Better Economy Mujeres Unidas y Activas National Center for Youth Law Parent Voices SEIU California UAW Local 2865 US Women's Chamber of Commerce USC Davis School of Gerontology, Family Caregiver Support Hearing Date: April 24, 2013 SB 770 Consultant: Deanna D. Ping Page 6 Senate Committee on Labor and Industrial Relations Program Women's Employment Rights Clinic of Golden Gate University School of Law Zazie Restaurant OPPOSITION None received. Hearing Date: April 24, 2013 SB 770 Consultant: Deanna D. Ping Page 7 Senate Committee on Labor and Industrial Relations