BILL ANALYSIS                                                                                                                                                                                                    Ó



                                                                       AB 438


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          ASSEMBLY THIRD READING


          AB  
          438 (Chiu)


          As Amended  April 6, 2015


          Majority vote


           ------------------------------------------------------------------- 
          |Committee       |Votes |Ayes                  |Noes                |
          |----------------+------+----------------------+--------------------|
          |Insurance       |9-4   |Daly, Calderon,       |Beth Gaines, Travis |
          |                |      |Cooley, Cooper,       |Allen, Grove, Mayes |
          |                |      |Dababneh, Frazier,    |                    |
          |                |      |Gatto, Gonzalez,      |                    |
          |                |      |Rodriguez             |                    |
          |                |      |                      |                    |
          |----------------+------+----------------------+--------------------|
          |Appropriations  |13-4  |Gomez, Bloom, Bonta,  |Bigelow, Gallagher, |
          |                |      |Calderon, Chang,      |Jones, Wagner       |
          |                |      |Daly, Eggman, Eduardo |                    |
          |                |      |Garcia, Holden,       |                    |
          |                |      |Quirk, Rendon, Weber, |                    |
          |                |      |Wood                  |                    |
          |                |      |                      |                    |
          |                |      |                      |                    |
           ------------------------------------------------------------------- 


          SUMMARY:  Expands the obligation of the Department of Industrial  
          Relations (DIR) and the Division of Workers' Compensation (DWC) to  
          provide certain notices in more languages than English and  
          Spanish.  Specifically, this bill:  









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          1)Provides that both the DWC and the DIR shall be subject to the  
            Dymally-Alatorre Bilingual Services Act (Act), for purposes of  
            the forms and notices that are required to be provided to  
            injured workers.


          2)Adds reference to the DIR to the provision of law that directs  
            the DWC to protect the interests of injured workers who are  
            entitled to the timely provision of compensation.


          3)Deletes an express exception for the State Compensation  
            Insurance Fund (SCIF) from a provision of law that directs  
            "state agencies" that are "directly involved in the furnishing  
            of information or rendering of services to the public" to have  
            qualified bilingual persons in "public contact positions."


          EXISTING LAW:  


          1)Provides for a comprehensive system to provide workers'  
            compensation benefits to employees who suffers injuries or  
            conditions arising out of or in the course of employment.


          2)Creates the DWC, headed by an Administrative Director (AD), a  
            Gubernatorial appointee, who by statute is directed to  
            administer the workers' compensation program, and carry out the  
            various general and specific duties involved in that  
            administration.  The DWC is organizationally a unit within the  
            DIR.


          3)Provides for labor law enforcement operations, in addition to  
            the workers' compensation program, within the DIR, including the  
            Industrial Welfare Commission, the Division of Labor Standards  
            Enforcement, the Division of Occupational Safety and Health,  








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            among others.


          4)Establishes SCIF as a quasi-public entity with the purpose of  
            selling workers compensation insurance both in the competitive  
            market and to any employer that is unable to purchase workers'  
            compensation insurance from a private insurer.


          5)Exempts SCIF from a Government Code provision that requires  
            state agencies that provide services or information to the  
            public to employ bilingual persons in public contact positions.


          6)Defines "furnishing of information or rendering of services" to  
            include providing public safety, protection, or prevention;  
            administering state benefits; implementing public programs;  
            managing public resources or facilities; holding public  
            hearings; or engaging in other state programs or activities.


          7)Establishes the Act, which generally requires state agencies to  
            make their services available in multiple languages.   
            Specifically, the Act:


             a)   Requires state agencies to conduct a survey every two  
               years to determine the language needs of their constituents  
               and the agency's ability to meet those needs, unless exempted  
               by the State Personnel Board;


             b)   Requires state agencies that serve a substantial number of  
               non-English-speaking people, and that provide materials in  
               English, to also provide the materials in any  
               non-English-speaking language spoken by a substantial number  
               of the public served by the agency.










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             c)   Defines "substantial" to be 5% or more of the public  
               served by any local office or facility of the agency (i.e.,  
               the DWC's San Francisco office would probably have a  
               different mix of languages that must be used than the Fresno  
               office, or the Los Angeles office.)


          FISCAL EFFECT:  According to the Assembly Appropriations  
          Committee:


          1)Negligible state fiscal effect to DIR.  DIR, including DWC, is  
            subject to the Act and its language requirements. 


          2)Negligible state fiscal effect for SCIF.  SCIF is a quasi-state  
            entity, but the only state funds it receives are for  
            administering and paying for workers' compensation benefits for  
            state employees, which are not expected to increase  
            significantly since most state workers are English-speaking.   
            Additionally, it is unclear whether the removing the express  
            exemption of SCIF from the Dymally-Allatore Act would compel  
            SCIF to comply with language access requirements, because it is  
            unclear whether SCIF meets the other criteria (such as direct  
            services to the public) that would require it to comply.  


          COMMENTS:  


          1)Purpose.  As the author notes in his background materials,  
            "Workers are vulnerable to injury on the job regardless of the  
            language they speak."  Non-English speaking injured workers face  
            challenges when seeking workers' compensation benefits,  
            including difficulty filling out even basic forms, meeting  
            deadlines that they were unable to understand from  
            English-language notices, and otherwise navigating the  
            complexities of the workers' compensation system.  The author  
            asserts that the DWC is currently not even fully compliant with  








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            existing law mandating both English and Spanish language forms  
            and notices, but even with the 2 languages, that is simply not  
            sufficient in light of the ethnic diversity in California.  For  
            example, the author points out that Massachusetts has eight  
            languages available to users of its workers' compensation  
            system.  Thus, the bill is aimed at expanding access to DWC's  
            information by expanding the number of languages DWC would be  
            required to use, and to close the "loophole" that exempts SCIF  
            from the Act.


          2)Background.  According to the Commission on Health and Safety  
            and Workers' Compensation (CHSWC), almost 15 million  
            Californians are protected by the workers' compensation laws.   
            Each year, approximately 500,000 work injuries occur, with  
            approximately 150,000 of those injuries resulting in lost  
            work-time.  As many as 55,000 of these injured workers are  
            determined to have at least some degree of permanent disability,  
            and more than 20,000 suffer injuries so significant that they  
            cannot return to work.  Thus, the consequences of industrial  
            injuries can be serious for a large number of people.  In light  
            of the complexities of the system, it cannot be argued that  
            understanding what procedures to follow, and how to protect  
            one's rights, do not have significant implications for whether  
            the system is working or not working for any particular injured  
            worker.  In addition, despite the fact that the bill is  
            sponsored by the California Applicants' Attorneys Association  
            (CAAA), many cases do not, or should not, require the  
            intervention of lawyers.  Unfortunately, many  
            non-English-speaking applicants are forced to seek counsel  
            because they do not understand the notices and materials they  
            receive.  


          3)SCIF exemption.  This bill purports to include SCIF within the  
            Act simply by deleting an express statutory exemption in one of  
            the Act's provisions.  However, it is less than clear that  
            SCIF's functions meet the Act's requirements, even without the  
            express exemption.  Despite being "quasi-public," the fact  








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            remains that SCIF sells insurance; it does not appear to do any  
            of the things listed in the definition of "furnishing of  
            information or rendering of services to the public."  Rather  
            than leave the issue in this uncertain state, the author may  
            wish to consider creating a separate provision of law, and  
            specify exactly what it is that SCIF should be required to do  
            with respect to non-English languages.


            A second issue raised by addressing SCIF is whether or not  
            SCIF's competitors - the private workers' compensation insurers,  
            and to some extent, the self-insured employers - should have to  
            provide the same language services as SCIF.  Currently, SCIF  
            covers about 11% of the market.  Just a few years ago, SCIF  
            covered more than 50% of the market.  But regardless of its  
            market position, non-English-speaking injured workers whose  
            employer is not SCIF insured have the same challenges and needs  
            as SCIF-covered non-English-speaking injured workers.  From both  
            a competitive perspective, and a needs perspective, it is not  
            clear why non-English-speaking injured workers should be treated  
            differently depending on which insurer his or her employer  
            selected.


          4)Inclusion of DIR.  Existing law mandates the DWC to use both  
            English and Spanish languages "in administering and enforcing  
            this division and Division 4" of the Labor Code.  Division 4 is  
            the workers' compensation law.  "This division" (Division 2)  
            contains general laws that create a number of entities within  
            the DIR.  By adding the DIR to the mandate of Labor Code Section  
            124, it is not clear whe  -  ther the DIR is being subjected to the  
            Act only for purposes of workers' compensation laws, or for the  
            broader purposes of all of the other programs established in  
            Division 2 of the Labor Code.  The author may wish to clarify  
            whether or not programs in addition to the workers' compensation  
            program are intended to be covered by the bill.











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          Analysis Prepared by:                                               
          Mark Rakich / INS. / (916) 319-2086  FN: 0000206