BILL ANALYSIS                                                                                                                                                                                                    






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          |SENATE RULES COMMITTEE            |                        AB 897|
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                                   THIRD READING 


          Bill No:  AB 897
          Author:   Gonzalez (D)
          Amended:  8/20/15 in Senate
          Vote:     21  

           PRIOR VOTES NOT RELEVANT

           SUBJECT:   Grocery workers


          SOURCE:    Author


          DIGEST:  This bill specifies that the definition of grocery  
          establishment does not include a retail store that has ceased  
          operations for six months or more. Recently signed provisions  
          (AB 359, Gonzalez, Chapter 212, Statutes of 2015), upon a change  
          in control of a "grocery establishment", require an incumbent  
          grocery employer to prepare a list of specified eligible grocery  
          workers for a successor grocery employer to hire from during a  
          90-day transition period.




          Senate Floor Amendments of 8/20/15 gut and amended the previous  
          contents of the bill, which dealt with the retention of files by  
          the courts, to instead address a clean-up requested by Governor  
          Brown to the recently signed grocery worker retention  
          provisions. 


          ANALYSIS:   








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          Existing law: 


          1)Establishes, effective January 1, 2016, a worker retention  
            requirement for the change in ownership or control of grocery  
            establishments, as specified, which requires an incumbent  
            grocery employer to provide to the successor grocery employer  
            the name, address, date of hire, and employment occupation  
            classification of each eligible grocery worker.


          2)Requires the successor grocery employer to maintain a  
            preferential hiring list of eligible grocery workers.  The  
            successor grocery employer shall retain each eligible grocery  
            worker hired from the list for a period of at least 90 days  
            during which the eligible grocery workers shall be employed  
            under the terms and conditions established by the successor  
            and pursuant to the terms of a relevant collective bargaining  
            agreement, if any.


          3)Provides that during the 90-day transition employment period,  
            the successor grocery employer shall not discharge without  
            cause an eligible worker.


          4)Requires, at the end of the 90-day transition period, the  
            successor grocery employer to make a written performance  
            evaluation for each grocery worker.  If the worker's  
            performance is satisfactory, the successor grocery employer  
            shall consider offering continued employment under the terms  
            and conditions established by the successor and as required by  
            law.


          5)Defines, among others, the following terms:


             a)   "Grocery establishment" means a retail store that is  
               over 15,000 square feet in size and that sells primarily  
               household foodstuffs for offsite consumption, as specified.  








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             b)   "Eligible grocery worker" means individuals whose  
               primary place of employment is at the grocery establishment  
               and who have worked for the incumbent grocery employer for  
               at least six months prior to the transfer.  However, it  
               excludes managerial, supervisory or confidential employees.


             c)   "Change in control" means any sale, assignment,  
               transfer, contribution, or other disposition of all or  
               substantially all of the assets or a controlling interest,  
               including by consolidation, merger, or reorganization, of  
               the incumbent grocery employer or any person who controls  
               the incumbent grocery employer or any grocery establishment  
               under the operation or control of either the incumbent  
               grocery employer or any person who controls the incumbent  
               grocery employer.


          This bill: 

          1)Specifies that "grocery establishment" does not include a  
            retail store that has ceased operations for six months or  
            more.


          2)Specifies that this bill incorporates amendments to Section  
            2502 of the Labor Code, as added by Section 1 of Chapter 212  
            of the Statutes of 2015, and it shall become operative only if  
            Chapter 212 of the Statutes of 2015 becomes operative. 


          Background


          Clean-up to the recently signed grocery worker retention bill.  
          This Legislature passed and the Governor signed AB 359 (Chapter  
          212, Statutes of 2015) which, effective January 1, 2016,  
          requires a successor grocery employer to retain eligible grocery  
          workers for a 90-day transitional period and, upon completion of  
          that period, requires the successor grocery employer to consider  
          offering continued employment to those workers. Chapter 212 of  
          the Statutes of 2015 defines a "grocery establishment" to mean a  







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          retail store in this state that is over 15, 000 square feet in  
          size and that sells primarily household foodstuffs for offsite  
          consumption, as specified. 

          In his August 17th signature letter for AB 359, Governor Brown  
          stated the following, "As drafted, the bill is not clear how the  
          provisions apply if an incumbent grocery employer has ceased  
          operations.  The author and sponsors have committed to clarify  
          that the law would not apply to a grocery store that has ceased  
          operations for six months or more. I look forward to receiving  
          that fix before the end of this legislative session." 

          This bill honors the commitment made to Governor Brown to  
          address this concern.

          Wages and Working Conditions of Food Retail Workers. A 2014  
          study by the Food Labor Research Center at University of  
          California, Berkeley (commissioned by the United Food and  
          Commercial Workers) titled, "Shelved: How Wages and Working  
          Conditions for California's Food Retail Workers Have Declined as  
          the Industry has Thrived," made the following findings,  
          "California's food retail industry has shown consistent and  
          robust growth in sales and employment, with employment growing  
          faster than in the economy overall.  Between 2000 and 2011, the  
          number of grocery stores in California - the largest segment of  
          food retail establishments in the state - increased by 5%, from  
          9,893 to 10,403.  California's food retail industry paid workers  
          $7.7 billion in 2011, and generated gross revenue of $98.2  
          billion in 2013?.While California food retail industry  
          employment has grown in the past decade, food retail workers'  
          wages have declined.  According to Census data, in 2010 dollars,  
          median hourly wages of grocery store workers - the largest  
          segment of food retail workers - fell from $12.97 in 1999 to  
          $11.33 in 2010, a decline of 12.6%.  Moreover, the proportion of  
          food retail workers earning poverty wages increased  
          dramatically, from 43% in 1999 to 54% in 2010.  This means that  
          in 2010, more than half of all California food retail workers  
          earned less than the hourly wage needed to reach an annual  
          income of $22,458, the minimum income necessary to provide them  
          with a low standard of living for a family of three in the  
          Western U.S. if they worked full-time for the full year (2,080  
          hours)."

          FISCAL EFFECT:   Appropriation:    No          Fiscal  







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          Com.:NoLocal:    No


          SUPPORT:   (Verified8/25/15)


          None received


          OPPOSITION:   (Verified8/25/15)


          None received


          Prepared by:Alma Perez / L. & I.R. / (916) 651-1556
          8/26/15 12:57:15


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