BILL ANALYSIS                                                                                                                                                                                                    Ó






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          |SENATE RULES COMMITTEE            |                       AB 1293|
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                                   THIRD READING 


          Bill No:  AB 1293
          Author:   Holden (D)
          Amended:  3/26/15 in Assembly
          Vote:     21  

           SENATE PUBLIC EMP. & RET. COMMITTEE:  3-2, 7/13/15
           AYES:  Pan, Beall, Hall
           NOES:  Morrell, Fuller

           SENATE APPROPRIATIONS COMMITTEE:  5-2, 8/27/15
           AYES:  Lara, Beall, Hill, Leyva, Mendoza
           NOES:  Bate, Nielsen

           ASSEMBLY FLOOR:  53-24, 6/2/15 - See last page for vote

           SUBJECT:   State public employment: state personal services  
                     contracts


          SOURCE:    Service Employees International Union, Local 1000
          
          DIGEST:   This bill prohibits the use of state personal services  
          contracts for reasons other than achieving cost savings if the  
          contract would displace state civil service employees.

          ANALYSIS:
          
          Existing law:

          1)Requires, based on provisions in the California Constitution,  
            that services provided by state agencies generally be  
            performed by state civil service employees.









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          2)Permits the use of personal services contracts in order to  
            achieve cost savings provided that specified criteria are met.

          3)Requires a state agency proposing to execute a personal  
            services contract to achieve cost saving to notify the State  
            Personnel Board (SPB) of its intention and requires the SPB to  
            immediately contact specified persons or organizations upon  
            receipt of the notice so that they may be given a reasonable  
            opportunity to comment on the proposed contract.

          4)Authorizes an employee organization to request, within 10 days  
            of receiving the above notice, the SPB to review any proposed  
            or executed contract, as specified.

          5)Permits the use of personal services contracts in  
            circumstances other than to achieve cost savings, including:

             a)   When the nature of the services is such that the  
               services cannot be adequately rendered by an existing  
               agency of the public entity.

             b)   If the state seeks to contract for private assistance to  
               perform "new functions" not previously undertaken by the  
               state or covered by an existing department.

             c)   When the nature of the work is such that the Government  
               Code standards for emergency appointments apply.

             d)   When the services are of such urgent, temporary, or  
               occasional nature that the delay incumbent in their  
               implementation under civil service would frustrate their  
               very purpose.

          1)Prohibits a state agency from executing a personal services  
            contract for non-cost savings reasons, except in specified  
            sudden and unexpected situations, until it has certified that  
            all employee organizations that perform the type of work being  
            contracted out have been notified.

          2)Requires, at a minimum, the notification to include a full  
            copy of the proposed contract.  Permits the notifying agency  
            to redact specific confidential or proprietary information  
            from the notice.








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          3)Requires the Department of General Services to establish the  
            certification of notification process.

          This bill:

          1)Provides that the use of personal services contracts in  
            response to particular conditions other than to achieve cost  
            savings is prohibited if it will cause the displacement of  
            civil service employees.

          2)Defines "displacement" to include layoffs, demotions,  
            involuntary transfers to a new class or to a new location  
            requiring a change in residence, and time base reductions.

          3)Specifies that displacement does not include changes in shifts  
            or days off or reassignment to other positions in the same  
            class and general location.

          Comments
          
          According to the author:

            In August 2014, California Correctional Health Care Services  
            (CCHCS) issued State Restriction of Appointment (SROA) notices  
            [i.e., layoff notices] to employees in several medical  
            services classifications.  During the period in which the  
            layoff notices were issued, the state actively recruited  
            private vendor staff through existing contracts and  
            Craigslist.

            SROA notices generally imply that there is a layoff due to the  
            fact that there is not enough work.  However, for a six month  
            period ending June 2014, the overtime for Registered Nurses  
            and Licensed Vocational Nurses was upwards of 400,000 hours  
            for a six month period.  Some staff who received SROA notices  
            were transferred to other positions at other institutions  
            doing the same work.  Others have not found work yet and will  
            remain unemployed.  Currently, CCHCS is working to address  
            mandatory overtime by recruiting 785 Limited Term Staff.   
            Recruiting Limited-Term Intermittent staff will be difficult  
            because they are easier to terminate because they have less  
            employee protections.  When departments need to save money  
            they can cut intermittent workers' hours, terminate contract  
            employees, or terminate temporary appointments such as  







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            limited-term appointments.  Finally, departments should not be  
            allowed to layoff civil service staff when it creates a  
            staffing emergency resulting in the use of contract/registry  
            staff.

          Prior Legislation
          
          AB 906 (Pan, Chapter 744, Statutes of 2013) prohibits a state  
          agency from executing a personal services contract, except in  
          specified sudden and unexpected situations, until it has  
          certified that all employee organizations that perform the type  
          of work being contracted out have been notified.

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

          According to the Senate Appropriations Committee this bill will  
          result in unknown costs, potentially over $50,000 (General  
          and/or special funds), to the extent this bill were to impact  
          current emergency staffing and hiring processes.


          SUPPORT:   (Verified8/27/15)


          Service Employees International Union, Local 1000 (source)
          American Federation of State, County and Municipal Employees
          California School Employees Association


          OPPOSITION:   (Verified8/27/15)


          None received

          ARGUMENTS IN SUPPORT:   According to the sponsor:


               In June 2014, California Correctional Health Care Services  
               (CCHCS) issued layoff notices to its healthcare staff.   
               According to vacancy data from the State Controller's  
               Office (SCO), two months before layoff notices were issued,  
               the classes that received notices had a total of 566  
               vacancies.  Following the layoffs, in December 2014,  







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               vacancies increased by 278 to 844.  Excessive overtime  
               hours, coupled with vacancies prove that there is more work  
               than the department is currently staffed for.


               In January 2015, CCHCS issued a memorandum regarding  
               implementation of a Limited-Term Intermittent Nursing Pool.  
                They plan to hire 785.3 CNAs, LVNs and RNs.  CCHCS  
               currently has retention and recruitment problems due to  
               incomparable pay and benefits provided by other state  
               departments, county, and private institutions.  The issue  
               of staffing was created by CCHCS and now they are replacing  
               the regular workforce with temporary workers and registry  
               staff.




               AB 1293 gets to this issue by prohibiting state departments  
               from laying off civil service employees, artificially  
               creating the illusory need for emergency staffing  
               situations that have to be filled by an alternative or  
               temporary workforce.  This scenario circumvents AB 906,  
               which requires unions to be notified when new contracts are  
               put out to bid, because CCHCS recruited registry staff  
               during the layoff process from pre-existing contracts.


          ASSEMBLY FLOOR:  53-24, 6/2/15
          AYES:  Alejo, Bloom, Bonilla, Bonta, Brown, Burke, Calderon,  
            Campos, Chau, Chiu, Chu, Cooley, Cooper, Dababneh, Daly, Dodd,  
            Frazier, Cristina Garcia, Eduardo Garcia, Gatto, Gipson,  
            Gomez, Gonzalez, Gordon, Gray, Roger Hernández, Holden, Irwin,  
            Jones-Sawyer, Levine, Linder, Lopez, Low, McCarty, Medina,  
            Mullin, Nazarian, O'Donnell, Perea, Quirk, Rendon,  
            Ridley-Thomas, Rodriguez, Salas, Santiago, Mark Stone,  
            Thurmond, Ting, Waldron, Weber, Williams, Wood, Atkins
          NOES:  Achadjian, Travis Allen, Baker, Bigelow, Brough, Chang,  
            Dahle, Beth Gaines, Gallagher, Hadley, Harper, Jones, Kim,  
            Lackey, Maienschein, Mathis, Mayes, Melendez, Obernolte,  
            Olsen, Patterson, Steinorth, Wagner, Wilk
          NO VOTE RECORDED:  Chávez, Eggman, Grove

          Prepared by:Pamela Schneider / P.E. & R. / (916) 651-1519







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          8/31/15 11:43:36


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