BILL ANALYSIS Ó
AB 1669
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Date of Hearing: April 6, 2016
ASSEMBLY COMMITTEE ON LABOR AND EMPLOYMENT
Roger Hernández, Chair
AB 1669
(Roger Hernández) - As Amended March 8, 2016
SUBJECT: Displaced employees: service contracts: collection
and transportation of solid waste
SUMMARY: Extends an existing bid preference for public transit
contractors who agree to retain employees (as specified) to also
include contracts for the collection and transportation of solid
waste.
EXISTING LAW:
1) Requires all bidders on public transit service contracts to
advise the awarding authority whether they will retain the
employees of the prior contractor/subcontractor.
2) Requires awarding authorities who put out a bid for public
transit service to provide a 10 percent bidding preference to
contractors and subcontractors who agree to retain the
employees of the prior contractor/subcontractor for a period
of at least 90 days.
3) Requires existing contractors to provide awarding authorities
with specified employee information, which will assist
bidding contractors/subcontractors in costing their bids.
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4) Exempts contractors/subcontractors from retaining employees
for "cause," as defined.
5) Authorizes the new contractor/subcontractor to pay alternate
wages and provide alternate benefits from those of the prior
contractor/subcontractor.
6) Authorizes the new contractor/subcontractor to retain fewer
employees than the prior contractor, if necessary. In such a
situation, the employees shall be retained by seniority
within the given job classification.
7) Authorizes employees who have not been offered employment or
who have been discharged in violation of the provisions of
this bill to bring suit against the contractor/subcontractor
in superior court.
8) Provides for remedy in the form of reinstatement, back pay,
benefits and attorney's fees and costs.
9) Obliges an awarding authority, after public hearing, to
terminate a contract substantially breached by a
contractor/subcontractor.
10)Provides that such a terminated contractor/subcontractor is
ineligible to bid or be awarded a contract/subcontract with
the terminating awarding authority for between one and three
years, to be determined by the awarding authority.
11)Also provides for employment retention protection for
employees of janitorial and building maintenance contractors,
as specified.
FISCAL EFFECT: Unknown
COMMENTS: Existing law already establishes a 10 percent bidding
preference for public transit service contractors and
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subcontractors who agree to retain employees of the previous
contractor for a period of at least 90 days. That requirement
was enacted by Senate Bill 158 (Alarcón) of 2003.
This bill would simply extend those requirements to contractors
and subcontractors who submit bids for contracts for the
collection and transportation of solid waste.
This bill is double referred to the Local Government Committee
upon passage out of this Committee
Arguments in Support
This bill is sponsored by the California Teamsters Public
Affairs Council. The sponsor states that this bill is intended
to prevent keeping workers from being displaced when a city's
contract for solid waste services changes companies.
They argue that when cities and counties contract for services
like solid waste disposal, they are often focused on the costs
of the bids, the level of service provided, and the type of
diversion offered. In many cases, the workers fall through the
cracks when contracts change hands. The existing workforce,
trained and experienced, is summarily laid off and replaced.
These mass layoffs hurt individual families, but also impact the
local economy. Promoting a stable workforce allows workers to
invest in and contribute to their community. It means people
can stay in their homes, kids can stay in their schools, and
families can retain health insurance. It also means fewer
workers relying on unemployment benefits or other
taxpayer-funded programs.
The sponsor contends that this bill rewards companies who retain
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existing solid waste service employees for ninety days after the
new contract takes effect with a 10 percent bid preference. This
allows the company an opportunity to decide whether to retain
the employee, while giving the employee additional time to
prepare for a possible layoff job. Existing law already
provides such a preference in bids for transit services.
Arguments in Opposition
Opponents state that, although rehiring employees who are
threatened with the loss of their jobs is common in the solid
waste industry, they oppose the idea that this voluntary
practice should be codified into law. They state that there is
no evidence of a widespread failure to rehire employees when a
solid waste contract changes hands. Moreover, competition in
the solid waste industry has resulted in a consolidation of
contractors. Opponents argue that to the extent that a new
state law requiring a bid preference will mean an increase to
operating costs, it may drive even more companies into
extinction. Finally, they argue that sustaining the necessary
degree of local control over solid waste collection activities
has been a cornerstone of California policy for over 100 years.
Prior Related Legislation
This bill is similar, but not identical to, AB 508 (Swanson)
from 2011. AB 508 was referred to, but never heard, in the
Senate Appropriations Committee.
REGISTERED SUPPORT / OPPOSITION:
Support
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California Labor Federation, AFL-CIO
California Teamsters Public Affairs Council (sponsor)
Opposition
Inland Empire Disposal Association
Los Angeles County Waste Management Association
Solid Waste Association of North America
Solid Waste Association of Orange County
Analysis Prepared by:Ben Ebbink / L. & E. / (916) 319-2091
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