BILL ANALYSIS Ó
AB 1669
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Date of Hearing: April 13, 2016
ASSEMBLY COMMITTEE ON LOCAL GOVERNMENT
Susan Talamantes Eggman, Chair
AB 1669
(Roger Hernández) - As Amended March 8, 2016
SUBJECT: Displaced employees: service contracts: collection
and transportation of solid waste.
SUMMARY: Requires any local government agency that awards
contracts for the collection and transportation of solid waste
to give a 10% preference to any bidder who agrees to retain, for
at least 90 days, employees of a previous contractor or
subcontractor. Specifically, this bill:
1)Expands an existing 10% bid preference for public transit
service contract bidders who agree to retain, for a period of
not less than 90 days, employees of a previous contractor or
subcontractor to also apply to contracts for the collection
and transportation of solid waste.
2)Defines "solid waste" to mean all putrescible and
nonputrescible solid, semisolid, and liquid wastes, including
garbage, trash, refuse, paper, rubbish, ashes, industrial
wastes, demolition and construction wastes, abandoned vehicles
and parts thereof, discarded home and industrial appliances,
dewatered, treated, or chemically fixed sewage sludge which is
not hazardous waste, manure, vegetable or animal solid and
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semisolid wastes, and other discarded solid and semisolid
wastes. "Solid waste" does not include any of the following
wastes:
a) Hazardous waste, as specified;
b) Radioactive waste regulated, pursuant to the Radiation
Control Law, as specified; and,
c) Medical waste regulated, pursuant to the Medical Waste
Management Act, as specified.
3)Makes findings and declarations regarding the economic impacts
when a local agency awards a solid waste contract to a new
contractor and the new contractor does not retain employees of
the prior contractor, such as unnecessary reliance on
unemployment insurance, public social services, and health
programs.
4)Provides that, if the Commission on State Mandates determines
that this bill contains costs mandated by the state,
reimbursement to local agencies and school districts for those
costs shall be made, pursuant to Part 7 (commencing with
Section 17500) of Division 4 of Title 2 of the Government
Code.
EXISTING LAW:
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1)Requires all bidders on local agency public transit service
contracts to declare as part of the bid whether or not they
will retain the employees of the prior contractor or
subcontractor for a period of not less than 90 days.
2)Requires local agencies that put out a bid for public transit
services to provide a 10% bidding preference to any bidder who
agrees to retain the employees of the prior contractor or
subcontractor for a period of not less than 90 days.
3)Requires existing contractors to provide local agencies with
specified employee information to assist bidding contractors
or subcontractors in costing their bids.
4)Exempts contractors or subcontractors from their obligation to
retain employees for "cause," as defined.
5)Provides that the new contractor or subcontractor is not
required to pay the same wages or offer the same benefits as
those of the prior contractor or subcontractor.
6)Authorizes the new contractor or 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.
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7)Authorizes employees who have not been offered employment or
who have been discharged in violation of the provisions of
current law to bring suit against the contractor or
subcontractor in superior court, and provides for remedy in
the form of reinstatement, back pay, benefits and attorney's
fees and costs.
8)Requires a local agency, after a public hearing, to terminate
a contract substantially breached by a contractor or
subcontractor. A terminated contractor or subcontractor is
ineligible to bid or be awarded a contract with the
terminating local agency for between one and three years, to
be determined by the local agency.
9)Provides for employment retention protection for employees of
janitorial and building maintenance contractors, as specified.
FISCAL EFFECT: This bill is keyed fiscal.
COMMENTS:
1)Author's Statement. According to the author, "Even as the
economy shows signs of recovery, many workers who have lost
their jobs are finding it difficult or nearly impossible to
find new ones. When cities or counties contract for garbage
services, they are often focused on the costs of the bids and
the level of service provided. In many cases, workers fall
through the cracks when contracts change hands. The existing
workforce, trained and experienced, is summarily laid off and
replaced.
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"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 are relying on unemployment insurance or
other taxpayer-funded programs."
2)Background and Bill Summary. Current law requires local
agencies that put out a bid for public transit services to
provide a 10% bidding preference to any bidder who agrees to
retain employees of the prior contractor or subcontractor for
at least 90 days. The law does not require a new contractor
to retain employees of the prior contractor unless the bid
preference is granted, nor does it require a new contractor to
pay the same wages or offer the same benefits as the former
contractor. The law, which has been in place since 2003, is
intended to provide a measure of job security to transit
workers when a local agency changes transit service contracts.
This bill would add contracts for the collection and
transportation of solid waste to these provisions, thereby
offering the same protections to solid waste workers. This
bill would apply to any local government agency, including any
city, county, special district, transit district, joint powers
authority, or nonprofit corporation that awards or otherwise
enters into contracts for the collection and transportation of
solid waste in California. This bill is sponsored by the
California Teamsters Public Affairs Council.
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3)Previous Legislation. SB 158 (Alarcon), Chapter 103, Statutes
of 2003, established a bidding preference for public transit
service contractors and subcontractors who agree to retain,
for a period of at least 90 days, employees of a previous
contractor or subcontractor.
AB 2189 (Koretz) of 2002 would have required a public transit
contractor to retain the employees of a former contractor
during a 60-day transition employment period. AB 2189 was
vetoed with the following message:
"Unlike the problems that plague workers in the janitorial
industry, workers that labor under public contracts are not
subject to the exploitation that motivated me to sign the
legislation for janitorial workers."
SB 20 (Alarcon), Chapter 795, Statutes of 2001, created the
Displaced Janitor Opportunity Act, which requires successor
janitorial contractors with 25 or more employees to retain for
60 days employees of the previous employer performing
janitorial or building maintenance service duties with four
months or more service.
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4)State Mandate. This bill is keyed a state mandate, which
means the state could be required to reimburse local agencies
for implementing the bill's provisions if the Commission on
State Mandates determines that the bill contains costs
mandated by the state.
5)Arguments in Support. The California Teamsters Public Affairs
Council, sponsor of this measure, states, "The current law for
transit service contracts has been in effect for nearly
fifteen years. It has stabilized the industry, allowing
drivers to retain work. There have been no reported cases of
litigation on the issue, which is a strong indication of how
smoothly this law has functioned. As a practical matter, in
the vast majority of cases, all of the bidders take the
preference, which results in no difference in the cost to the
contracting entity but avoids needless job displacement."
6)Arguments in Opposition. The Solid Waste Association of North
America, in opposition, writes, "This legislation would
infringe on local control and flexibility. With limited
resources, it is critical that local governments have
authority over contracting and employment decisions to provide
the most cost effective services. Preference for one
contractor or subcontractor over another should not be
pre-determined by a requirement that may be inappropriate
based on unique contracting, staffing, and economic
circumstances that local governments may face. Bidders have
the option to retain previous employees and local governments
already have the right to put such terms in procurement
documents to meet local needs."
7)Double-Referral. This bill was heard by the Labor and
Employment Committee on April 6, 2016, where it passed with a
5-2 vote.
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REGISTERED SUPPORT / OPPOSITION:
Support
California Teamsters Public Affairs Council
California Labor Federation
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:Angela Mapp / L. GOV. / (916) 319-3958
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