BILL ANALYSIS                                                                                                                                                                                                    Ó



          SENATE COMMITTEE ON
          PUBLIC EMPLOYMENT AND RETIREMENT
                               Dr. Richard Pan, Chair
                                2015 - 2016  Regular 

          Bill No:            AB 2028         Hearing Date:    6/27/16
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          |Author:    |Cooper                                               |
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          |Version:   |6/13/16    As amended                                |
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          |Urgency:   |No                     |Fiscal:    |Yes              |
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          |Consultant:|Glenn Miles                                          |
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          Subject:  School and safety employees:  wrongful termination:   
          service credit

            SOURCE:  California Professional Firefighters
                    California School Employees Association

            ASSEMBLY VOTES:
          
          
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          |Assembly Floor:                 |76 - 0                          |
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          |Assembly Appropriations         |16 - 0                          |
          |Committee:                      |                                |
          |--------------------------------+--------------------------------|
          |Assembly Public Employees,      |6 - 0                           |
          |Retirement/Soc Sec Committee:   |                                |
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           DIGEST:    This bill requires that a member of the California  
          Public Employees' Retirement System (CalPERS) who was  
          involuntarily terminated from employment and is later reinstated  
          to the position pursuant to an administrative, arbitral, or  
          judicial proceeding shall be reinstated with all retirement  
          benefits that the member otherwise would have accrued.

          ANALYSIS:
          
          Existing law:







          AB 2028 (Cooper)                                   Page 2 of ?
          
          
          
          1)Requires the State Personnel Board to direct the payment of  
            salary and all interest accrued thereto, and the reinstatement  
            of all benefits, including retirement benefits, that otherwise  
            would have normally accrued whenever the board revokes or  
            modifies an adverse action and orders that a state employee be  
            returned to his or her position.

          2)In addition, GC Section 21198 provides the authority to  
            restore service credit for all CalPERS members, who retired  
            after being wrongfully terminated, but before the termination  
            was reversed, pursuant to an administrative or judicial  
            proceeding.

          This bill:

          1)Requires that a CalPERS member who was involuntarily  
            terminated from employment and is later reinstated to the  
            position pursuant to an administrative, arbitral, or judicial  
            proceeding shall be reinstated with all retirement benefits  
            that the member otherwise would have accrued.

          2)Provides that the reinstatement of benefits shall be effective  
            as of the date from which salary is awarded in the  
            administrative, arbitral, or judicial proceedings.   
            Additionally, the bill requires that contributions shall be  
            made for any period for which salary is awarded in the  
            proceedings in the amount that the member would have  
            contributed had his or her employment not been terminated.

          3)Provides that the member shall receive credit as state  
            service, as defined in Section 20069, for the period for which  
            salary is awarded and contributions are received.

          4)Applies to members who are subject to an involuntary  
            termination effective on or after January 1, 2017.

          5)Requires the member's employer to notify the CalPERS board of  
            the final decision ordering the member's reinstatement to  
            employment within five days of the date the decision becomes  
            final.  The notification shall include the date of involuntary  
            termination and the date on which the member was reinstated to  
            employment after the decision.

          6)Provides that if the Commission on State Mandates determines  








          AB 2028 (Cooper)                                   Page 3 of ?
          
          
            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.

          Background

          According to CalPERS, under existing law, there are two code  
          sections that permit service credit to be granted retroactively  
          to employees that have been subjected to an involuntary  
          termination which has been subsequently reversed.  One section  
          "applies only to state employees and requires the State  
          Personnel Board, when revoking or modifying an "adverse action'  
          and ordering the employee to be returned to his or her position,  
          to direct payment of salary and interest, as well as  
          reinstatement of retirement and other benefits that otherwise  
          would have accrued."

          The other section "applies to all CalPERS members that retired  
          after an involuntary termination and were subsequently  
          reinstated to their employment."

          Thus, according to CalPERS, "school members and contracting  
          agency members who do not retire after an involuntary  
          termination do not have any eligibility to have service credit  
          granted regardless of whether or not the termination is  
          reversed."  However, CalPERS has apparently applied this  
          interpretation of statute inconsistently in the past and both  
          approved and rejected requests to credit reinstated school  
          employees with service credit for periods corresponding to a  
          wrongful termination.

          According to the sponsor, "AB 2028 would codify past practice at  
          CalPERS into statute to restore retirement credits for school,  
          safety, and local agency employees and retirees, when it is  
          found that they were wrongfully terminated."  Despite past  
          practices, the sponsor states that "CalPERS believes that  
          existing statutes could be deemed insufficient to provide  
          service credit restoration for school, safety, and some local  
          agency employees, as statutorily provided to state employees."

          Related/Prior Legislation
          
          AB 2009 (Papan, Chapter 1195, Statutes of 1985) required the  








          AB 2028 (Cooper)                                   Page 4 of ?
          
          
          State to reinstate benefits that would have accrued to a state  
          employee who had been subject to adverse action which was  
          subsequently reversed, including retirement, medical, dental,  
          and seniority benefits.

          FISCAL EFFECT:                 Appropriation:  No    Fiscal  
          Com.:             Yes          Local:          Yes


          SUPPORT:

          California Professional Firefighters (co-source)
          California School Employees Association (co-source)
          California Federation of Teachers
          California Labor Federation
          Laborers' International Union of North America, Locals 777
          Laborers' International Union of North America, Locals 792
          Los Angeles County Professional Peace Officers Association
          Orange County Professional Firefighters Association, Local 3631
          Organization of SMUD Employees
          Peace Officers Research Association of California
          San Diego County Court Employees Association
          San Luis Obispo County Employees Association


          OPPOSITION:

          None received

          ARGUMENTS IN SUPPORT:    According to the sponsor,  

               This bill codifies past practice at CalPERS.  This bill  
               would continue to ensure parity for school and safety  
               workers with state workers.

               Without this fix, an employee could lose the service credit  
               that he/she otherwise was entitled to, if the wrongful  
               termination never occurred.

          

          











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