BILL ANALYSIS                                                                                                                                                                                                    ”



                                                                    AB 2493


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          GOVERNOR'S VETO


          AB  
          2493 (Atkins)


          As Enrolled  August 23, 2016


          2/3 vote


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          |Committee       |Votes|Ayes                  |Noes                |
          |                |     |                      |                    |
          |                |     |                      |                    |
          |                |     |                      |                    |
          |----------------+-----+----------------------+--------------------|
          |Insurance       |10-0 |Daly, Travis Allen,   |                    |
          |                |     |Calderon, Chu,        |                    |
          |                |     |Cooley, Cooper,       |                    |
          |                |     |Dababneh, Frazier,    |                    |
          |                |     |Gatto, Rodriguez      |                    |
          |                |     |                      |                    |
          |----------------+-----+----------------------+--------------------|
          |Appropriations  |15-0 |Gonzalez, Bloom,      |                    |
          |                |     |Bonilla, Bonta,       |                    |
          |                |     |Calderon, Chang,      |                    |
          |                |     |Daly, Eggman, Eduardo |                    |
          |                |     |Garcia, Roger         |                    |
          |                |     |HernŠndez, Holden,    |                    |
          |                |     |Quirk, Santiago,      |                    |
          |                |     |Weber, Wood           |                    |
          |                |     |                      |                    |
          |                |     |                      |                    |
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          |ASSEMBLY:  |73-0  |(June 2, 2016) |SENATE: |38-0  |(August 16,      |
          |           |      |               |        |      |2016)            |
          |           |      |               |        |      |                 |
          |           |      |               |        |      |                 |
          |           |      |               |        |      |                 |
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          SUMMARY:  Authorizes enhanced temporary disability benefits  
          (commonly referred to as "4850 time") for rank and file and  
          supervisory firefighters employed by the California Department  
          of Forestry and Fire Protection (CalFIRE).  Specifically, this  
          bill:  


          1)Grants firefighter employees of CalFIRE, whether they are rank  
            and file or supervisory employees, the right to a leave of  
            absence for up to one year, in lieu of other disability  
            benefits provided by the Labor Code, with full pay in the  
            event of a disabling injury that arises out of, or occurs in  
            the course of, employment.


          2)Provides that the benefit is available to the employees who  
            are engaged in active firefighting duties.


          EXISTING LAW:  


          1)Provides for a comprehensive system of employer-paid benefits  
            to be provided to employees who suffer illness or injury that  
            arises out of, or in the course of, employment.
          2)Includes temporary disability benefits (TD) for up to 104  
            weeks if an employee is temporarily unable to work during  
            recuperation from the workplace illness or injury.









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          3)Establishes a minimum and a maximum amount that an employee  
            may receive, which is adjusted annually to reflect rising wage  
            levels.  Currently the minimum benefit is $165 per week, and  
            the maximum benefit is $1103.  The benefit is calculated based  
            on 2/3 of an employee's average weekly wages, subject to the  
            maximum cap.


          4)Provides specified public safety officers (most peace officer  
            and firefighter employees of local governments and special  
            districts) with an enhanced temporary disability benefit for  
            up to the first year of temporary disability.  These safety  
            officers receive their full salary (tax free) during the first  
            year of temporary disability.  (Labor Code Section 4850.)


          5)Provides this same enhanced disability benefit to officers of  
            the California Highway Patrol.  (Labor Code Section 4800.5.)


          6)Provides this same enhanced benefit to employees of the  
            Department of Justice who are in the "state peace  
            officer/firefighter" classification, whose principal duties  
            involve active law enforcement, and to harbor police employed  
            by the San Francisco Harbor Commission.  (Labor Code Section  
            4800.)


          7)Provides this same benefit to firefighters employed by the  
            University of California fire department, whose primary duties  
            consist of active firefighting and prevention services, and  
            law enforcement officers of the University of California  
            Police Department, whose primary duties consist of active law  
            enforcement. (Labor Code Sections 4804.1 and 4806.)


          8)Provides, for employees of the California State University  
            Police Department whose principal duties consist of active law  








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            enforcement, an enhanced industrial disability leave for up to  
            one year in an amount equal to his or her "net take home  
            salary," defined as the salary received after state and  
            federal income taxes, and employee retirement contributions,  
            have been deducted.  (Labor Code Section 4816.)


          9)Provides CalFIRE firefighters, as a result of collective  
            bargaining, injured during active firefighting activities,  
            with a TD benefit similar to that received by California State  
            University police (essentially regular TD but without the  
            cap).


          FISCAL EFFECT:  CalFIRE estimates approximately $1.2 million  
          annually based on increased benefit payments and increased leave  
          time and overtime costs.  CalFIRE also estimates increased  
          oversight staffing needs of between $120,000 and $350,000  
          annually, depending on workload.


          COMMENTS:  


          1)Purpose.  The purpose of the bill is to treat CalFIRE  
            firefighters fairly by providing them with benefits similar to  
            the benefits available to most other firefighters in  
            California.  According to the author, "A firefighter is a  
            firefighter, regardless of what entity issues their badge."   
            The risk factors faced by CalFIRE firefighters are the same as  
            the firefighters employed by other agencies, and the benefits  
            available to CalFIRE firefighters ought to be the same.


          2)Temporary disability benefits.  The goal of TD is to  
            approximate an employee's take home pay during the period  
            after injury when the employee is temporarily unable to work.   
            This goal is implemented by basing the weekly TD benefit on  
            2/3 of the employee's average weekly wages.  Because there is  








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            a cap, employees who make more than approximately $1600 per  
            week do not reach this 2/3 goal, but because the benefit is  
            tax free, most employees receive an adequate TD benefit while  
            they are recovering.  CalFIRE firefighters injured while  
            actually fighting a fire receive, as a result of collective  
            bargaining, a TD benefit that is calculated similarly to  
            regular TD, but not subject to the cap.


          3)Special public safety benefits.  Most public safety officers  
            (peace officer, sheriff, and firefighter employees generally)  
            receive certain special workers' compensation benefits that  
            other employees do not receive.  Most notably, this class of  
            employee has the benefit of a range of "presumptions" that  
            certain illnesses or injuries are automatically deemed to be  
            work related.  All other employees are required to prove that  
            their condition is work related.  The second significant  
            special workers' compensation benefit is granted by Labor Code  
            Sections 4800 through 4850 - commonly referred to as "4850  
            time" - and this law grants defined employees up to one year  
            of full salary in lieu of the regular method for calculating  
            TD benefits.  


          4)Tax advantages.  Because these benefits are paid due to  
            disability, they are not subject to either state or federal  
            taxes.  This rule applies to regular TD benefits, and to  
            4800-4850 benefits.  Because of the tax-free status of this  
            benefit, a public safety officer takes home substantially more  
            in weekly benefits than they normally earn while working -  
            i.e., normal take home pay plus what would have been paid in  
            taxes.  Public employers have long complained that this  
            creates a disincentive in getting injured public safety  
            officers to return to work, even if they are able, due to the  
            financial loss they would suffer when they return.  


          5)Collective bargaining?  If a public agency wants to grant  
            employees certain benefits of employment, it is able to  








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            accomplish that goal without need for a statutory change.  In  
            fact, the City of Los Angeles has provided "4850-like"  
            benefits to a range of employees without need of a statute  
            mandating the benefit for those employees.  CalFIRE fighters  
            have, in fact, already utilized collective bargaining to  
            obtain a "better than regular TD" benefit.  It may be the case  
            that the collective bargaining process, and not legislation,  
            is the better approach to enhancing the benefits of this class  
            of employee.


          Recent legislation.  In 2013, SB 527 (Block), Chapter 66,  
          Statutes of 2013, was signed into law.  SB 527 added lifeguards  
          employed by the City of San Diego to the list of public safety  
          employees entitled to 4850 time.  Proponents of that bill argued  
          that the San Diego lifeguards performed duties comparable to Los  
          Angeles County lifeguards, who already have this benefit.  The  
          City of San Diego was in support of SB 527.


          Last year, AB 1451 (Chavez) of 2015 sought to provide 4850  
          benefits to a class of lifeguards employed by the City of  
          Oceanside, arguing that other lifeguards employed by San Diego  
          and Los Angeles who performed comparable duties already receive  
          this benefit.  Governor Brown vetoed AB 1451.  The veto message  
          stated:


          "This bill adds full-time lifeguards employed by the City of  
          Oceanside to the list of employees who are entitled up to one  
          year of leave, paid at full salary without payroll tax  
          deductions, if they suffer an illness or injury that arises out  
          of their job duties.


          "Recent data indicates public employers' costs related to this  
          disability leave benefit have increased at an alarming rate.   
          These cost figures give me pause to extend this benefit further  
          in state law.  If the City of Oceanside wishes to offer full  








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          salary in lieu of temporary disability for one year to their  
          regular full-time lifeguards, they are free to do so by means of  
          the collective bargaining process.  Eligibility for this benefit  
          is best left to the City of Oceanside, not the state, to  
          determine."


          GOVERNOR'S VETO MESSAGE:


               This bill grants to the Department of Forestry and  
               Fire Protection firefighters up to one year of "4800  
               time" disability leave paid at full salary and  
               tax-free.  This policy results in higher take home pay  
               than pre-injury wages.


               As stated in my veto of AB 1451 last year, costs go up  
               significantly when this benefit is extended to new  
               classes of employees.  The state now faces over $200  
               billion in unfunded pension and health liabilities.   
               Since 2011 the costs for all this has increased by  
               nearly $5 billion per year-a 59 percent increase.


               In light of these huge commitments, I am reluctant to  
               extend this disability benefit at all-let alone  
               through legislation outside the bargaining process.




          Analysis Prepared by:                                             
          Mark Rakich / INS. / (916) 319-2086  FN: 0005120













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