BILL ANALYSIS Ó
SENATE COMMITTEE ON LABOR AND INDUSTRIAL RELATIONS
Senator Tony Mendoza, Chair
2015 - 2016 Regular
Bill No: SB 368 Hearing Date: January 13,
2016
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|Author: |Berryhill |
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|Version: |January 4, 2016 |
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|Urgency: |No |Fiscal: |Yes |
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|Consultant:|Brandon Seto |
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Subject: Employment: work hours
KEY ISSUES
Should individual employees, on a one-on-one basis, be allowed
to request an alternative workweek schedule from their employer?
Should employers have final say in approving these individual
alternative workweek requests from their employees without the
requirement of a secret ballot election by the entire work unit?
ANALYSIS
Existing law:
1) Defines a full workday as 8 hours, and 40 hours as a
workweek. Overtime wage rates must be paid for any time
worked beyond those previously mentioned definitions (Labor
Code §510).
2) Requires overtime to be paid at the rate of no less than
one and one-half times an employee's regular rate of pay
for work performed beyond 8 hours in a day or 40 hours in a
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week. Furthermore, work performed beyond 12 hours in a day
is to be compensated at twice the regular rate of pay
(Labor Code §510).
3) Defines a "work unit" as a division, a department, a job
classification, a shift, a separate physical location, or a
recognized subdivision thereof. A work unit may consist of
an individual employee as long as the aforementioned
criteria for an identifiable work unit is met (Labor Code
§511).
4) Authorizes the adoption of alternative workweek
schedules for work units, provided 2/3 of employees in a
work unit vote by secret ballot to approve an alternative
workweek schedule which allows employees to work up to 10
hours a day within a 40-hour workweek without the payment
of overtime (Labor Code §511).
5) Under these existing alternative workweek schedule
options, employers pay their employees at overtime rates of
one and one-half times their regular rate of pay for time
worked beyond 10 hours a day or for any work in excess of
40 hours in a week. Also, any work beyond 12 hours in a day
must be compensated at twice the employee's regular rate of
pay (Labor Code §511).
This Bill:
Would enact the California Workplace Flexibility Act of 2016
which would allow employees to request a flexible work schedule
of up to four 10-hour days per week without the obligation on
the employer to pay overtime for the 9th and 10th hours worked
per day in that schedule. Specifically, this bill would:
1) Require employers to pay overtime rates after 10 hours
of work in a day or 40 hours in a week for workers who have
chosen a flexible schedule pursuant to this act. After 12
work hours in a day, the worker would have to be paid
double the regular rate of pay by their employer.
2) Allow individual employees to request alternative
workweek schedules from their employers without the
requirement of a secret ballot decision by 2/3 of the work
unit.
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3) Enable employers to consider employee requests for
alternative work schedules, but not to induce such requests
through promises of detriment or benefit to the employee.
4) Allow either employer or employee to terminate the
alternative work schedule through written notice.
5) Exclude public employees or those covered by a
collective bargaining agreement.
COMMENTS
1. Need for this bill?
This bill's stated intent is to provide flexibility to
employers and employees in terms of work schedules. It
contends that California's overtime and alternative work
schedule laws are prohibitive, which is detrimental both to
employers and their employees. According to the author, this
bill would create greater efficiency for employers and greater
work-life balance for employees.
This bill is nearly identical to legislation proposed over the
past decade to change overtime and work scheduling laws. Much
of the law that this bill seeks to revise originated from AB
60 (Knox) of 1999, which enacted provisions for alternative
workweek schedules, provided that they were decided upon by a
secret ballot election in which 2/3 of the affected employees
approved such a schedule. This bill would remove that
requirement and would also alter the definition of the 8-hour
workday.
2. Proponent Arguments :
According to the author, existing law is entirely too
difficult to be a viable option for establishing work schedule
flexibility for a vast majority of employers. Any time after
10 hours/day is subject to overtime. Work in excess of the
schedule established by the agreement must be paid at 1.5
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times the employee's regular rate of pay. "Work in excess of
the schedule" means any work outside of the regular schedule.
For example, if an employer asks an employee to work a day
that is not part of the employee's regular alternate workweek
- maybe the employer needs that person to cover a shift of an
ill co-worker - the employee must be paid overtime for the
entire shift.
Proponents argue that a flexible workweek option prescribed in
this bill will have multiple effects benefiting California's
workforce and economy. Allowing more employees to have a
flexible work schedule would result in them working different
hours than the standard 8:00am to 5:00pm. This would in turn
mean far fewer cars on the road during peak rush hour, less
traffic congestion and less automobile emission from idling
cars. A reduction in commute time and pollution would improve
the quality of life for all. Also, California law regarding
hours and overtime is complex and unclear, which, is part of
the reason there are so many work hours and overtime
class-action lawsuits. This simple change would be a benefit
to workers and might help reduce the number of lawsuits as a
result of confusion regarding overtime laws.
Additionally, the author argues that the states bordering
California have more flexible rules. In Oregon, employees
working overtime must be paid at 1.5 times their regular rate
of pay after working 40 hours in a single week. In Washington,
most employees paid hourly are entitled to 1.5 times their
regular rate of pay for any time worked over 40 hours in a
seven-day workweek. Some salary- or commission-based employees
also must be paid overtime. Arizona does not have state-set
overtime rules and instead requires employers to use the
40-hour requirements set out in the federal Fair Labor
Standards Act. In Nevada, an employer must pay 1.5 times an
employee's regular rate of pay whenever an employee works more
than 40 hours in a week or more than eight hours in any
workday, unless the employee and employer have made a specific
agreement providing for a scheduled 10-hour day with a
four-day workweek.
3. Opponent Arguments :
Opponents argue that this bill would undermine the 8-hour day
and allow workers to be pressured to waive daily overtime.
They argue that existing law already permits the adoption of
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alternate schedules through either an election or a collective
bargaining agreement. It also permits workers to request "make
up time" as needed to leave early one day to attend to
personal or family errands and stay late the next without the
employer incurring overtime liability. Opponents argue that
California's strong labor laws protect employees from being
forced to accept unsafe and unfair working conditions and this
bill is in direct conflict with decades of worker protection
efforts.
Opponents contend that the current process is not a
complicated or burdensome one. In fact, they argue that its
provisions are the result of Labor-Management discussions at
the Industrial Welfare Commission to establish terms that both
sides thought were fair and workable. Additionally, opponents
argue that the current process is largely in the hands of the
employer since the employer has sole discretion over 1)
whether or not to conduct an election, 2) which worksites or
departments are eligible, 3) which schedule options to make
available. Furthermore, opponents point out that even a unit
of just one employee may be offered this alternate schedule
election.
Additionally, opponents argue that it is the employer who has
the most to gain, a significant financial incentive, in moving
an employee from daily overtime to weekly overtime. Permitting
individual deals, without the protections of an election or a
union, open the door to all manner of employer pressure,
intimidation, and retaliation. The discretion granted to
employers in approving employee requests also allows for
inconsistent company policies and creates the potential for
favoritism.
4. Prior Legislation :
There have been many previous bills that were similar or
nearly identical to this one, and all failed passage in the
first policy committees in their respective houses of origin.
They include:
AB 2448 (Jones) of 2014
AB 907 (Conway) of 2014
SB 607 (Berryhill) of 2013
SB 1115 (Dutton) of 2012
SB 367 (Dutton) of 2011
AB 830 (Olsen) of 2011
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SB 1335 (Cox and Dutton) of 2010
SB 187 (Benoit) of 2009
AB 2127 (Benoit) of 2008
AB 510 (Benoit) of 2007
AB 2217 (Villines) of 2006
SB 1254 (Ackerman) of 2006
AB 640 (Tran) of 2005
SUPPORT
Air Conditioning Trade Association (ACTA)
California Chapters of the American Fire Sprinkler Association
(AFSA)
Plumbing-Heating-Cooling Contractors Association of California
(CAPHCC)
Western Electrical Contractors Association (WECA)
OPPOSITION
California Labor Federation, AFL-CIO
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