BILL ANALYSIS Ó
SB 654
Page 1
Date of Hearing: August 22, 2016
ASSEMBLY COMMITTEE ON LABOR AND EMPLOYMENT
Tony Thurmond, Chair
SB
654 (Jackson) - As Amended August 18, 2016
SENATE VOTE: 21-16
SUBJECT: Unlawful employment practice: parental leave
SUMMARY: Enacts the "New Parent Leave Act" to, among other
things, require an employer of 20 or more employees to allow
eligible employees to take up to six (6) weeks of job-protected
parental leave to bond with a new child. Specifically, this
bill:
1)Defines "employer" to mean either of the following:
a) A person who directly employs (within 75 miles of the
worksite) 20 or more persons to perform services for a wage
or salary.
b) The state and any political subdivision of the state and
cities.
2)Makes it an unlawful employment practice for an employer to
SB 654
Page 2
refuse to allow an employee, with more than 12 months and at
least 1,250 hours of service with the employer, to take up to
six (6) weeks of parental leave to bond with a new child
within one year of the child's birth, adoption or foster care
placement.
3)Requires the employer to provide a guarantee of employment in
the same or comparable position upon return, as specified.
4)Provides that the employee may utilize accrued vacation pay,
paid sick time, other accrued paid time off, or other paid or
unpaid time off negotiated with the employer, during the
period of parental leave.
5)Makes is an unlawful employment practice for an employer to
refuse to maintain and pay for continued group health coverage
for eligible employees who take parental leave at the same
level and under the same conditions that would have been
provided of the employee had continued to work during the
duration of the leave.
6)Specifies that an employee is entitled to take Pregnancy
Disability Leave, in addition to the leave provided in this
bill, if the employee is otherwise qualified for that leave.
7)Provides that this bill does not apply to an employee subject
to both the California Family Rights Act (CFRA) and the
federal Family Medical Leave Act (FMLA).
8)Provides that in any case in which two employees who are
entitled to leave for the same birth, adoption or foster care
placement are employed by the same employer, the employer is
not required, but may elect, to grant simultaneous leave to
SB 654
Page 3
both employees.
9)Provides that the basic minimum duration of the leave shall be
two weeks. However, an employer may grant requests for
additional occasions of leave lasting less than two weeks.
10)Provides that leave under this bill shall run concurrently
with parental leave taken pursuant to a specified provision of
existing law applicable to certain certificated school
employees.
11)Provides that this bill shall become operative on January 1,
2018.
EXISTING LAW:
1)Provides that the CFRA and the federal FMLA, required to be
taken concurrently, entitles eligible workers of employers
with 50 or more employees to:
a) Take up to 12 workweeks of unpaid, job-protected leave
during a 12-month period for specified family and medical
reasons, including time to bond with a new child through
birth, adoption or foster care placement, among others.
b) Guaranteed reinstatement to the same or comparable
SB 654
Page 4
position.
c) Continued group health coverage during the duration of
the leave under the same terms and conditions.
2)Establishes the Paid Family Leave (PFL) program, within the
State Disability Insurance program, as a partial
wage-replacement plan funded through employee payroll
deductions. Among other things:
a) PFL provides eligible employees with up to six weeks of
wage replacement benefits to care for a seriously ill
child, spouse or registered domestic partner, parent,
siblings, grandparents, grandchildren, and parents-in-laws
or to bond with a minor child within one year of the birth
or placement of the child in connection with foster care or
adoption.
b) Employers may require that employees take up to two
weeks of earned but unused vacation when using PFL. The law
does not allow employers to require employees to use sick
leave.
SB 654
Page 5
c) PFL does not provide job protection or return to work
rights.
d) PFL does not require continued group health coverage
during leave.
3)Establishes that Pregnancy Disability Leave (PDL), under the
Fair Employment and Housing Act, requires private employers
with five or more employees and public employers to provide up
to four months of unpaid, job-protected leave for pregnancy,
childbirth or related conditions.
a) Employees may use accrued vacation and paid sick leave
during PDL.
b) Employees are entitled to reasonable accommodations and
reinstatement to the job held before PDL began.
SB 654
Page 6
c) Employers are required to continue health coverage
during PDL.
FISCAL EFFECT: Unknown
COMMENTS: This bill would establish the New Parent Leave Act
under FEHA and make it an unlawful employment practice for an
employer, as defined, to refuse to allow an employee to take up
to six (6) weeks of parental leave to bond with a new child
within one year of the child's birth, adoption, or foster care
placement. This bill would also prohibit an employer from
refusing to maintain and pay for coverage under a group health
plan for an employee who takes this leave.
According to the author, under current law, only those who work
for an employer of 50 or more are eligible for job protected
parental leave under California law. That leaves many new
parents with an impossible choice between the wellbeing of his
or her new child and his or her family's financial security.
Supporters argue that this bill would drastically improve access
to parental leave by providing job protection to more California
workers. Supporters assert that this bill would ensure that
millions of California workers who have been paying into the PFL
insurance program are able to use this benefit for parental
leave without risk of losing their job. The need for expanded
and equitable access to parental leave in the state cannot be
understated. The co-sponsors note that the benefits of parental
SB 654
Page 7
leave on the health and welfare of the economy and our state's
working families have been well-documented. Research shows that
parental leave, particularly when there is job protection,
increases new mothers' wage growth and future employment rates.
Fathers who take parental leave are more engaged with their
newborns, promoting greater gender equity at home and at work.
In addition, evidence strongly suggests that children enjoy many
short- and long-term benefits from parental leave, including
better health and higher high school graduation rates.
Opponents argue that this bill will overwhelm small employers.
They assert that even though the leave under this bill is not
"paid" by the employer, that does not mean the small employer
will not suffer added costs. While on leave, the employer will
have to: (1) maintain medical benefits while the employee is on
leave; (2) pay for a temporary employee to cover for the
employee on leave, usually at a higher premium given the limited
duration of employment; or (3) pay overtime to other employees
to cover the work of the employee on leave. The cost of
overtime is higher given the increase of the minimum wage, which
will add to the overall cost on small employers.
Opponents also contend that California already imposes a list of
family-friendly leaves of absences on employers, including paid
sick days, school activities leave, kin care, the paid family
leave program, pregnancy disability leave, and the CFRA. This
list is in addition to the leaves of absence required at the
federal level. They assert that imposing another 6-week leave
of absence, targeted specifically at small employers, is simply
too much for employers to bear.
Finally, opponents assert that this bill exposes employers to
costly litigation and cited to a study by an insurance provider
that estimated the cost for a small to mid-size employer to
defend and settle a single plaintiff discrimination claim was
approximately $125,000. Opponents contend that this amount,
especially for a small employer, reflects the financial risk
associated with defending a lawsuit under FEHA, such as the
litigation that would be created by this bill, and the ability
SB 654
Page 8
to leverage an employer into resolving or settling the case
regardless of merit.
Prior Related Legislation
This bill is similar to SB 1166 (Jackson), which failed passage
in the Assembly Committee on Labor and Employment earlier this
year. However, among other changes, this bill extends the
employee threshold from 10 to 20 employees, and reduces the
amount of job-protected leave from 12 weeks to six (6) weeks.
REGISTERED SUPPORT / OPPOSITION:
Support
9 to 5
9 to 5 California Chapter and National Association
Alliance for Community Empowerment
American Association of University Women
American Civil Liberties Union of California
Antelope Valley Hospital WIC Program
Breastfeed LA
SB 654
Page 9
California Asset Building Coalition
California Black Health Network
California Child Care Resource & Referral Network
California Commission on the Status of Women and Girls
California Domestic Workers Coalition
California Edge Coalition
California Employment Lawyers Association (co-sponsor)
California Hunger Action Coalition
California Immigrant Policy Center
California Labor Federation, AFL-CIO
California Latinas for Reproductive Justice
California Legislative Women's Caucus
California Partnership
SB 654
Page 10
California Rural Legal Assistance Foundation
California Teachers Association
California Women's Law Center
California Work and Family Coalition
Career Ladders Project
Center for Popular Democracy
Center for WorkLife Law at UC Hastings
Child Care Law Center
Child Family Guidance Center
Children's Hospital Los Angeles
Common Sense Kids Action
Consumer Attorneys of California
Courage Campaign
SB 654
Page 11
Employment Lawyers Association
Equal Rights Advocates (co-sponsor)
First 5 California
Healthy Communities, Inc.
Legal Aid Society - Employment Law Center (co-sponsor)
Los Angeles County Professional Peace Officers Association
Maternal and Child Health Access
Mexican American Legal Defense and Educational Fund
Mujeres Unidas y Activas
National Association of Social Workers, California Chapter
National Association of Working Women
National Council of Jewish Women California
Numerous Individuals
SB 654
Page 12
Organization of SMUD Employees
Our Family Coalition
Parent Voices
Raising California Together
San Diego Court Employees Association
San Luis Obispo County Employees Association
Service Employees International Union
South LA Health Projects
Stronger California Advocates Network
The Opportunity Institute
Tradeswomen, Inc.
UFCW Western State Council
Voices for Progress
SB 654
Page 13
Western Center on Law and Poverty
Women's Foundation of California
Opposition
Acclamation Insurance Management Services
Agricultural Council of California
Allied Managed Care
American Petroleum and Convenience Store Association
Associated Builders and Contractors - San Diego Chapter
Associated Builders and Contractors of California
CalAsian Chamber of Commerce
California Ambulance Association
California Association for Health Services at Home
SB 654
Page 14
California Association of Joint Powers Authorities
California Association of Nursery and Garden Centers
California Bankers Association
California Business Properties Association
California Chamber of Commerce
California Farm Bureau Federation
California Hotel and Lodging Association
California Landscape Contractors Association
California League of Food Processors
California Manufacturers and Technology Association
California Professional Association of Specialty Contractors
California Restaurant Association
California Retailers Association
SB 654
Page 15
California State Association of Counties
California Travel Association
Chambers of Commerce Alliance of Ventura and Santa Barbara
County
Civil Justice Association of California
Coalition of Small and Disabled Veteran Businesses
Culver City Chamber of Commerce
El Centro Chamber of Commerce
Family Winemakers of California
Flasher Barricade Association
Greater Bakersfield Chamber of Commerce
Greater Fresno Area Chamber of Commerce
Greater Merced Chamber of Commerce
International Franchise Association
SB 654
Page 16
Lake County Chamber of Commerce
League of California Cities
National Federation of Independent Business
North Orange County Chamber of Commerce
Oxnard Chamber of Commerce
Palm Desert Area Chamber of Commerce
Plumbing-Heating-Cooling Contractors Association of California
Rancho Cordova Chamber of Commerce
Redondo Beach Chamber of Commerce
Santa Maria Chamber of Commerce Visitor & Convention Bureau
South Bay Alliance of Chambers of Commerce
The Greater Coachella Valley Chamber of Commerce
The Greater Conejo Valley Chamber of Commerce
SB 654
Page 17
Western Carwash Association
Western Electrical Contractors Association
Western Growers Association
Yuba-Sutter Chamber of Commerce
Analysis Prepared by:Ben Ebbink / L. & E. / (916)
319-2091