BILL ANALYSIS                                                                                                                                                                                                    Ó




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          |SENATE RULES COMMITTEE            |                        SB 667|
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                                    THIRD READING


          Bill No:  SB 667
          Author:   Jackson (D)
          Amended:  4/6/15  
          Vote:     21  

           SENATE LABOR & IND. REL. COMMITTEE:  5-0, 4/22/15
           AYES:  Mendoza, Stone, Jackson, Leno, Mitchell

           SENATE APPROPRIATIONS COMMITTEE:  7-0, 5/4/15
           AYES:  Lara, Bates, Beall, Hill, Leyva, Mendoza, Nielsen

           SUBJECT:   Disability insurance:  eligibility:  waiting period


          SOURCE:    Legal Aid Society-Employment Law Center


          DIGEST:  This bill (1) waives the 7-day waiting period for an  
          individual who has already served the 7-day waiting period for  
          the initial claim when that person files a subsequent claim for  
          disability benefits for the same or a related condition within  
          60 days after the initial disability benefit period, and (2)  
          requires the Employment Development Department (EDD) to submit a  
          report regarding the effect of the modified waiting period to  
          the Legislature by January 1, 2020, as specified.

          ANALYSIS:   

          Existing law:

          1)Provides, under the State Disability Insurance (SDI) program,  
            a state-mandated partial wage-replacement insurance plan  
            funded through employee payroll deductions to provide  
            short-term Disability Insurance and Paid Family Leave benefits  
            to eligible workers temporarily unable to work due to non-work  








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            related illness or injury, pregnancy, or childbirth.  

          2)Provides eligible individuals can receive disability benefits  
            equal to one-seventh (1/7th) of his or her weekly benefit  
            amount for each full day during which he or she is unemployed  
            due to a disability if the Director of EDD makes specified  
            findings, including that:

             a)   He/she has made a disability benefits claim as required  
               by regulations.

             b)   He/she has been unemployed and disabled for a waiting  
               period of 7-consecutive days during each disability benefit  
               period. During this 7-day waiting period, no disability  
               benefits are payable.  (Labor Code §2627) 

          1)Defines "disability benefit period" as the continuous period  
            of unemployment and disability beginning with the first day  
            for which the individual files a valid claim for disability  
            benefits.  

          2)Provides that if an individual receives two consecutive  
            periods of disability due to the same or related cause or  
            condition and separated by a period of not more than 14 days,  
            then they are considered as one disability benefit period.    
            (Labor Code §2608)
           
           This bill:

          1)Waives the 7-day waiting period for an individual who has  
            already served the 7-day waiting period for the initial claim  
            when that person files a subsequent claim for disability  
            benefits for the same or a related condition within 60 days  
            after the initial disability benefit period.  

          2)Requires the Director of EDD to submit a report regarding the  
            effect of the modified waiting period to the Legislature by  
            January 1, 2020, as specified.
          
          Background

          Under the SDI program, an employee must serve a waiting period  








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          of seven consecutive days of wage loss prior to receiving  
          partial wage replacement disability benefits. If an employee  
          return to work after a period of temporary disability for more  
          than 2 weeks before experiencing a reoccurrence of the same  
          condition they must re-serve the seven consecutive day waiting  
          period before being eligible for additional benefits. According  
          to the EDD, in 2014 there were a total of
          699,486 SDI claims filed of which 5,853 were from individuals  
          who filed multiple claims for the same condition.  

          The author argues that this second waiting period significantly  
          disadvantages employees who are managing a chronic illness or  
          injury, like chronic debilitating back pain or those who have  
          returned to work after initial cancer treatment, but must have  
          chemotherapy treatments every three weeks. This bill addresses  
          this problem by extending from two weeks to 60 days the period  
          of time under which an employee can reopen an SDI claim without  
          having to suffer a new 7-consecutive day waiting period of wage  
          loss.

          FISCAL EFFECT:   Appropriation:    No          Fiscal  
          Com.:YesLocal:   No


          According to the Senate Appropriations Committee, EDD indicates  
          that it would incur one-time costs of about $57,000 (Disability  
          Insurance Fund) to implement the provisions of the bill. While  
          it is unknown how many additional claims might be eligible for  
          payment if the recovery period were expanded, a review of the  
          claimants who file multiple claims in the same year for the same  
          condition revealed a very small amount of claimants filing  
          multiple initial claims for the same condition.


          SUPPORT:   (Verified4/22/15)


          Legal Aid Society-Employment Law Center (source)
          California Labor Federation, AFL-CIO
          California Rural Legal Assistance Foundation
          National Association of Social Workers, California Chapter
          UCSF Helen Diller Family Comprehensive Cancer Center, Social  








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            Work Department


          OPPOSITION:   (Verified4/22/15)

          None received


          ARGUMENTS IN SUPPORT:     The author believes that this bill  
          ensures that the SDI system better serves the needs of employees  
          managing chronic health conditions.  According to the author, if  
          an employee returns to work after a period of disability in  
          which they served the seven consecutive-day unpaid waiting  
          period before drawing SDI benefits, that employee shouldn't have  
          to serve another seven consecutive-day unpaid waiting period, if  
          they must leave work again within a two month period for  
          additional treatment. The author argues that the unpaid waiting  
          period places an unnecessary hardship on workers managing a  
          chronic health condition and disincentives employees from  
          returning to work as soon as and for as long as possible.  This  
          bill is a common sense reform that will give workers with  
          serious health issues better access to much needed SDI benefits.  
           

          Prepared by:Alma Perez / L. & I.R. / (916) 651-1556
          5/15/15 15:07:28


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