BILL ANALYSIS                                                                                                                                                                                                    Ó



                                                                     SB 667  


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          Date of Hearing:  August 19, 2015


                        ASSEMBLY COMMITTEE ON APPROPRIATIONS


                                 Jimmy Gomez, Chair


          SB 667  
          (Jackson) - As Amended May 18, 2015


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          Urgency:  No  State Mandated Local Program:  NoReimbursable:  No


          SUMMARY:


          This bill extends the duration of the "disability benefit  
          period" from 14 to 60 days so that fewer claimants with ongoing  
          or recurring conditions have to face a new 7-day waiting period  
          for each absence from work, and requires the Employment  








                                                                     SB 667  


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          Development Department (EDD) to report on the impact of this  
          change by January 1, 2020.


          FISCAL EFFECT:


          1)Unknown, likely minor potential impact to the State Disability  
            Insurance (SDI) Fund (technically called the Unemployment  
            Compensation Disability Fund, but often referred to as the SDI  
            Fund) as a result of this bill.  The SDI program paid out $4.5  
            billion in benefits in 2013-14. 


            For certain individuals who have conditions such as cancer for  
            which treatment may be intermittent for a period of time, this  
            may result in an additional week or two of benefits being  
            provided. The average weekly benefit amount is $493. EDD  
            reports a small number of claimants had more than one claim  
            for the same condition in the same year (5,853 claims in  
            2014).  Of these, not all would qualify for additional  
            benefits under this change.  An unknown portion would be  
            within the 60-day time frame prescribed by the bill.  In  
            addition, a small number of new claims may be filed for which  
            it would not have been worthwhile to file under previous  
            rules.  Thus, the exact number of people benefiting from this  
            change is unknown, but it seems likely that it could be in the  
            hundreds statewide.  If, for example, if 500 people per year  
            were eligible for an additional week of average benefits due  
            to this bill, costs to the SDI Fund will be $245,000, which  
            equates an increase of 0.005% in total expenditures.  This  
            cost may be offset by other dynamics.   


          2)$60,000 in estimated one-time costs to EDD for information  
            technology systems changes (SDI Fund).  


          COMMENTS:








                                                                     SB 667  


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          1)Purpose. According to the author, this bill ensures that the  
            SDI system better serves the needs of employees managing  
            chronic health conditions.  An employee who returns to work  
            after a period of disability in which they served the 7-day  
            waiting period before drawing SDI benefits, shouldn't have to  
            serve another 7-day waiting period if they must leave work  
            again within a two month period. The author argues that the  
            unpaid waiting period places an unnecessary hardship on  
            workers managing a chronic health condition and discourages  
            employees from returning to work as soon as, and for as long  
            as, possible.


          2)Background. Under the SDI program, an employee must serve a  
            waiting period of 7 consecutive days of wage loss prior to  
            receiving benefits. If an employee returns to work after a  
            period of temporary disability for more than 2 weeks before  
            experiencing a reoccurrence of the same condition they must  
            again serve the 7-day waiting period before being eligible for  
            additional benefits. 


          Analysis Prepared by:Lisa Murawski / APPR. / (916)  
          319-2081