BILL ANALYSIS Ó
SENATE COMMITTEE ON APPROPRIATIONS
Senator Ricardo Lara, Chair
2015 - 2016 Regular Session
SB 950 (Nielsen) - Excluded employees: arbitration
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|Version: April 27, 2016 |Policy Vote: P.E. & R. 5 - 0, |
| | JUD. 7 - 0 |
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|Urgency: No |Mandate: No |
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|Hearing Date: May 2, 2016 |Consultant: Robert Ingenito |
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This bill meets the criteria for referral to the Suspense File.
Bill
Summary: SB 950 would authorize binding arbitration on behalf of
an excluded state employee for alleged violations of working
conditions, as specified, whose grievance has not been resolved
after the fourth level of review.
Fiscal
Impact: The California Department of Human Resources (CalHR)
indicates that it would incur increased staffing costs
representing itself and other departments in arbitration as a
result of the bill. The number of additional
grievances/arbitrations that would result is unknown; however,
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CalHR estimates a cost of $40,000 per arbitration (General
Fund). However, the bill's costs would be partially offset to
the extent that CalHR were to win arbitration proceedings (See
Staff Comments).
Background: Current law authorizes excluded employee organizations to
represent excluded employees in employment relations, including
grievances, with the State. Current state regulations
(California Code of Regulations, Title 2, Section 599.859(d))
provide a standard grievance procedure which requires each party
involved to attempt to resolve the grievance promptly and within
the time limits contained in the grievance procedure, unless the
parties mutually consent to extend a time limit. The grievance
procedure is required to be completed in as few levels of review
as possible but no more than four levels, as follows:
Informal Discussion. The excluded employee or the
excluded employee's representative shall discuss the
grievance with the excluded employee's immediate
supervisor. If the grievance is not settled within five
work days, a written grievance may be filed.
Formal Grievance - Level 1. A formal grievance may be
filed no later than 10 work days after the event or
circumstances occasioning the grievance. The first level
of review shall respond to the grievance in writing within
10 work days after the receipt of the formal grievance.
Formal Grievance - Level 2. The grievant may appeal the
decision of the first level within 10 work days after
receipt of the response. Within 15 work days after receipt
of the appealed grievance, the person designated by the
appointing power as the second level of review shall
respond in writing to the grievance.
Formal Grievance - Level 3. The grievant may appeal the
decision of the second level within 10 work days after
receipt of the response to the appointing power or his/her
designee. Within 15 work days after receipt of the appeal,
the appointing power or his/her designee shall respond in
writing to the grievance.
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Formal Grievance - Level 4. The grievant may appeal the
decision of the third level within 10 work days after
receipt of the response to the Director, Department of
Personnel Administration or his/her designee. Within 20
work days the Director, or his/her designee shall respond
in writing to the grievance.
Proposed Law:
This bill would establish the Excluded Employee Arbitration Act,
which would, among other things, do the following:
Create the Excluded Employee Arbitration Act which would
authorize an employee organization that represents an
excluded employee to request binding arbitration when the
following conditions are met:
o The excluded employee has filed a grievance
with CalHR alleging a violation of Title 2, California
Code of Regulations.
o The grievance has not been resolved
satisfactorily at the fourth level of review.
o In cases where there is no fourth level of
review, the employee organization requests arbitration
in writing to CalHR within 21 days of a decision
rendered at the third level of review.
Define arbitration as the binding ruling that resolves
an excluded employee grievance at the fifth level of the
excluded employee grievance process.
Specify a selection process for determining potential
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arbitrators.
Require the arbitrator to issue a decision for each
grievance heard during the arbitration. The decision shall
be based solely on the written record in the grievance, the
grievance response, and the oral presentations made at the
arbitration. The arbitrator's decision shall be legally
binding.
Mandate that the arbitrator issue a written decision
within 45 days of the conclusion of the hearing.
Order that the non-prevailing party pay the cost of the
arbitration, except that arbitrator would be prohibited
from ordering the excluded employee to pay the costs of
arbitration and would prohibit the costs of arbitration
from being passed on to the excluded employee.
Related
Legislation: AB 1584 (Evans, 2006) would have permitted an
excluded employee to request mediation after the fourth level of
review. The bill was held under submission on the suspense file
of this Committee.
Staff
Comments: As noted above, CalHR indicates that the bill would
require additional personnel time representing itself and other
departments in arbitration proceedings. In addition, CalHR notes
that the cost of this bill could be even greater as it allows
for the arbitration of a variety of regulations that fall
outside of CalHR's jurisdiction. Current regulations limit
grievances only to matters within CalHR's jurisdiction. Based on
those current regulations, CalHR responds to approximately 150
excluded employee grievances per year.
CalHR's estimate of $40,000 per arbitration assumes arbitration
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hearings last two days (and reflects additional time for
preparation and decision time), and includes the fee for the
arbitrator, attorney fees, court reporter fees, and costs to the
employee's appointing power to produce witnesses and documents.
The figure excludes costs related to travel and accommodations.
Should CalHR prevail in an arbitration proceeding, its costs
would be paid by the excluded state employee's representing
organization, lowering the fiscal impact of the bill.
Staff notes that to the extent that the provision requiring the
non-prevailing party to pay the cost of the arbitration
incentivizes resolution during one of the initial four levels of
review currently in place, costs resulting from the bill could
be reduced.
Staff notes that the bill would likely achieve litigation
savings. However, the departments realizing the savings would
likely not have their budgets correspondingly reduced.
Consequently, the aggregate level of state spending would not be
impacted.
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