BILL ANALYSIS Ó
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|SENATE RULES COMMITTEE | SB 950|
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VETO
Bill No: SB 950
Author: Nielsen (R)
Amended: 6/29/16
Vote: 21
SENATE PUBLIC EMP. & RET. COMMITTEE: 5-0, 4/11/16
AYES: Pan, Morrell, Beall, Hall, Moorlach
SENATE JUDICIARY COMMITTEE: 7-0, 4/19/16
AYES: Jackson, Moorlach, Anderson, Hertzberg, Leno, Monning,
Wieckowski
SENATE APPROPRIATIONS COMMITTEE: 7-0, 5/27/16
AYES: Lara, Bates, Beall, Hill, McGuire, Mendoza, Nielsen
SENATE FLOOR: 39-0, 5/31/16
AYES: Allen, Anderson, Bates, Beall, Berryhill, Block,
Cannella, De León, Fuller, Gaines, Galgiani, Glazer, Hall,
Hancock, Hernandez, Hertzberg, Hill, Hueso, Huff, Jackson,
Lara, Leno, Leyva, Liu, McGuire, Mendoza, Mitchell, Monning,
Moorlach, Morrell, Nguyen, Nielsen, Pan, Pavley, Roth, Stone,
Vidak, Wieckowski, Wolk
NO VOTE RECORDED: Runner
SENATE FLOOR: 39-0, 8/29/16
AYES: Allen, Anderson, Bates, Beall, Berryhill, Block,
Cannella, De León, Fuller, Gaines, Galgiani, Glazer, Hall,
Hancock, Hernandez, Hertzberg, Hill, Hueso, Huff, Jackson,
Lara, Leno, Leyva, Liu, McGuire, Mendoza, Mitchell, Monning,
Moorlach, Morrell, Nguyen, Nielsen, Pan, Pavley, Roth, Stone,
Vidak, Wieckowski, Wolk
ASSEMBLY FLOOR: 75-1, 8/22/16 - See last page for vote
SUBJECT: Excluded employees: arbitration
SB 950
Page 2
SOURCE: Association of California State Supervisors
California Correctional Supervisors Organization
DIGEST: This bill establishes the Excluded Employee
Arbitration Act which authorizes 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.
ANALYSIS:
Existing law:
1)Establishes the Ralph C. Dills Act (Dills Act) which sets
forth a framework that governs labor relations between the
State and state employees.
2)Excepts from the Dills Act's definition of state employee:
managerial employees, confidential employees, supervisory
employees, and other employees, as defined.
3)Establishes the Bill of Rights for State Excluded Employees
which defines excluded employees as those employees excepted
from the Dills Act.
4)Provides that the purpose of the Bill of Rights for State
Excluded Employees includes informing excluded employees of
their rights and terms and conditions of employment and also
serves to promote harmonious personnel relations among those
representing state management in the conduct of state affairs.
5)Prohibits excluded employees from holding office in employee
organizations representing rank and file employees or
participating in any employee representational matters on
behalf of non-excluded employees.
6)Provides that excluded employee organizations shall have the
right to represent their excluded members in their employment
relations, including grievances, with the State of California.
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7)Authorizes supervisory employees to form, join and participate
in the activities of supervisory organizations of their own
choosing for purposes of representation on all matters of
supervisory employee relations, as provided, or to refrain
from so doing. They also have the right to represent
themselves individually in their employment relations with the
state employer.
8)Authorizes the California Department of Human Resources
(CalHR) to adopt reasonable rules and regulations for the
administration of employer-employee relations.
This bill:
1)Creates the Excluded Employee Arbitration Act which authorizes
an employee organization that represents an excluded employee
to request binding arbitration when the following conditions
are met:
a) The excluded employee has filed a grievance with CalHR
alleging a violation of Title 2, California Code of
Regulations.
b) The grievance has not been resolved satisfactorily at
the fourth level of review.
c) 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.
2)Defines arbitration as the binding ruling that resolves an
excluded employee grievance at the fifth level of the excluded
employee grievance process.
3)Requires CalHR and the employee organization, following a
request for arbitration, to designate a standing panel of at
least 20 arbitrators to be made available for resolving
arbitrations authorized by this bill.
4)Provides that if fewer than three arbitrators are available,
then the employee organization or the employer may obtain the
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names of an additional five arbitrators from the California
State Mediation and Conciliation Service within the Department
of Industrial Relations.
5)Sets forth a process whereby the employee organization and the
employer may consecutively strike any arbitrator from the
arbitration panel until the name of one arbitrator is agreed
upon, or, if no agreement is made, the last remaining person
on the panel shall be designated the arbitrator. The name of
that arbitrator shall be submitted in writing to CalHR.
6)Requires 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.
7)Provides that if the employee organization does not submit its
choice of an arbitrator within 45 days after requesting
arbitration, the request for arbitration shall be considered
withdrawn. However, a withdrawn request shall not be
construed to prevent the employee from pursuing other
grievance procedures available under law.
8)Provides that a party to the arbitration has the right to have
a certified shorthand reporter transcribe the proceeding and
specifies that the transcript shall be the official record of
the proceeding.
9)Requires the arbitrator to issue a written decision within 45
days of the conclusion of the hearing. Specifies that the
arbitrator shall apply California law to the facts and that
the decision shall be based solely on the written record in
the grievance, the grievance response, and the oral
presentations made at the arbitration. Specifies that the
arbitrator's decision shall be legally binding.
10)Requires the arbitrator to order that the non-prevailing
party pay the cost of the arbitration, including the costs of
a certified shorthand reporter. The arbitrator is prohibited
from ordering the excluded employee to pay the costs of
arbitration or reporter and specifies that the costs of
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arbitration and reporter cannot be passed on to the excluded
employee.
Background
Current law authorizes CalHR to adopt reasonable rules and
regulations for the administration of employer-employee
relations. CalHR has adopted regulations that set out a
Grievance and Appeal Procedure for excluded employees.
Under Title 2, Section 599.859 of the California Code of
Regulations, supervisory employee organizations or individual
supervisors may pursue resolution of disagreements over issues
with their employer that fall within the jurisdiction of CalHR
through a grievance procedure that typically includes an
informal review and four formal levels of review by the employer
according to the following timeline:
Informal Level: Within five work days of the incident, an
informal discussion between the excluded employee and the
employee's supervisor or manager.
Level 1: If unsatisfied with the informal review, the
employee may file a formal grievance within 10 work days of
the incident and the employer's designee for the first level
of review must respond within 10 working days.
Level 2: The employee may appeal the employer's Level 1
decision within 10 work days of receipt of the employer's
response and the employer's designee for the second level of
review must respond within 15 work days.
Level 3: The employee may appeal the employer's Level 2
decision within 10 work days of receipt of the employer's
response and the employer's designee for the third level of
review must respond within 15 work days.
Level 4: The employee may appeal the employer's Level 3
decision to CalHR within 10 work days of receipt of the
employer's response and CalHR's designee for the fourth level
of review must respond within 20 work days.
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Upon denial at the fourth level of review, the employee or the
employee organization representing the employee may pursue a
claim with the State Personnel Board, the Department of Fair
Employment and Housing, or the State Superior Court depending on
the issue in dispute.
Related/Prior Legislation
AB 526 (Evans, 2007), held on suspense in the Senate
Appropriations Committee, was identical to AB 1584 (Evans,
2006).
AB 1584 (Evans, 2006), held on suspense in the Senate
Appropriations Committee, would have permitted an excluded
employee to request mediation after the fourth level of review.
AB 1258 (Matthews, 2003), an identical bill to AB 2802, died at
the Assembly Desk without committee referral.
AB 2802 (Strom-Martin, 2002) would have established arbitration
procedures for supervisory employees of the Department of
Corrections and the Department of the Youth Authority. The bill
was held under submission in the Assembly Appropriations
Committee.
FISCAL EFFECT: Appropriation: No Fiscal
Com.:YesLocal: No
According to the Assembly Appropriations Committee, unknown
fiscal impact. While the additional costs of this new
arbitration to CalHR are approximately $40,000 GF per
arbitration, there is considerable uncertainty about the total
cost to the state. Specifically, the fiscal effect of this bill
is dependent on the following factors:
1)Case outcomes. The costs of arbitration would be offset in
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instances when CalHR wins arbitration proceedings and is
therefore compensated for its costs.
2)The impact of arbitration on other parts of the formal
grievance procedure. The new arbitration process could create
competing incentives within the grievance process. Currently,
CalHR processes an average 150 grievances per year for
excluded employees. It can be assumed a number of these would
have been elevated to arbitration if such an option were
available to employees, since arbitration is perceived as
producing better outcomes for workers. Even a handful of
additional cases that are elevated to arbitration would result
in GF costs in excess of $150,000. However, SB 950 may also
result in savings that are difficult to calculate in advance.
The threat of arbitration could mean that an agreement between
the employee and employer is reached earlier in the formal
grievance process, thereby reducing administrative costs.
Moreover, to the extent that arbitration is pursued instead of
taking a case to court, CalHR could see significant reduction
in litigation costs.
SUPPORT: (Verified10/6/16)
Association of California State Supervisors (co-source)
California Correctional Supervisors Organization (co-source)
Association for Los Angeles Deputy Sheriffs
California Association of Code Enforcement Officers
California College and University Police Chiefs Association
California Narcotic Officers' Association
Civil Justice Association of California
Los Angeles County Professional Peace Officers Association
Los Angeles Police Protective League
Professional Engineers in California Government
Riverside Sheriffs' Association
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OPPOSITION: (Verified10/6/16)
None received
ARGUMENTS IN SUPPORT: According to the sponsor, "the
excluded employee grievance system is virtually illusory for
excluded employees.
"Of all the grievances filed, 99% are denied because there is no
consequence for the state agency to not follow the rules, and
there is no objective oversight." Thus, employee organizations
respond by filing lawsuits in court to combat the most egregious
cases that they believe should be granted in the grievance
process.
"The inability to have arbitration has cost the state
unnecessary litigation costs. This bill will bring a more
meaningful effort to resolve issues and problems at a much lower
level and save the taxpayer money."
GOVERNOR'S VETO MESSAGE:
I am returning Senate Bill 950 without my signature.
This bill adds arbitration to the existing four step
grievance process for state supervisors.
Expanding the grievance process for the state's managers to
include legally binding arbitration will reduce
departments' ability to effectively manage state operations
and will result in significant unbudgeted state costs.
ASSEMBLY FLOOR: 75-1, 8/22/16
AYES: Achadjian, Alejo, Arambula, Atkins, Baker, Bigelow,
Bloom, Bonilla, Bonta, Brown, Burke, Calderon, Campos, Chang,
SB 950
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Chau, Chávez, Chiu, Chu, Cooley, Cooper, Dababneh, Daly, Dodd,
Eggman, Frazier, Beth Gaines, Gallagher, Cristina Garcia,
Eduardo Garcia, Gatto, Gipson, Gomez, Gonzalez, Gordon, Gray,
Grove, Hadley, Harper, Holden, Irwin, Jones, Jones-Sawyer,
Kim, Lackey, Levine, Linder, Lopez, Low, Maienschein, Mathis,
Mayes, McCarty, Medina, Mullin, Nazarian, Obernolte,
O'Donnell, Olsen, Patterson, Quirk, Ridley-Thomas, Rodriguez,
Salas, Santiago, Steinorth, Mark Stone, Thurmond, Ting,
Wagner, Waldron, Weber, Wilk, Williams, Wood, Rendon
NOES: Travis Allen
NO VOTE RECORDED: Brough, Dahle, Roger Hernández, Melendez
Prepared by:Glenn Miles / P.E. & R. / (916) 651-1519
10/14/16 12:28:25
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