BILL ANALYSIS
SENATE PUBLIC EMPLOYMENT & RETIREMENT BILL NO: AB 1765
Lou Correa, Chair Hearing date: June 28, 2010
AB 1765 (Solorio) as amended 3/11/10 FISCAL: YES
STATE EMPLOYEES: EXEMPTION FROM FURLOUGH FOR SPECIFIED CIVIL
SERVICE EMPLOYEES
HISTORY :
Sponsor: Author
Prior legislation: SBX8 29 of 2010 (Steinberg),
Vetoed
AB 2008 of 2010 (Arambula), as amended May 28,
2010
Senate Appropriations Committee
AB 1215 of 2010 (De La Torre), as amended
September 4, 2009
Senate PE&R Committee
ASSEMBLY VOTES :
PER & SS 4-0 4/07/10
Appropriations 12-5 5/28/10
Assembly Floor 55-14 6/01/10
SUMMARY :
This bill :
1)would exempt state employees from being furloughed if all
of the following are true:
a) California's unemployment rate during the previous
month reached or exceeded 8.5%;
b) the individual is employed in a position funded at
least 95% or more by the federal government;
c) the employee performs services related to the
Unemployment Insurance Program; and
d) the employee works for the California Unemployment
Insurance Appeals Board or the Employment Development
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Department.
2)makes findings and declarations about the necessity of
unemployment insurance benefits, and underperformance and
failure to achieve federal standards by related state
departments, attributable to the Governor's imposed
furlough program.
BACKGROUND AND ANALYSIS :
1) Existing law :
a) sets forth the general policy that the workweek of a
state employee shall be 40 hours and authorizes
workweeks of different hours to be established in order
to meet varying needs of different state agencies.
b) authorizes the Governor to require that the 40-hour
workweek be worked in four days in any state agency or
part thereof when the Governor determines that the best
interests of the state would be served thereby.
c) vests the Department of Personnel Administration
(DPA) with the duties and responsibilities for the
administration of salaries, hours, and other
personnel-related matters and authorizes the DPA to
represent the Governor in matters of collective
bargaining related to hours, wages, and working
conditions.
2) Executive Orders S-16-08 and S-13-09 imposed mandatory
furloughs on state civil service employees, regardless of
funding source and with limited exemptions .
Furloughs of 2 days per month began in February of 2009,
and were increased to 3 days per month in July of 2009.
Since the July implementation, many state departments,
boards, and commissions have been closed three days per
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month. Some have been exempted from closures and those
employees are on a self-directed furlough program. The
self-directed program allows employees to accrue furlough
days and use them like vacation days, upon management
approval. Accrued furlough days have no cash value and
must be used within 24 months of the end of the furlough
program.
According to DPA, accrued furlough days must be used before
an employee may use accrued vacation, annual leave,
personal holidays, holiday credit, personal leave time
credit, and compensatory time off.
The current 3-day furlough requirement amounts to a
reduction of approximately 13.85% of employees'
compensation.
According to the Department of Personnel Administration,
some departments employing civil service employees have
been exempted from the furlough program.
California Highway Patrol and 911 Dispatchers
Department of Forestry and Fire Protection (during fire
season)
The Public Utilities Commission
The Legislative Counsel Bureau
The Bureau of State Audits
The current furlough program is scheduled to end on June
30, 2010.
FISCAL:
According to the Assembly Appropriations committee analysis:
According to the controller, there are about 10,000
employees at EDD and 800 employees at CUIAB, the majority
of which are funded from federal funds. The impact of the
bill depends on future unemployment rates and the extent to
which furloughs are implemented in the future.
As an illustration, if the governor were to order three-day
per month furloughs in 2011-12 and the unemployment rate
were above 8.5%, the bill would result in $50 million in
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annual compensation related costs (mostly federal funds).
COMMENTS :
1)According to the author, "Employee furloughs in EDD and the
CUIAB impede employees' ability to review applications for
unemployment insurance, pay unemployment benefits, and
approve training that will help unemployed individuals
regain marketable skills. Additionally, furloughs are
creating a long-term liability for the state when the
affected employees begin to utilize their required banked
furlough days."
2)As stated in the findings and declarations of the bill,
"Furloughing state employees whose positions are financed
by the federal government and who work in programs designed
to combat the state's economic recession fails to produce
savings to the state General Fund, reduces services to the
public, contributes to the late payment of vital
unemployment benefits to unemployed people in California,
and delays the state's economic recovery."
3) Arguments in Support
The California Labor Federation states:
Labor law enforcement, unemployment benefits assistance,
and highway maintenance and safety-all of these programs
have been derailed by furloughs. Not only have furloughs
caused serious backlogs throughout state government, but
they have also jeopardized essential enforcement work due
to the inability of furloughed workers to meet statutes of
limitations. This misguided policy has harmed nearly all
Californians, and especially hurt the most vulnerable.
SEIU Local 1000 notes that "EDD is nearly one hundred percent
federally funded, meaning that furloughs in EDD do not save
the General Fund one dime." "This has left thousands of
unemployed Californians struggling every day to make ends
meet, while waiting to receive their unemployment insurance
assistance. The situation at EDD simply confirms that there
are no savings with furloughs."
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5) Arguments on Opposition
The Department of Finance opposes this bill, noting the
following: furloughs are a temporary cash management
solution, it is necessary to apply furloughs across the board
in order to effectively manage the workforce and avoid
inequities, and this bill would limit the power of future
governors to implement furloughs in a fiscal emergency.
6) SUPPORT :
California Labor Federation (CLF)
California Nurses Association (CNA)
Professional Engineers in California Government (PECG)
Service Employees International Union (SEIU), Local 1000
7) OPPOSITION :
Department of Finance
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