BILL ANALYSIS                                                                                                                                                                                                    






          SENATE PUBLIC EMPLOYMENT & RETIREMENT      BILL NO: SB 37
          Lou Correa, Chair            Hearing date: April 20, 2009
          SB 37 (Strickland)    as amended   4/01/09  FISCAL:   YES
           
          STATE EMPLOYEES:  REDUCTION OF PAPER STATEMENTS ON PAY FOR  
          EMPLOYEES THAT CHOOSE ELECTRONIC FUNDS TRANSFER
          
           
           HISTORY  :

              Sponsor:  author

              Prior legislation:  AB 232 (Hill) 2009
                         Assembly Appropriations Committee


           SUMMARY  :
          
          Would provide that state employees who participate in the  
          direct deposit program shall receive their statement of  
          earnings and deductions by an electronic method unless the  
          employee requests, in writing, to receive a paper version of  
          the statement.


           BACKGROUND  :

          1)   Existing law permits electronic funds transfer (EFT) for  
          state employees  

           Existing law  :

            a) permits state employees of the state to  voluntarily  
            authorize  the direct deposit by electronic fund transfer of  
            their salary or wages into an account at the financial  
            institution of their choice,

            b)  allows each employing agency to establish the  
            participation eligibility criteria, and

            c)  provides that participants enrolled in the direct  
            deposit program do not receive payroll warrants, but  
            continue to receive a statement of earnings and deductions  
          David Felderstein
          Date:  4/14/09                                         Page 1  










            (participants receive a non-negotiable paper direct deposit  
            advice).










          2)   Existing law requires the issuance of an itemized  
          statement  

           Existing state law  :

            a)  requires each state agency that issues a payment of  
            salary or wages, whether by direct deposit or otherwise, to  
            provide each employee, at his or her discretion, an  
            itemized statement in writing or electronically, and

            b)  provides that the electronic statement is contingent  
            upon the funding and implementation of the State  
            Controllers Office's (SCO's) new 21st Century Human  
            Resources system.


           ANALYSIS  :

          1)   This bill  :

            a)  provides that employees who participate in the direct  
            deposit program employees shall receive their statement of  
            earnings and deductions by an electronic method unless the  
            employee requests, in writing, to receive a paper version  
            of the statement, and

            b)  continues the requirement in  existing law  that the  
            provision of the electronic statement of deductions shall  
            be contingent on the funding and implementation of the  
            SCO's new 21st Century Human Resources system.

          David Felderstein
          Date:  4/14/09                                         Page 2  











           COMMENTS  :

          1)   SCO's 21st Century Human Resources system not yet  
          implemented  

          The committee is advised that, since the 21st Century Human  
          Resources system is not yet implemented, changes to the  
          current state "legacy" payroll system will be needed to  
          comply with  this bill .

           As amended April 1st, this bill  will take effect when the SCO  
          has the capabilities to provide for an electronic earnings  
          statement.

          2)   AB 232 (Hill) 2009 would provide similar provisions for  
          STRS  

          The committee is advised that  AB 232 (Hill) of 2009  allows  
          the California State Teachers Retirement System (STRS) to  
          prescribe the form for accepting electronically signed  
          applications and documents and not mail a copy of benefit  
          payment information when payments are made by electronic  
          funds transfer, unless there is a change in the net amount  
          paid.




          3)   SUPPORT  :

               California State Controller's Office
               City of Carpinteria
               Contra Costa Taxpayers Association
               National Tax Limitation Committee 
               People's Advocate
               Santa Barbara County Taxpayers Association (SBCTA) 
               Santa Barbara Technology and Industry Association  
          (SBTIA)

          4)  OPPOSITION  :     
              
                California Association of Professional Scientist  
          David Felderstein
          Date:  4/14/09                                         Page 3  










          (received 4/20/09 AM)




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          David Felderstein
          Date:  4/14/09                                         Page 4