BILL ANALYSIS �
AB 274
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Date of Hearing: April 13, 2011
ASSEMBLY COMMITTEE ON INSURANCE
Jose Solorio, Chair
AB 274 (Garrick) - As Introduced: February 7, 2011
SUBJECT : Unemployment insurance: time period for employers to
respond.
SUMMARY : Increases the period for employers affected by an
unemployment insurance (UI) claim to submit facts to dispute the
potential eligibility for UI benefits. Specifically, this bill :
1)Authorizes each "employing unit" (hereafter: employer)
affected by a claim of UI benefits, within 30 days after the
mailing of the notice of the UI claim, to submit to the
Employment Development Department (EDD) any facts within its
possession disclosing whether the claimant left the employer's
employ voluntarily and without good cause or left due to
specified circumstances including misconduct, consumption of
alcoholic beverages or other intoxicants, to accompany a
spouse to a place from which it is impractical to commute, or
to protect his or her family or oneself from domestic violence
abuse.
2)Requires each employer, after being notified by EDD of an UI
claim, to submit within 30 days any facts known that may
affect the claimant's eligibility for benefits, and allows for
an extension for good cause.
3)If after the 30-day period the employer acquires knowledge of
facts that could not reasonably have been known within the
period, the employer shall within 30 days of acquiring the
knowledge submit the facts to EDD and the 30-day period may
also be extended for good cause.
4)Provides that if, after a notice of determination of UI
eligibility, the employer acquires knowledge of facts that may
affect the eligibility of the UI claimant and those facts
could not have reasonably been known within the 30-day period,
the employer shall within 10 days of acquiring that knowledge
submit those facts to EDD, and allows this 10-day period to
also be extended for good cause.
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EXISTING LAW :
1)Authorizes each employer affected by a claim of UI benefits,
within 10 days after the mailing of the notice of the UI
claim, to submit to EDD any facts within its possession
disclosing whether the claimant left the employer's employ
voluntarily and without good cause or left due to specified
circumstances including misconduct, consumption of alcoholic
beverages or other intoxicants, to accompany a spouse to a
place from which it is impractical to commute, or to protect
his or her family or oneself from domestic violence abuse.
2)Requires each employer, after being notified by EDD of an UI
claim, to submit within 10 days any facts known that may
affect the claimant's eligibility for benefits, and allows for
an extension for good cause.
3)Provides that if after the 10-day period, the employer
acquires knowledge of facts that could not reasonably have
been known within the period, the employer shall within 10
days of acquiring the knowledge submit the facts to EDD, and
the 10-day period may also be extended for good cause.
4)Provides that if, after a notice of determination of UI
eligibility, the employer acquires knowledge of facts that may
affect the eligibility of the UI claimant and those facts
could not have reasonably been known within the 10-day period,
the employer shall within 10 days of acquiring that knowledge
submit those facts to EDD, and the 10-day period may be
extended for good cause.
FISCAL EFFECT : Undetermined.
COMMENTS :
1)Background. According to the author, the existing law
requires EDD to provide notice of the filing of an
unemployment claim to the claimant's last employing unit, and
requires the employer to submit, within 10 days after the
mailing of the notice, any facts that may affect the
claimant's eligibility for benefits.
2)Support. The author states this bill is needed because under
existing law, if the employer is required to travel for
business, they may not have adequate time to provide the
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required facts, thus violating the required process. If there
are pertinent facts which may affect the claimant's
eligibility for benefits, the increased time frame allows for
accuracy and transparency.
The California Association for Health Services at Home (CAHSAH)
states that the 30-day reporting period provides a much needed
reprieve for employers since the ten day timeframe often
creates barriers for employers to obtain all of the necessary
facts to provide EDD with a clear understanding of the causes
for the employee's termination. CAHSAH also states that small
employers who do not have a Human Resource department often
have managers and owners that handle multiple roles for the
organization and may find it unnecessarily onerous to comply
within 10 days.
3)Opposition. The California Labor Federation, AFL-CIO, states
this bill would delay UI benefits to laid off workers, and
that current law already grants EDD the discretion to allow
for good cause extensions to the amount of time employers have
to respond. The California Labor Federation also states that
this is no time to delay the delivery of safety net benefits
to laid off workers, and that eligible workers need immediate
benefit payments to stay in their homes, feed their families,
and gather the resources needed to continue to look for work.
Moreover, delaying benefits by nearly three weeks would run
the risk of irreparable harm to families and the economies of
local communities. The CA Labor Federation also points out
that the recent State Auditor report on the administration of
UI benefits by EDD found that the Department is not meeting
federal standards for making first payments of UI benefits
(i.e., the federal standard is that 80% of the first payments
be made within 14 days of the first allowable week), that as a
result, California is designated as an "At Risk" state, and
that the timelines proposed by this bill could threaten
California's receipt of the federal administrative funds for
the Department.
The California Teamsters Public Affairs Council states that the
facts material to a claimant's eligibility are limited in
nature and consist of information reasonably known to
employers at the time of termination. The CA Teamsters state
this would include whether the employee leaves voluntarily or
was let go due to misconduct. Moreover, the existing
administrative process does not impose a time-consuming burden
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on employers since the submission of facts and the
administrative proceedings are informal. The CA Teamsters
state that there are not sufficient reasons for extending the
deadline, and that imposing this delay on the families of
displaced workers would be inhumane and completely
unnecessary.
REGISTERED SUPPORT / OPPOSITION :
Support
California Association for Health Services at Home (CAHSAH)
Opposition
CA Conference Board of the Amalgamated Transit Union
CA Conference of Machinists
CA Official Court Reporters Association
California Labor Federation, AFL-CIO
California Teamsters Public Affairs Council
Engineers and Scientists of California
International Longshore and Warehouse Union
Professional and Technical Engineers, Local 21
SCOPE, Laborers International Union of North America
UNITE HERE!
United Food and Commercial Workers -Western States Conference
Utility Workers Union of America, Local 132
Analysis Prepared by : Manny Hernandez / INS. / (916) 319-2086