BILL ANALYSIS �
AB 804
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Date of Hearing: March 30, 2011
ASSEMBLY COMMITTEE ON INSURANCE
Jose Solorio, Chair
AB 804 (Yamada) - As Introduced: February 17, 2011
SUBJECT : Family Temporary Disability Insurance Program
SUMMARY : Extends eligibility for specified state disability
insurance (SDI) benefits to employees who are not able to work
due to their taking care of a grandparent, grandchild, sibling,
or parent-in-law. These benefits are known as family temporary
disability insurance, or Paid Family Leave. Specifically, this
bill :
1)Extends eligibility for the family temporary disability
insurance (FTDI) program to employees who take time off from
work to care for a seriously ill grandparent, grandchild,
sibling, or parent-in-law. This program provides up to six
weeks of SDI benefits during a one year period.
2)The bill defines "sibling" as person related to another person
by blood, adoption, or affinity through a common legal or
biological parent. The bill defines "parent-in-law" as the
parent of a spouse or a domestic partner.
3)Specifies that, in order to obtain FTDI benefits, an
individual must submit a claim to the Director of the
Employment Development Department (EDD) for these benefits,
the EDD Director must find that the individual has been unable
to perform his or her customary work for a seven-day period
(known as a "waiting period" for which no benefits are
payable), and the individual has filed a certificate as to the
health condition of the grandparent, grandchild, or sibling,
or parent-in-law.
4)Requires a physician or practitioner to provide a statement,
in connection with the certificate of eligibility to care for
family member, that the serious health condition warrants the
care by the employee and to provide an estimate of the time
needed by the employee to care for the grandparent,
grandchild, or sibling.
EXISTING LAW :
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1)Establishes the State Disability Insurance (SDI) Program for
individuals who are unable to work due to sickness or injury,
the sickness or injury of a family member, or the birth,
adoption, or foster care placement of a new child, and to
reduce the suffering caused by unemployment resulting
therefrom. The purpose of SDI is to mitigate the evils and
burdens that fall on the unemployed worker and his or her
family.
2)Requires a claimant for SDI benefits to establish his or her
medical eligibility for each period of disability by obtaining
a certificate from a treating physician or practitioner that
establishes the sickness, injury, or pregnancy of
the employee, or the condition of the family member that
warrants the care of the employee. As part of the certificate
of eligibility to care for a family member, the physician or
practitioner must provide an estimate of the time needed by
the employee to care for the child, parent, spouse, or
domestic partner.
3)Defines a "valid claim" as a claim for unemployment
compensation disability benefits (i.e., SDI claim) made in
accordance with state law if the individual is unemployed and
disabled and has earned at least $300 in wages in
covered employment during a base period.
4)Specifies that an individual is not eligible for SDI benefits
for any period that he or she receives unemployment insurance
(UI) compensation benefits.
5)Requires each employee to contribute to the Disability Fund to
pay the costs of DI benefits. The rate of these employee
contributions ranges from 0.1% to 1.5% of wages, and are
calculated and announced annually by the Director of the EDD.
6)Establishes the FTDI program, also known as Paid Family Leave
(within the State Disability Insurance Program), that provides
up to six weeks of wage replacement benefits to workers who
take time off work to care for a seriously ill child, spouse,
parent, domestic partner, or to bond with a minor child within
one year of birth or placement of the child in connection with
foster care or adoption.
FISCAL EFFECT : Unknown, but likely significant increased
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claims for the Paid Family Leave (PFL) Program. The fiscal
analysis of a prior bill that was nearly identical, SB 727
(Kuehl) of the 2007-08 Session, noted that every 1% increase in
claims would cost between $500,000 and $600,000. This program,
however, is self-supporting and is covered by employee
contributions.
COMMENTS :
1)Purpose. The purpose of this bill is to allow employees
covered by the FTDI Program to receive partial wage
replacement benefits in order to care for seriously ill
grandparents, grandchildren, siblings, or parents-in-law.
2)Background. Under existing law, employees who are covered by
State Disability Insurance (SDI) may take six weeks of paid
leave within a 12-month period under the FTDI Program. The
FTDI benefits are 55% of the employee's weekly earnings, with
the minimum benefit of $50 per week and the maximum benefit of
$882 per week for no longer than six weeks. The funds for
these employee benefits are paid by employees through wage
deductions taken by the employer and sent to EDD. This
program is also commonly referred to as Paid Family Leave
(PFL).
Existing law also requires employers with 50 or more employees
within a 75-mile radius to grant 12 weeks of unpaid leave in a
12-month period to any employee who is eligible. This leave
can be taken by an employee for the purposes of child birth,
care of a newly adopted child or newly placed foster child,
and serious health conditions of the employee, the employee's
spouse or registered domestic partner, or the employee's
parent. This leave, granted under both the California Family
Rights Act and the federal Family and Medical Leave Act, must
be taken concurrently.
In 2007, the Senate Office of Research published a report
entitled "Balancing Work and Family" that provided information
on the FTDI program for the period July 1, 2004 through June
30, 2006. The report found that 10% of all rejected claims
were for family members not covered under the law. Most of
the denied claims were for siblings (35%, or 191 people),
grandparents (19%, or 104 people), and in-laws (10%, or 52
people).
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3)Arguments in support. The author reports that EDD data shows
that over 400,000 families have benefited from the FTDI
program, yet several hundred applications for the benefits
have been rejected because their claim was for a non-covered
relationship.
California's diverse population includes a variety of familial
arrangements with unique caregiving needs. Studies show that
over half of employed Californians expect to need to take
family or medical leave from work in the next five years,
according to a 2006 UCLA study. Sixteen percent of all
California households include at least one person providing
care to someone over the age of 50, and about half of these
caregivers are in the workforce. California also has the
second highest percentage of multi-generational households in
the country. Additionally, almost half of Californians are
single, and their closest relative may be a sibling.
The author and the bill's supporters state that the existing
narrow definition of family forces many family caregivers to
choose between a paycheck and providing needed care to a
seriously ill "non-traditional" family member. Therefore, the
PFL definition of family member should reflect the structure
of today's families so that workers may take the leave they
need to care for the people they love. By expanding the Paid
Family Leave Program to include extended family caregivers,
more California workers will be able to care for their family
without jeopardizing their economic well-being or the health
of their families.
Supporters also state that in recent years we have become
acutely aware of the increasing role that grandparents play in
raising their grandchildren, which this measure explicitly
recognizes.
4)Suggested amendments. The following amendments are
recommended:
a) Definitions. Two terms are not defined in the bill:
"grandparent" and "grandchild." It is recommended that
these terms be defined as follows: "grandparent" means a
parent of the employee's parent, and "grandchild" means a
child of the employee's child.
The definition of "sibling" omits the word "a". (Page 8,
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lines 11 - 12 of the bill.) It should read: "Sibling"
means a person related to another person by blood,
adoption, or affinity through common legal or biological
parent.
b) Operative date. The bill does not provide an
implementation phase for a major state agency directed to
provide a new service to potentially several thousand
people. The author may want to consider a six-month
period for this purpose. The amendment could read: The
amendments made by this act shall become operative on
July 1, 2012.
5)Prior Legislation . SB 1661 (Kuehl) of 2002 created the Family
Temporary Disability Insurance (FTDI) Program which began on
January 1, 2004. SB 727 (Kuehl) of 2003 made changes that
clarified the role of EDD in maintaining the program as well
as ensuring the accumulation of enough funds to pay for the
benefits. SB 727 (Kuehl) of 2007, which proposed to extend
the FTDI Program to caring for grandparents, grandchildren,
siblings, and parents-in-law, was vetoed by the Governor.
REGISTERED SUPPORT / OPPOSITION :
Support
Labor Project for Working Families (Sponsor)
9to5, National Association of Working Women
AARP
California Alliance for Retired Americans
California Commission on the Status of Women
California Employment Lawyers Association
California Labor Federation, AFL-CIO
California Nurses Association/National Nurses Organizing
Committee
California Women's Law Center
Congress of California Seniors
Equal Rights Advocates
Restaurant Opportunities Center of Los Angeles
St. John's Well Child & Family Center, Los Angeles
The Legal Aid Society-Employment Law Center
UAW Local 2865
United Food & Commercial Workers Union, Local 5
United Steelworkers, USW Local 675
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Opposition
None received.
Analysis Prepared by : Manny Hernandez / INS. / (916) 319-2086