BILL ANALYSIS �
SB 151
Page 1
Date of Hearing: May 9, 2011
ASSEMBLY COMMITTEE ON PUBLIC EMPLOYEES, RETIREMENT AND SOCIAL
SECURITY
Warren T. Furutani, Chair
SB 151 (Correa) - As Amended: April 14, 2011
SENATE VOTE : 27-13
SUBJECT : State employees: memoranda of understanding.
SUMMARY : Provides legislative ratification for the memoranda
of understanding (MOU) agreed to by the state and the following
state bargaining units (BUs):
1)BU 2 (Attorneys and Hearing Officers), represented exclusively
by the California Attorneys, Administrative Law Judges, and
Hearing Officers in State Employment (CASE);
2)BU 6 (Corrections), represented exclusively by the California
Correctional Peace Officers Association (CCPOA);
3)BU 7 (Protective Services and Public Safety), represented
exclusively by the California Statewide Law Enforcement
Association;
BU 9 (Professional Engineers), represented exclusively by the
Professional Engineers in California Government;
4)BU 10 (Professional Scientific), represented exclusively by
the California Association of Professional Scientists and 13
(Stationary Engineers); and,
5)BU 13 (Stationary Engineers), represented exclusively by the
International Union of Operating Engineers (IUOE).
In addition, this bill ratifies 13 addenda to MOUs ratified in
2010 in order to make provisions of those MOUs consistent with
the agreements reached in the six MOUs ratified in this bill.
EXISTING LAW :
1)Establishes the Ralph C. Dills Act, which requires the state
to collectively bargain with official representatives of
employee groups (i.e., bargaining units) regarding wages and
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working conditions, and to define negotiated agreements in
MOUs.
2)Establishes the Department of Personnel Administration (DPA)
as the official representative of the Governor in all matters
related to collective bargaining.
3)Requires that any MOU between the state and an official
representative must be ratified by the Legislature.
4)Requires that an addendum to a ratified MOU must be submitted
to the Joint Legislative Budget Committee (JLBC) for analysis,
and, if so required by the JLBC, must also be approved by the
Legislature.
5)Establishes the Public Employees Retirement Law, which
provides health and retirement benefits for state employees.
6)Specifies that if the provisions of certain statutes are in
conflict with an MOU, the terms of the MOU will be prevailing
in those cases.
7)Specifies that if a state MOU expires, the provisions of the
MOU continue in effect until a new MOU is ratified, as long as
the parties continue to bargain in good faith.
8)Requires the Legislative Analyst's Office (LAO) to analyze all
state MOUs and to provide analyses of the MOUs and their
fiscal impact to the Legislature within 10 days of receipt of
the MOUs from the DPA.
9)Creates the State Peace Officers' and Firefighters' Defined
Contribution Plan (PO/FF II), a defined contribution plan
exclusively for correctional peace officers. Since 1998, the
state has contributed 2% of correctional officer pay to this
plan for all officers in the plan.
FISCAL EFFECT :
1)According to DPA the savings (in millions) created by the MOUs
are as follows:
--------------------------------------------------------------
| BU | FY 2010/2011 | Total Savings over Life of |
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| | | Contract |
|------+--------------------------+----------------------------|
| 2 |$34.4 (GF=$9.4; OF=$25.0) | $29.5 (GF=$8.7; OF=$20.8) |
|------+--------------------------+----------------------------|
| 6 | $291.2 (GF=$290.9; |$233.2 (GF=$233.0; OF=$.24) |
| | OF=$.29) | |
|------+--------------------------+----------------------------|
| 7 |$37.8 (GF=$11.2; OF=26.4) | $24.5 (GF=$7.8; OF=$16.6) |
|------+--------------------------+----------------------------|
| 9 | $134 (GF=$3.10; OF=$131 | $231 (GF=$5.3; OF=$226) |
|------+--------------------------+----------------------------|
| 10 |$22.9 (GF=$3.2; OF=$19.6) | $38.2 (GF=$5.4; OF=$32.7) |
|------+--------------------------+----------------------------|
| 13 | $7.5 (GF=$5.1; OF=$2.3) | $6.7 (GF=$4.4; OF=$2.2) |
|------+--------------------------+----------------------------|
|Total | $527.8 |$563.1 |
--------------------------------------------------------------
Costs related to the addenda for the personal professional
days are minimal and absorbable by the departments
according to DPA.
2)The LAO analyses show an erosion of savings based on the
current year fiscal budget, which includes a full year of
furlough for employees in these bargaining units (i.e., 3 days
per month/approximately 15% salary reduction). The agreements
result in the furlough program ending as of March 31, thus
resulting in a reduction in the anticipated savings for the
final three months of the fiscal year.
DPA does not include the savings erosion due to ending the
furlough program in its cost analyses.
COMMENTS : The following information regarding this bill was
provided by DPA:
1)Provides legislative ratification for the MOUs agreed to
between the state and state BUs 2 (CASE), 6 (CCPOA), 7
(CSLEA), 9 (PECG), 10 (CAPS), and 13 (IUOE).
2)Increases the normal employee contribution rate to fund
retirement benefits, effective on the first day of the pay
period following legislative ratification, as follows:
--------------------------------------------------------------
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|Retirement Classification |Current |New |
| |Contribution |Contribution |
| |Rate |Rate |
| | |(SB 151) |
|----------------------------------+-------------+-------------|
|BU 2: Miscellaneous & Industrial |6% |9% |
|w/Social Security | | |
|----------------------------------+-------------+-------------|
|BU 2: Miscellaneous & Industrial |7% |10% |
|wo/Social Security | | |
|----------------------------------+-------------+-------------|
|BU 2: Safety |7% |10% |
|----------------------------------+-------------+-------------|
|BUs 6, 7, 9, 10: Miscellaneous & |5% |8% |
|Industrial w/Social Security | | |
|----------------------------------+-------------+-------------|
|BUs 6, 7, 9, 10: Miscellaneous & |6% |9% |
|Industrial wo/Social Security | | |
|----------------------------------+-------------+-------------|
|BUs 7, 9, 10: Safety |6% |9% |
|----------------------------------+-------------+-------------|
|BU 6: Peace Officers |8% |11% |
|----------------------------------+-------------+-------------|
|BU 7: Peace Officers |8% |10% |
|----------------------------------+-------------+-------------|
|BU 13: Miscellaneous & Industrial |5% |10% |
|w/Social Security | | |
|----------------------------------+-------------+-------------|
|BU 13: Miscellaneous & Industrial |6% |11% |
|wo/Social Security | | |
|----------------------------------+-------------+-------------|
|BU 13: Safety |6% |11% |
| | | |
--------------------------------------------------------------
3)Requires that compensation for employees covered by these
agreements shall be continuously appropriated in the event of
a late budget for fiscal years 2012/2013 and 2013/2014.
4)Makes three technical clarifications to previous legislation
enacted in 2010 as follows:
a) AB 1625 (Perez), Chapter 728, Statutes of 2010: Reduces
by 1% the contribution rate for excluded and exempt
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employees connected to BU 2. DPA states that the current
rates in statute are incorrect with regard to these
employees, who have always paid the lower amount, as
corrected by this bill.
b) SB 846 (Correa), Chapter 162, Statutes of 2010: This
bill ratified the 2010 MOU agreement between the state and
BU 5 (Highway Patrol), which allows the member
contribution, for a limited time as specified, to be
redirected to the members' retirement contribution. The
amendment included in this bill will allow DPA to apply
that provision to excluded and exempt patrol members of
CalPERS as well.
c) Changes a section number for a continuous appropriation
section added in 2010 so that it is consistent with other
such sections.
5)Ratifies other terms and conditions of the MOUs, including
changes to the previous contracts, which are summarized as
follows:
---------------------------------------------------------------
|Contract Provision |BU |Amount/Time Frame/Other Information |
|--------------------+-----+------------------------------------|
|Increase to Maximum |All |BU 2: Misc/Sfty: 4% |
|Salary Step (linked | |BU 6: Misc/Ind: 3% |
|to amount of | |BU 6: PO: 4% |
|increased member | |BU 7: Misc/Ind/Sfty: 3% |
|contributions and | |BU 7: PO: 2% |
|other concessions); | |BU 9 & 10: 3% |
|Effective 7/1/13 | |BU 13: Misc/Sfty: 5% |
|--------------------+-----+------------------------------------|
|Personal Leave |All |Effective for 12 months. Days have |
|Program (PLP): | |no cash value. BUs 2, 10, 13: |
|Approximately 5% | |Employees at State Compensation |
|pay reduction in | |Insurance Fund exempt from PLP. |
|exchange for 1 day | |BU 10: Employees may choose to have |
|of leave per month. | |proportional pay reduction in |
| | |exchange for 2 or 3 PLP days per |
| | |month over successive months until |
| | |12 PLP days are taken. |
|--------------------+-----+------------------------------------|
|Personal/Professiona|All |BU 2: 2 days |
|l Days: To be used | |BUs 7, 9, 10, 13: 2 days |
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|for personal or | |BU 6: 4 days in 2012 and 2 days in |
|professional | |2013 |
|development. No | | |
|cash value and must | | |
|be used in a fiscal | | |
|year (BU 6 must use | | |
|the days in a | | |
|calendar year). | | |
|--------------------+-----+------------------------------------|
|Other Leave |BU 2 |1.73 hours/month through 6/2013 |
| | |(may be saved and cashed out) |
|--------------------+-----+------------------------------------|
|Health Benefits: |All |BUs 2, 7, 10, 13: 80/80 Formula |
|80/80 Formula: | |1/1/12 & 1/1/13 |
|$482/Employee only | | |
|$946/Employee and 1 | |BU 9: 85/80 Formula 1/1/12 & 1/1/13 |
|dependent | | |
|$1,241/Employee and | |BU 6: Partial increase upon |
|2 or more | |ratification with full increase to |
|dependents | |80/80 Formula paid 1/1/12 and |
| | |1/1/13 |
|85/80 Formula: | | |
|$460Employee only | |(Note: BUs 9 and 10 have the 80/80 |
|$893/Employee and 1 | |Formula provided in statute which |
|dependent | |can be modified via MOU) |
|$1,156/Employee and | | |
|2 or more | | |
|dependents | | |
|--------------------+-----+------------------------------------|
|Length of Contract |All |BUs 2, 7, 9, 10, 13: 4/1/2011 to |
| | |7/1/2013 |
| | |BU 6: 4/1/2011 to 7/2/2013 |
|--------------------+-----+------------------------------------|
|Furlough Protection |All |No furloughs during the 12 months |
| | |that the Personal Leave Program is |
| | |in effect. |
|--------------------+-----+------------------------------------|
|Number of Employees | |BU 2: 3,300 |
|Covered (in | |BU 6: 28,124 |
|full-time | |BU 7: 6,185 |
|equivalents) | |BU 9: 10,112 |
| | |BU 10: 2,440 |
| | |BU 13: 912 |
|--------------------+-----+------------------------------------|
|Other Provisions |All |Acknowledge legislation reducing |
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| | |retirement formulas for employees |
| | |hired after 1/15/2011, 3-year final |
| | |compensation if applicable, and |
| | |elimination of 2 state holidays. |
| | |SBX3 8, Ducheny, Chapter 4, |
| | |Statutes of 2009-10, Third |
| | |Extraordinary Session; SBX6 22, |
| | |Hollingsworth, Chapter 3, Statutes |
| | |of 2009-10, Sixth Extraordinary |
| | |Session) |
|--------------------+-----+------------------------------------|
|Other Provisions |BU 6 |Terminates employer contribution of |
| | |2% of pay to PO/FF II. Employees |
| | |will fund union release time bank |
| | |by contributing 1 hour per year. |
| | |Acknowledges legislation |
| | |prohibiting leave from being |
| | |counted as time worked for the |
| | |purpose of calculating overtime. |
| | |Employees who work on holidays earn |
| | |2 times normal hourly rate. |
| | |$200 month differential for working |
| | |at Pelican Bay State Prison, High |
| | |Desert State Prison, or California |
| | |Correctional Center. |
|--------------------+-----+------------------------------------|
|Other Provisions |BU 7 |Employees will fund union release |
| | |time bank by contributing 1.5 hours |
| | |per year. |
| | |Time and a half plus holiday credit |
| | |for working on specified holidays. |
| | |Employees in state-owned housing |
| | |will pay fair market value. |
|--------------------+-----+------------------------------------|
|Other Provisions |BUs |Time and a half for working on |
| |9, |specified holidays. |
| |10 |Salary survey for informational |
| | |purposes. |
| | |Joint Labor/Management Committee to |
| | |assist with HR Mondernization |
| | | |
---------------------------------------------------------------
6)Provides legislative ratification for addenda to MOUs ratified
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in 2010 between the State and state BUs 12 (Craft and
Maintenance), 16 (Physicians, Dentists and Podiatrists), 18
(Psychiatric Technicians), and 19 (Health and Social
Services/Professional).
Specifically, these addenda provide 2 personal/professional days
for employees in these units, consistent with the 2 days
provided to SEIU in its 2010 contract and the contracts
covered by this legislation.
7)Provides legislative ratification for addenda to MOUs ratified
in 2010 between the state and state BUs 1 (Professional,
Administrative, Financial, and Staff Services), 3
(Professional Educators and Librarians), 4 (Office and
Allied), 11 (Engineering and Scientific Technicians), 14
(Printing and Allied Trades), 15 (Allied Services), 17
(Registered Nurses), 20 (Medical and Social Services), 21
(Educational Consultant and Library) represented exclusively
by the Service Employees International Union (SEIU), Local
1000.
Specifically, these addenda exempt employees in these bargaining
units who work at the State Compensation Insurance Fund from
the Personal Leave Program.
Arguments in support:
Citing concessions in the MOU and the fact that many CASE
members will not have had a salary increase in over seven years,
while seeing salary cuts during that time, CASE states: "While
these concessions were difficult for our members, CASE
recognizes the fiscal realities facing the State of California,
and understands the need to contribute to solving the current
deficit."
From CCPOA: "A collective bargaining agreement is the foundation
of a harmonious relationship between the state employer and its
workforce." "Mindful of the fiscal challenges facing the state,
we are pleased to have reached an agreement with the current
Administration that helps resolve the current budget shortfall
while re-establishing a solid framework for the relationship
between our members and the state."
From CSLEA: "In recent years, state employees have experienced
significant reductions in compensation in order to help the
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state deal with its budget challenges. This agreement continues
to help the state cope with the current budget problem while
providing needed stability to our members."
From PECG: "This bill generates hundreds of millions of dollars
in budget savings for the State at the same time it provides
state engineers and other state employees definitive terms of
employment."
From CAPS: "SB 151 provides significant savings to the state
during difficult times while ensuring stable working conditions
for state scientists and other state employees."
REGISTERED SUPPORT / OPPOSITION :
Support
American Federation of State, County and Municipal Employees
(Sponsor)
California Association of Professional Scientists (Sponsor)
California Association of Psychiatric Technicians (Sponsor)
California Attorneys, Administrative Law Judges, and Hearing
Officers in State Employment (Sponsor)
California Correctional Peace Officers Association (Sponsor)
California Statewide Law Enforcement Association (Sponsor)
Department of Personnel Administration (Sponsor)
International Union of Operating Engineers (Sponsor)
Professional Engineers in California Government (Sponsor)
Union of American Physicians and Dentists (Sponsor)
Opposition
None on file
Analysis Prepared by : Karon Green / P.E., R. & S.S. / (916)
319-3957