BILL ANALYSIS �
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THIRD READING
Bill No: AB 1556
Author: Perea (D), et al.
Amended: 6/17/14 in Senate
Vote: 21
SENATE LABOR & INDUSTRIAL RELATIONS COMMITTEE : 4-1, 6/11/14
AYES: Hueso, Leno, Padilla, Mitchell
NOES: Wyland
SENATE APPROPRIATIONS COMMITTEE : Senate Rule 28.8
ASSEMBLY FLOOR : 54-21, 4/21/14 - See last page for vote
SUBJECT : Unemployment insurance
SOURCE : Author
DIGEST : This bill makes a number of reforms to the policies
and practices in the administration of the Unemployment
Insurance (UI) program, as specified.
ANALYSIS : Existing law provides for the payment of
unemployment compensation benefits through the UI program,
administered by the Employment Development Department (EDD),
which is a federal-state program that provides weekly UI
payments to eligible workers who lose their jobs through no
fault of their own.
Under existing law, an individual is eligible for UI benefits if
he/she meets the following:
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1.Has received enough wages during the base period to establish
a claim.
2.Is totally or partially unemployed.
3.Is unemployed through no fault of his/her own.
4.Is physically able to work.
5.Is available for work, meaning ready and willing to
immediately accept work.
6.Is actively looking for work.
7.Is approved for training before training benefits are paid.
Existing law authorizes an unemployed individual who files a
claim for UI benefits or extended duration benefits, to apply to
the EDD for a determination of potential eligibility for
benefits during a period of training or retraining through the
California Training Benefit (CTB) program. The CTB program
allows eligible claimants to receive their UI benefits while
attending training or retraining programs approved by EDD.
Claimants attending an approved training course are not required
to look for work, be available for work or accept work while in
training.
Existing law authorizes an automatic eligibility determination
for UI benefits to continue during a training program if it
falls within the following:
1.The training is authorized by the federal Workforce Investment
Act of 1998 or by the Employment Training Panel.
2.The training is authorized by the federal Trade Act of 1974.
3.The individual is a participant of the CalWORKs program.
4.The individual is a participant in training with a provider
that is certified and on the Eligible Training Provider List.
5.The individual is a journey level union member and the
training/retraining course of instruction is industry-related
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training necessary due to changes in technology, or industry
demands, or is necessary to retain employment.
Existing law requires EDD to publish informational material
regarding the Unemployment Insurance Code and its programs in
English and Spanish.
This bill makes a number of reforms to the policies and
practices in the administration of the UI program.
Specifically, this bill:
1.Requires EDD to translate key documents and publications for
both the UI program and State Disability Insurance program
into the seven most commonly used languages among participants
in each program.
2.Requires EDD to translate website content providing
information regarding the process of applying for and
receiving UI benefits into the seven additional languages most
commonly used by applicants/claimants.
3.Requires the Director of EDD to periodically review the UI
program to identify policies and practices which result in
delayed benefit payments, increased EDD workload, and provide
little or no value in identifying or preventing fraud or abuse
in the program.
The Director of EDD shall report to the Legislature the
results of the first review on or before July 1, 2015.
1.Prohibits the EDD from automatically scheduling an individual
for a redetermination of eligibility (and halting benefit
payments) for any week in which he/she is participating in a
training or education program and has notified EDD of such
program.
However, if EDD determines that commencement of, or
ongoing participation in, this training or education
program conflicts with eligibility requirements for UI
benefits, EDD may schedule and conduct a determination of
eligibility.
1.Requires an individual, to maintain his/her eligibility, to
file continued claims during a continuous period of
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unemployment, submit a continued claim not more than 14 days
from the end of the last week ending date, or not more than 14
days from the date EDD issued that continued claim.
2.Prohibits an unemployed individual to be disqualified for
unemployment compensation benefits solely on the basis that
the continued claim was submitted 15 to 21 days from the end
of the last week ending date showing on the continued claim,
or 15 to 21 days from the date EDD issued that continued
claim, whichever is later.
FISCAL EFFECT : Appropriation: Yes Fiscal Com.: Yes
Local: No
SUPPORT : (Verified 6/23/14)
Asian Americans Advancing Justice - Los Angeles
California Communities United Institute
California Labor Federation, AFL-CIO
California School Employees Association, AFL-CIO
SEIU, Local 1000
OPPOSITION : (Verified 6/23/14)
Associated Builders and Contractors of California
California Business Roundtable
California Chamber of Commerce
California Farm Bureau Federation
California Grocers Association
California Manufactures and Technology Association
California Restaurant Association
California Retailers Association
California Taxpayers Association
Family Business Association
National Federation of Independent Business
ARGUMENTS IN SUPPORT : According to proponents, during the
most recent recession, UI kept many distressed communities
functioning while local job markets collapsed and many small
businesses struggled to survive sharp reductions in consumer
demand. However, they argue, in recent years the program has
struggled to meet the needs of the unemployed. The vast
majority of calls seeking UI assistance fail to reach an
operator, most denials and modifications that reach second-level
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appeals are overturned in favor of the worker, and IT failures
have delayed or denied benefits for hundreds of thousands of
claimants. Proponents argue that while this inability to
adequately handle demand remains primarily an issue of funding,
system inefficiencies and basic process problems have also
played a role.
Proponents contend that this bill will address the most
immediate of these systematic problems by improving translation
of UI information, requiring a review of eligibility
determination practices, clarify existing standards for workers
enrolled in training programs, and extend a grace period for
workers seeking to continue their claim. With these reforms in
place, they can begin making serious progress towards improving
outcomes for California's unemployed workers.
ARGUMENTS IN OPPOSITION : According to opponents, California
currently remains in debt to the federal UI trust fund by almost
$10 billion; therefore, the state is at risk of incurring the
Benefit Cost Rate (BCR) add-on. This tax increase is now an
issue for 16 states that have had five or more years during
which they had outstanding UI loan balances. Opponents argue
that the way BCR is calculated, it would result in an estimated
2% increase in employer's federal UI tax. Federal regulations
require that there not be a "net decrease in solvency" in the UI
trust fund in order for a state to qualify for a waiver of the
BCR add-on. They argue that the net decrease could be created
by administrative, regulatory or legislative action.
Therefore, they believe this bill is premature in light of
pending rules from the federal Department of Labor regarding
state requirements for waivers of looming UI tax hikes.
ASSEMBLY FLOOR : 54-21, 4/21/14
AYES: Alejo, Ammiano, Atkins, Bloom, Bocanegra, Bonilla, Bonta,
Bradford, Brown, Buchanan, Ian Calderon, Campos, Chau,
Chesbro, Cooley, Dababneh, Daly, Dickinson, Eggman, Fong, Fox,
Frazier, Garcia, Gatto, Gomez, Gonzalez, Gordon, Gray, Hall,
Roger Hern�ndez, Holden, Jones-Sawyer, Levine, Lowenthal,
Mullin, Muratsuchi, Nazarian, Pan, Perea, V. Manuel P�rez,
Quirk, Quirk-Silva, Rendon, Ridley-Thomas, Rodriguez, Salas,
Skinner, Stone, Ting, Weber, Wieckowski, Williams, Yamada,
John A. P�rez
NOES: Achadjian, Allen, Bigelow, Ch�vez, Conway, Dahle,
Donnelly, Beth Gaines, Gorell, Grove, Hagman, Harkey, Jones,
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Logue, Maienschein, Mansoor, Nestande, Patterson, Wagner,
Waldron, Wilk
NO VOTE RECORDED: Linder, Medina, Melendez, Olsen, Vacancy
PQ:kd 6/24/14 Senate Floor Analyses
SUPPORT/OPPOSITION: SEE ABOVE
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