A bill Proposing a 4-day Workweek Is Moving Through the California Legislature and Would Target Companies With 500+ Employees

California is taking the lead on making the four-day workweek a reality.

State Assembly members are proposing a bill that would create shortened workweek for non-union, hourly workers at companies with 500 or more employees. 

The bill, authored by Asm. Evan Low and Asm. Cristina Garcia, is currently moving through committee. It’s similar to a federal bill proposed by Rep. Mark Takano, also from California, that is currently awaiting a vote in the House Education and Labor Committee.

Low told Insider support surrounding Takano’s bill partially inspired this one: “As we come out of the COVID pandemic, I am excited about how we reimagine our workforce while uplifting the voices of workers to get back in the job market in response to the Great Resignation,” Low said.

Garcia told Insider that now is the perfect time for discussions surrounding a lessened workweek, especially as labor shortages continue across the country and companies begin experimenting with the concept. “Two years into this pandemic, you see a moment of employees driving change and employees reimagining what they think their work week or their work-life balance should be,” Garcia said.

It could take years before a proposed bill like this can become a law, but “there’s been a lot of enthusiasm more recently now that this bill was introduced out there,” Garcia added.

AB 2932 would change state law and shorten the workweek to 32 hours but compensate employees at a similar pay rate. Employees who work over 32 hours would receive overtime at 1.5 times their hourly wages. 

Companies around the world have tested or embraced the 4-day workweek, like Microsoft, which reported a 40% increase in productivity, and Buffer, which found that employees are less likely to burn out. The country of Iceland also had a trial of the 4-day workweek, which was so successful that 86% of the country’s workforce moved to a shorter workweek.

Critics say it’s a ‘job killer’

Ashley Hoffman, policy advocate for the California Chamber of Commerce, argued in a letter to Low that the bill is a “job killer” and would present added costs to employers.

“AB 2932’s impact on labor costs in California will discourage job growth in the state and likely reduce opportunities for workers,” Hoffman wrote.

In a comment to Insider, a spokesperson from the Chamber of Commerce said they would not be able to support a proposal that “requires employers to pay for 32 hours of work at the rate they are currently paying for a 40 hour work week.”

Garcia said that although labor costs are a concern, she feels a bill targeting larger companies would help protect smaller businesses. Additionally, she said boosting employee morale through a shortened workweek could help companies with hiring and retention.

“Especially if you’re seeing more productivity, you’re seeing less attrition, all those things are good things for companies,” Garcia said. “All those things help with the bottom line.”

Click here to read the full article at the Business Insider

Work-Hating California Seeks to Stop Freelance Workers


JobsCalifornia has a well-deserved reputation for being unfriendly to business. Depending on what happens in Sacramento this year, the environment for workers could become unpleasant, as well.

An attack on workers’ freedom began nearly a year ago, when the California Supreme Court established a new legal standard for worker classification in its Dynamex ruling. Independent contractors must be considered employees and the companies hiring them must comply with the web of laws and regulations relating to minimum wage, overtime, payroll taxes, unemployment benefits, income tax withholding, and insurance plans.

Freelancers can be classified as independent contractors only when their work structure passes an “ABC test,” which sets an unreasonably high bar. Independent contractors cannot be supervised, they must be engaged in work the “hiring entity” isn’t otherwise involved in, and they must perform similar work for other hiring entities.

While the test has been applied a few times in court, it has not been codified into state law. That could happen during the current legislative session. Whatever Sacramento produces could potentially affect as many as two million contract workers across California. For many, it could mean the difference between being employed and unemployed, as well as the difference between being satisfied and unsatisfied with their jobs.

Support for codifying Dynamex comes from a belief that businesses are actively violating “employee rights” by misclassifying them as independent contractors. At least one lawmaker openly wishes to make things “more difficult” for companies.

“Individuals are not able to make it on three side hustles,” says Assemblywoman Lorena Gonzalez Fletcher, a Democrat in San Diego. “That shouldn’t be the norm. That shouldn’t be accepted.”

If the court’s decision becomes state law, “the norm” will be a reduction in work, disappearing opportunities, fewer dollars earned, and diminished free agency for those who’d rather, and in some cases have no choice but to, work in the gig economy.

While politicians argue without evidence that the gig economy is “rigged,” and want employment affiliations to be dictated by the court’s guidelines, almost all independent contractors prefer the work arrangements they have set up for themselves. The Bureau of Labor Statistics has found that “fewer than one in 10 independent contractors” would choose traditional work environments over freelancing.

Faced with the likelihood of losing their autonomy, independent contractors are already leaving jobs. The entire staff of independent barbers at Bottle & Barlow, a hipster barbershop on R Street in Sacramento, walked out in September when the shop reorganized its business to meet the court’s ABC requirement. Shop owner Anthony Giannotti, who said the Dynamex ruling “really gutted us,” explained why barbers — and other independent contractors — are at a disadvantage under a Dynamex framework.

“Something that attracts most of us to this industry is the freedom,” Giannotti told the local media. “I don’t want to have a boss above me telling me what to do and that’s kinda what the state’s forcing us to do now.”

Tina Kerrigan, a dietary consultant who contracts with Southern California nursing facilities, assisted living homes, and hospices, also sees unwelcome change ahead. She told the San Gabriel Valley Tribune last fall that if she is classified as an employee, she expects to “lose all of my flexibility and I’d see about a 30 percent drop in pay.”

The future of newer, innovative companies, which drive economic growth, would also be bleak. Uber, Lyft, TaskRabbit, DoorDash, Instacart, and other entrepreneurial enterprises that have successfully followed business models requiring contract workers could find their plans might no longer work under a Dynamex regulatory regime. Even if they adapt, they will be forced to shift resources that would otherwise be dedicated to research, development, and consumer demand to compliance exercises.

Transitions will be costly. A UCLA study found that companies retaining independent contractors save “between 29 and 39 cents for every dollar” of earnings they pay out. While some argue that’s a downside of the gig economy, it’s in reality one of its advantages, because it makes companies more profitable, an outcome that should be universally supported. As Austrian economist Ludwig von Mises wrote, “a profitable enterprise tends to expand, an unprofitable one tends to shrink.”

While it’s possible gig economy companies will remain profitable, should the Dynamex decision become California law, profits will fall, which means expansion will be contracted. Is it that what lawmakers want?

Those hoping to codify Dynamex claim they’re simply trying to protect workers. But they’re more likely serving the interests of unions, which would rather trap workers under their boot than see them employed independently.

This article was originally published by the Pacific Research Institute

California unemployment rate at record low 4.1%

JobsCalifornia’s unemployment rate dropped to 4.1 percent in September, a record low since it started tracking the number this way in 1976, the Employment Development Department reported Friday.

The Bay Area boasted the state’s lowest unemployment rates, falling below 3 percent in eight of the nine counties, all but Solano, where it was still under the statewide average.

The San Francisco, Oakland and San Jose metro areas all posted unemployment rates that were the lowest for the month of September since 1990. They fell below the lows set in September 1999, the peak of the dot-com boom.

Economists cheered the numbers, coming 10 years after the financial crisis that sent the country into a tailspin, but said they may be overstating the health of the labor market. Wage growth is still subpar, with benefits and bonuses making up a growing percentage of total compensation. And the labor force participation rate, which measures the percent of the adult population with a job, is markedly below where it was 10 year ago. This suggests that there are still discouraged workers sitting on the sidelines who could be pulled back into the labor force if wages were more enticing and employers more willing to hire them. …

Click here to read the full article from the San Francisco Chronicle

Taxpayer Danger Lurks Beneath California’s Employment Numbers


JobsOn a superficial level, things look pretty good in California. Sure, we have big problems with wildfires and other periodic disasters, but the state’s finances have made a strong recovery since the depths of the recession. Indeed, Gov. Brown has repeatedly touted the multi-billion-dollar surplus and the state’s balanced budget.

But objective assessments from government experts and academicians have warned of troubling aspects of the state’s financial condition. These include mega projects we can’t pay for, business flight out of California, unfunded pension obligations in the hundreds of billions of dollars, a state government that is growing much faster than population and inflation combined and a dysfunctional political system.

Close analysis reveals that California is like a home with a fresh coat of paint but a crumbling foundation. It may look pretty, but there are serious problems that are not readily apparent.

One area where there is a gulf between superficial appearance and reality is in California labor statistics. Here again, on the surface, the state’s 4.2 percent unemployment rate looks very good — and it is. During the depths of the recession, the state hit a high of 12.2 percent unemployment and tens of thousands of Californians were suffering. There’s no denying that we’ve seen a vast improvement.

But there are metrics beyond the simple unemployment rate that must be taken into consideration to fully comprehend the health of California’s labor force. A recent report from the California Center for Jobs and the Economy has troubling news: “California’s labor force grew only 16,922 over the 12 months ending July 2018, or 0.1 percent growth. The U.S. as a whole grew 1.8 million — a 1.1 percent expansion.” In other words, California’s labor force has seemingly hit a plateau — an unusual occurrence given the strength of the national economy. …

Click here to read the full article from the Long Beach Press-Telegram

California bill would close ‘insidious’ wage gap between men and women

As reported by the San Jose Mercury News:

A pay equity bill expected to pass the California Assembly this afternoon would strengthen existing laws and “close that insidious wage gap” between men and women, a bipartisan group of women legislators said Monday.

If passed and signed by Gov. Jerry Brown, it would be the toughest equal pay law in the country and become what supporters hope will be a model for the rest of the country, said state Sen. Hannah-Beth Jackson, D-Santa Barbara, chair of the California Legislative Women’s Caucus and author of SB358, the California Fair Pay Act.

The bill, supported by Republicans as well as the Chamber of Commerce, ensures that women are paid equally for work that is substantially similar to the work of their male colleagues. It also requires that women do not face retaliation if they discuss or ask how much their male colleagues are paid. …

Click here to read the full story

If You Want a Job, Where Should You Move?


JobsSince the U.S. economy imploded in 2008, there’s been a steady shift in leadership in job growth among our major metropolitan areas. In the earliest years, the cities that did the best were those on the East Coast that hosted the two prime beneficiaries of Washington’s resuscitation efforts, the financial industry and the federal bureaucracy. Then the baton was passed to metro areas riding the boom in the energy sector, which, if not totally dead in its tracks, is clearly weaker.

Right now, job creation momentum is the strongest in tech-oriented metropolises and Sun Belt cities with lower costs, particularly the still robust economies of Texas.

Topping our annual ranking of the best big cities for jobs are the main metro areas of Silicon Valley: the San Francisco-Redwood City-South San Francisco Metropolitan Division, followed by San Jose-Sunnyvale-Santa Clara, swapping their positions from last year.

Our rankings are based on short-, medium- and long-term job creation, going back to 2003, and factor in momentum — whether growth is slowing or accelerating. We have compiled separate rankings for America’s 70 largest metropolitan statistical areas (those with nonfarm employment over 450,000), which are our focus this week, as well as medium-size metro areas (between 150,000 and 450,000 nonfarm jobs) and small ones (less than 150,000 nonfarm jobs) in order to make the comparisons more relevant to each category. (For a detailed description of our methodology, click here.)

An Economy Fit For Geeks

Venture capital and private-equity firms keep pouring money into U.S. technology companies, lured by the promise of huge IPO returns. Last year was the best for new stock offerings since the peak of the dot-com bubble, with 71 biotech IPOs and 55 tech IPOs. It’s continuing to fuel strong job creation in Silicon Valley. Employment expanded 4.8% in the San Francisco Metropolitan Division in 2014, which includes the job-rich suburban expanses of San Mateo to the south, and employment is up 21.2% since 2009. This has been paced by growth in professional business services jobs in the area, up 9% last year, and in information jobs, which includes many social media functions – information employment expanded 8.3% last year and is up 28.7% since 2011.

San Jose which, like San Francisco, was devastated in the tech crash a decade ago, has also rebounded smartly. The San Jose MSA clocked 4.9% job growth last year and 20.0% since 2009. Employment in manufacturing, once the heart of the local economy, has grown 8% since 2011, after a decade of sharp reversals, but the number of information jobs there has exploded, up 16% last year and 35.7% since 2011.

Meanwhile, there’s been a striking reversal of fortune in the greater Washington, D.C., area, while the greater New York area has also fallen off the pace. In the years after the crash, soaring federal spending pushed Washington-Arlington-Alexandria to as high as fifth on our annual list of the best cities for jobs; this year it’s a meager 47th, with job growth of 1.5% in 2014, following meager 0.2% growth in 2013, while Northern Virginia (50th) and Silver Spring-Frederick-Rockville (64th) also lost ground, dropping, respectively, five and 15 places.

Job growth has also slowed in the greater New York region, which also was an early star performer in the immediate aftermath of the recession, in part due to the bank bailout that consolidated financial institutions in their strongest home region. Virtually all the areas that make up greater New York have lost ground in our ranking: the New York City MSA has fallen to 17th place from seventh last year, as employment growth tailed off to 2.6% in 2014 from 3.2% in 2013. Meanwhile Nassau-Suffolk ranks 49th, Rockland-Westchester 60th and Newark is second from the bottom among the biggest metro areas in 69th place.

The Shift To ‘Opportunity Cities’ Continues

Not every tech hot spot has the Bay Area’s advantages, which include venture capital, the presence of the world’s top technology companies and a host of people with the know-how to start and grow companies.

But other metro areas have something Silicon Valley lacks: affordable housing. Most of the rest of our top 15 metro areas have far lower home prices than the Bay Area, or for that matter Boston, Los Angeles or New York. And they also have experienced strong job growth, often across a wider array of industries, which provides opportunities for a broader portion of the population.

The combination of lower prices and strong job opportunities are what earns them our label of “opportunity cities.” The Bay Area may attract many of the best and brightest, but it is too expensive for most. Despite the current boom, the area’s population growth has been quite modest — San Jose has had an average population growth rate of 1.5% over the past four years. In contrast, seven of our top 10 metro areas, including third place Dallas-Plano-Irving, Texas, and No. 4 Austin, Texas, are also in the top 10 in terms of population growth since 2000. If prices and costs are reasonable, people will go to places where work is most abundant.

In the Dallas metro area, the job count grew 4.2% last year, paced by an 18.6% expansion in professional business services, while overall employment is up 15.7% since 2009. Job growth last year in Austin, Texas, was a healthy 3.9%, while the information sector expanded by 4.7% and since 2011 by 17.8%.

Many Texas cities, of course, have benefited from the energy boom — the recent downturn in oil prices make it likely that growth, particularly in No. 6 Houston, will decelerate in coming years.

But what is most remarkable about the top-performing cities is the diversity of their economies. Most have tech clusters, but several, such as Houston, Nashville, Tenn., Dallas and Charlotte, N.C., have growing manufacturing, trade, transportation and business services sectors. The immediate prognosis, however, may be brightest in places like Denver and Orlando, where growth is less tied to energy than business services, trade and tourism. Nashville, which places fifth on our list, has particularly bright prospects, due not only to its growing tech and manufacturing economy, but also its strong health care sector which, according to one recent study, contributes an overall economic benefit of nearly $30 billion annually and more than 210,000 jobs to the local economy.

The Also-Rans

Some economies lower in our rankings have made strong improvements, notably Atlanta-Sandy Spring-Roswell, which rose to 12th this year, a jump of 12 places. Long a star performer, the Georgia metro area stumbled through the housing bust, but it appears to have regained its footing, with strong job growth across a host of fields from manufacturing and information to health, and particularly business services, a category in which employment has increased 24% since 2009.

In California, one big turnaround story has been the Riverside-San Bernardino area, which gained six places to rank 11th this year as it has again begun to benefit from migration caused by coastal Southern California’s impossibly high home prices.

Several mid-American metro areas also are showing strong improvement. Louisville-Jefferson County, Ky., jumped fifteen places to 21st, propelled by strong growth in manufacturing, business services and finance. Kansas City, Kan. (23rd), and Kansas City, Mo. (46th), both made double-digit jumps in our rankings. In Michigan, Detroit-Dearborn-Livonia, bolstered by the recovery of the auto industry, gained six places to 59th, while manufacturing hub Warren-Troy-Farmington Hills picked up two to 39th. These may not be high growth areas, but these metro area no longer consistently sit at the bottom of the list.

Losing Ground

One of the biggest resurgent stars in past rankings, New Orleans-Metairie, dropped 17 places to 43rd, while Oklahoma City fell 17 places to 33rd. These cities lack the economic diversity to withstand a long-term loss of energy jobs if the sector goes into a prolonged downturn.

Yet perhaps the most troubling among the also-rans are the metro areas that have remained steadily at the bottom. These are largely Rust Belt cities such as last place Camden, N.J., which has been at or near that position for years.

Future Prospects

Now the best prospects appear to be in tech-heavy regions, but it’s important to recognize that a key contributor to the tech sector’s frenzy of venture capital and IPOs had been the Federal Reserve’s unprecedented monetary interventions, which are now phasing out. As it is, headwinds to expansion in the Bay Area are strong. High housing prices, according to recent study, may make it very difficult for these companies to expand their local workforces. The median price of houses in tech suburbs like Los Gatos now stand at nearly $2 million — rich for all but a few — while downtown Palo Alto office rents have risen an impossible 43% in the last five years.

Companies like Google, which has run into opposition over its proposed new headquarters expansion, may choose to shift more employment to other tech centers, such as Austin, Denver, Seattle, Raleigh and Salt Lake City, where the cost of doing business tends to be less. Similarly the stronger dollar could erode the modest progress made by some industrial cities, such as Detroit and Warren, as it gives a strong advantage to foreign competitors.

Normally we would expect these processes to play out slowly. But in these turbulent times, it’s best to keep an eye out for disruptive changes — a new economic cataclysm, should one occur, could quickly shift the playing field once again.

Joel Kotkin is editor of NewGeography.com and Presidential fellow in urban futures at Chapman University, and Michael Shires is Associate Professor of Public Policy, Pepperdine University

Cross-posted at New Geography and Fox and Hounds Daily

Employment Struggles for Ex-Offenders New Focus of CA Legislation

The good news is that the California Department of Corrections offers program to help inmates become opticians.

The bad news is that there are four different state statutes that allow the state to refuse to license an ex-offender as an optician, established in explicit language in the law.

It’s the riddle of reform, as California’s prison inmate population dropped 17 percent between 2005 and 2014 while the number of individuals on parole dipped 61 percent.

Where do they go, though?

Ineligible for employment

Both stats are relatively sunny reflections on Gov. Brown and the state Assembly’s effort to reduce both crime and criminals.

Among other things, the state hiked credits toward early release for non-violent and minimum custody offenders and established a new parole system for non-violent second time criminals.

But if you’re looking for a job and have been convicted of a crime involving a controlled substance – and this includes marijuana– forget about getting work on an ambulance crew, a litter van, or a wheelchair van. You could become a real estate broker, a midwife or a speech pathologist, but you’d have to make a case for it.

Any misdemeanor will keep you from working at as a smog check station attendant, a locksmith, a repo man or board member of a humane society.

The information comes from a database assembled by the American Bar Association. Users can search dictates in each state for how a conviction of a variety of crimes can affect a person’s ability to get a job, a business license, a judicial position, housing, education and 10 other endeavors.

The findings can be comforting – someone with a felony conviction can’t serve on a grand jury – and amusing, as a felon is also ineligible to participate in the cap-and-trade program for greenhouse gas emissions.

Contradictions in law

The database also exposes the contradictions in the law regarding employment restrictions on inmates. In California, “not much work has been done on fixing the employment and licensure issues,” said W. David Ball, an associate professor at Santa Clara University School of Law.

“These laws are generally written broadly, and there are laws that are easy to understand, like you would not want someone who was involved with financial fraud to be a CPA,” Ball said. “But it makes no sense that someone convicted of drunk driving can’t be a cosmetologist.”

The ABA database is part of a broad effort to loosen restrictions on ex-offenders. There is a national move to create a bill in all states forcing them to examine their laws regarding ex-offenders and employment. Advocates claim passage would bring recidivism rates down.

In California, 61 percent of felons returned to prison within three years, according to a 2014 annual state report on recidivism.

The study found that “inmates committed to prison for property crimes consistently recidivate at a higher rate than those committed for other types of crimes, including crimes against persons, drug crimes, and ‘other’ crimes.”

The move to a national retooling of restrictions on ex-offenders is not welcomed by all parts of the legal community.

Too soft on criminals?

“This was like a liberal do-gooder thing,” James Bopp, a Terre Haute, Ind., lawyer told the Wall Street Journal earlier this month. “The law is constructed in a way to grossly favor the criminal who is seeking relief from these collateral effects of their conviction.”

The passage in November of Proposition 47 pruned the ranks of the incarcerated even more, as the law softened criminal classifications for some crimes including drug possession and shoplifting. It also made the theft and reception of stolen goods under $950 a misdemeanor.

Under Prop. 47, part of the projected $400 million to $700 million projected to be saved statewide by cutting down on the state’s incarceration bill is to be spent on mental health and substance abuse services.

Such services, while they can help treat an ex-offender, also exclude the ex-offender community: A misdemeanor conviction excludes a person from becoming a vocational nurse, treating an adolescent in a drug treatment program or obtaining a psychiatric technician license.

Additional legislation

Lawmakers are still making adjustments to the effects of the bill, plugging holes and shaping the mandate. Some are concerned that a provision in the measure would allow the theft of a gun to be lumped in with stealing a bag of Twizzlers in the under $950 category.

A measure authored by state Sen. Cathleen Galgiani is winding its way through the statehouse, seeking to fix that, making the theft of any firearm a crime not subject to the parameters of Prop. 47.

Another bill, SB205, looks to fund a university study of the effects of Prop. 47.

Still another bill, SB527, seeks to allocate money from the expected corrections savings for truancy and dropout prevention, funding over four jobs for that task alone.

Collateral consequences are also often unintended consequences, said Ball, the associate professor at the Santa Clara law school.

“I’d like to raise the bar higher so you have to make a case for ‘why not?’ rather than reasons to impose,” Ball said. “These collateral consequences really do prevent people from starting over.”

Steve Miller can be reached at 517-775-9952 and [email protected]. His website is www.Avalanche50.com

Originally published by CalWatchdog.com

How California’s State and Local Governments Can Save $50 Billion Per Year


Photo Courtesy of 401(K) 2013, Flickr

Photo Courtesy of 401(K) 2013, Flickr

Back in the early 2000s, in the aftermath of the internet bubble’s collapse, California’s state and local governments endured a period of austerity that resulted in “furloughs,” where, typically, employees would take Fridays off in exchange for a 20 percent cut in their pay. That is, they worked 20 percent less, and made 20 percent less in pay – but their rate of pay was not cut.

This display of “sacrifice” was an eye opener for private sector workers, especially salaried employees of small businesses, who endured cuts to their rates of pay at the same time as their hours of work increased. Most people in the private sector back in the early 2000s felt lucky to have a job, even if it meant working harder and making less.

There’s a lesson to be learned from the period of state and local government “furloughs” in California: California’s government functioned just fine with 20 percent fewer hours spent at the job, overall, and California’s government workers got by, overall, making 20 percent less money. So since we know these cuts are feasible, it is interesting to estimate just how much money Californians would save, if there were a 20 percent reduction to California’s state and local government workforce, and then there were a 20 percent reduction to the pay and benefits collected by those state and local government workers who remained employed.

Getting information on just how much California’s state and local workers make is notoriously difficult. California’s state controller’s Public Pay database collects the data, but presents “averages” that include part-time employees in the denominator, and do not consolidate the data. Transparent California, a public information project jointly produced by the California Policy Center and the Nevada Policy Research Institute, provides very good information on individual pay and benefits, but also does not consolidate the information.

A California Policy Center study, “How Much Do California’s State, City and County Workers Really Make?” uses 2012 raw data from the state controller that screens out part-time workers to develop averages for city, county and state workers.

California’s State and Local Government Employees
Average Compensation by Entity – 2012

20140131_CA-Gov-Pay_Table2-b

A recent UnionWatch analysis of Los Angeles Unified School District provided a baseline estimate for total teacher compensation – although in variance to the table, please note the same analysis adds an estimated value of $4,033 per teacher to take into account the state’s direct contribution to CalSTRS. As a representative example of total teacher pay, LAUSD is pretty good; the California Dept. of Education reports the Statewide Average Teacher base salary averaged $69,324 during 2014, nearly identical to the LAUSD analysis.

Los Angeles Unified School District
Average Compensation by Job Class – 2013

20150303-UW_Ring-LAUSD-Actual

Armed with this information, and cross-referencing with the U.S. Census Bureau’s estimate of current numbers of full time state and local government employees in California (ref. Government Employment & Payroll, and select “state” and “local,” in each case selecting “California”), we can make a reasonable estimate of how much our full time state/local workforce is currently costing taxpayers. We can also estimate how much a 20 percent reduction in workforce combined with a 20 percent reduction in total compensation would save taxpayers each year:

California State and Local Government Employees, Est. Total Cost per Year
Projected Annual Savings via 20% Reduction to Headcount and to Compensation

20150512-UW_20percent-solution

While this thought exercise may seem to be an exercise in futility, the fact is, we’ve tried it once already, and it worked. That is, during the furloughs of the early 2000s, California’s state and local government workers got by just fine with a 20 percent reduction in pay, and California’s state and local government services functioned adequately even though 20 percent of the workforce was absent (i.e., they were all taking Friday’s off).

It is fair to ask why the focus must always be on austerity. Why not pay everyone more in the private sector? That’s a good question and the answer is simple: It’s impossible. The average total compensation in California’s private sector is roughly half what public employees make. There isn’t enough money in the world to pay everyone this much money, and it is grossly unfair to taxpayers and private workers to treat public sector workers as a privileged class, exempt from the economic challenges facing everyone else.

The problem is even deeper than just one of inequity and insolvency. The problem with creating a privileged class of government workers is that they no longer make common cause with the people they serve. This consequence should trouble social liberals at least as much as it troubles fiscal conservatives, because the most powerful bloc of voters in California, unionized, politically active government workers, are putting their personal financial interests ahead of other worthy government projects. Imagine what $52.7 billion could buy.

The solution is to combine cutbacks in government employee compensation with investments in infrastructure and reductions in regulatory hurdles in order to reduce prices for goods and services. Government created artificial scarcity has raised the price of housing, energy, water and transportation to levels that only the elite can easily afford. If government workers were compelled to make common cause with other workers, instead of this elite, maybe they would finally support reforms to lower the cost of living.

Ed Ring is the executive director of the California Policy Center.

CalChamber Unveils List of 2015 “Job Creator” Bills


Since 2008, CalChamber has been identifying bills that will improve the state’s job climate and stimulate our economy.  We put them on our annual “Job Creator” list hoping to put a spotlight on proposals that will encourage investment in our economy.

Last week, we released the 2015 “Job Creator” list.  This year’s list includes 11 bills that will improve our legal climate, lower costs for employers, spur tourism, and create construction jobs. The list follows recommendations made in our annual business issues guide, called “Foundation for a Better California.”

Each year we hope to have as many job creator bills on our list as we do on our job killer list.  Let’s hope our policy makers make that possible in the years to come! 

The list of 2015 job creator bills includes the following proposals:

Creates Construction Jobs

AB 35 (Chiu; D-San Francisco) Creates Affordable Housing Opportunities. Expands the existing low-income housing tax credit program, making the state better able to leverage an estimated $200 million more in Federal Tax Credits.

AB 323 (Olsen; R-Modesto) Expedites and Reduces Cost for Roadway Repair and Maintenance Projects. Streamlines infrastructure development by extending indefinitely the current CEQA exemption for certain roadway repair and maintenance projects.

AB 641 (Mayes; R-Yucca Valley) Expedites and Reduces Cost for Housing Projects. Streamlines and reduces regulatory burdens for the approval and construction of housing developments by providing an expedited review process under the California Environmental Quality Act.

Improved Legal Climate

AB 52 (Gray; D-Merced) Disability Access Litigation Reform.  Seeks to improve access for disabled customers and limit frivolous litigation against businesses for construction-related accessibility claims by providing an opportunity for the businesses to timely resolve any potential violations.

AB 54 (Olsen; R-Modesto) Disability Access Litigation Reform. Seeks to improve access for disabled patrons without harming businesses through frivolous lawsuits by providing businesses with a 60-day right to correct the violation for a claim based upon a constructed related accessibility standard that was changed or modified in the prior three years.

AB 588 (Grove; R-Bakersfield) Reduces Frivolous Litigation. Seeks to limit frivolous litigation under the Labor Code Private Attorneys General Act, by allowing an employer a 33 day right to cure technical violations on an itemized wage statement that did not cause any injury to the employee.

AB 1252 (Jones; R-Santee) Protects Businesses from Proposition 65 Lawsuits. Provides needed relief to small businesses by prohibiting a person from bringing a Proposition 65 lawsuit against a business employing fewer than 25 employees. Failed passage in the Assembly Environmental Safety and Toxic Materials Committee, 04/14/15. Reconsideration Granted

AB 1470 (Alejo; D-Salinas) Reduction of Costly Employment Class Action Litigation. Limits frivolous class action litigation against employers in California who are creating high paying jobs by creating a rebuttable presumption that employees earning at least $100,000 and performing non-manual labor and at least one exempt duty are exempt from overtime requirements.

SB 67 (Galgiani; D-Stockton) Disability Access Litigation Reform. Seeks to limit frivolous litigation against small businesses and those that have sought to comply, by limiting remedies to injunctive relief and expanding the current period to correct any violation from 60 to 120 days.

Tourism

SB 249 (Hueso; D-Logan Heights) Enhanced Driver’s License. Encourages international trade and tourism by authorizing the Department of Motor Vehicles to issue enhanced driver licenses to U.S. citizens to expedite legal traffic at the border.

Workplace Improvements/Training

AB 1038 (Jones; R-Santee) Flexible Workweek. Provides employers with the opportunity to accommodate employees’ needs as well as business demands by allowing employees to request a voluntary, flexible workweek agreement that can be repealed by the employee at any time with proper notice. Failed passage in the Assembly Labor and Employment Committee, 04/22/15. Reconsideration Granted.

Cumulative Job Creator Signatures

2014: 14 job creator bills identified, 5 sent to Governor, signs 5

2013: 16 job creator bills identified, 2 sent to Governor, signs 2

2012: 34 job creator bills identified, 9 sent to Governor, signs 9

2011: 5 job creator bills identified, 0 sent to Governor

2010: 16 job creator bills identified, 4 sent to Governor, signs 4

2009: 18 job creator bills identified, 2 sent to Governor, signs 2

2008: 3 job creator bills identified, 2 sent to Governor, signs 2

Originally published by Fox and Hounds Daily

Denise Davis is vice president, media relations and external affairs at Cal Chamber

2015 Job Killers — CalChamber Releases Its Preliminary Report


The California Chamber of Commerce yesterday released a preliminary list of “job killer” bills to call attention to the negative impact that 16 proposed measures would have on California’s job climate and economic recovery, should they become law.

Although we will be opposing a number of bills throughout this year, the ‘job killer’ list represents the worst of the worst. These proposals will unnecessarily increase costs on California employers that will likely lead to a loss of jobs.

The list is preliminary. We expect to add more bills to the list in the coming weeks as legislation is amended, and we will periodically release “job killer” watch updates as legislation changes. Please track the status of “job killer” bills on www.cajobkillers.com or by following @CAJobKillers on Twitter. 

Here is the preliminary list of 2015 “job killer” bills:

Increased Labor Costs

AB 357 (Chiu; D-San Francisco) Predictable Scheduling Mandate/Protected Leave of Absence — Imposes an unfair, one-size fits all, two-week notice scheduling mandate on certain employers that perform retail sales activity, and penalizes these employers with “additional pay” for making changes to the schedule with less than two weeks notice, and additionally imposes an unlimited, protected leave of absence from work as well as a broad new protected class of employees who are receiving public assistance or have an identified family member receiving such assistance.

SB 3 (Leno; D-San Francisco/ Leyva; D-Chino) Automatic Minimum Wage Increase— Unfairly increases’ employers costs while ignoring the economic factors or other costs of employers by increasing the minimum wage by $3.00 over the next two and a half years with automatic increases tied to inflation.

SB 406 (Jackson; D-Santa Barbara) Significant Expansion of California Family Rights Act — Creates less conformity with federal law by dramatically reducing the employee threshold from 50 to less than 5 employees and expanding the family members for whom leave may be taken, which will provide a California-only, separate 12 week protected leave of absence on both small and large employers to administer, thereby increasing costs and risk of litigation.

Increased Fuel Costs

SB 350 (de León; D-Los Angeles) Costly and Burdensome Regulations — Potentially increases costs and burdens on all Californians by mandating an arbitrary and unrealistic reduction of petroleum use by 50%, increasing the current Renewable Portfolio Standard to 50% and increasing energy efficiency in buildings by 50% all by 2030 without regard to the impact on individuals, jobs and the economy.

Tax Increases

ACA 4 (Frazier; D-Oakley) Lowers Vote Requirement for Tax Increases — Adds complexity and uncertainty to the current tax structure and pressure to increase taxes on commercial, industrial and residential property owners by giving local governments new authority to enact special taxes, including parcel taxes, by lowering the vote threshold from two-thirds to 55%.

SB 684 (Hancock; D-Berkeley) Increased Tax Rate — Threatens to significantly increase the corporate tax rate on publicly held corporations and financial institutions up to 15% according to the wages paid to employees in the United States, and threatens to increase that rate by 50% thereafter, if the corporation or institution reduces its workforce in the United States and simultaneously increases its contractors.

SCA 5 (Hancock; D-Berkeley) Lowers Vote Requirement for Tax Increases — Adds complexity and uncertainty to the current tax structure and pressure to increase taxes on commercial, industrial and residential property owners by giving local governments new authority to enact special taxes, including parcel taxes, by lowering the vote threshold from two-thirds to 55%.

Increased Burdensome Environmental Regulation

AB 356 (Williams; D-Santa Barbara) Limits In-State Energy Development — Jeopardizes high paying middle class jobs in resource extraction fields by severely restricting wastewater injections sites and requiring unnecessary monitoring of those sites.

AB 1490 (Rendon; D-Lakewood) Limits In-State Energy Development — Drives up fuel prices and energy prices by imposing a de facto moratorium on well stimulation activities by halting the activity after an  earthquake of a magnitude 2.0 or higher.

SB 32 (Pavley; D-Agoura Hills) Halts Economic Growth — Increases costs for California businesses, makes them less competitive and discourages economic growth by adopting further greenhouse gas emission reductions for 2030 and 2050 without regard to the impact on individuals, jobs and the economy.

Increased Health Care Costs

SB 546 (Leno; D-San Francisco) Health Care Rate Regulation — Threatens employers with higher premiums and interferes with their ability to negotiate with health plans by imposing unnecessary and burdensome new reporting requirements on health plans and insurers in the large group market, and giving the Department of Managed Health Care and the Department of Insurance authority to modify or deny all rate changes in the large group market.

Economic Development Barriers

AB 359 (Gonzalez; D-San Diego) Costly Employee Retention Mandate — Inappropriately alters the employment relationship and increases frivolous litigation by allowing a private right of action and by requiring any successor grocery employer to retain employees of the former grocery employer for 90 days and continue to offer continued employment unless the employees’ performance during the 90-day period was unsatisfactory.

SB 576 (Leno; D-San Francisco) Stifles Mobile Application Technology Development — Stifles innovation and growth in the mobile application economy and creates unnecessary and costly litigation by mandating unnecessary, redundant and impractical requirements that will leave many current and future mobile applications unusable, with no benefit to the consumer.

Increased Unnecessary Litigation Costs

AB 244 (Eggman; D-Stockton) Private Right of Action Exposure — Jeopardizes access to credit for home mortgages, increasing the challenge to attract business to California because of high housing prices, by extending the homeowner’s bill of rights to others, thereby opening the door to more private rights of action.

AB 465 (Hernández; D-West Covina) Increased Litigation — Significantly drives up litigation costs for all California employers as well as increases pressure on the already-overburdened judicial system by precluding mandatory employment arbitration agreements, which is likely pre-empted by the Federal Arbitration Act.

SB 203 (Monning; D-Carmel) Lawsuit Exposure — Exposes beverage manufacturers and food retailers to lawsuits, fines and penalties based on state-only labeling requirements for sugar-sweetened drinks.

 president and CEO of the California Chamber of Commerce

Originally published by Fox and Hounds Daily