CC SR 20240604 H - Legislation Update Labor Relations Bills
CITY COUNCIL MEETING DATE: 06/04/2024
AGENDA REPORT AGENDA HEADING: Consent Calendar
AGENDA TITLE:
Consideration and possible action to take positions on certain labor bill legislation being
considered by state law makers.
RECOMMENDED COUNCIL ACTION:
1. Authorize the Mayor to sign position letters in opposition of Senate Bill (SB) 1116
(Unemployment Insurance) and Assembly Bill (AB) 2561 (Local Public Employees:
Vacant Positions).
FISCAL IMPACT: None
Amount Budgeted: N/A
Additional Appropriation: N/A
Account Number(s): N/A
ORIGINATED BY: Shaunna Hunter, Senior Administrative Analyst
REVIEWED BY: Same as Below
APPROVED BY: Ara Mihranian, AICP, City Manager
ATTACHED SUPPORTING DOCUMENTS:
A. Letter in Opposition to SB 1116 (Page A-1)
B. Letter in Opposition to AB 2561 (Page B-1)
C. SB 1116 – Unemployment Insurance: Trade Disputes, Eligibility for Benefits
D. AB 2404 – Labor Relations: Strikes
E. AB 2561 – Local Public Employees: Vacant Positions
BACKGROUND AND DISCUSSION:
State law makers propose several new bills that may be poised to impact local
government operations, particularly in personnel management and labor relations, with
potential disruptions to service delivery to communities. These bills have advanced past
their house of origin and are progressing through the California State Legislature. In light
of these developments, Cal Cities is urging cities to submit letters of opposition.
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In accordance with the 2024 Legislative Platform, staff has prepared letters opposing
specific legislation for the City Council’s consideration. The links provided below offer
detailed analyses, proposed bill language, and tracking information by Cal Cities.
SB 1116 (Portantino & Durazo) Unemployment Insurance. This bill would enable
striking employees to be eligible for unemployment benefits after two weeks of striking.
Current law provides for the payment of unemployment compensation benefits and
extended benefits to eligible individuals who meet specified requirements. Under current
law, unemployment benefits are paid from the Unemployment Fund, which is continuously
appropriated for these purposes. Current law makes an employee ineligible for benefits if
the employee left work because of a trade dispute and specifies that the employee
remains ineligible for the duration of the trade dispute. Existing case law holds that
employees who left work due to a lockout by the employer, even if it was in anticipation
of a trade dispute, are eligible for benefits. This bill would restore eligibility after the first
2 weeks for an employee who left work because of a trade dispute.
Attached for the Council’s consideration is the draft opposition letter to SB 1116
(Attachment A).
AB 2561 (McKinnor) Vacant Positions. This bill requires local governments to meet and
confer with labor unions if the vacancy rate in the membership exceed s 10% for more
than 90 days and develop, publish, and implement a plan to address the vacancy rate
within the next 180 days. The plan would need to be presented at a public hearing.
Attached for the Council’s consideration is the draft opposition letter to AB 2561
(Attachment B).
ADDITIONAL INFORMATION:
AB 2404 (Lee) Labor Relations Strikes. Cal Cities had originally requested cities
oppose AB 2404 which seeks to remove provisions in MOUs against striking and
sympathy striking for local government employees. If approved, all verbiage against
striking, crossing picket lines, and sympathy striking would need to be removed from
MOUs and the labor unions must inform their members of their rights to strike; all local
government employees would be impacted except public safety, emergency
management, and first responders.
As of publishing this agenda packet, the City’s State Lobbyist, RPPG, informed staff that
this bill has been held. Therefore, Staff is not recommending a opposition be issued at
this time.
CONCLUSION:
Staff recommends the City Council authorize the Mayor to sign the attached letters
opposing various bills under consideration by state law makers which address employee
relations, vacancy rates, and striking which may hinder governmental services.
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ALTERNATIVES:
In addition to the Staff recommendation, the following alternative actions are available for
the City Council’s consideration:
1. Do not authorize one or any combination of the attached opposition letters and
provide further direction.
2. Take other action, as deemed appropriate.
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30940 HAWTHORNE BLVD. / RANCHO PALOS VERDES, CA 90275-5391 / (310) 544-5207 / FAX (310) 544-5291 / WWW.RPVCA.GOV
June 4, 2024 Via Email
Senator Anthony Portantino
California State Senate, District 25
1021 O Street, Suite 7630
Sacramento, CA 95814
Senator Maria Elena Durazo
California State Senate, District 26
1021 O Street, Suite 7530
Sacramento, CA 95814
SUBJECT: Notice of Opposition for SB 1116
Dear Honorable Senators Portantino and Durazo,
I am writing on behalf of the City of Rancho Palos Verdes to express our strong opposition
to SB 1116 (Portantino). This bill proposes to provide Unemployment Insurance (UI) benefits
to employees who remain on strike for more than two weeks. We believe this would unfairly
burden employers by requiring them to fund ongoing labor disputes through the UI system.
Local government revenues are already incredibly restrictive, with limited funding sources.
As cost pressures continue to increase, it is crucial for local agencies to maintain a fiscally
solvent UI system to continue delivering public services and providing competitive benefits
to both active and retired employees.
Under current law, UI payments are designed to assist employees who, through no fault of
their own, are forced to leave their employment. Participating local agencies fund these
payments through an Unemployment Insurance Reserve Account (UI Account) managed by
the Employment Development Department (EDD). SB 1116 would significantly alter this
system by extending UI benefits to workers who are still employed but have chosen to go
on strike as a labor negotiating tactic. In the event of a strike lasting over two weeks, SB
1116 would allow all striking workers to claim UI benefits for up to 26 weeks, leading to
simultaneous claims that would drastically increase UI costs for local government agencies.
Moreover, the financial implications of SB 1116 extend beyond individual employers. The bill
would likely exacerbate the already dire state of California’s UI fund, which was exhausted
during the COVID-19 pandemic and is projected to owe $21 billion to the federal government
by the end of 2025. This debt is nearly double the amount borrowed during the 2008
recession, which took a decade to repay. California’s UI insolvency led to significant federal
tax increases, ranging from hundreds of millions to over $2 billion per year between 2012
and 2018. With the UI fund becoming insolvent less than two years after repaying the federal
UI debt from the Great Recession, further leveraging an already burdened system is
unsustainable.
A-1
Senators Portantino and Durazo
June 4, 2024
Page 2
Similar legislation has been proposed in 2023 (SB 799, Portantino; SB 227, Durazo,
pending) and in 2022 (AB 2847, Garcia), which was vetoed by the Governor. Given the
current budget deficit, no additional burden should be placed on taxpayers or businesses,
including local governments, at this time.
Additionally, SB 1116 could undermine good faith negotiations in the bargaining process.
Public employers strive to engage in fair and productive bargaining with employee
representatives. If SB 1116 were enacted, we anticipate it would result in longer periods of
impasse, increased costs associated with extended Public Employee Relations Board
proceedings, and a decline in the quality of public services.
For these reasons, we must oppose SB 1116 (Portantino) and urge you to consider the
substantial negative impacts this bill would have on local governments, the UI fund, and the
broader community.
Sincerely,
John Cruikshank
Mayor
cc: Al Muratsuchi, Assemblymember, 66th Assembly District
Ben Allen, Senator, 24th State Senate District
Jeff Kiernan, Cal Cities
Marcel Rodarte, California Contract Cities Association
Sharon Gonsalves, Renne Public Policy Group
Rancho Palos Verdes City Council and City Manager
A-2
30940 HAWTHORNE BLVD. / RANCHO PALOS VERDES, CA 90275-5391 / (310) 544-5207 / FAX (310) 544-5291 / WWW.RPVCA.GOV
June 4, 2024 Via Email
Assemblymember Tina McKinnor
California State Assembly, District 61
State Capitol
P.O. Box 942849
Sacramento, CA 94249-0061
SUBJECT: Notice of Opposition for AB 2561 (Employee Vacancy Rates)
Honorable Chair McKinnor,
I am writing to express opposition to Assembly Bill (AB) 2561, which requires local agencies
with vacancy rates over 10% for more than 180 days to create and implement a plan to
reduce these rates to 0% within another 180 days. This plan must also be presented publicly
and posted online for at least a year.
As a contract city, Rancho Palos Verdes uses various tactics to fill vacant positions, including
contracting technical workers, hiring interns, and employing short-term workers while we
recruit talented permanent employees. Recently, we participated in a Class and
Compensation study to evaluate our departments, positions, and titles to aid in recruitment
and retention. These adjustments take time to implement effectively. AB 2561 detracts from
our efforts to build an engaged and effective workforce for the benefit of our residents.
Public sector vacancies are a significant issue statewide. The State of California has had a
vacancy rate above 10% for over 20 years, currently around 20%. Counties, especially in
behavioral health, corrections, and social services, face similar challenges.
Despite ongoing efforts to recruit and retain employees, several factors contribute to
persistent vacancies. Post-COVID demand for remote work, shifting workforce priorities,
and burnout from pandemic-related workloads have made public sector roles less attractive.
Additionally, mandated service delivery overhauls without adequate support have further
strained resources.
AB 2561's requirement for additional reporting and planning diverts critical staff from their
primary duties and adds an unfunded mandate, exacerbating the problem. Local agencies
are already modernizing hiring processes and offering competitive compensation. Effective
solutions require investment from educational institutions, all government levels, and the
private sector.
B-1
Chair McKinnor
June 4, 2024
Page 2
Instead of imposing additional reporting burdens, we should focus on practical, collaborative
approaches to address workforce shortages. Local governments, through their personnel
divisions and in partnership with bargaining units, can develop and implement hiring and
retention strategies without the mandates proposed in AB 2561.
I urge you to oppose AB 2561 and support more effective and collaborative solutions.
Sincerely,
John Cruikshank
Mayor
cc: Public Employment and Retirement Committee Members and Staff
Al Muratsuchi, Assemblymember, 66th Assembly District
Ben Allen, Senator, 24th State Senate District
Jeff Kiernan, Cal Cities
Marcel Rodarte, California Contract Cities Association
Sharon Gonsalves, Renne Public Policy Group
Rancho Palos Verdes City Council and City Manager
B-2