Credit Report Bill Substantially Amended

AB 22, by Assembly Member Tony Mendoza, was substantially amended last week to clarify exemptions to credit reports and clarify the definitions of “consumer credit report” and “managerial position.” As counties will recall, AB 22 restricts prospective employers from using consumer credit reports for employment purposes. The bill now exempts the following from this restriction:

• A position within the Department of Justice
• Managerial position (see below)
• Position as a sworn peace officer or other law enforcement position
• Position for which credit report information is required by law
• Position requiring regular access to all of the following information for any one person: bank/credit card information, Social Security number, birthdate
• Position that involves access to confidential or proprietary information, including a formula, pattern, compilation, program, device, method, technique, process or trade secret that (a) drives independent economic value, actual or potential, from not being generally known to, and not being readily ascertainable by proper means by, other persons, who may obtain economic value from the disclosure or use of the information, and (b) is the subject of an effort that is reasonable under the circumstances to maintain secrecy of the information.
• Position that involves regular access to cash totaling $10,000 or more of the employer, a customer, or client, during the workday.

Amendments to AB 22 now define “managerial position” consistent with Wage Order 4, Section 1 of the Industrial Welfare Commission, further exempting an employee who meets the definition of exempt: 

• Whose duties and responsibilities involve the management of the enterprise in which he/she is employed or of a customarily recognized department or subdivision thereof.
• Who customarily and regularly directs the work of two or more other employees.
• Who has the authority to hire or fire other employees or whose suggestions and recommendations as to the hiring or firing and as to the advancement and promotion or any other change of status of other employees will be given particular weight.
• Who is primarily engaged in duties which meet the test of the exemption. The activities constituting exempt work and nonexempt work shall be construed in the same manner as such items are construed in the following regulations under the Fair Labor Standards Act. Exempt work shall include all work that is directly and closely related to exempt work and work which is properly viewed as a means for carrying out exempt functions. The work actually performed by the employee during the course of the workweek must, first and foremost, be examined and the amount of time the employee spends on such work, together with the employer’s realistic expectations and the realistic requirements of the job shall be considered in determining whether the employee satisfies this requirement.
• Employee must also earn a monthly salary equivalent to no less than two times the state minimum wage for full-time employment (40 hours/week)

AB 22 is currently is Assembly enrollment after which it will be sent to Governor Brown for further action. CSAC remains opposed to the legislation.

Conference Committee to Hear Pension Reform during Interim

Two bills, AB 340 and SB 827, were amended last week with language that expresses the intent of the Legislature to convene a conference committee to craft legislation that will reform state and local pension systems.

Counties will recall that the previous version of AB 340, by Assembly Member Warren Furutani, would have prohibited a variety of payments from being included in compensation earnable for the purpose of calculating retirement benefits for members of 1937 Act county retirement systems; additionally, the bill would have prohibited a person who retires on or after January 1, 2012, from returning to work as a retired annuitant or as a contract employee for a period of 180 days after retirement. CSAC opposed this legislation. 

SB 827, by Senator Joseph Simitian, is the Senate version of AB 340. Both bills will lead to the establishment of a bipartisan conference committee composed of Assembly Members and Senators and chaired by Assembly Member Furutani, which will hold public hearings on pension reforms. The hearings will include participation from the Department of Finance, the Legislative Analyst’s Office, the California Public Employees Retirement System, the California State Teachers Retirement system and other key experts and stakeholders, and will report back to the Legislature when it reconvenes in January.

CSAC will keep you apprised of details related to the conference committee as they are received.

Bill Would Disallow Prohibition of Project Labor Agreements

SB 922, by President Pro tem Darrell Steinberg, would specify what must be included in a project labor agreement (PLA) and also specifies that a charter ordinance cannot be passed that would prohibit the use of PLAs. The bill provides that the following must be included in a PLA: 

• Prohibition of discrimination based on race, national origin, sex, sexual orientation, political affiliation, or membership in a labor organization.
• Permission qualified contractors and subcontractors to bid regardless of whether they are part of a collective bargaining agreement.
• A drug-testing protocol and guarantee against work stoppages, strikes, lockouts, and similar project disruptions.
• Requirement that disputes over the PLA to be resolved by a neutral arbitrator.

CSAC has taken an oppose position on SB 922, as it interferes with local control and a county’s ability to make a decision regarding the use of PLAs on public works projects. The bill now awaits action by Governor Brown.