January 6, 2020 marks the reconvening of California’s biennial legislative session. More than 1,000 additional bills will be introduced before the end of February, and several dozen others face final votes by this month’s end as they were held over from 2019.
Among the most controversial for all employers is Assembly Bill 5’s “redux”… or a re-do because, as signed into law by Governor Gavin Newsom last fall, it has numerous effects on independent contractors vs. employees. It proclaims that an independent worker is really an employee deserving of benefits, wage and hours protections, and the right to unionize. Even though special carve-outs were injected into the bill at the last minute to satisfy certain groups and industries, others such as Uber, Lyft and Doordash have pledged to launch a $90,000,000 (!) ballot initiative (or a new bill) to change its terms. Construction trades were excluded from AB 5, but ASAC will be watching closely as major lobbying forces will be in the halls daily; these include the Chamber of Commerce, labor, book writers and journalists, nurses, care givers, minimum wage earners, etc. In addition, lawsuits have already been started challenging the new law.
2020 promises to be problematic for other reasons. It’s an election year, campaigning has begun, political action committees are being solicited for contributions, and the emerging edginess of our national standing due to the impeachment and the recent assassination of a prominent Iranian General. Legislators will be pressed for their opinions on these matters as they run for election or reelection. Most will not introduce any bill that draws opposition from constituents and which jeopardizes their chances of winning.
That said, and despite a good economy and large treasury surplus, California’s housing shortage and the growing number of homeless persons will dominate the news. This means there will be at least one dozen meaty bills to address these issues, among another dozen that will go nowhere due to their terms or a legislator’s lack of political “juice”. And, according to the Department of Finance’s “Population Division” more people left California than entered it, including those without visas. That’s a ten-year low which cannot signal a prosperous future.
Too, the collapse and bankruptcy of the state’s utility giant Pacific Gas & Electric due to wild fires spawned by poor overhead line maintenance will assuredly have the State chip in some relief for tens of thousands of residents whose homes and entire towns have been burnt to the ground. Shareholders and Wall Street are also gloomy about the financial hit they’ll take.
Two bills that ASAC supported were signed into law and merit discussion: Assembly Bill 456: The law prescribes various requirements regarding the formation, content, and enforcement of state and local public contracts. It provided (until January 1, 2020) that contracts entered into on or after January 1, 2017 include a claim resolution process for any claim by a contractor in connection with a public works project against a public entity. It defines a claim for these purposes as a separate demand by the contractor for one or more of the following: a time extension for relief from damages or penalties for delay, payment of money or damages arising from work done pursuant to the contract for a public work, or payment of an amount disputed by the public entity. This bill extends the operation of this claim resolution process until January 1, 2027.
And, Senate Bill 197: Existing law prohibited the CA Department of Transportation, until January 1, 2020, from withholding retention proceeds when making progress payments for work performed by a contractor. This bill deletes the sunset of 2020, thereby making the prohibition operative indefinitely. ASAC was a strong advocate in support of the original retention bill and also SB 197.
Stay tuned for more news from Sacramento. ASAC is monitoring bills daily in your behalf.