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Final Thoughts on 2016 and a Caution to Legislators and Employers for 2017

I will begin this by saying that some of this article is focused on California, while much can be applicable to the rest of the United States.  The San Joaquin Valley is a microcosm of what has taken place across this country.  The rural, farming and agriculture areas of this country are tired of being ignored.   And finally, they stood up in November and got the attention of the people that think that life is only lived in big cities.

California politicians are very good at double speak.  They say they are supportive of Agriculture, but none of them every actually come to the Valley to talk to business owners.  On the rare occasion they do come to the Valley it is to talk to the workers or to point at a High Speed Rail train that is not going to do anything for people here.

The fact is, California, and many State governments across the country, would prefer if Agriculture would just go away.  They would much rather we were all working in a state full of Silicone Valley businesses.  They are cleaner, there would be no fight over water, and we could just ignore it altogether.  In the past election, we did not get visits by Hillary (Trump dropped in quickly) and Kamala Harris (the new Senator) didn’t bother with and knows nothing about this side of California.  The Governor has only been to Fresno a few times in 6 years and that is never to learn about real issues (he knows it all I guess).

For the rest of the country, the story is similar.  President Obama flew over the rest of the US and only visited a few coastal states in 8 years in office.  He came to California almost monthly to San Francisco or Los Angeles to attend a fund raiser, but on the ONE occasion that he came to the valley to discuss the drought, he got off the plane, went to a dirt field for about 1 hour and then flew out because he had a golf date in Southern California (where they had water to make beautiful greens for his putting).  We never saw a thing done about the drought after that and still have not until last week when a bill (0pposed by outgoing Senator Barbara Boxer) was signed by the President to help us build dams.  This was not because of any work done by the President, but by the work of our Representatives from the Valley that finally got enough support from  enough people in both parties to get this to the President despite Barbara Boxer.

One of the most telling examples of how Legislators view business owners is how they write regulations.  Almost all regulations start with the assumption that most employers are bad.  In fact, many times it is actually written into the introduction and states that this bill must be passed to protect the workers, etc.  The reality is that most employers work very hard with their employees to create a family atmosphere.  The regulations get in the way of much of this.  Every time the government mandates a benefit that many people are already doing for their employees, they add cumbersome requirements, and many pages of fines and penalties if you do not do it exactly right.  In a more practical world, doing your best should count for something, but not according to our Legislators.  So, every time they add a benefit, many employers remove another benefit so they can afford the one the government wants.  There is only one pot of money, but Legislators think employers can just invent more money like Congress does and it just isn’t the case.

If there is one takeaway from the recent Presidential elections is that middle-America and rural areas are tired of being ignored or shoved aside by our representatives.  If you don’t visit and really listen to their issues, you run the chance of being replaced.  Not all issues affecting business and employees can be handled by looking out the window in Los Angeles or Sacramento or Washington, D.C.  I hope they pay attention or 2018 could be a very turbulent year as well.

BUT THERE IS A RESPONSIBILITY OF THE OWNER\EMPLOYER AS WELL:

In 1999, in California, Governor Gray Davis signed the labor bills establishing daily as well as weekly overtime rules.  It also established a 30 minute employee meal with stern regulations.  Here we are 17 years later and there are still a number of employers who ignore, or do not know of these laws, or simply choose to go their own way.  This affects all of us.  When an employer does not follow the simple laws and refuses to do things like installing a time clock and paying people for the hours they work, they give every employer a black eye and give every Legislator an easy excuse to add new laws and regulations.  In other words, a few stubborn bad employers are making business hard for everyone else.  Instead of just complaining about the State or the Federal government, if  you know an employer that is not following the law, talk to them and let them know they are a big part of the problem.

The easiest way to pay people with the least amount of work on your part is to pay people exactly what they work based on a time clock.  Anything else you are doing is why we keep getting more “wage theft” headlines.  Let’s all resolve in 2017 to pay people for what they work and hold them accountable for the job.  Spend your hard time enforcing your rules instead of working hard to explain a poor payroll practice.  With minimum wages going up and other regulations coming to many States, 2017 is a good year to get on board the right train.  HR Mobile Services, Inc. is there to help you do it, but you have to follow the program to make it successful.

Have a Happy and Prosperous New Year!!!

CALIFORNIA DEFEATS OVERTIME BILL FOR AGRICULTURE AGAIN…..BUT…..

On Friday, there was a heated debate in Sacramento regarding a bill that would remove the exemptions for agriculture workers and bring them into the 8 hour day and 40 hour workweek.

First, a little history:

The Federal Government exempted agriculture workers back in the 1940’s from the FLSA and left the regulation of overtime to the States if they wanted to improve on this standard.  NO OTHER STATE DID…..EXCEPT CALIFORNIA.  In 1976 Jerry Brown (the first time as Governor), signed bills that established the 10 hour day and 60 hour work-week.  This was included in the Wage Orders that were established about 2001, specifically, Wage Order 14 with some agriculture work being moved to the 8/40 schedule with wage orders 8 and 13.

In 2010 and again in 2011, they tried to change the rules to 8/40 but it was defeated again with Governor Arnold Schwarzenegger stating:

“Unfortunately, this measure, while well-intended, will not
improve the lives of California’s agricultural workers and
instead will result in additional burdens on California
businesses, increased unemployment, and lower wages.  In order
to remain competitive against other states that do not have such
wage requirements, businesses will simply avoid paying overtime.
Instead of working 10-hour days, multiple crews will be hired
to work shorter shifts, resulting in lower take home pay for all
workers.  Businesses trying to compete under the new wage rules
may become unprofitable and go out of business, resulting in
further damage to our already fragile economy.”

So again on Friday, we had the arguments for and against.  3  pro-8/40 Assembly members felt it was important to quote Bible Scripture.  While interesting, this is not really the argument.  There were supporters from the usual groups, UFW, Labor leaders on one side and Agriculture employers on the other.  What was missing was those who really represent the interests of the employee.

Right now, a dairy worker generally works 60 hours a week, 10 hours a day.  If you pass this law, that employee will be working 40 hours a week, or 8 hours per day (5 days a week).  Since employers will not want to pay overtime, they will do one of 3 things.  They will change from two 10-hour shifts a day, to 3 8-hour shifts per day.  Or, they will reduce the size of their herds so they can be handled in 8 hours and this will further reduce the number of employees needed.  Finally, they can just close up and go to one of the other 49 states that want to work with agricultural employers.

When you reduce the worker’s income by 20 hours per week, you are not doing them a favor.  In fact, you may be creating a much worse situation.  In order to make up for the lost income (can you afford to lose $200 + per week in your pay?) the employee will have to look for a second income.  This means working at another dairy 2 days a week or working a second shift at another dairy.  This increases the likelihood of injuries due to being over tired, less time with family and most likely they will not have a day off at all.  Right now they get one or two days off a week, but if they have a second job, that will most likely go away.  YOU ARE NOT HELPING A PERSON WHEN YOU REDUCE THEIR HOURS, INCOME AND DAYS OFF.

Though well intentioned, this shows a real lack of understanding of the actual on the ground situation.  Typical of State Legislators, they sit in their Sacramento office and listen to advocates instead of getting their shoes dirty and talking to the actual people involved.  I would extend an invitation to any State Legislator to come and spend a day in our office to see the impact of some of their legislations.  I can guarantee there are at least 10 things that they do not know exist or the impact it has on employers and employees, and the environment.

Meanwhile, contact your representatives directly, not through an organization, and point out to them the tremendous loss to employees if this legislation goes through.  They won’t listen to your problems, but they may listen if you are discussing your employee’s concerns.

Attention ALL States: California is at it Again – Double Holiday Pay!!!!!

Hot on the heals of establishing a mandatory 3 days of sick pay for all employees in the state, California is now considering Double Pay for certain holidays.  Please read the analysis below from the California Chamber of Commerce Alert Bulletin regarding this legislation (more commentary at the end):

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Assembly Committee Passes Double Holiday Pay Bill

March 20, 2015 Jennifer Barrera

The Assembly Labor and Employment Committee this week approved a California Chamber of Commerce-opposed bill requiring double pay for work on certain days.

During testimony to the committee on AB 67 (Gonzalez; D-San Diego) CalChamber Policy Advocate Jennifer Barrera explained that the bill increases costs, creates a competitive disadvantage, and potentially violates employers’ constitutional rights by forcing employers to recognize certain days as “family holidays” and compensate all employees with double pay for work performed on those days.

Violates Religious Freedom

AB 67 provides that employers shall compensate an employee at no less than twice the employee’s regular rate of pay on a “family holiday,” defined as “December 25 of each year” and “the fourth Thursday of November of each year,” commonly referred to as Christmas and Thanksgiving.

While the recognition of these holidays may seem benign to some persons, employers who have non-Christian-based beliefs or are immigrants to America might not see the recognition the same way. The Legislature should not mandate certain days as more significant based upon religious or cultural beliefs that are not maintained by all.

Further questions about the First Amendment implications of AB 67 were raised during the hearing and directed at Barrera, but she was stopped from answering them by the committee chair, who cited procedural precedent issues.

Unavoidable Increase in Costs

Although some employers may close their place of business on a “family holiday” to accommodate their employees, others do not realistically have that option for their business models.

Competitive Disadvantage

AB 67 would also unilaterally increase the cost of doing business only for those employers who have a physical presence in California, thereby automatically placing them at a competitive disadvantage with online companies and out-of-state businesses that would not be subject to this cost.

Recently, the Legislature tried to even the playing field between online retailers and brick-and-mortar stores in the sales-tax arena. AB 67 would further distort this playing field by increasing the cost of doing business for local employers, as opposed to online retailers, who would not have to comply.

Regular Rate of Pay/PAGA Enforcement

Determining the regular rate of pay of many employees requires a detailed calculation that goes beyond just an employee’s hourly pay. As defined by the Division of Labor Standards Enforcement, the “regular rate of pay includes a number of different kinds of remuneration, for example hourly earnings, salary, piecework earnings, commissions, certain bonuses, and the value of meals and lodging.” While this calculation is performed for overtime purposes, it is subject to good faith errors as to what types of “remuneration” should be included in the calculation.

Due to being included in Section 511.5 of the Labor Code, the provisions of AB 67 are subject to the Private Attorneys General Act (PAGA) (Labor Code Section 2699 et seq.). Therefore, errors in calculating the regular rate of pay or failures to comply with other provisions of this mandate would add another threat of litigation against California employers.

Key Vote

AB 67 passed the Assembly Labor and Employment Committee 5-2.

 

Ayes: Chu (D-San Jose), Hernández (D-West Covina), Low (D-Campbell), McCarty (D-Sacramento), Thurmond (D-Richmond.

 

Noes: Harper (R-Huntington Beach), Patterson (R-Fresno).

 

The bill now heads to the Assembly Appropriations Committee; no hearing date has been set.

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This bill puts a direct strain on any employer who works with living beings, animal or human.  Zoos, dairies, pet stores, aviaries, animal conservatories, laboratories and research facilities, all would fall under this.  Not mentioned are the thousands of employees who work with the elderly and infirmed.  Now, many places fully staff on the holidays so that people who may not have family or a place to celebrate a holiday, have a great day.  Now they will cut back to a bare minimum of workers and hours and this will also reduce the enjoyment of holidays for those people.

This is a well intentioned bill but not a well thought out bill.  Notice that Sick Pay, Paid leave, and now Holiday pay do not affect the State employees because they can just close on those days or they already have a better package of specialties, or, what the heck, it is just tax payer money so there are no real consequences to State agencies.   Hmmmm……..

One positive, there is almost no reason to join a union any more.  They are already in the California Legislature.

We ask that you contact your representatives and express your opinion about this legislation. 

 

Cattle Rustling is on the Rise

SACRAMENTO, Calif.  —   A crime that was at the center of many Western movies is thriving in  modern-day California as reports of cattle rustling are on the rise,  state livestock officials said.

Greg Lawley, chief of the state’s Bureau of Livestock Identification,  said 1,317 head of cattle were stolen or reported missing last year. He  told the Sacramento Bee (    https://bit.ly/1cka3Jb  ) that it’s a 22 percent increase from prerecession numbers.

The USDA reports that cattle prices hit record highs in 2011 and 2012. One steer can sell for $1,000 or more.

Cattle ranchers hope a bill setting tougher fines and punishments that  goes into effect Jan. 1 will serve as a deterrent. Previously, there  were no set fines for cattle rustling. Next year, the crime will be  punishable as a felony or misdemeanor with up to a $5,000 fine.

Currently, it can be common for rustlers to plead charges down to a misdemeanor.

“They’ll get probation,” said Justin Oldfield, vice president of  government relations with the California Cattlemen’s Association. “When  people are punished, it’s usually a fine and not jail time. There  doesn’t seem to be a whole lot of seriousness from the courts.”

Oldfield told the Bee that he is uncertain whether the new law will  deter cattle theft, but he believes that it will create awareness.

“When you’re talking about the value of a steer worth $1,000 or more,  and you lose five of those – that’s a substantial impact to an  operation,” he said. “It can make or break the bottom line for that  year.”

There are roughly 3 million head of cattle in California, most of them  dairy cows. But 575,000 head roam the range, often with no more  protection than a brand.

Last year, the livestock identification bureau identified and returned  cattle worth $1.4 million to the owners. State officials say the crime  probably is under-reported.

In 2010 Red Bluff rancher Candace Owen lost 25 calves to thieves.

“It’s a terrible crime when you steal someone’s livelihood,” she said.

Officials say most thefts are inside jobs. Rustlers can load up a  livestock trailer and be in another state in a matter of hours.

“The thing with stealing livestock, and especially cattle, is you can  get 100 percent of its value, especially with unbranded animals,” Lawley said. In most cases a brand is the only way to establish ownership.

The rise in cattle theft in California is part of a national trend. In  2012, more than 10,400 head of cattle and horses were reported missing  or stolen to the Texas and Southwestern Cattle Raisers Association – a  36 percent increase from 2010.

Information from: The Sacramento Bee,    https://www.sacbee.com 

The Associated Press