Bill Text: CA SB700 | 2021-2022 | Regular Session | Amended

---

Bill Title: State Contract Act: High Road Employment Program.

Spectrum: Partisan Bill (Democrat 1-0)

Status: (Engrossed - Dead) 2022-08-11 - August 11 hearing: Held in committee and under submission. [SB700 Detail]

Download: California-2021-SB700-Amended.html

---

Amended  IN  Assembly  June 16, 2022

Amended  IN  Senate  March 10, 2021

CALIFORNIA LEGISLATURE— 2021–2022 REGULAR SESSION

Senate Bill

No. 700

---

Introduced by Senator Durazo

February 19, 2021

---

An act to add Section 330 to the Unemployment Insurance Code, relating to employment. Article 11 (commencing with Section 10440) to Chapter 2 of Part 2 of Division 2 of the Public Contract Code, and to amend Sections 14005 and 14013 of the Unemployment Insurance Code, relating to employment.

LEGISLATIVE COUNSEL'S DIGEST

SB 700, as amended, Durazo. Employment Development Department. State Contract Act: High Road Employment Program.

(1) Existing law establishes the Labor and Workforce Development Agency as an executive branch agency within state government, consisting of specified boards and departments, including the California Workforce Development Board and the Employment Development Department.

Existing law, the California Workforce Innovation and Opportunity Act, establishes the California Workforce Development Board as the body responsible for assisting the Governor in the development, oversight, and continuous improvement of California’s workforce investment system and the alignment of the education and workforce investment systems to the needs of the 21st century economy and workforce. Existing law tasks the board with developing standards, procedures, and criteria for defining high road workforce development and training partnerships.

Existing law, the State Contract Act, governs contracting between state agencies and private contractors, and sets forth requirements for the bidding, awarding, and overseeing of contracts for projects. Existing law charges the Department of General Services, in the Government Operations Agency, with various administrative duties under the act.

This bill would establish the High Road Employment Program within the Labor and Workforce Development Agency to assist state agencies in complying with specified High Road Employment Plan requirements and with appropriate planning, inclusive decisionmaking, and fair disbursement of community and worker support resources.

This bill would require each bidder for a contract with the state, as a condition of eligibility for such a contract, to submit a High Road Employment Plan to the Department of General Services that includes certification, under penalty of perjury, that all workers are properly classified, as specified, and that includes certain job information, including the number of jobs created, and wage and benefit amounts by job classification for nonsupervisory workers. By expanding the scope of the crime of perjury, the bill would impose a state-mandated local program.

The bill would also require each plan to demonstrate job quality standards and employment practices that include specified provisions, including, among others, offering a stable employment schedule and compliance with high road standards, as prescribed.

The bill would further require the Labor and Workforce Development Agency, the Government Operations Agency, including the Department of General Services, and the Governor’s Office of Business and Economic Development to establish, and be referred to as the Interagency High Road Team, and to be collectively responsible for oversight and decisionmaking related to creating High Road Employment Plan evaluation metrics and advancing other objectives relating to high road procurement. The bill would require the team to compile specified information related to high road employment requirements reported by state agencies and to report this information to the Legislature on or before January 1, 2024.

(2) Existing law requires the California Workforce Development Board to assist the Governor in developing standards, procedures, and criteria for defining high road employers, high road jobs, high road workforce development, and high road training partnerships in California.

This bill would add high road contracting and high road procurement to those standards, procedures, and criteria. The bill would define related terms, including “economic equity” for purposes of the act.

The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.

This bill would provide that no reimbursement is required by this act for a specified reason.

Existing law creates, in the Labor and Workforce Development Agency, the Employment Development Department, which is vested with the duties, purposes, responsibilities, and jurisdiction with respect to job creation activities.

This bill would require the department to be bound by specified California Unemployment Insurance Appeals Board decisions for all purposes related to unemployment insurance, including the determination of benefits or obligations for employees and employers and apply the appeals board’s reasoning and interpretation in all appropriate cases.

Digest Key

Vote: MAJORITY   Appropriation: NO   Fiscal Committee: YES   Local Program: NOYES  

---

Bill Text

The people of the State of California do enact as follows:

SECTION 1.

 Article 11 (commencing with Section 10440) is added to Chapter 2 of Part 2 of Division 2 of the Public Contract Code, to read:

Article  11. High Road Employment Plan

10440.

 This article shall be known, and may be cited, as the High Road Employment Plan.

10441.

 For the purposes of this article, the following definitions apply:

(a) “Compliance Program” means the High Road Employment Program.

(b) “Department” means the Department of General Services.

(c) “Interagency High Road Team” or “team” shall mean the team consisting of the Labor and Workforce Development Agency, the Government Operations Agency, including the Department of General Services, and the Governor’s Office of Business and Economic Development, that is established pursuant to Section 10444.

(d) “Plan” means the High Road Employment Plan.

(e) “State” or “state agency” means any department, division, board, bureau, commission, or other agency of the state.

10442.

 There is hereby established within the Labor and Workforce Development Agency the High Road Employment Program, to assist state agencies in complying with High Road Employment Plan requirements and appropriate planning, inclusive decisionmaking, and fair disbursement of community and worker support resources.

10443.

 (a) Each bidder for a contract with the state, as a condition of eligibility for such a contract, shall submit a High Road Employment Plan to the department that includes certification, under penalty of perjury, that all workers are properly classified pursuant to Section 2750.5 of the Labor Code, and that includes the following information:

(1) The number of full-time employment jobs proposed to be retained and created by the contract.

(2) Wage and benefit amounts by job classification for nonsupervisory workers under the contract.

(3) The number of all jobs specifically proposed to be retained and created for individuals facing barriers to employment, as defined in subdivision (j) of Section 14005 of the Unemployment Insurance Code, under the contract.

(4) Detailed information regarding any training or apprenticeship programs.

(5) Planned or actual retention of nonsupervisory workers by percentage of workforce.

(b) Each plan shall demonstrate job quality standards and employment practices that include, but are not limited to, all of the following:

(1) Compliance with the high road standard pursuant to subdivision (r) of Section 14005 of the Unemployment Insurance Code.

(2) Consistency with workplace laws and regulations, including efforts to remedy past problems and compliance with Section 2775 of the Labor Code.

(3) Adoption of mechanisms to include worker voice and agency in the workplace.

(4) Offering a stable employment schedule.

(5) Providing benefits such as health care, retirement, paid sick leave and paid family leave.

(6) Opportunities for career advancement and training with wage increases as skills are acquired.

(7) Providing safe and healthy working conditions.

10444.

 (a) The Labor and Workforce Development Agency, the Government Operations Agency, including the Department of General Services, and the Governor’s Office of Business and Economic Development shall establish, and be referred to as, the Interagency High Road Team. The team shall collectively be responsible for oversight and decisionmaking, including, but not limited to, all of the following:

(1) Creating High Road Employment Plan evaluation metrics.

(2) Developing technical assistance and evaluation infrastructure.

(3) Tracking and reporting progress and deliverables.

(b) Upon request by a state agency and approval by the team, the team shall establish interagency agreements that shall advance the objectives of high road procurement and incentive programs.

(c) (1) The team shall require each state agency to report to the team the state agency’s high road employment requirements in the state agency’s procurement processes and incentive programs.

(2) The team shall compile the information reported by each state agency and report this information to the Legislature on or before January 1, 2024.

(3) The requirement for submitting a report imposed under paragraph (2) shall be inoperative on January 1, 2028, pursuant to Section 10231.5 of the Government Code.

(4) The report required pursuant to paragraph (2) shall be submitted in compliance with Section 9795 of the Government Code.

10445.

 This article shall not apply to the following:

(a) The California Conservation Corps.

(b) Fire safe councils.

(c) Any contract subject to Section 1720 of the Labor Code.

10446.

 (a) The program shall be staffed by at least four full-time employees of the Labor and Workforce Development Agency.

(b) The staff shall ensure that state agencies comply with the provisions of this article, including, but not limited to, the plan and programs.

SEC. 2.

 Section 14005 of the Unemployment Insurance Code is amended to read:

14005.

 For purposes of this division:

(a) “Board” means the California Workforce Development Board.

(b) “Agency” means the Labor and Workforce Development Agency.

(c) “Career pathways,” “career ladders,” or “career lattices” are an identified series of positions, work experiences, or educational benchmarks or credentials with multiple access points that offer occupational and financial advancement within a specified career field or related fields over time. “Career pathways,” “career ladders,” and “career lattices” offer combined programs of rigorous and high-quality education, training, and other services that do all of the following:

(1) Align with the skill needs of industries in the economy of the state or regional economy involved.

(2) Prepare an individual to be successful in any of a full range of secondary or postsecondary education options, including apprenticeships registered under the National Apprenticeship Act of 1937 (29 U.S.C. Sec. 50 et seq.), except as in Section 3226 of Title 29 of the United States Code.

(3) Include counseling to support an individual in achieving the individual’s education and career goals.

(4) Include, as appropriate, education offered concurrently with and in the same context as workforce preparation activities and training for a specific occupation or occupational cluster.

(5) Organize education, training, and other services to meet the particular needs of an individual in a manner that accelerates the educational and career advancement of the individual to the extent practicable.

(6) Enable an individual to attain a secondary school diploma or its recognized equivalent, and at least one recognized postsecondary credential.

(7) Help an individual enter or advance within a specific occupation or occupational cluster.

(d) “Cluster-based sector strategies” mean methods of focusing workforce and economic development on those sectors that have demonstrated a capacity for economic growth and job creation in a particular geographic area.

(e) “Data driven” means a process of making decisions about investments and policies based on systematic analysis of data, which may include data pertaining to labor markets.

(f) “Economic security” means, with respect to a worker, earning a wage sufficient to support a family adequately, and, over time, to save for emergency expenses and adequate retirement income, based on factors such as household size, the cost of living in the worker’s community, and other factors that may vary by region.

(g) “Evidence-based” means making use of policy research as a basis for determining best policy practices. Evidence-based policymakers adopt policies that research has shown to produce positive outcomes, in a variety of settings, for a variety of populations over time. Successful, evidence-based programs deliver quantifiable and sustainable results. Evidence-based practices differ from approaches that are based on tradition, belief, convention, or anecdotal evidence.

(h) “High-priority occupations” mean occupations that have a significant presence in a targeted industry sector or industry cluster, are in demand, or projected to be in demand, by employers, and pay or lead to payment of a wage that provides economic security.

(i) (1) “In-demand industry sector or occupation” means either of the following:

(A) An industry sector that has a substantial current or potential impact, including through jobs that lead to economic self-sufficiency and opportunities for advancement, on the state, regional, or local economy, as appropriate, and that contributes to the growth or stability of other supporting businesses, or the growth of other industry sectors.

(B) An occupation that currently has or is projected to have a number of positions, including positions that lead to economic self-sufficiency and opportunities for advancement, in an industry sector so as to have a significant impact on the state, regional, or local economy, as appropriate.

(2) The determination of whether an industry sector or occupation is “in-demand” under this subdivision shall be made by the board or local board, or through the regional planning process in which local boards participate under the Workforce Innovation and Opportunity Act, as appropriate, using state and regional business and labor market projections, including the use of labor market information.

(j) “Individual with employment barriers” means an individual with any characteristic that substantially limits an individual’s ability to obtain employment, including indicators of poor work history, lack of work experience, or access to employment in nontraditional occupations, long-term unemployment, lack of educational or occupational skills attainment, dislocation from high-wage and high-benefit employment, low levels of literacy or English proficiency, disability status, or welfare dependency, including members of all of the following groups:

(1) Displaced homemakers.

(2) Low-income individuals.

(3) Indians, Alaska Natives, and Native Hawaiians, as those terms are defined in Section 3221 of Title 29 of the United States Code.

(4) Individuals with disabilities, including youths who are individuals with disabilities.

(5) Older individuals.

(6) Ex-offenders.

(7) Homeless individuals, as defined in Section 14043e-2(6) of Title 42 of the United States Code, or homeless children and youths, as defined in Section 11434a(2) of Title 42 of the United States Code.

(8) Youth who are in, or have aged out of, the foster care system.

(9) Individuals who are English language learners, individuals who have low levels of literacy, and individuals facing substantial cultural barriers.

(10) Eligible migrant and seasonal farmworkers, as defined in Section 3322(i) of Title 29 of the United States Code.

(11) Individuals within two years of exhausting lifetime eligibility under Part A of Title IV of the Social Security Act (42 U.S.C. Sec. 601 et seq.).

(12) Single parents, including single, pregnant women.

(13) Long-term unemployed individuals.

(14) Transgender and gender nonconforming individuals.

(15) Any other groups as the Governor determines to have barriers to employment.

(k) “Industry cluster” means a geographic concentration or emerging concentration of interdependent industries with direct service, supplier, and research relationships, or independent industries that share common resources in a given regional economy or labor market. An industry cluster is a group of employers closely linked by common product or services, workforce needs, similar technologies, and supply chains in a given regional economy or labor market.

(l) “Industry or sector partnership” means a workforce collaborative, convened or acting in partnership with the board or a local board, that does the following:

(1) Organizes key stakeholders in an industry cluster into a working group that focuses on the shared goals and human resources needs of the industry cluster and that includes, at the appropriate stages of development of the partnership:

(A) Representatives of multiple businesses or other employers in the industry cluster, including small and medium-sized employers when practicable.

(B) One or more representatives of a recognized state labor organization or central labor council, or another labor representative, as appropriate.

(C) One or more representatives of an institution of higher education with, or another provider of, education or training programs that support the industry cluster.

(2) The workforce collaborative may include representatives of any of the following:

(A) State or local government.

(B) State or local economic development agencies.

(C) State boards or local boards, as appropriate.

(D) A state workforce agency or entity providing employment services.

(E) Other state or local agencies.

(F) Business or trade associations.

(G) Economic development organizations.

(H) Nonprofit organizations, community-based organizations, or intermediaries.

(I) Philanthropic associations.

(J) Industry associations.

(K) Other organizations, as determined to be necessary by the members comprising the industry sector or partnership.

(m) “Industry sector” means those firms that produce similar products or provide similar services using somewhat similar business processes, and are closely linked by workforce needs, within a regional labor market.

(n) “Local labor federation” means a central labor council that is an organization of local unions affiliated with the California Labor Federation or a local building and construction trades council affiliated with the State Building and Construction Trades Council of California.

(o) “Sector strategies” means methods of prioritizing investments in competitive and emerging industry sectors and industry clusters on the basis of labor market and other economic data indicating strategic growth potential, especially with regard to jobs and income, and exhibit the following characteristics:

(1) Focus workforce investment in education and workforce training programs that are likely to lead to jobs providing economic security or to an entry-level job with a well-articulated career pathway into a job providing economic security.

(2) Effectively boost labor productivity or reduce business barriers to growth and expansion stemming from workforce supply problems, including skills gaps and occupational shortages by directing resources and making investments to plug skills gaps and provide education and training programs for high-priority occupations.

(3) May be implemented using articulated career pathways or lattices and a system of stackable credentials.

(4) May target underserved communities, disconnected youths, incumbent workers, and recently separated military veterans.

(5) Frequently are implemented using industry or sector partnerships.

(6) Typically are implemented at the regional level where sector firms, those employers described in subdivisions (j) and (l), often share a common labor market and supply chains. However, sector strategies may also be implemented at the state or local level depending on sector needs and labor market conditions.

(p) “Workforce Innovation and Opportunity Act of 2014” means the federal act enacted as Public Law 113-128.

(q) (1) “Earn and learn” includes, but is not limited to, a program that does either of the following:

(A) Combines applied learning in a workplace setting with compensation allowing workers or students to gain work experience and secure a wage as they develop skills and competencies directly relevant to the occupation or career for which they are preparing.

(B) Brings together classroom instruction with on-the-job training to combine both formal instruction and actual paid work experience.

(2) “Earn and learn” programs include, but are not limited to, all of the following:

(A) Apprenticeships.

(B) Preapprenticeships.

(C) Incumbent worker training.

(D) Transitional jobs, as described in paragraph (5) of subsection (d) of Section 3174 of Title 29 of the United States Code, as that section read on January 1, 2021, and subsidized employment with an employer of record, which may include, but not be limited to, an employment social enterprise or a worker cooperative, particularly for individuals with barriers to employment.

(E) Paid internships and externships.

(F) Project-based compensated learning.

(r) “High road” means a set of economic and workforce development strategies to achieve economic growth, economic equity, shared prosperity and a clean environment. The strategies include, but are not limited to, interventions that:

(1) Improve job quality and job access, including for women and people from underserved and underrepresented populations.

(2) Meet the skill and profitability needs of employers.

(3) Meet the economic, social, and environmental needs of the community.

(s) “High road training partnership” means an initiative or project that models strategies for developing industry-based, worker-focused training partnerships, including labor-management partnerships. High Road Training partnerships operate via regional, industry- or sector-based training partnerships comprised of employers, workers, and their representatives including organized labor, community-based organizations, education, training, and social services providers, and labor market intermediaries. High Road Training partnerships demonstrate job quality standards and employment practices that include, but are not limited to, the following:

(1) Provision of comparatively good wages and benefits, relative to the industry, occupation, and labor market in which participating workers are employed.

(2) Payment of workers at or above local or regional living wage standards as well as payment at or above regional prevailing wage standards where such standards exist for the occupations in question.

(3) A history of investment in employee training, growth, and development.

(4) Provision of opportunities for career advancement and wage growth.

(5) Safe and healthy working conditions.

(6) Consistent compliance with workplace laws and regulations, including proactive efforts to remedy past problems.

(7) Adoption of mechanisms to include worker voice and agency in the workplace.

(t) “High road construction careers” are high road training partnerships that invest in regional training partnerships comprised of local building trades councils, workforce, community, and education interests that connect to state-approved apprenticeship programs, that utilize the standard Multi-Craft Core preapprenticeship training curriculum and provide a range of supportive services and career placement assistance to women and people from underserved and underrepresented populations.

(u) “Job quality” or “quality jobs” means jobs that provide family-sustaining wages; employer-provided benefits, including, but not limited to, health insurance, retirement, and paid time off; career advancement opportunities; and collective worker input; and are stable, predictable, safe and free of discrimination.

(v) “Economic equity” means all workers have access to quality jobs, structural opportunities for upward mobility, wealth - generating opportunities, and safe and healthy workplaces—regardless of race, ethnicity, gender, sexual orientation, religious beliefs, ability, or past criminal record—and productivity gains would be widely distributed to workers.

(u)

(w) “Career advancement” means demonstrated progression along a career ladder as evidenced by both wage growth and occupational advancement.

(v)

(x) “Employment social enterprise” means a nonprofit or for-profit organization that meets all of the following requirements:

(1) Is organized as a social purpose corporation or a benefit corporation, or as an organization incorporated within a larger organization.

(2) Demonstrates evidence of a mission to provide and to access employment and social supports with on-the-job and life skills training to a direct labor force comprised of individuals with a “barrier to employment,” as that phrase is defined in Section 3102 of Title 29 of the United States Code, as that section read on January 1, 2021.

(3) Is evidence-based and utilizes data-driven policies in implementing procedures and measuring outcomes.

(4) Produces or assembles goods or provides services, or a combination of both.

(w)

(y) “Worker cooperative” has the same meaning as defined in Section 12253.5 of the Corporations Code.

SEC. 3.

 Section 14013 of the Unemployment Insurance Code is amended to read:

14013.

 The board shall assist the Governor in the following:

(a) Promoting the development of a well-educated and highly skilled 21st century workforce, and the development of a high road economy that offers an educated and skilled workforce with fair compensation and treatment in the workplace.

(b) Developing, implementing, and modifying the State Plan. The State Plan shall serve as the comprehensive framework and coordinated plan for the aligned investment of all federal and state workforce training and employment services funding streams and programs. To the extent feasible and when appropriate, the State Plan should reinforce and work with adult education and career technical education efforts that are responsive to labor market trends, as well as economic trends that impact the labor market and workforce, including, but not limited to, climate change, automation of work, and employment.

(c) The review and technical assistance of statewide policies, of statewide programs, and of recommendations on actions that should be taken by the state to align workforce, education, training, and employment funding programs in the state in a manner that supports a comprehensive, high-quality, and streamlined workforce development system in the state, including the review and provision of comments on the State Plan, if any, for programs and activities of one-stop partners that are not core programs.

(d) Developing and continuously improving the statewide workforce investment system, including:

(1) The identification of barriers and means for removing barriers to better coordinate, align, and avoid duplication among the programs and activities carried out through the system.

(2) The development, promotion, and implementation of strategies, as well as the administration of, an field assistance for, programs to advance the use of career pathways for the purpose of providing individuals, including low-skilled adults, youth, and individuals with barriers to employment, and including individuals with disabilities, with workforce investment activities, education, and supportive services to enter or retain high-quality employment. To the extent permissible under state and federal laws, these policies and strategies should support linkages between kindergarten and grades 1 to 12, inclusive, and community college educational systems in order to help secure educational and career advancement. These policies and strategies may be implemented using a sector strategies framework and should ultimately lead to placement in a job providing economic security or job placement in an entry-level job that has a well-articulated career pathway or career ladder to a job providing economic security.

(3) The development, promotion, and implementation of strategies for providing effective outreach to and improved access for individuals and employers who could benefit from services provided through the workforce development system.

(4) The development, promotion, and implementation of strategies, as well as the administration of, and field assistance for, programs that meet the needs of employers, workers, and jobseekers, particularly through industry or sector partnerships related to in-demand industry sectors and occupations, including policies targeting resources to competitive and emerging industry sectors and industry clusters that provide economic security and are either high-growth sectors or critical to California’s economy, or both. These industry sectors and clusters shall have significant economic impacts on the state and its regional and workforce development needs, including, but not limited to, California’s transition to a carbon neutral economy, and have documented career opportunities.

(5) Consistent with the definitions in Section 14005, developing standards, procedures, and criteria for defining high road employers, high road jobs, high road contracting, high road procurement, high road workforce development, and high road training partnerships in California, in accordance with lessons learned from the board’s ongoing high road workforce development initiatives.

(6) The administration, promotion, and expansions of, as well as field assistance for, high road training partnerships, as defined in Section 14005.

(7) The administration, promotion, and expansion of, as well as field assistance for, high road construction careers, as defined in Section 14005.

(8) Recommending adult and dislocated worker training policies and investments that offer a variety of career opportunities while upgrading the skills of California’s workforce. These may include training policies and investments pertaining to any of the following:

(A) Occupational skills training, including training for nontraditional employment.

(B) On-the-job training.

(C) Incumbent worker training in accordance with Section 3174(d)(4) of Title 29 of the United States Code.

(D) Programs that combine workplace training with related instruction, which may include cooperative education programs.

(E) Training programs operated by the private sector.

(F) Skill upgrading and retraining.

(G) Entrepreneurial training.

(H) Transitional jobs in accordance with Section 3174(d)(5) of Title 29 of the United States Code.

(I) Job readiness training provided in combination with any of the services described in subparagraphs (A) to (H), inclusive.

(J) Adult education and literacy activities provided in combination with any of the services described in subparagraphs (A) to (G), inclusive.

(K) Customized training conducted with a commitment by an employer or group of employers to employ an individual upon successful completion of the training.

(e) The identification of regions, including planning regions, for the purposes of Section 3121(a) of Title 29 of the United States Code, and the designation of local areas under Section 3121 of Title 29 of the United States Code, after consultation with local boards and chief elected officials.

(f) The development and continuous improvement of the one-stop delivery system in local areas, including providing assistance to local boards, one-stop operators, one-stop partners, and providers with planning and delivering services, including training services and supportive services, to support effective delivery of services to workers, job seekers, and employers.

(g) Recommending strategies to the Governor for strategic training investments of the Governor’s 15-percent discretionary funds.

(h) Developing strategies to support staff training and awareness across programs supported under the workforce development system.

(i) The development and updating of comprehensive state performance accountability measures, including state-adjusted levels of performance, to assess the effectiveness of the core programs in the state as required under Section 3141(b) of Title 29 of the United States Code. As part of this process the board shall do all of the following:

(1) Develop a workforce metrics dashboard, to be updated annually, that measures the state’s human capital investments in workforce development to better understand the collective impact of these investments on the labor market. The board shall determine the approach for measuring labor market impacts, provided that, to the extent feasible, the board uses statistically rigorous methodologies to estimate, assess, and isolate the impact of programs on participant outcomes. The workforce metrics dashboard shall be produced, to the extent feasible, using existing available data and resources that are currently collected and accessible to state agencies. The board shall convene workforce program partners to develop a standardized set of inputs and outputs for the workforce metrics dashboard. The workforce metrics dashboard shall do all of the following:

(A) Provide a status report on credential attainment, training completion, degree attainment, and participant earnings from workforce education and training programs. The board shall publish and distribute the final report.

(B) Provide demographic breakdowns, including, to the extent possible, race, ethnicity, age, gender, veteran status, wage and credential or degree outcomes, and information on workforce outcomes in different industry sectors.

(C) Measure, at a minimum and to the extent feasible with existing resources, the performance of the following workforce programs: community college career technical education, the Employment Training Panel, Title I and Title II of the federal Workforce Investment Act of 1998 (Public Law 105-220), Title I and Title II of the federal Workforce Innovation and Opportunity Act of 2014 (Public Law 113-128), Trade Adjustment Assistance, and state apprenticeship programs.

(D) Measure participant earnings in California, and to the extent feasible, in other states. The Employment Development Department shall assist the board by calculating aggregated participant earnings using unemployment insurance wage records, without violating any applicable confidentiality requirements.

(2) The State Department of Education is hereby authorized to collect the social security numbers of adults participating in adult education programs so that accurate participation in those programs can be represented in the workforce metrics dashboard. However, an individual shall not be denied program participation if the individual refuses to provide a social security number. The State Department of Education shall keep this information confidential, except, the State Department of Education is authorized to share this information, unless prohibited by federal law, with the Employment Development Department, the board, or the board’s designee, who shall keep the information confidential and use it only to track the labor market and other outcomes described in subparagraph (A) of paragraph (1) of program participants in compliance with all applicable state and federal laws and mandates, including all performance reporting requirements under the Workforce Innovation and Opportunity Act.

(3) (A) Participating workforce programs, including, but not limited to, those specified in subparagraph (C) of paragraph (1), shall provide participant data in a standardized format to the Employment Development Department, the board, or the board’s designee.

(B) The Employment Development Department, the board, or the board’s designee, shall aggregate data provided by participating workforce programs and shall report the data, organized by demographics, earnings, and industry of employment, to the board to assist the board in producing the annual workforce metrics dashboard.

(4) The board shall ensure that a designee has the technical and operational capability of meeting appropriate privacy and security requirements.

(j) The identification and dissemination of information on best practices, including best practices for all of the following:

(1) The effective operation of one-stop centers, relating to the use of business outreach, partnerships, and service delivery strategies, including strategies for serving individuals with barriers to employment.

(2) The development of effective local boards, which may include information on factors that contribute to enabling local boards to exceed negotiated local levels of performance, sustain fiscal integrity, and achieve other measures of effectiveness.

(3) Effective training programs that respond to real-time labor market analysis, that effectively use direct assessment and prior learning assessment to measure an individual’s prior knowledge, skills, competencies, and experiences, and that evaluate such skills, and competencies for adaptability, to support efficient placement into employment or career pathways.

(k) The development and review of statewide policies affecting the coordinated provision of services through the state’s one-stop delivery system described in Section 3151(e) of Title 29 of the United States Code, including the development of all of the following:

(1) Objective criteria and procedures for use by local boards in assessing the effectiveness and continuous improvement of one-stop centers described in Section 3151(e) of Title 29 of the United States Code.

(2) Guidance for the allocation of one-stop center infrastructure funds under Section 3151(h) of Title 29 of the United States Code.

(3) Policies relating to the appropriate roles and contributions of entities carrying out one-stop partner programs within the one-stop delivery system, including approaches to facilitating equitable and efficient cost allocation in such a system.

(l) The development of strategies for technological improvements to facilitate access to, and improve the quality of, services and activities provided through the one-stop delivery system, including such improvements to all of the following:

(1) Enhance digital literacy skills, as defined in Section 9101 of Title 20 of the United States Code, referred to in this division as “digital literacy skills.”

(2) Accelerate the acquisition of skills and recognized postsecondary credentials by participants.

(3) Strengthen the professional development of providers and workforce professionals.

(4) Ensure the technology is accessible to individuals with disabilities and individuals residing in remote areas.

(m) The development of strategies for aligning technology and data systems across one-stop partner programs to enhance service delivery and improve efficiencies in reporting on performance accountability measures, including the design and implementation of common intake, data collection, case management information, and performance accountability measurement and reporting processes and the incorporation of local input into such design and implementation, to improve coordination of services across one-stop partner programs.

(n) The development of allocation formulas for the distribution of funds for employment and training activities for adults, and youth workforce investment activities, to local areas as permitted under Sections 3163(b)(3) and 3173(b)(3) of Title 29 of the United States Code.

(o) The preparation of the annual reports described in paragraphs (1) and (2) of Section 3141(d) of Title 29 of the United States Code.

(p) The development of the statewide workforce and labor market information system described in Section 49l–2(e) of Title 29 of the United States Code.

(q) By July 1, 2020, the development, in conjunction with the Employment Development Department and with input from local workforce development boards, of a policy regarding mutual aid agreements between and among local workforce development boards to enable them to effectively respond to disasters and that is consistent with applicable state and federal law.

(r) The development of other policies as may promote statewide objectives for, and enhance the performance of, the workforce development system in the state.

(s) Helping individuals with barriers to employment, including low-skill, low-wage workers, the long-term unemployed, and members of single-parent households, achieve economic security and upward mobility by implementing policies that encourage the attainment of marketable skills relevant to current labor market trends.

(t) Evaluating program outcomes, including program participant outcomes for all grant programs administered by the California Workforce Development Board, regardless of funding source.

SEC. 4.

 No reimbursement is required by this act pursuant to Section 6 of Article XIII B of the California Constitution because the only costs that may be incurred by a local agency or school district will be incurred because this act creates a new crime or infraction, eliminates a crime or infraction, or changes the penalty for a crime or infraction, within the meaning of Section 17556 of the Government Code, or changes the definition of a crime within the meaning of Section 6 of Article XIII B of the California Constitution.

SECTION 1.

The Legislature finds and declares all of the following:

(a)Some employers regularly avoid obligations such as payment of payroll taxes and payment of premiums for workers’ compensation, social security, unemployment insurance, and disability insurance by misclassifying workers as independent contractors or by relying on other contingent work arrangements to unlawfully shift liability to their own misclassified employees or to corporate entities whose main purpose is to serve as a liability shield for the employer. This often takes the form of an employer directing an employee to enlist additional employees in performing the employer’s work, or a company contracting with another insolvent entity whose sole purpose is providing employees to the company in question.

(b)This subterfuge hurts the state by depriving it of the revenue that enables the state to administer and fund its various social safety net programs, and by making it difficult for the state to recover unpaid taxes and premiums from the bona fide employers who control the employees in question.

(c)To address this by correctly placing employer obligations on the responsible employer, existing state law prevents employers from shifting liability for one of their employees to a second employee even if the employer did not directly hire and does not directly pay the employee in question. Further, existing state law prevents employers from shifting liability to sham entities by establishing explicit requirements for what constitutes a “leasing employer” or “temporary services employer.”

(d)Despite this, when processing multiple claims for drayage drivers that applied for unemployment insurance compensation benefits during the coronavirus (COVID-19) pandemic, the Employment Development Department (EDD) failed to find an employment relationship between the company and the workers who provide services for that company under that company’s control. Instead, the EDD has erroneously placed the burden for failing to provide wage data or pay unemployment insurance taxes on other individuals employed by that company or on sham corporate entities that do not satisfy the requirements to be considered a leasing employer or a temporary services employer.

(e)At least two of these erroneous EDD determinations have been overturned by the California Unemployment Insurance Appeals Board, which has correctly interpreted the law to place responsibility on the company in question, upholding decisions by administrative law judges that have correctly applied the law. Yet, the EDD continues to maintain its anomalous determinations, requiring workers to pursue lengthy and burdensome appeals. This is in conflict with existing law, and the extended appeals divert resources from the agency, expose misclassified workers to unjustified liability, and allow companies that break the law to continue to evade justice.

(f)It is the intent of the Legislature to clarify that existing law prohibiting an employing entity from shifting liability to its own employees or to sham corporate entities that do not qualify as statutory employers also applies to the schemes employers in the drayage industry are utilizing to escape their statutory liability. This clarification is intended to ensure that the EDD makes the correct determinations with regard to employer liability rather than expending resources supporting an incorrect reading of the law.

SEC. 2.Section 330 is added to the Unemployment Insurance Code, to read:

330.

Notwithstanding Section 11425.60 of the Government Code and Section 409, for all purposes under this code, including the determination of benefits or obligations for employees and employers, the department shall be bound by the appeals board’s decisions in Ruben Aldrete Ruiz v. Employment Development Department, Case No. AO-445635, issued on January 22, 2021, and in Francisco J. Banales v. Employment Development Department, Case No. AO-445581, issued on December 17, 2020. These decisions correctly interpret current law, and the department shall apply the appeals board’s reasoning and interpretation in all appropriate cases.