Friday, May 29, 2015

Sacramento AB 722 and SB3/Fair Pay and Safe Workplaces 

Yesterday was a busy day in Sacramento. According to the SF Chronicle today over 650 bills came up before  the Senate and Appropriation Committees on Thursday.  The reason this is so important is that all bills have to get to the Senate or Assembly floor by today. To our great disappointment  AB 722 our  equity crowd funding bill was sent to suspense effectively stopping the bill . We are not sure why this happened as the Department of Business Oversight  said there was no cost to the bill  and the bill was supported by 27 business associations and labor. We are not going to give up and will look for ways to move this forward.

Passing yesterday in Appropriation was Mark Leno increase in the minimum wage. The bill would increase the minimum wage  to $11 per hour in 2016 and $13 per hour  in 2017. In 2019 the wage will be indexed to increase annually  by the Consumer Price Index.

I don’t know how many businesses have Federal  contracts but please see below request from Yvonne Lee the Regional Advocate for Region 9. If you are impacted by this I would appreciate your comments

Yvonne Y. Lee | Regional  Advocate for AmSam, AZ, CA, CNMI, GU, HI, NV |
| SBA Office of Advocacy | 455 Market Street, #600, San Francisco, CA 94105 | p 415/744-8493| f 202/481-4167 |
| yvonne.lee@sba.govwebsitelistservblog | Facebooktwitter |

Fair Pay and Safe Workplaces
On May 28, 2015 the FAR Council published a proposed rule, Fair Pay and Safe Workplaces,  to amend the Federal Acquisition Regulation (FAR) to implement the Executive Order “Fair Pay and Safe Workplaces.”  The Executive Order (E.O.) requires that for contracts over $500,000 prospective and existing contractors disclose whether under certain labor laws there has been any administrative merits determination, civil judgment, or arbitral award or decision rendered against them during the preceding three-year period. The E.O. directs agencies to include clauses in their contracts that require similar disclosures by certain subcontractors so their prime contractors can also consider labor violations when determining whether there have been any similar violations by prospective or existing subcontractors. The E.O. further requires that processes be established to assist contractors and subcontractors to come into compliance with labor laws. To achieve paycheck transparency for workers, the E.O. requires contractors and subcontractors to provide individuals with information each pay period regarding how they are paid and to provide notice to those workers whom they treat as independent contractors. The E.O. also addresses arbitration of employee claims.

The definition of “labor laws” is derived from the E.O and includes the following statutes and E.O.s:
  • The Fair Labor Standards Act, 29 U.S.C. chapter 8
  • The Occupational Safety and Health Act (OSHA) of 1970
  • The Migrant and Seasonal Agricultural Worker Protection Act
  • The National Labor Relations Act
  • 40 U.S.C. chapter 31, subchapter IV, formerly known as the Davis-Bacon Act
  • 41 U.S.C. chapter 67, formerly known as the Service Contract Act
  • E.O. 11246 of September 24, 1965 (Equal Employment Opportunity)
  • Section 503 of the Rehabilitation Act of 1973
  • The Vietnam Era Veterans' Readjustment Assistance Act of 1972 and the Vietnam Era Veterans' Readjustment Assistance Act of 1974
  • The Family and Medical Leave Act
  • Title VII of the Civil Rights Act of 1964
  • The Americans with Disabilities Act of 1990
  • The Age Discrimination in Employment Act of 1967
  • E.O. 13658 of February 12, 2014 (Establishing a Minimum Wage for Contractors).

Comments on this rule are due on July 27, 2015.
•          Comment to the Proposed Rule on
•          Link to the Fact Sheet on FAR Case 2014-025
•          Link to DOL Guidance Document
•          Link to DOL Q&A
•          Advocacy Contact: Major Clark(link sends e-mail) or call 205-205-6533

This proposed rule, and a proposed guidance document being issued simultaneously by the Department of Labor (DOL), are intended to implement the E.O.'s requirements.   The comment period is for 60 days; comments are due by July 27, 2015.  Listed below is a Department of Labor landing page for Q&As and a fact sheet on FAR Case 2014-025, Far Pay and Safe Workplaces.

Scott Hauge
Small Business California
2311 Taraval Street
San Francisco, CA  94116

Wednesday, May 20, 2015

Is You Business Ready to Comply with California's New Sick Pay Law 

Please register for “Is your business ready to comply with California's new sick pay law?” on Jun 8, 2015 3:00 PM PDT at:

Small Business California is pleased to partner with Payality to provide a free webinar with detailed information on the new California Sick Pay law that becomes effective July 1, 2015. Almost all employers, even those with just one employee, will be affected by this new law.

Please register for this 30 minute webinar to learn more.

About Payality
Payality provides payroll, HR compliance and benefit solutions that help business owners minimize risk and have more time to focus on growing and managing their business. . See how Payality performs and you’ll never look back. Visit for more information.

After registering, you will receive a confirmation email containing information about joining the webinar.

Brought to you by GoToWebinar®
Webinars Made Easy®

Chet Reilly
Phone (559) 634-1001
Fax (888) 677-7160

1600 Draper Street
Kingsburg, CA 93631

Below is an article posted by the NBSA regarding changes to rules involving overtime pay that we wanted to pass along.  We are being told that it would basically work like this: Federal Minimum wage $7.25 x 4= $29.  California minimum wage(effective July 1 2015) $10.00 x 4=$40.00.This change could be particularly problematic for smaller employers where all employees—including the owner—regularly perform a range of duties.

You should contact your Human Resources or payroll vendor for more information.


Overtime Rules to be Unveiled

After a wait of well over a year, the U.S. Department of Labor (DOL) may soon be ready to propose new overtime rules. In his 2014 State of the Union address, President Obama announced that he would ask the Department of Labor to review overtime standards. Now under review at the Office of Management and Budget (OMB), those new rules are expected to propose further restricting the ability of employers to exempt “white collar” workers from overtime rules.
The DOL proposal is expected in June—it could come any time—and it could more than double the salary level required for employees to be considered exempt. The proposal is also expected to change the “primary duty” test, thereby making it more difficult to qualify an employee as exempt when they perform both exempt and non-exempt duties. This change could be particularly problematic for smaller employers where all employees—including the owner—regularly perform a range of duties.
When the proposed rule is finally issued, there will be a period for public comment before a final rule is announced. NSBA expects to be actively engaged in this process to create an ultimate rule that will be workable for small businesses and their employees.
Scott Hauge
Small Business California
2311 Taraval Street
San Francisco, CA  94116

Tuesday, May 19, 2015

White Paper on Net New Job Creation

Please see the link below. This information is really important for small business owners to understand. Board member Terry Bibbens has  looked at the Office of Advocacy data and put together a White paper showing that all the net new jobs from 1989 to 2012  were created by businesses with less than 20 employees.
I think this is really important for policy makers to  understand in developing economic development policy. Thank you Terry for putting this together

The Very Small Businesses Are Vital To Job Creation In The United States 5-18-2015 SB CAL

Small Business California sponsored bill AB  1245 passed the  Assembly on a 76 to 1 vote yesterday. This bill would require all businesses to file EDD quarterly filings by 2018. We believe small businesses will benefit from this once they are shown how to do this.  We believe this is more efficient  and will reduce errors. Only 35% of the businesses in the state file online.  The cost saving for EDD is estimated to be about $ 8 million

To help small businesses that are not online we are employing  the services of the Small Business Development Centers around the state. We are hopeful that they will receive $500000 from EDD which will be matched by the SBA. It should be noted that there is a hardship provision for those businesses that do not have the technology to do this.

The bill will now go over to the Senate.
Scott Hauge
Small Business California
2311 Taraval Street
San Francisco, CA  94116

Monday, May 11, 2015

Prepaid Legal Coverage/ Small Business California Bills 2014-2015 Session

How many of you have heard of or looked into prepaid legal coverage?  If there was a company that could provide you the ability to contact an attorney and get advice any time you wanted for a fixed cost per month, would you be interested if the cost was affordable?  By affordable I mean $39 a month for a business with less than 10 employees, $89 per month for businesses with 10 to 50 employees, and $149 a month for businesses between 50 and 99 employees.
Many small businesses are being solicited about this.  Do you have this?  Have you been solicited?  What questions would you have?
Please see below the bills Small Business California is sponsoring, supporting, or opposing for this legislative session. Do you agree with SB Cal's positions?!services/cee5.

Scott Hauge
Small Business California
2311 Taraval Street
San Francisco, CA  94116

Friday, May 08, 2015

Insurance Commissioner approves 10.2 percent workers compensation decrease

Please see below recommendation of 10.2 workers compensation reduction for July 1. Keep in mind this is not binding on insurance companies.

Insurance Commissioner Dave Jones wasted little time in approving a 10.2% cut in the state's advisory pure premium rates as requested by the Bureau effective July 1, 2015. The decision on the mid-year rate change came quickly and will give the industry more time than usual to review the findings and decide whether or not to use the approved rates.

The Bureau is a non-governmental private organization financially supported by insurance carriers.

Besides the cut, the most interesting fact is that the proposed pure premium rates were made without the use of the State Compensation Insurance Fund's loss adjustment expenses. State Fund's LAE is way out of line with industry norms.

Had State Fund's data been included, the rate cut – if there would have been a rate cut - would have been significantly smaller. The Bureau will not quantify that number.

The department's proposed decision reiterates its earlier finding that State Fund's loss adjustment expenses (LAE) “include a significant component of excess expense," the decision reports. State Fund's experience is being excluded entirely rather than being tempered at just 50% as had been the case in years' past.

The Commissioner's decision sticks with the Bureau’s recommendation of $2.46 per $100 of payroll. It was 3 cents higher than the best estimated presented by the public member's actuary. The benchmark rate is a weighted average and is not indicative of what any individual employer will pay, which is influenced primarily by their industry classification and loss history.

Compline’s rating system and other tools will have the new rates in and running within a couple of days.

The Insurance Commission’s decision concluded “the California workers' compensation insurance industry's profitability indicates that the pricing environment continues to benefit from substantial investment income relating to substantially higher premiums in prior years and associated reserves, resulting in an average market price level that is below what may be sustainable without this underlying level of support.”

But it is State Fund, which has the highest investment income relative to premium and depends upon its investment income to sustain its high expenses.

“However,” the written decision continues, “the average charged rate in 2014 of $2.93 appears much stronger relative to the WCIRB's July 1, 2015 indicated pure premium rate of $2.46. If lower pure premium rates are maintained in future filings, it appears that charged rates may be approaching long-term sustainable levels.”

Jones' decision adopted in full the proposed decision and order drafted by CDI hearing officer Patricia Hein, a former State Fund attorney.

Scott Hauge

Small Business California
2311 Taraval Street
San Francisco, CA 94116