Thursday, April 1, 2021

Government Affairs and Merit Shop Advocacy
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CFEC Plans Two Zoom PLA Meetings
On Tuesday, April 6th at 1:00pm CFEC will hold a Zoom meeting to discuss CFEC’s PLA strategy for the San Diego region.

On Wednesday, April 7th at 1:00pm they will hold a Zoom meeting to discuss CFEC’s PLA strategy for two major projects in Sacramento.

To participate send an email to cfec.ca@gmail.com

 
The American Jobs Plan Yesterday, President Joe Biden rolled out his $2 trillion infrastructure plan at a—surprise, surprise--carpenters’ training facility in Collier, Pennsylvania, a Pittsburgh suburb whose population is about 98 percent white. Biden made two specific mentions of PLAs in his outline that you can read here. In total – he mentioned unions 24 times in his summary.

Under the section entitled Build, Preserve, And Retrofit More Than Two Million Homes and Commercial Buildings; Modernize Our Nation’s Schools, Community Colleges, And Early Learning Facilities; And Upgrade Veterans’ Hospitals and Federal Buildings. “The President’s plan invests $213 billion to produce, preserve, and retrofit more than two million affordable and sustainable places to live. It pairs this investment with an innovative new approach to eliminate state and local exclusionary zoning laws, which drive up the cost of construction and keep families from moving to neighborhoods with more opportunities for them and their kids. The President’s plan will help address the growing cost of rent and create jobs that pay prevailing wages, including through project labor agreements with a free and fair choice to join a union and bargain collectively. (The President didn’t mention a worker’s right to not be forced to join a union).

Under Create Good-Quality Jobs That Pay Prevailing Wages in Safe and Healthy Workplaces While Ensuring Workers Have A Free and Fair Choice to Organize, Join A Union, and Bargain Collectively with Their Employers. “Create good jobs. The President’s plan demands that employers benefiting from these investments follow strong labor standards and remain neutral when their employees seek to organize a union and bargain collectively. He is asking Congress to tie federal investments in clean energy and infrastructure to prevailing wages and require transportation investments to meet existing transit labor protections. He also is calling for investments tied to Project Labor, Community Workforce, local hire, and registered apprenticeships and other labor or labor-management training programs so that federal investments support good jobs and pathways to the middle class. (Does his use of labor or labor-management training programs signal future challenges for employer training programs?). Finally, he is asking Congress to include a commitment to increasing American jobs through Buy America and Ship American provisions.
 
Additional Sick Pay One remaining piece of COVID-19 legislation was the enactment of SB 95 (Skinner). This bill mandates that employers expand supplemental paid sick leave for COVID-19-related absences. SB 95, which took effect on March 29, 2021, applies retroactively to applicable leave taken on or after January 1, 2021, and remains in effect until September 30, 2021. Thus, covered employers must provide Supplemental COVID-19 Paid Sick Leave beginning on March 29, 2021, and covered employees who took qualifying leave between January 1 and March 28 may request retroactive payment for leave taken during that period.

Lawmakers Propose Wealth Tax and PIT Increase From CalTax State lawmakers recently proposed two major tax increases: a wealth tax targeting Californians with a net worth above $50 million and a personal income tax increase on annual income over $2 million. The PIT increase was revealed in amendments to AB 65, by Democratic Assembly Member Evan Low. The bill would create the California Universal Basic Income Program, funded via a 1 percent surcharge on income above $2 million beginning January 1, 2022. The bill would bring California’s top PIT rate – already the highest in the United States – to 14.3 percent. The revenue generated by the tax hike would be used to provide monthly $1,000 payments to Californians who are at least 18 years old, are not incarcerated, have been residents of the state for the prior three consecutive taxable years and do not earn more than 200 percent of the per capita median income for the counties in which they reside. As a tax increase, the bill faces a two-thirds vote threshold in the Legislature.

The wealth tax proposal was unveiled March 15 in a virtual press conference hosted by the lead author, Assembly Member Alex Lee. The proponents said the legislation, which is not yet in print, would impose a 1 percent tax on wealth over $50 million and a 1.5 percent tax on wealth over $1 billion. Lee’s press conference also featured Assembly Members Luz Rivas, Miguel Santiago, and Lorena Gonzalez. The lawmakers were joined California Federation of Teachers President Jeff Freitas, entrepreneur Joe Sanberg, and University of California at Berkeley Economics Professor Emmanuel Saez. According to several participants in the press conference, their tax increase is intended to make California’s wealthiest residents “pay their fair share.” If approved by at least two-thirds of the Legislature, the wealth tax would be placed on a statewide ballot in a measure that would need a simple majority vote for passage. Saez, co-author of the book, “The Triumph of Injustice: How the Rich Dodge Taxes and How to Make Them Pay,” said the tax would raise approximately $22 billion per year – approximately half of which would be paid by 170 individuals. “The mere introduction of a similar proposal last year was enough to increase the exodus of businesses, individuals and investments fleeing California,” CalTax President Robert Gutierrez said. “This damaging proposal encourages more Californians to follow in the footsteps of others who already moved out of California. Most other states are not threatening to tax their residents’ savings and personal effects – items that were purchased with money left over after paying California’s highest-in-the-nation income tax.” Opponents of the two tax hikes noted that proponents’ revenue estimates do not appear to factor in the likelihood that some of the targeted individuals would move out of California and establish residence in a state with lower taxes. Gutierrez noted that the state government is collecting billions of dollars more than expected under the current tax rates and has a large reserve that got the state through a year of pandemic without having to cut funding for education or other important programs. Governor Gavin Newsom and one of his top advisors have said the governor will not approve wealth taxes or income tax increases this year.

Sales Tax Increases Take Effect April 1 in Many Areas of the State Voter-approved sale tax rate increases will take effect April 1 in many areas of the state, the California Department of Tax and Fee Administration notified retailers in a special notice. In 11 cities, the new tax rate will be 10.25 percent. Ten of the cities are in Los Angeles County (Bell Gardens, Bellflower, City of Commerce, Lancaster, Lomita, Palmdale, San Fernando, Signal Hill, South El Monte, and West Hollywood). The remaining 10.25 percent city is El Cerrito, in Contra Costa County. Consumers in Turlock will have a tough time estimating the cost of sales tax without a calculator, as the new rate is 8.625 percent. They may be used to dealing with non-round numbers, however, as the new rate replaces the current rate of 7.875 percent.

How the PRO Act could change the way contractors do business The construction industry’s use of independent contractors and subcontractors, even sub-subcontractors, is standard practice. The nature of the business requires a wide range of expertise and independent contractors can help with the short-term staffing that a company does not have in-house, or they can supplement a contractor's full-time workforce. Using independent contractors and subcontractors also saves the hiring contractor money because it doesn't have to pay employee benefits, provide workers' compensation coverage or withhold taxes on those entities. Story

Recall Watch March 22, 2021 From TargetBook March 17 was the deadline for proponents of the Gavin Newsom recall to submit their signatures to county elections offices. Proponents announced that they had submitted 2,117,730 signatures. Once the recall is determined to have enough valid signatures, voters will have 30 business days during which they may withdraw their signatures. Gavin Newsom's 'Stop the Republican Recall' committee announced it had raised over $538,000 from online donors in its first 48 hours. Independent expenditures have already begun for the recall and replacement candidates. Former GOP Rep. Doug Ose, who dropped out of the 2018 governor's race after 52 days citing poor fundraising and a crowded field of candidates, announced he would be a candidate in the recall election. With the GOP field becoming increasingly crowded, all eyes are on whether Newsom's campaign can hold back the dam for the next six months and prevent a credible Democratic candidate from running in the recall.

Speaker Nancy Pelosi spoke out recently in an attempt to pull the Democratic Party together around Newsom. She told reporters that the recall effort was “an unnecessary notion,” adding, “I don’t think it even rises to the level of an idea.”

But the public has another notion. A poll released this week by the nonpartisan firm Probolsky Research found that California voters were split on whether to recall Newsom. Forty percent supported recalling him, while 46 percent were opposed. That’s not overwhelming support — but it’s a clear sign that Newsom is in choppy waters and would need to work hard to head off a recall if a vote does get scheduled.

Biden May Be the Most Pro-Labor President Ever; That May Not Save Unions (Grab your box of WECA tissues) The New York Times reports “Labor leaders are effusive in praising the new president, but experts worry that he may be powerless to reverse unions’ long-term decline.” Story