CLFP Successful in Stopping Several Bills Detrimental to Food Processing

The California Legislature adjourned its 2019 Legislative Session on September 13. CLFP was engaged on a number of priority legislative issues in the final weeks of the legislative session that had direct implications to the food processing industry in California. While CLFP was successful in stopping several of these bills, some did pass the legislature and were sent to the Governor Newsom’s desk.

Priority Packaging Recycling Bills
Two bills that CLFP strongly opposed were held in the Legislature at the end of session and will be considered again in 2020. SB 54 (Ben Allen) and AB 1080 (Lorena Gonzalez), which are identical bills, would have set impractical recycling rates and deadlines, provided CalRecycle with broad emergency regulatory authority that included significant fee authority with no legislative oversight and draconian penalties for unintentional data reporting errors. The bills also lacked assurances that local jurisdictions and waste haulers would pull material through for all recyclable and compostable materials, among other significant issues.

CLFP has worked with the offices of Senator Allen and Assembly Member Gonzalez to try and make the bills workable and will continue to engage on these bills throughout the legislative recess.

Priority Workforce Bills
The Governor signed AB 5 (Gonzalez) on September 18. AB 5 codifies into the Labor Code the court decision in Dynamex Operations West, Inc. v. Superior Court of Los Angeles, which rejected the long-standing Borello test (where employer control over the worker was a key) and adopted the “ABC” test for determining whether workers should be classified as either employees or independent contractors. The bill contains more than 31 exemptions for a number of industries, but the exemptions are still not broad enough. AB 5’s author has committed to work on a clean-up bill over the fall and add more exemptions. CLFP is working with the California Truckers Association on a potential exemption for independent truckers which are vital to moving agricultural products throughout California.

On the final day of the legislative year, AB 1066 (Gonzalez), a CLFP-opposed bill granting unemployment benefits to striking workers, fell short of votes needed to pass the Senate. AB 1066 would have significantly increased costs on employers engaged in a trade dispute by allowing employees on strike to receiving unemployment benefits if the strike lasted more than four weeks, incentivizing strikes, burdening employers and potentially affecting the solvency of California’s unemployment insurance fund.

A remaining workforce issue of importance to the food processing industry and the entire business community is AB 51 (Gonzalez) which bans arbitration agreements made as a condition of employment. The bill is similar to legislation vetoed last year by Governor Jerry Brown for plainly violating federal law. If enacted, the bill would create more cost, litigation and uncertainty for employers, who would have to wait until a court definitively resolves the conflict with federal statute. Governor Newsome signed the bill on October 10.

California Environmental, Public Health, and Workers Defense Act of 2019
On September 27 Governor Newsom vetoed SB 1 (Atkins) that would have threatened California’s water supply and would have created regulatory uncertainty and litigation. Specifically, it would have undermined current state efforts to move forward with Voluntary Agreements through a rigid approach to water management that fails to appreciate science-based decision making to manage and provide reliable water supplies for California and protect, restore and enhance the ecosystems of the Bay-Delta and its tributaries.

SB 1 would have further increased the potential for costly litigation by forcing a federal agency to operate the Central Valley Project subject to the California Endangered Species Act, when that state law is preempted by the federal Endangered Species Act.

It further would have created significant regulatory uncertainty and litigation risks to regulated entities by giving certain state agencies authority to adopt rules and regulations without any of the Administrative Procedure Act safeguards when the agency, in its discretion, determined that the federal rules and regulations in effect on January 19, 2017 are “less protective” than existing federal law.