Although many in Sacramento cite selective statistics to claim California’s business climate is great—such as our current 5th largest GDP in the world—small business owners understand the reality that California’s ever-increasing cost of doing business is strangling small businesses from expanding and forcing many others to leave the state. In a survey released just last month by Wallet Hub, California ranked 47th for “Business Costs” in the nation.
This is why NFIB is focusing on a handful of bills in these final weeks of the legislative session which would have a direct impact on the cost of doing business in California in the areas of employer mandates, increased litigation, and additional environmental overreach.
Currently, California is home to some of the strongest worker protection laws in the nation, yet some legislators in the Capitol are aggressively pursing new mandates on employers which would do far more to enrich trial lawyers from new lawsuits rather than protect California workers. Senate Bill 1300 (Jackson) would drastically expand opportunities to sue an employer for failing to prevent any form of harassment in the workplace, even when no harassment has occurred. This bill would effectively make California courts the Human Resources department for the entire state.
Specifically, SB 1300 would strike the ‘severe and pervasive’ requirement to determine harassment has occurred in the workplace—all one would have to prove is they found an action unwelcome and they could file suit in civil court. More troubling is the fact that any employee may take action against the employer, even if he or she was not a party to the interaction. While we are urging the author to remove this private right of action, as currently written, SB 1300 would represent a new wave of litigation and compliance costs.
Assembly Bill 3081 (Gonzalez Fletcher) would similarly add several new, complicated requirements on employers to prevent harassment in the workplace—however the bill adds provisions to the Labor Code which duplicate and contradict many provisions currently in the Government Code. This is significant because it not only creates massive confusion for employers attempting to comply with the law, but it also creates immense opportunity for trial lawyers to sue under the Private Attorneys General Act (PAGA).
Finally, SB 100 (De Leon) would aggressively mandate 100% of electricity sold in California be generated by renewable energy sources by the year 2045, without any regard to cost to ratepayers. California is already home to the most aggressive environmental goals in the nation while also being home to some of the highest utility rates. Mandating our entire electric grid deliver 100% renewable energy is reckless and would add incredible costs to struggling small businesses and working families.
While there are number of additional bad bills NFIB is working to stop in these final weeks of session, there are indeed some proposals which seek to lower the cost of doing business. AB 2596 (Cooley and Kiley) would direct the Governor’s Office of Business and Economic Development to develop a comprehensive statewide economic development plan in order to retain and attract new businesses to California. AB 916 (Quirk-Silva) would make changes to California’s new employment hiring tax credit of up to $2,400 per employee to expand participation amongst small business owners. These bills would be a step in the right direction for small business owners, but we must do far more to address our fundamentally exorbitant cost of doing business in California.
As always, bills may be quickly amended—or entirely gutted—in these final days of session, therefore commentary on bills above may change. To get updates on these bills, and other NFIB Good, Bad, and Ugly priority bills, check out www.NFIB.com/CA/GBU for the latest info.