The California Chamber of Commerce has tagged SB 799 (Portantino; D-Burbank) as a job killer, citing the proposal’s requirement for employers to subsidize striking workers through additional taxes paid to the Unemployment Insurance (UI) fund.
“By forcing employers to pay unemployment insurance payments to striking workers, SB 799 would raise taxes on employers across California and overturn more than 70 years of precedent,” said CalChamber Policy Advocate Robert Moutrie.
“Being unemployed is fundamentally different than being on strike,” said Moutrie. “SB 799 fundamentally alters the nature of UI by providing unemployment benefits to workers who still have a job and have chosen to temporarily refuse to work as a negotiating tactic. Simply put, going on strike is not the same as being laid off.”
CalChamber was joined by more than 50 organizations in expressing opposition to the measure.
Chief among the concerns of the CalChamber and members of the opposition coalition is that SB 799 will worsen California’s ongoing UI fund crisis. Currently, California’s UI fund is in historic debt of $18 billion due to the COVID-19 pandemic and government mandated shutdowns.
To address the insolvency, California employers are already paying increased UI taxes pursuant to federal law and are likely to face ongoing tax increases until approximately 2032. According to coalition members, SB 799 would worsen California’s UI fund crisis and increase the state’s interest payments.
A copy of the coalition’s letter of opposition can be found here.