BILL ANALYSIS                                                                                                                                                                                                    Ó






          SENATE PUBLIC EMPLOYMENT & RETIREMENT    BILL NO:  SB 216
          Jim Beall, Chair             HEARING DATE:  April 8, 2013
          SB 216 (Beall)    as amended   4/03/13       FISCAL:  YES

           STATE MANAGERS & SUPERVISORS:  SALARY COMPACTION
           
           HISTORY  :

            Sponsor:  Association of California State Supervisors  
            (ACSS), Sponsor

            Other legislation:  SB 1113 (Evans) 2012
                             Died in Assembly Appropriations


           SUMMARY  :

          SB 216 requires the Department of Human Resources (CalHR) to  
          address salary compaction for managerial and supervisorial  
          employees and provide data to the Legislature when  
          insufficient revenue is available to implement a salary  
          determination to increase managerial and supervisorial  
          salaries by 10 percent over the salaries of their subordinate  
          rank and file employees.


           BACKGROUND AND ANALYSIS  :
          
          1)   Existing law  :

             a)   effective July 1, 2012, merged the Department of  
               Personnel Administration (DPA) and the administrative  
               functions of the State Personnel Board (SPB) to form  
               CalHR, which among other duties serves as the  
               representative for the Governor in all state collective  
               bargaining activities.

             b)   requires that CalHR and each of the state's 21  
               collective bargaining units meet and confer and enter  
               into contracts over wages and working conditions for  
               represented employees.

             c)   requires that CalHR set salaries for excluded and  
          Glenn A. Miles
          Date:  4/03/13                                          Page  
          1









               exempt employees, and allows excluded employee  
               representatives to meet and confer with CalHR, but does  
               not otherwise make the state employer or excluded  
               employees subject to collective bargaining requirements.

          2)   This bill  :

             a)   makes findings and declarations regarding the roll of  
               CalHR in setting salaries for excluded employees and  
               managing the nonmerit aspects of the state's personnel  
               system, and declares that CalHR is unable or reluctant  
               to recommend appropriate salary increases for excluded  
               employees when there is no legislative appropriation to  
               pay for the increases, and in such cases defers to the  
               Department of Finance even though the Department of  
               Finance has no direct role in establishing or  
               recommending salaries for excluded employees.

             b)   requires CalHR to address salary compaction and  
               parity concerns consistent with the principle that it is  
               appropriate to provide managerial/supervisory employees  
               a salary at least 10 percent higher than the salary of  
               rank and file employees they supervise.

             c)   requires CalHR to provide the Legislature with data  
               on salary compaction as specified whenever the  
               department determines there is insufficient revenue to  
               fund a salary determination to increase  
               managerial/supervisorial salaries pursuant to the  
               State's compaction differential policy.

           COMMENTS  :

          1)   What is salary compaction  ?

          Salary compaction refers to the condition where  
          managerial/supervisorial (excluded) employees do not earn  
          enough in relation to their subordinate employees.  This is  
          problematic because excluded employee candidates may be  
          dis-incentivized from seeking promotions, or after promoting,  
          may later decide to demote to non-managerial/supervisorial  
          positions.

          Glenn A. Miles
          Date:  4/03/13                                          Page  
          2









          CalHR sets excluded employees' compensation.  There is no  
          statutory requirement to extend a pay package that was  
          bargained for represented employees to related excluded  
          employees. CalHR is not currently required to study the  
          impact of the rank and file MOU on related excluded classes  
          and provide data to the Legislature.  Excluded employees do  
          not generally receive overtime pay and other protections  
          provided to represented employees through collective  
          bargaining.  Moreover, excluded employees may have higher  
          levels of stress and responsibility due to their  
          managerial/supervisorial role.

          2)   Arguments in Support  :

          The Association of California Supervisors states that "after  
          years of?cuts to state employees, supervisors, managers, and  
          confidential employees now often make less than the employees  
          who work for them.  In fact, according to a recent survey, 43  
          percent of state supervisors and managers earn the same or  
          less than the employees who report to them."

          According to the California Correctional Supervisor  
          Organization, "Compaction issues, left unaddressed, create a  
          disincentive for qualified line officers to seek promotion.   
          This in turn, weakens the structure of the entire  
          organization."

          3)   SUPPORT  :

            Association of California State Supervisors (ACSS), Sponsor
            California Association of Professional Scientists (CAPS),  
            Co-sponsor
            California Correctional Supervisor Organization, Co-sponsor
            Professional Engineers in California Government (PECG),  
          Co-sponsor

          4)   OPPOSITION  :

            None to date




          Glenn A. Miles
          Date:  4/03/13                                          Page  
          3









                                       #####








































          Glenn A. Miles
          Date:  4/03/13                                          Page  
          4