(April 29, 2009) A California Chamber of Commerce-sponsored bill that will help employees and employers achieve greater flexibility in work schedules by allowing workers to request and employers to mutually agree to a four-day compressed workweek will be considered in a Senate committee today.

SB 187 (Benoit; R-Bermuda Dunes), a CalChamber “job creator” bill, simplifies the establishment of an alternative workweek schedule so that individual workers can achieve much-needed flexibility.

Employers have told the CalChamber that they want California law to permit flexible workweek schedules such as four-day workweeks for individual workers desiring to find a balance between work and personal lives.

Specifically, SB 187 establishes a voluntary, employee-driven process where the employees can request and their employer may mutually agree, to a four-day compressed workweek schedule. If the employer agrees to the proposed four-day workweek schedule, the four-day workweek will be paid at straight time rates. Any work performed beyond the compressed work schedule would remain subject to current California overtime requirements.

Current Law Inflexible

Although recent statutory changes adopted in the 2009 budget process are helpful once the scheduling has been approved in the election, these changes do not address the complexity of the process, or the liability that employers face in the secret ballot election process.

Current state law requires overtime compensation to be paid for work performed by an hourly employee who works in excess of eight hours in a single day or more than 40 hours in a single workweek. Due to California’s strict overtime premium pay requirements, however, employers do not usually permit a four-day compressed workweek schedule because the last two hours of each 10-hour workday would have to be paid at time-and-a-half wage rates.

Complex Law

Currently, in order for employees to adopt an alternative workweek schedule, an employer must conduct a secret ballot election with two-thirds of employees in the work unit approving the proposal. The process is complex, and any misstep by the employer could lead to costly lawsuits.

Under current (and very detailed) Industrial Welfare Commission wage orders, employers may institute alternative work schedules only if a supermajority of affected employees agree to the arrangement in writing and by secret ballot. Employers must hold discussion meetings at least 14 days before secret ballot voting. Two-thirds of the company’s employees must agree to the change. Any deviation from the rigidly controlled process voids the election and subjects the employer to potential lawsuits that can seek up to three years of back overtime pay for affected workers, along with huge penalties and fines.

Moreover, variances in schedules or the use of more than one schedule—unless it was offered in the secret ballot election—are prohibited without repeating the voting process. This in effect eliminates most employers and employees from choosing schedule options such as compressed workweeks.

Employees/Employers Benefit

In the current economic environment, many employers cannot afford to provide raises, bonuses and enhanced benefits. It makes sense to allow employers to provide flexible work schedules as an employee benefit to increase morale and allow employees to reap the benefit of an extra day off per week.

Working a compressed four-day workweek provides for up to 50 extra days each year for the average full-time employee. That will be time for the employee to spend with family, attend children’s school activities, take care of dependent elders, go to medical appointments, go back to school or attend to other private matters that usually cannot be accomplished on a weekend.

Environmental Benefits

A report released in 2005 by the state Department of Health Services shows that employees in the state spend up to 100 hours per year commuting. More employees working an alternative workweek schedule could lead to fewer cars on the road during peak rush hours and less traffic congestion. With employees commuting at different times of the day, easing traffic congestion will lessen commute time as well.

Employee Protections

SB 187 contains several important employee protections:

• The bill does not affect workers covered by collective bargaining agreements.
• Employees covered by collective bargaining agreements in both the private and public sector are exempt from daily overtime—these include all state, county and city employees, such as those employed by school districts, water districts and a multitude of other governmental agencies.
• The employee must request the alternative schedule in writing.
• The employee or the employer may terminate the schedule agreement in writing at any time.
• The Division of Labor Standards Enforcement will enforce the new rule and adopt or revise regulations to implement it.
• The bill prohibits any employer from offering an employment benefit to an employee as an incentive to seek flexible schedules.
• The bill prohibits retaliation against an employee who does not seek a flexible schedule.
• The bill also prohibits an employer from forcing an employee to work more than eight hours in a workday without overtime pay.

Action Needed

SB 187 will be heard in the Senate Labor and Industrial Relations Committee on April 29.

The CalChamber urges members to ask committee members to support SB 187.

A sample letter is available at www.calchambervotes.com.

Staff Contact: Marti Fisher

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