AWC Legislative Bulletin - 04/24/2007 (Plain Text Version)

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From the Director: Session Ends – Good Year for Cities
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Personnel & Labor Relations

AWC Priority
Elimination of Gain-Sharing (EHB 2391)

On Saturday, April 21, the House amended HB 2391 on the floor and passed it on a vote of 52-45. The Senate made no further changes to the bill, passing it on Sunday, April 22, on a 26-21 vote.

While the amended version does end gain-sharing after one additional disbursement (an AWC priority), it provides for additional benefits that wipe out much of the savings local governments would have realized due to the elimination of gain-sharing. This was a very contentious issue right until the very end. The bill is now on its way to the Governor for signature.

The most significant – and most costly – benefit enhancement affects members of Plan 2 and Plan 3 of the Public Employees' Retirement System (PERS), the School Employees' Retirement System (SERS) and the Teachers' Retirement System (TRS).

Effective July 1, 2008 (September 1, 2008 for TRS and SERS), the bill provides a different early retirement option for members with 30 years of service, allowing them to retire with unreduced benefits at age 62.

Members with 30 years of service who are between 55 and 61 may also retire early with reduced early retirement reduction factors: 2% for a 61-year old member, 5% for a 60-year old member, and, for members between ages 55 and 59, an additional 3% per year for each year they are younger than 60. In other words, a 55-year old member with 30 years of service could take early retirement with a 20% benefit reduction. Under current law, the reduction would be 30%.

The bill also provides for an increase in the PERS Plan 1 Uniform COLA effective July 1, 2009, and includes other changes applicable to TRS and SERS only. All of the benefit enhancements are contingent upon the repeal of gain-sharing. If the courts order reinstatement of gain-sharing benefits, the new benefits would be repealed (except for those who have already retired).

Once we receive the fiscal note for the final version of the bill, we will post information on the AWC website showing expected future employer and employee contribution rates.

Definition of Disability (SSB 5340)

As we reported in last week’s Bulletin, SSB 5340 was amended and passed the House on April 10. The Senate refused to concur in the House amendments, sending the bill back to the House. The House further amended the bill to add a "legislative finding" section, and the Senate quickly approved the amended bill on a vote of 46-2. It has been delivered to the Governor for signature.

In a 2006 decision, McClarty v. Totem Electric, the State Supreme Court provided clarity for employers by adopting the same definition of disability for Washington as the definition in the federal Americans with Disabilities Act. The legislative finding in SSB 5340 states that the McClarty opinion fails to recognize that Washington's antidiscrimination law provides protections independent of federal law.

Although proponents of this legislation stated that it simply "turns back the clock" to codify state law prior to the McClarty decision, it goes much further than that, significantly expanding the definition of disability under Washington law. For example, pre-McClarty law in Washington required that an impairment substantially limit an employee’s ability to do the job in order to constitute a disability. Under this new definition, for claims other than reasonable accommodation, there is no such limitation.

The expanded definition will apply to all causes of action that occurred before July 6, 2006 (the date of the McClarty decision) and to those that will occur after the effective date of the act, July 22, 2007.

The Governor has until Tuesday, May 15, to sign or veto the bill. She could also choose to veto certain sections. We are currently reviewing the bill and evaluating options.

Family and Medical Leave Insurance (E2SSB 5659)

The last bill to pass the House before the April 13 cutoff was a scaled-down version of the family & medical leave insurance bill, E2SSB 5659. The House version was substantially different than the version that passed the Senate, and the Senate refused to concur in the House amendments.

The bill was then sent to a conference committee of three senators and three representatives to work out the differences. Listed below are the major components of the conference committee’s revised bill, which passed the House on Saturday and the Senate the last day of the session.

The bill outlines a basic framework for a family leave insurance program, which would go into effect on October 1, 2009. It would provide $250 per week for a maximum of five weeks of leave taken by a parent following birth or adoption of a child, and would mandate job protection for employees taking leave if they work for an employer with more than 25 employees.
It establishes a 13-member joint legislative task force to study the establishment of a family and medical leave program and report its findings and recommendations, including proposed legislation, to the Legislature by January 1, 2008.
It does not specify the state agency responsible for administering the family leave insurance program, nor does it establish premiums to finance the benefits, instead directing the task force to make recommendations on both issues.
It states that leave under the bill must be taken concurrently with leave taken under the federal Family and Medical Leave Act or the state Family Leave Law, and permits employers to require that leave under the bill be taken concurrently or otherwise coordinated with leave allowed under collective bargaining agreements or employer policies.

E2SSB 5659 has been delivered to the Governor for signature.

Presumptive Disease for Firefighters (ESHB 1833)

The House concurred with the Senate amendments and ESHB 1833 has been delivered to the Governor.

The bill expands the diseases and conditions that are presumed to be job-related for firefighters for workers’ compensation purposes. Under the bill, a firefighter is entitled to attorney fees and other costs when the presumption is upheld on appeal. The final version does not include a change in the evidence standard which would have made it virtually impossible for an employer to rebut the presumption.

Six-Year Collective Bargaining Agreements (SSB 5251)

The Governor signed SSB 5251 on April 18 and it goes into effect on July 22, 2007.

This legislation allows local governments and their employees to agree to contract terms of up to six years, instead of the current three-year maximum term.