AB 161: State employment: state bargaining units.
- Session Year: 2025-2026
- House: Assembly
- Latest Version Date: 2025-09-08
Current Status:
In Progress
(2025-09-13: Ordered to inactive file at the request of Senator Grayson.)
Introduced
In Committee
Awaiting First Chamber Vote
Passed First Chamber
In Committee
Awaiting Second Chamber Vote
Passed Second Chamber
Enacted
What does this bill do?
This bill approves new labor agreements between the state and many state employee groups (State Bargaining Units 1, 3, 4, 5, 8, 10, 11, 12, 13, 14, 15, 16, 17, 18, 19, 20, and 21) but says any parts that cost money only take effect if the Legislature specifically provides the funding, and either the state or the unions may reopen negotiations if funds are not approved. It also requires employees in Units 8, 10, and 18 to join the 2025 Personal Leave Program, changes the timing and rules for some pension and retiree‑health contributions (including for Unit 18), suspends certain retiree‑health payments for specified years, and adds $14,597,000 to Budget Act items.
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(1)Existing law provides that a provision of a memorandum of understanding reached between the state employer and a recognized employee organization representing state civil service employees that requires the expenditure of funds does not become effective unless approved by the Legislature in the annual Budget Act.
Existing law requires the Department of Human Resources to provide a memorandum of understanding to the Legislative Analyst, who then has 10 calendar days from the date the tentative agreement is received to issue a fiscal analysis to the Legislature. Existing law prohibits the memorandum of understanding from being subject to legislative determination until either the Legislative Analyst has presented a fiscal analysis of the memorandum of understanding or until 10 calendar days have elapsed since the memorandum was received by the Legislative Analyst.
This bill, notwithstanding the above-described statutory provisions, would approve provisions of the agreements entered into by the state employer and specified state bargaining units. The bill would provide that the provisions of the agreements that require the expenditure of funds will not take effect unless funds for these provisions are specifically appropriated by the Legislature. The bill would authorize the state employer or the bargaining units to reopen negotiations if funds for these provisions are not specifically appropriated by the Legislature. The bill would require the provisions of the agreement that require the expenditure of funds to become effective even if the provisions are approved by the Legislature in legislation other than the annual Budget Act. By approving provisions of the agreements that require the expenditure of funds, this bill would make an appropriation.
(2)Existing law, for the 202627 fiscal year, continuously appropriates to the Controller from the General Fund unallocated special funds, including federal funds and unallocated nongovernmental cost funds, and any other fund from which state employees are compensated, the amount necessary for the payment and compensation and employee benefits to state employees covered by specified memoranda of understanding if the Budget Act of 2026 is not enacted by July 1, 2026.
This bill would additionally include the memoranda of understanding for State Bargaining Unit 8 (effective July 1, 2024, to June 30, 2027, inclusive) and State Bargaining Unit 18 (effective July 1, 2025, to July 1, 2028, inclusive).
Existing law, for the 202728 fiscal year, continuously appropriates to the Controller from the General Fund unallocated special funds, including federal funds and unallocated nongovernmental cost funds, and any other fund from which state employees are compensated, the amount necessary for the payment and compensation and employee benefits to state employees covered by specified memoranda of understanding if the Budget Act of 2027 is not enacted by July 1, 2027.
This bill would additionally include the memorandum of understanding for State Bargaining Unit 18 (effective July 1, 2025, to July 1, 2028, inclusive).
Existing law, for the 202829 fiscal year, continuously appropriates to the Controller from the General Fund unallocated special funds, including federal funds and unallocated nongovernmental cost funds, and any other fund from which state employees are compensated, the amount necessary for the payment and compensation and employee benefits to state employees covered by the memoranda of understanding for State Bargaining Unit 6 and State Bargaining Unit 16, if the Budget Act of 2028 is not enacted by July 1, 2028.
This bill would additionally include the memorandum of understanding for State Bargaining Unit 18 (effective July 1, 2025, to July 1, 2028, inclusive).
(3)Existing law states that it is the policy of the state that the workweek of the state employee shall be 40 hours, and the workday of state employees 8 hours, except that workweeks and workdays of a different number of hours may be established in order to meet the varying needs of the different state agencies.
Existing law also requires state employees in specified bargaining units, except as specified, from July 1, 2025, to June 30, 2027, inclusive, to participate in the Personal Leave Program 2025 (PLP 2025), either as required by an applicable memorandum of understanding reached or by the direction of the department for excluded employees, under which each employee receives a reduction in pay not greater than certain listed amounts in exchange for a specified number of hours per month of PLP 2025 leave credits.
This bill would also require state employees in State Bargaining Units 8, 10, and 18 to participate in the PLP 2025, either as required by an applicable memorandum of understanding or by the direction of the department for excluded employees, as prescribed. Under the program, in exchange for a reduction in pay not greater than certain listed amounts, those employees would receive monthly PLP 2025 leave credits, subject to certain exclusions.
(4)The Public Employees Retirement Law (PERL) creates the Public Employees Retirement System for the purpose of providing public employees pension and other benefits, which are funded by employee and employer contributions and investment returns. Contributions and investment returns are deposited in the Public Employees Retirement Fund, which is continuously appropriated for the payment of benefits and administration of the system. PERL vests management and control of PERS in its board of administration. PERL and labor agreements prescribe different normal rates of contribution for employees depending on bargaining unit, employer, and inclusion of service in the federal social security system, among other factors.
Under PERL, effective July 1, 2021, the normal contribution rates for state miscellaneous or state industrial members who are represented by State Bargaining Unit 18 are adjusted in accordance with specified procedures based on changes in normal cost rates, as determined by the board.
This bill would change the above-described effective date to July 1, 2027. The bill would also provide that, effective July 1, 2025, to June 30, 2027, specified employee contributions for state miscellaneous and industrial members represented by State Bargaining Unit 18 shall remain in place.
Under PERL, effective July 1, 2021, the normal contribution rates for state safety members who are represented by State Bargaining Unit 18 are adjusted in accordance with specified procedures based on changes in normal cost rates, as determined by the board.
This bill would change the above-described effective date to July 1, 2027. The bill would also provide that, effective July 1, 2025, to June 30, 2027, specified employee contributions for state safety members represented by State Bargaining Unit 18 shall remain in place. The bill would make other related and conforming changes to these provisions on normal cost rates.
(5)The Public Employees Medical and Hospital Care Act (PEMHCA), which is administered by the Board of Administration of the Public Employees Retirement System, prescribes methods for calculating the state employer contribution for postemployment health care benefits for eligible retired public employees and their families and for the vesting of these benefits. PEMHCA establishes the Annuitants Health Care Coverage Fund, which is continuously appropriated, for the purpose of prefunding health care coverage for annuitants, including administrative costs.
PEMHCA requires employees in State Bargaining Unit 10 to prefund retiree health care and requires the state to make a matching contribution. PEMHCA suspended the employees monthly contribution for prefunding other postemployment benefits for the 202021 fiscal year for State Bargaining Unit 10.
This bill would suspend the employee and employer monthly contribution for prefunding other postemployment benefits for State Bargaining Unit 10, effective the first day of the pay period following ratification by both parties, for the 202526 and 20262027 fiscal years.
PEMHCA requires certain state employees in the judicial branch to make contributions to prefund retiree health care based on a specified schedule and requires the state to make a matching contribution.
This bill would suspend the employee and employer monthly contribution for prefunding other postemployment benefits for those judicial branch employees, effective July 31, 2025, for the 202526 and 20262027 fiscal years.
PEMHCA requires employees in State Bargaining Unit 18 to prefund retiree health care and requires the state to make a matching contribution. PEMHCA suspends the employee and employer monthly contribution for prefunding other postemployment benefits for the 202526 and 202627 fiscal years.
This bill would provide that, effective July 1, 2027, the amount of the employee and employer contributions required to prefund retiree health care shall be based on a specified schedule, beginning with 1.5% of pensionable compensation on July 1, 2027, and increasing to 4.5 % of pensionable compensation on July 1, 2029. Beginning July 1, 2030, the bill would require both the employer and employee contribution percentages to be increased or decreased to maintain a 50% cost sharing of actuarially determined normal costs, as prescribed. The bill would make various related and conforming changes to those provisions on retiree health care costs.
(6)The Budget Act of 2025 makes various appropriations for the purpose of employee compensation.
This bill would revise specified Budget Act items, for a total increase of $14,597,000, pursuant to agreements reached between the state employer and State Bargaining Units 1, 3, 4, 5, 8, 10, 11, 14, 15, 17, 18, 20, and 21, in accordance with a specified schedule.
(7)This bill would declare that it is to take effect immediately as a bill providing for appropriations related to the Budget Bill.
This bill would express the intent of the Legislature to enact statutory changes relating to the Budget Act of 2025.This bill would express the intent of the Legislature to enact statutory changes relating to the Budget Act of 2025.
The Legislature finds and declares that the purpose of this act is to approve the agreements entered into by the state employer and State Bargaining Units 1, 3, 4, 5, 8, 10, 11, 12, 13, 14, 15, 16, 17, 18, 19, 20, and 21 pursuant to Section 3517.5 of the Government Code.
SEC. 2.Notwithstanding Section 19829.5 of the Government Code, the provisions of the memoranda of understanding or addenda, or both, prepared pursuant to Section 3517.5 of the Government Code and entered into by the state employer and State Bargaining Units 1, 3, 4, 11, 14, 15, 17, 20 and 21, dated August 12, 2025, and August 15, 2025, State Bargaining Unit 5, dated August 3, 2025, State Bargaining Unit 8, dated July 16, 2025, State Bargaining Unit 10, dated August 14, 2025, State Bargaining Unit 11, dated August 6, 2025, State Bargaining Unit 12, dated August 15, 2025, State Bargaining Unit 13, dated August 15, 2025, and State Bargaining Unit 18, dated August 14, 2025, which require the expenditure of funds, are hereby approved for the purposes of Section 3517.6 of the Government Code. Additionally, notwithstanding Section 19829.5 of the Government Code, the provisions of the agreement prepared pursuant to Section 3517.5 of the Government Code and entered into by the state employer and Bargaining Unit 16, dated August 18, 2025, and State Bargaining Unit 19, dated August 18, 2025, which require the expenditure of funds, are hereby approved for the purposes of Section 3517.6 of the Government Code.
SEC. 3.The provisions of the memoranda of understanding and addenda approved in Section 2 of this act that require the expenditure of funds shall not take effect unless funds for these provisions are specifically appropriated by the Legislature. If funds for these provisions are not specifically appropriated by the Legislature, either the state employer or State Bargaining Units 1, 3, 4, 5, 8, 10, 11, 12, 13, 14, 15, 16, 17, 18, 19, 20, and 21 may reopen negotiations on all or part of the memoranda of understanding, addenda, or agreement.
SEC. 4.Notwithstanding Section 3517.6 of the Government Code, the provisions of the memoranda of understanding or addenda included in Section 2 of this act that require the expenditure of funds shall become effective even if the provisions of the memoranda of understanding or addenda, or both, are approved by the Legislature in legislation other than the annual Budget Act.
SEC. 5.Section 19829.9854 of the Government Code is amended to read:19829.9854.(a)Notwithstanding Section 13340, for the 202627 fiscal year, if the Budget Act of 2026 is not enacted by July 1, 2026, for the memoranda of understanding entered into between the state employer and State Bargaining Unit 2 (effective July 1, 2025, to June 30, 2028, inclusive), State Bargaining Unit 5 (effective July 1, 2024, to June 30, 2027, inclusive), State Bargaining Unit 6 (effective July 3, 2025, to July 2, 2028, inclusive), State Bargaining Unit 7 (effective July 1, 2023, to June 30, 2027, inclusive), State Bargaining Unit 8 (effective July 1, 2024, to June 30, 2027, inclusive), State Bargaining Unit 9 (effective July 1, 2025, to June 30, 2028, inclusive), State Bargaining Unit 10 (effective July 1, 2024, to July 1, 2027, inclusive), State Bargaining Unit 12 (effective July 1, 2023, to June 30, 2027, inclusive), State Bargaining Unit 13 (effective July 1, 2025, to June 30, 2027, inclusive), State Bargaining Unit 16 (effective July 1, 2025, to July 1, 2028, inclusive), State Bargaining Unit 18 (effective July 1, 2025, to July 1, 2028, inclusive), and State Bargaining Unit 19 (effective July 1, 2025, to June 30, 2028, inclusive), there is hereby continuously appropriated to the Controller from the General Fund, unallocated special funds, including, but not limited to, federal funds and unallocated nongovernmental cost funds, and any other fund from which state employees are compensated, the amount necessary for the payment of compensation and employee benefits to state employees covered by the above memoranda of understanding until the Budget Act of 2026 is enacted. The Controller may expend an amount no greater than necessary to enable the Controller to compensate state employees covered by the above memoranda of understanding for work performed between July 1, 2026, of the 202627 fiscal year and the enactment of the Budget Act of 2026.
(b)If the memoranda of understanding entered into between the state employer and State Bargaining Unit 2 (effective July 1, 2025, to June 30, 2028, inclusive), State Bargaining Unit 5 (effective July 1, 2024, to June 30, 2027, inclusive), State Bargaining Unit 6 (effective July 3, 2025, to July 2, 2028, inclusive), State Bargaining Unit 7 (effective July 1, 2023, to June 30, 2027, inclusive), State Bargaining Unit 8 (effective July 1, 2024, to June 30, 2027, inclusive), State Bargaining Unit 9 (effective July 1, 2025, to June 30, 2028, inclusive), State Bargaining Unit 10 (effective July 1, 2024, to July 1, 2027, inclusive), State Bargaining Unit 12 (effective July 1, 2023, to June 30, 2027, inclusive), State Bargaining Unit 13 (effective July 1, 2025, to June 30, 2027, inclusive), State Bargaining Unit 16 (effective July 1, 2025, to July 1, 2028, inclusive), State Bargaining Unit 18 (effective July 1, 2025, to July 1, 2028, inclusive), and State Bargaining Unit 19 (effective July 1, 2025, to June 30, 2028, inclusive), are in effect and approved by the Legislature, the compensation and contribution for employee benefits for state employees represented by these bargaining units shall be at a rate consistent with the memoranda of understanding referenced above, unless otherwise provided for by the Budget Act or other legislative enactment.
(c)Expenditures related to any warrant drawn pursuant to subdivision (a) are not augmentations to the expenditure authority of a department. Upon the enactment of the Budget Act of 2026, these expenditures shall be subsumed by the expenditure authority approved in the Budget Act of 2026 for each affected department.
(d)This section shall only apply to an employee covered by the terms of the State Bargaining Unit 2 (effective July 1, 2025, to June 30, 2028, inclusive), State Bargaining Unit 5 (effective July 1, 2024, to June 30, 2027, inclusive), State Bargaining Unit 6 (effective July 3, 2025, to July 2, 2028, inclusive), State Bargaining Unit 7 (effective July 1, 2023, to June 30, 2027, inclusive), State Bargaining Unit 8 (effective July 1, 2024, to June 30, 2027, inclusive), State Bargaining Unit 9 (effective July 1, 2025, to June 30, 2028, inclusive), State Bargaining Unit 10 (effective July 1, 2024, to July 1, 2027, inclusive), State Bargaining Unit 12 (effective July 1, 2023, to June 30, 2027), State Bargaining Unit 13 (effective July 1, 2025, to June 30, 2027, inclusive), State Bargaining Unit 16 (effective July 1, 2025, to July 1, 2028, inclusive), State Bargaining Unit 18 (effective July 1, 2025, to July 1, 2028, inclusive), and State Bargaining Unit 19 (effective July 1, 2025, to June 30, 2028, inclusive), memoranda of understanding. Notwithstanding Section 3517.8, this section shall not apply after the term of the memoranda of understanding has expired. For purposes of this section, the memorandum of understanding for State Bargaining Unit 2 expires on June 30, 2028, the memorandum of understanding for State Bargaining Unit 5 expires on June 30, 2027, the memorandum of understanding for State Bargaining Unit 6 expires on July 2, 2028, the memorandum of understanding for State Bargaining Unit 7 expires on June 30, 2027, the memorandum of understanding for State Bargaining Unit 8 expires on June 30, 2027, the memorandum for State Bargaining Unit 9 expires on June 30, 2028, the memorandum of understanding for State Bargaining Unit 10 expires on July 1, 2027, the memorandum of understanding for State Bargaining Unit 12 expires on June 30, 2027, the memorandum of understanding for State Bargaining Unit 13 expires on June 30, 2027, the memorandum of understanding for State Bargaining Unit 16 expires on July 1, 2028, the memorandum of understanding for State Bargaining Unit 18 expires on July 1, 2028, and the memorandum of understanding for State Bargaining Unit 19 expires on June 30, 2028.
SEC. 6.Section 19829.9855 of the Government Code is amended to read:19829.9855.(a)Notwithstanding Section 13340, for the 202728 fiscal year, if the Budget Act of 2027 is not enacted by July 1, 2027, for the memoranda of understanding entered into between the state employer and State Bargaining Unit 2 (effective July 1, 2025, to June 30, 2028, inclusive), State Bargaining Unit 6 (effective July 3, 2025, to July 2, 2028, inclusive), State Bargaining Unit 9 (effective July 1, 2025, to June 30, 2028, inclusive), State Bargaining Unit 10 (effective July 1, 2024, to July 1, 2027, inclusive), State Bargaining Unit 16 (effective July 1, 2025, to July 1, 2028, inclusive), State Bargaining Unit 18 (effective July 1, 2025, to July 1, 2028, inclusive), and State Bargaining Unit 19 (effective July 1, 2025, to June 30, 2028, inclusive), there is hereby continuously appropriated to the Controller from the General Fund, unallocated special funds, including, but not limited to, federal funds and unallocated nongovernmental cost funds, and any other fund from which state employees are compensated, the amount necessary for the payment of compensation and employee benefits to state employees covered by the above memoranda of understanding until the Budget Act of 2027 is enacted. The Controller may expend an amount no greater than necessary to enable the Controller to compensate state employees covered by the above memoranda of understanding for work performed between July 1, 2027, of the 202728 fiscal year and the enactment of the Budget Act of 2027.
(b)If the memoranda of understanding entered into between the state employer and State Bargaining Unit 2 (effective July 1, 2025, to June 30, 2028, inclusive), State Bargaining Unit 6 (effective July 3, 2025, to July 2, 2028, inclusive), State Bargaining Unit 9 (effective July 1, 2025, to June 30, 2028, inclusive), State Bargaining Unit 10 (effective July 1, 2024, to July 1, 2027, inclusive), State Bargaining Unit 16 (effective July 1, 2025, to July 1, 2028, inclusive), State Bargaining Unit 18 (effective July 1, 2025, to July 1, 2028, inclusive), and State Bargaining Unit 19 (effective July 1, 2025, to June 30, 2028, inclusive) are in effect and approved by the Legislature, the compensation and contribution for employee benefits for state employees represented by these bargaining units shall be at a rate consistent with the applicable memorandum of understanding referenced above, unless otherwise provided for by the Budget Act or other legislative enactment.
(c)Expenditures related to any warrant drawn pursuant to subdivision (a) are not augmentations to the expenditure authority of a department. Upon the enactment of the Budget Act of 2027, these expenditures shall be subsumed by the expenditure authority approved in the Budget Act of 2027 for each affected department.
(d)This section shall only apply to an employee covered by the terms of the State Bargaining Unit 2 (effective July 1, 2025, to June 30, 2028, inclusive), State Bargaining Unit 6 (effective July 3, 2025, to July 2, 2028, inclusive), State Bargaining Unit 9 (effective July 1, 2025, to June 30, 2028, inclusive), State Bargaining Unit 10 (effective July 1, 2024, to July 1, 2027, inclusive), State Bargaining Unit 16 (effective July 1, 2025, to July 1, 2028, inclusive), State Bargaining Unit 18 (effective July 1, 2025, to July 1, 2028, inclusive), and State Bargaining Unit 19 (effective July 1, 2025, to June 30, 2028, inclusive) memoranda of understanding. Notwithstanding Section 3517.8, this section shall not apply after the term of the applicable memorandum of understanding has expired. For purposes of this section, the memorandum of understanding for State Bargaining Unit 2 expires on June 30, 2028, the memorandum of understanding for State Bargaining Unit 6 expires on July 2, 2028, the memorandum of understanding for State Bargaining Unit 9 expires on June 30, 2028, the memorandum of understanding for State Bargaining Unit 10 expires on July 1, 2027, the memorandum of understanding for State Bargaining Unit 16 expires on July 1, 2028, the memorandum of understanding for State Bargaining Unit 18 expires on July 1, 2028, and the memorandum of understanding for State Bargaining Unit 19 expires on June 30, 2028.
SEC. 7.Section 19829.9856 of the Government Code is amended to read:19829.9856.(a)Notwithstanding Section 13340, for the 202829 fiscal year, if the Budget Act of 2028 is not enacted by July 1, 2028, for the memoranda of understanding entered into between the state employer and State Bargaining Unit 6 (effective July 3, 2025, to July 2, 2028, inclusive) and inclusive), State Bargaining Unit 16 (effective July 1, 2025, to July 1, 2028, inclusive), and State Bargaining Unit 18 (effective July 1, 2025, to July 1, 2028, inclusive), there is hereby continuously appropriated to the Controller from the General Fund, unallocated special funds, including, but not limited to, federal funds and unallocated nongovernmental cost funds, and any other fund from which state employees are compensated, the amount necessary for the payment of compensation and employee benefits to state employees covered by the above memoranda of understanding until the Budget Act of 2028 is enacted. The Controller may expend an amount no greater than necessary to enable the Controller to compensate state employees covered by the above memoranda of understanding for work performed between July 1, 2028, of the 202829 fiscal year and the enactment of the Budget Act of 2028.
(b)If the memoranda of understanding entered into between the state employer and State Bargaining Unit 6 (effective July 3, 2025, to July 2, 2028, inclusive) and inclusive), State Bargaining Unit 16 (effective July 1, 2025, to July 1, 2028, inclusive) inclusive), and State Bargaining Unit 18 (effective July 1, 2025, to July 1, 2028, inclusive) are in effect and approved by the Legislature, the compensation and contribution for employee benefits for state employees represented by the bargaining units shall be at a rate consistent with the applicable memorandum of understanding referenced above, unless otherwise provided for by the Budget Act or other legislative enactment.
(c)Expenditures related to any warrant drawn pursuant to subdivision (a) are not augmentations to the expenditure authority of a department. Upon the enactment of the Budget Act of 2028, these expenditures shall be subsumed by the expenditure authority approved in the Budget Act of 2028 for each affected department.
(d)This section shall only apply to an employee covered by the terms of the State Bargaining Unit 6 (effective July 3, 2025, to July 2, 2028, inclusive) and inclusive), State Bargaining Unit 16 (effective July 1, 2025, to July 1, 2028, inclusive) inclusive), and State Bargaining Unit 18 (effective July 1, 2025, to July 1, 2028, inclusive) memoranda of understanding. Notwithstanding Section 3517.8, this section shall not apply after the term of the applicable memorandum of understanding has expired. For purposes of this section, the memorandum of understanding for State Bargaining Unit 6 expires on July 2, 2028, and the memorandum of understanding for State Bargaining Unit 16 expires on July 1, 2028. 2028, and the memorandum of understanding for State Bargaining Unit 18 expires on July 1, 2028.
SEC. 8.Section 19851 of the Government Code is amended to read:19851.(a)It is the policy of the state, except during the operation of subdivision (c), that the workweek of the state employee shall be 40 hours, and the workday of state employees eight hours, except that workweeks and workdays of a different number of hours may be established in order to meet the varying needs of the different state agencies. It is the policy of the state to avoid the necessity for overtime work whenever possible. This policy does not restrict the extension of regular working-hour schedules on an overtime basis in those activities and agencies where it is necessary to carry on the state business properly during a manpower shortage.
(b)If the provisions of this section are in conflict with the provisions of a memorandum of understanding reached pursuant to Section 3517.5, the memorandum of understanding shall be controlling without further legislative action, except that if the provisions of a memorandum of understanding require the expenditure of funds, the provisions shall not become effective unless approved by the Legislature in the annual Budget Act.
(c)(1)Notwithstanding any other law, for the period from July 1, 2012, to June 30, 2013, inclusive, a state employee shall participate in the Personal Leave Program 2012 (PLP 2012 Program), either as required by an applicable memorandum of understanding reached pursuant to Section 3517.5 or by the direction of the department for excluded employees. Under the PLP 2012 Program, each employee shall receive a reduction in pay not greater than 5 percent. In exchange for this reduction in pay, each employee shall receive eight hours of PLP 2012 Program leave credits on the first day of each monthly pay period. This subdivision shall not apply to retired annuitants or to employees of entities listed in Section 3.90 of the Budget Act of 2012.
(2)Notwithstanding any other law, for the period from July 1, 2020, to June 30, 2021, inclusive, a state employee shall participate in the Personal Leave Program 2020 (PLP 2020 Program), either as required by an applicable memorandum of understanding reached pursuant to Section 3517.5 or by the direction of the department for excluded employees. Under the PLP 2020 Program, each employee shall receive a reduction in pay not greater than 10 percent. In exchange for this reduction in pay, each employee shall receive up to 16 hours of PLP 2020 Program leave credits on the first day of each monthly pay period. This subdivision shall not apply to retired annuitants or to employees of entities listed in Section 3.90 of the Budget Act of 2020.
(3)Notwithstanding any other law, for the period from July 1, 2025, to June 30, 2027, inclusive, a state employee in Bargaining Unit 6 shall participate in the Personal Leave Program 2025 (PLP 2025), as required by an applicable memorandum of understanding reached pursuant to Section 3517.5 or by the direction of the department for excluded employees. Under PLP 2025, each employee in Bargaining Unit 6 shall receive a reduction in pay not greater than 3 percent. In exchange for this reduction in pay, on the first day of each monthly pay period, each employee shall receive up to five hours of PLP 2025 leave credits, except that an employee with the class title Fire Captain (Class Code 9001) and Ranges L or M (192-hour schedule) or Ranges N or P (216-hour schedule) shall receive up to seven hours of PLP 2025 leave credits. This subdivision shall not apply to employees of entities listed in Section 3.90 of the Budget Act of 2025.
(4)Notwithstanding any other law, for the period from July 1, 2025, to June 30, 2027, inclusive, a state employee in Bargaining Unit 9 or Bargaining Unit 12 shall participate in the Personal Leave Program 2025 (PLP 2025), as required by an applicable memorandum of understanding reached pursuant to Section 3517.5. Under PLP 2025, each employee in Bargaining Unit 9 or 12 shall receive a reduction in pay not greater than 3 percent. In exchange for this reduction in pay, on the first day of each monthly pay period, each employee shall receive up to five hours of PLP 2025 leave credits. This subdivision shall not apply to employees of entities listed in Section 3.90 of the Budget Act of 2025.
(5)Notwithstanding any other law, for the period from July 1, 2025, to June 30, 2027, inclusive, a state employee in State Bargaining Units 1, 2, 3, 4, 5, 7, 11, 13, 14, 15, 16, 17, 19, 20, and 21 shall participate in the Personal Leave Program 2025 (PLP 2025), either as required by an applicable memorandum of understanding reached pursuant to Section 3517.5 or by the direction of the department for excluded employees. Under PLP 2025, each employee in State Bargaining Units 1, 2, 3, 4, 5, 7, 11, 13, 14, 15, 16, 17, 19, 20, and 21 shall receive a reduction in pay not greater than the amount listed in an applicable memorandum of understanding or as directed by the department for excluded employees. In exchange for this reduction in pay, each employee shall receive PLP 2025 leave credits on the first day of each monthly pay period, at the rate outlined in the applicable memorandum of understanding or as directed by the department for excluded employees. This subdivision shall not apply to employees of entities listed in Section 3.90 of the Budget Act of 2025.
(6)Notwithstanding any other law, beginning on the first day of the pay period following ratification and ending on June 30, 2027, inclusive, a state employee in State Bargaining Units 8, 10, and 18 shall participate in the Personal Leave Program 2025 (PLP 2025), either as required by an applicable memorandum of understanding reached pursuant to Section 3517.5 or by the direction of the department for excluded employees. Under PLP 2025, each employee in State Bargaining Units 8, 10, and 18 shall receive a reduction in pay not greater than the amount listed in an applicable memorandum of understanding or as directed by the department for excluded employees. In exchange for this reduction in pay, each employee shall receive PLP 2025 leave credits on the first day of each monthly pay period, at the rate outlined in the applicable memorandum of understanding or as directed by the department for excluded employees. This subdivision shall not apply to employees of entities listed in Section 3.90 of the Budget Act of 2025.
SEC. 9.Section 20683.77 of the Government Code is amended to read:20683.77.(a)Effective July 1, 2025, to June 30, 2027, inclusive, the employee contributions described in Section 20677.6 for state miscellaneous and industrial members represented by State Bargaining Unit 18 shall remain in place.
(a)(b)Notwithstanding Sections 20677.4 and 20677.6, effective July 1, 2021, 2027, the normal contribution rates for state miscellaneous or state industrial members who are represented by State Bargaining Unit 18 shall be adjusted in accordance with this section when both of the following occur:
(1)The total normal cost rate for the category in effect for the 201617 fiscal year has increased by 1 percent.
(2)Fifty percent of that normal cost rate, rounded to the nearest one-quarter of 1 percent, is greater than the normal contribution rate established in Section 20677.6.
(b)(c)On July 1 of the fiscal year after the board determines that the requirements of paragraphs (1) and (2) of subdivision (a) (b) have been met, the normal rate of contribution for state miscellaneous or state industrial members who are represented by State Bargaining Unit 18 shall be adjusted to 50 percent of the normal cost rate rounded to the nearest one-quarter of 1 percent, but not to increase or decrease by more than 1 percent.
(c)(d)Each year thereafter, the rate shall only be adjusted if the board determines the total normal cost rate increases or decreases by more than 1 percent of payroll above the total normal cost rate in effect at the time the employee contribution rate was last adjusted. The increase or decrease to the employee contribution in any given fiscal year shall not exceed 1 percent per year.
(d)(e)The normal rate of contribution established pursuant to this section shall be applied to the compensation in excess of three hundred seventeen dollars ($317) per month paid to a member whose service is not included in the federal system or in excess of five hundred thirteen dollars ($513) for one whose service is included in the federal system.
(e)(f)Consistent with the normal rate of contribution for all members identified in this section, the Director of the Department Human Resources may exercise their discretion to establish the normal rate of contributions for a state employee who is excepted from the definition of state employee in subdivision (c) of Section 3513, and an officer or employee of the executive branch of state government who is not a member of the civil service. The normal rate of contribution shall be the same for all members identified in this subdivision. The contribution rate shall be effective at the beginning of the pay period indicated by the Director of the Department of Human Resources.
(f)(g)If the provisions of this section are in conflict with the provisions of a memorandum of understanding reached pursuant to Section 3517.5, the memorandum of understanding shall be controlling without further legislative action, except that if the provisions of a memorandum of understanding require the expenditure of funds, the provisions shall not become effective unless and until approved by the Legislature in the annual Budget Act.
SEC. 10.Section 20683.78 of the Government Code is amended to read:20683.78.(a)Effective July 1, 2025, to June 30, 2027, inclusive, the employee contributions described in Section 20677.9 for state safety members represented by State Bargaining Unit 18 shall remain in place.
(a)(b)Notwithstanding Sections 20677.9 and 20683, effective July 1, 2021, 2027, the normal contribution rates for state safety members who are represented by State Bargaining Unit 18 shall be adjusted in accordance with this section when both of the following occur:
(1)The total normal cost rate for the category in effect for the 201617 fiscal year has increased by 1 percent.
(2)Fifty percent of that normal cost rate, rounded to the nearest one-quarter of 1 percent, is greater than the normal contribution rate established in Section 20677.9.
(b)(c)On July 1 of the fiscal year that the board determines that the requirements of paragraphs (1) and (2) of subdivision (a) (b) have been met, the normal rate of contribution for state safety members who are represented by State Bargaining Unit 18 shall be adjusted to 50 percent of the normal cost rate rounded to the nearest one-quarter of 1 percent, but not to increase or decrease by more than 1 percent.
(c)(d)Each year thereafter, the rate shall only be adjusted if the board determines the total normal cost rate increases increases or decreases by more than 1 percent of payroll above the total normal cost rate in effect at the time the employee contribution rate was last adjusted. The increase or decreases to the employee contribution in any given fiscal year shall not exceed 1 percent per year.
(d)(e)The normal rate of contribution established pursuant to this section shall be applied to the compensation in excess of three hundred seventeen dollars ($317) per month paid to a member whose service is not included in the federal system.
(e)(f)Consistent with the normal rate of contribution for all members identified in this section, the Director of the Department of Human Resources may exercise their discretion to establish the normal rate of contributions for a state employee who is excepted from the definition of state employee in subdivision (c) of Section 3513, and an officer or employee of the executive branch of state government who is not a member of the civil service. The normal rate of contribution shall be the same for all members identified in this subdivision. The contribution rate shall be effective at the beginning of the pay period indicated by the Director of the Department of Human Resources.
(f)(g)If the provisions of this section are in conflict with the provisions of a memorandum of understanding reached pursuant to Section 3517.5, the memorandum of understanding shall be controlling without further legislative action, except that if the provisions of a memorandum of understanding require the expenditure of funds, the provisions shall not become effective unless and until approved by the Legislature in the annual Budget Act.
SEC. 11.Section 22944.5 of the Government Code is amended to read:22944.5.(a)(1)The state and employees in State Bargaining Unit 2, 7, 8, 9, 10, 13, 18, or 19 shall prefund retiree health care, with the goal of reaching a 50-percent cost sharing of actuarially determined normal costs for both employer and employees by July 1, 2019.
(2)The state and employees in State Bargaining Units 6 and 16 shall prefund retiree health care, with the goal of reaching a 50-percent cost sharing of actuarially determined normal costs for both employer and employees by July 1, 2018.
(3)The state and employees in the judicial branch shall prefund retiree health care, with the goal of reaching a 50-percent cost sharing of actuarially determined normal costs for both employer and employees by July 1, 2017.
(4)The state and employees in State Bargaining Unit 1, 3, 4, 5, 11, 12, 14, 15, 17, 20, or 21 shall prefund retiree health care, with the goal of reaching a 50-percent cost sharing of actuarially determined normal costs for both employer and employees by July 1, 2020.
(b)(1)The employees in State Bargaining Unit 9 shall make contributions to prefund retiree health care based on the following schedule, and the state shall make a matching contribution:
(A)Effective July 1, 2017, 0.5 percent of pensionable compensation.
(B)Effective July 1, 2018, an additional 0.5 percent for a total employee contribution of 1.0 percent of pensionable compensation.
(C)Effective July 1, 2019, an additional 1.0 percent for a total employee contribution of 2.0 percent of pensionable compensation.
(D)The employees monthly contribution for prefunding other postemployment benefits for the 202021 fiscal year, as described in subparagraph (C), is suspended and shall not be withheld from employees salaries beginning with the July 2020 pay period and ending on June 30, 2021. The employers monthly contribution for prefunding other postemployment benefits will continue in the 202021 fiscal year, as described in subparagraph (C).
(E)The employers monthly contribution for prefunding other postemployment benefits for the 202526 and 202627 fiscal years, as described in subparagraph (C), is suspended and shall not be withheld from employees salaries or contributed by the employer.
(2)The employees in State Bargaining Unit 10 shall make contributions to prefund retiree health care based on the following schedule, and the state shall make a matching contribution:
(A)Effective July 1, 2017, 0.7 percent of pensionable compensation.
(B)Effective July 1, 2018, an additional 0.7 percent for a total employee contribution of 1.4 percent of pensionable compensation.
(C)Effective July 1, 2019, an additional 1.4 percent for a total employee contribution of 2.8 percent of pensionable compensation.
(D)Effective July 1, 2020, the employer and employee contribution percentages will be increased or decreased to maintain a 50-percent cost sharing of the actuarially determined total normal costs. Adjustments to both the employer and employee contribution percentages will occur if the actuarially determined total normal costs increase or decrease by more than one-half of 1 percent from the total normal cost contribution percentages in effect on July 1, 2019. The increase or decrease to the employer or employee contribution shall not exceed 0.5 percent per year.
(E)The employees monthly contribution for prefunding other postemployment benefits for the 202021 fiscal year, as described in subparagraph (D), is suspended and shall not be withheld from employees salaries beginning on the first day of the pay period following ratification and ending on June 30, 2021. The employers monthly contribution for prefunding other postemployment benefits will continue in the 202021 fiscal year, as described in subparagraph (D).
(F)Notwithstanding Sections 22940, 22942, 22943, 22944, 22944.2, 22944.3, and 22944.5, effective the first day of the pay period following ratification by both parties, the employees and employers monthly contribution for prefunding other postemployment benefits for the 202526 and 202627 fiscal years, as described in subparagraph (C) and (D), is suspended and shall not be withheld from employees salaries or contributed by the employer.
(3)The employees in State Bargaining Unit 6 shall make contributions to prefund retiree health care based on the following schedule, and the state shall make a matching contribution:
(A)Effective July 1, 2016, 1.3 percent of pensionable compensation.
(B)Effective July 1, 2017, an additional 1.3 percent for a total employee contribution of 2.6 percent of pensionable compensation.
(C)Effective July 1, 2018, an additional 1.4 percent for a total employee contribution of 4.0 percent of pensionable compensation.
(D)The employees monthly contribution for prefunding other postemployment benefits for the 202021 fiscal year, as described in subparagraph (C), is suspended and shall not be withheld from employees salaries beginning on July 1, 2020, and ending on June 30, 2021. The employers monthly contribution for prefunding other postemployment benefits will continue in the 202021 fiscal year, as described in subparagraph (C).
(E)The employers monthly contribution for prefunding other postemployment benefits for the 202526 and 20262027 fiscal years, as described in subparagraph (C), is suspended and shall not be contributed by the employer. The employees monthly contribution of 4.0 percent for prefunding other postemployment benefits will continue uninterrupted.
(4)The state employees in the judicial branch shall make contributions to prefund retiree health care based on the following schedule, and the state shall make a matching contribution:
(A)Effective July 1, 2016, 1.5 percent of pensionable compensation.
(B)Effective July 1, 2017, up to an additional 1.5 percent for a total employee contribution of up to 3.0 percent of pensionable compensation. The additional amount shall be determined by the Director of Finance no later than April 1, 2017, based on the actuarially determined normal costs identified in the state valuation.
(C)Effective July 31, 2025 to June 30, 2027, inclusive, the employees and employers monthly contribution for prefunding other postemployment benefits for the 2025-26 and 2026-27 fiscal years, as described in subparagraph (B), is suspended and shall not be withheld from employees salaries or contributed by the employer.
(C)(D)This paragraph does not apply to a judge who is subject to Chapter 11 (commencing with Section 75000) or Chapter 11.5 (commencing with Section 75500) of Title 8.
(5)The employees in State Bargaining Unit 12 shall make contributions to prefund retiree health care based on the following schedule, and the state shall make a matching contribution:
(A)Effective July 1, 2017, 1.5 percent of pensionable compensation.
(B)Effective July 1, 2018, an additional 1.0 percent for a total employee contribution of 2.5 percent of pensionable compensation.
(C)Effective July 1, 2019, an additional 1.0 percent for a total employee contribution of 3.5 percent of pensionable compensation.
(D)Effective July 1, 2020, an additional 1.1 percent for a total employee contribution of 4.6 percent of pensionable compensation.
(E)The employees monthly contribution for prefunding other postemployment benefits for the 202021 fiscal year, as described in subparagraph (D), is suspended and shall not be withheld from employees salaries beginning on the first day of the pay period following ratification and ending on June 30, 2021. The employers monthly contribution for prefunding other postemployment benefits will continue in the 202021 fiscal year, as described in subparagraph (D).
(F)Effective the first day of the pay period following ratification by both parties, but no sooner than July 1, 2021, the employer and employee contribution percentages shall be increased or decreased to maintain a 50-percent cost sharing of the actuarially determined total normal costs. Adjustments to both the employer and employee contribution percentages will occur if the actuarially determined total normal costs increase or decrease by more than one-half of 1 percent from the total normal cost contribution percentages in effect at the time. The increase or decrease to the employer or employee contribution shall not exceed 0.5 percent per year.
(G)The employees and employers monthly contribution for prefunding other postemployment benefits for the 202526 and 202627 fiscal years, as described in subparagraphs (D) and (F), is suspended and shall not be withheld from employees salaries or contributed by the employer.
(H)Effective July 1, 2027, 1.4 percent of pensionable compensation.
(I)Effective July 1, 2028, an additional 1.3 percent for a total employee contribution of 2.7 percent of pensionable compensation.
(J)Effective July 1, 2029, an additional 1.4 percent for a total employee contribution of 4.1 percent of pensionable compensation.
(K)Effective July 1, 2030, the employer and employee contribution percentages shall be increased or decreased to maintain a 50-percent cost sharing of the actuarially determined total normal costs. Adjustments to both the employer and employee contribution percentages shall occur if the actuarially determined total normal costs increase or decrease by more than one-half of one percent from the total normal contribution percentages in effect at the time. The increase or decrease to the employer or employee contribution shall not exceed 0.5 percent per year.
(6)The employees in State Bargaining Unit 2 shall make contributions to prefund retiree health care based on the following schedule, and the state shall make a matching contribution:
(A)Effective July 1, 2017, 0.7 percent of pensionable compensation.
(B)Effective July 1, 2018, an additional 0.6 percent for a total employee contribution of 1.3 percent of pensionable compensation.
(C)Effective July 1, 2019, an additional 0.7 percent for a total employee contribution of 2.0 percent of pensionable compensation.
(D)The employees monthly contribution for prefunding other postemployment benefits for the 202021 fiscal year, as described in subparagraph (C), is suspended and shall not be withheld from employees salaries beginning on the first day of the pay period following ratification and ending on June 30, 2021. The employers monthly contribution for prefunding other postemployment benefits will continue in the 202021 fiscal year, as described in subparagraph (C).
(E)Effective October 1, 2022, the employer and State Bargaining Unit 2 employee contribution percentages will be adjusted based on actuarially determined total normal costs. Adjustments to both the employer and employee contribution percentages will occur if the actuarially determined total normal costs increase or decrease by more than 0.5 percent from the total normal cost contribution percentages in effect at the time. Commencing the first day of the pay period following ratification, and on July 1 of each fiscal year thereafter, the employer and employee contribution percentages will be increased or decreased to maintain a 50-percent cost sharing of actuarially determined total normal costs. Furthermore, the increase or decrease to the employer or employee contribution in any given fiscal year shall not exceed 0.5 percent per year.
(F)Effective July 1, 2025, to June 30, 2027, inclusive, the employees and employers monthly contribution for prefunding other postemployment benefits for the 202526 and 202627 fiscal years, as described in subparagraphs (C) and (E), is suspended and shall not be withheld from employees salaries or contributed by the employer.
(7)The employees in State Bargaining Unit 7 shall make contributions to prefund retiree health care based on the following schedule, and the state shall make a matching contribution:
(A)Effective July 1, 2017, 1.3 percent of pensionable compensation.
(B)Effective July 1, 2018, an additional 1.4 percent for a total employee contribution of 2.7 percent of pensionable compensation.
(C)Effective July 1, 2019, an additional 1.3 percent for a total employee contribution of 4.0 percent of pensionable compensation.
(D)The employees monthly contribution for prefunding other postemployment benefits for the 202021 fiscal year, as described in subparagraph (C), is suspended and shall not be withheld from employees salaries beginning on the first day of the pay period following ratification and ending on June 30, 2021. The employers monthly contribution for prefunding other postemployment benefits will continue in the 202021 fiscal year, as described in subparagraph (C).
(E)Effective July 1, 2025, to June 30, 2027, inclusive, the employees and employers monthly contribution for prefunding other postemployment benefits for the 202526 and 202627 fiscal years, as described in subparagraph (C), is suspended and shall not be withheld from employees salaries or contributed by the employer.
(F)Effective July 1, 2027, 1.3 percent of pensionable contributions.
(G)Effective July 1, 2028, an additional 1.3 percent for a total employee contribution of 2.6 percent of pensionable compensation.
(H)Effective July 1, 2029, an additional 1.4 percent for a total employee contribution of 4 percent of pensionable compensation.
(I)Beginning July 1, 2030, the employer and employee contribution percentages shall be increased or decreased to maintain a 50-percent cost sharing of the actuarially determined total normal costs. Adjustments to both the employer and employee contribution percentages shall occur if the actuarially determined total normal costs increase or decrease by more than one-half of one percent from the total normal contribution percentages in effect at the time. The increase or decrease to the employer or employee contribution shall not exceed 0.5 percent per year.
(8)The employees in State Bargaining Unit 1, 3, 4, 11, 14, 15, 17, 20, or 21 shall make contributions to prefund retiree health care based on the following schedule, and the state shall make a matching contribution:
(A)Effective July 1, 2018, 1.2 percent of pensionable compensation.
(B)Effective July 1, 2019, an additional 1.1 percent for a total employee contribution of 2.3 percent of pensionable compensation.
(C)Effective July 1, 2020, an additional 1.2 percent for a total employee contribution of 3.5 percent of pensionable compensation.
(D)Effective the first day of the pay period following ratification, the contribution percentage in subparagraph (C) shall be reduced by 0.5 percent for a total employee contribution of 3.0 percent of pensionable compensation.
(E)Effective July 1, 2024, and each July thereafter, State Bargaining Unit 1, 3, 4, 11, 14, 15, 17, 20, or 21 employee contribution percentages will be adjusted based on actuarially determined total normal costs. Adjustments to both the employer and employee contribution percentages will occur if the actuarially determined total normal costs increase or decrease by more than 0.5 percent from the total normal cost contribution percentages in effect at the time. The employer and employee contribution percentages will be increased or decreased to maintain a 50-percent cost sharing of actuarially determined total normal costs. Furthermore, the increase or decrease to the employer or employee contribution in any given fiscal year shall not exceed 0.5 percent per year.
(F)The employees monthly contribution for prefunding other postemployment benefits for the 202021 fiscal year, as described in subparagraph (C), is suspended and shall not be withheld from employees salaries beginning on July 1, 2020, and ending on June 30, 2021. The employers monthly contribution for prefunding other postemployment benefits will continue in the 202021 fiscal year, as described in subparagraph (C).
(G)Effective July 31, 2025, to June 30, 2027, inclusive, the employees and employers monthly contribution for prefunding other postemployment benefits for the 202526 and 202627 fiscal years, as described in subparagraphs (D) and (E), is suspended and shall not be withheld from employees salaries or contributed by the employer.
(9)The employees in State Bargaining Unit 8 shall make contributions to prefund retiree health care based on the following schedule, and the state shall make a matching contribution:
(A)Effective July 1, 2017, 1.5 percent of pensionable compensation.
(B)Effective July 1, 2018, an additional 1.5 percent for a total employee contribution of 3.0 percent of pensionable compensation.
(C)Effective July 1, 2019, an additional 1.4 percent for a total employee contribution of 4.4 percent of pensionable compensation.
(D)The employees monthly contribution for prefunding other postemployment benefits for the 202021 fiscal year, as described in subparagraph (C), is suspended and shall not be withheld from employees salaries beginning on the first day of the pay period following ratification and ending on June 30, 2021. The employers monthly contribution for prefunding other postemployment benefits will continue in the 202021 fiscal year, as described in subparagraph (C).
(E)Effective the first day of the pay period following ratification by both parties, but no sooner than November 1, 2022, the employer and employee contribution will be decreased by 1 percent from 4.4 percent to 3.4 percent.
(F)Effective July 1, 2023, the contribution percentages will be adjusted based on the actuarially determined total normal cost. Adjustments to both the employer and employee contribution percentages will occur if the actuarially determined total normal costs increase or decrease by more than 0.5 percent or one-half of 1 percent from the normal total cost contribution percentages in effect at the time. If it is determined that an adjustment to the contribution rate is necessary, commencing no sooner than July 1, 2023, and July 1 of each fiscal year thereafter, the employer and employee contribution percentages will be increased or decreased to maintain a 50-percent cost sharing of actuarially determined total normal costs. Furthermore, the increase or decrease to the employer or employee contribution in any given fiscal year shall not exceed 0.5 percent per year.
(G)Effective July 1, 2025, to June 30, 2027, inclusive, the employees and employers monthly contribution for prefunding other postemployment benefits for the 202526 and 202627 fiscal years, as described in subparagraphs (E) and (F), is suspended and shall not be withheld from employees salaries or contributed by the employer.
(10)The employees in State Bargaining Unit 13 shall make contributions to prefund retiree health care based on the following schedule, and the state shall make a matching contribution:
(A)Effective July 1, 2017, 1.3 percent of pensionable compensation.
(B)Effective July 1, 2018, an additional 1.3 percent for a total employee contribution of 2.6 percent of pensionable compensation.
(C)Effective July 1, 2019, an additional 1.3 percent for a total employee contribution of 3.9 percent of pensionable compensation.
(D)The employees monthly contribution for prefunding other postemployment benefits for the 202021 fiscal year, as described in subparagraph (C), is suspended and shall not be withheld from employees salaries beginning with the August 2020 pay period and ending on June 30, 2021. The employers monthly contribution for prefunding other postemployment benefits will continue in the 202021 fiscal year, as described in subparagraph (C).
(E)Effective August 2, 2022, the employer and employee contribution percentages will be adjusted based on actuarially determined total normal costs. Adjustments to both the employer and employee contribution percentages will occur if the actuarially determined total normal costs increase or decrease by more than 0.5 percent from the total normal cost contribution percentages in effect at the time. Commencing no sooner than July 1, 2022, the employer and employee contribution percentages will be increased or decreased to maintain a 50-percent cost sharing of actuarially determined total normal costs. Furthermore, the increase or decrease to the employer or employee contribution in any given fiscal year shall not exceed 0.5 percent per year.
(F)Effective July 1, 2025, to June 30, 2027, inclusive, the employees and employers monthly contribution for prefunding other postemployment benefits for the 202526 and 202627 fiscal years, as described in subparagraph (D) and (E), is suspended and shall not be withheld from employees salaries or contributed by the employer.
(G)Effective July 1, 2027, 1.2 percent of pensionable compensation.
(H)Effective July 1, 2028, an additional 1.3 percent for a total employee contribution of 2.5 percent of pensionable compensation.
(I)Effective July 1, 2029, an additional 1.3 percent for a total employee contribution of 3.8 percent of pensionable compensation.
(J)Beginning July 1, 2030, both the employer and employee contribution percentages will be increased or decreased to maintain a 50 percent cost sharing of actuarially determined total normal costs. The increase or decrease to the employer or employee contribution in any given fiscal year shall not exceed 0.5 percent per year.
(11)The employees in State Bargaining Unit 18 shall make contributions to prefund retiree health care based on the following schedule, and the state shall make a matching contribution:
(A)Effective July 1, 2017, 1.3 percent of pensionable compensation.
(B)Effective July 1, 2018, an additional 1.3 percent for a total employee contribution of 2.6 percent of pensionable compensation.
(C)Effective July 1, 2019, an additional 1.4 percent for a total employee contribution of 4.0 percent of pensionable compensation.
(D)After July 1, 2019, the employer and employee contribution percentages will be adjusted based on actuarially determined total normal costs. Adjustments to both the employer and employee contribution percentages will occur if the actuarially determined total normal costs increase by more than 0.5 percent from the total normal cost contribution percentages in effect at the time. Commencing no sooner than July 1, 2021, and on July 1 of each fiscal year thereafter, if it is determined that an adjustment to the contribution rate is necessary, the employer and employee contribution percentages will be increased to maintain a 50-percent cost sharing of actuarially determined total normal costs. The increase to the employer or employee contribution in any given fiscal year shall not exceed 0.5 percent per year.
(E)The employees monthly contribution for prefunding other postemployment benefits for the 202021 fiscal year, as described in subparagraphs (C) and (D), is suspended and shall not be withheld from employees salaries beginning on the first day of the pay period following ratification and ending on June 30, 2021. The employers monthly contribution for prefunding other postemployment benefits will continue in the 202021 fiscal year, as described in subparagraphs (C) and (D).
(F)Effective October 1, 2022, the employer and employee contribution percentages will be adjusted based on actuarially determined total normal costs. Adjustments to both the employer and employee contribution percentages will occur if the actuarially determined total normal costs increase or decrease by more than 0.5 percent from the total normal cost contribution percentages in effect at the time. Commencing the first day of the pay period following ratification, and on July 1 of each fiscal year thereafter, the employer and employee contribution percentages will be increased or decreased to maintain a 50-percent cost sharing of actuarially determined total normal costs. Furthermore, the increase or decrease to the employer or employee contribution in any given fiscal year shall not exceed 0.5 percent per year.
(G)Effective July 1, 2025, to June 30, 2027, inclusive, the employees and employers monthly contribution for prefunding other postemployment benefits for the 202526 and 202627 fiscal years, as described in subparagraphs (C) and (F), is suspended and shall not be withheld from employees salaries or contributed by the employer.
(H)Effective July 1, 2027, the amount of the employees and matching employer contributions required to prefund retiree healthcare shall be based on the following schedule:
(i)Effective July 1, 2027, 1.5 percent of pensionable compensation.
(ii)Effective July 1, 2028, an additional 1.5 percent for a total employee contribution of 3.0 percent of pensionable compensation.
(iii)Effective July 1, 2029, an additional 1.5 percent for a total employee contribution of 4.5 percent of pensionable compensation.
(I)Beginning July 1, 2030, both the employer and employee contribution percentages will be increased or decreased to maintain a 50 percent cost sharing of actuarially determined normal costs. The increase or decrease to the employer or employee contribution in any given fiscal year shall not exceed 0.5 percent per year.
(12)The employees in State Bargaining Unit 19 shall make contributions to prefund retiree health care based on the following schedule, and the state shall make a matching contribution:
(A)Effective July 1, 2017, 1.0 percent of pensionable compensation.
(B)Effective July 1, 2018, an additional 1.0 percent for a total employee contribution of 2.0 percent of pensionable compensation.
(C)Effective July 1, 2019, an additional 1.0 percent for a total employee contribution of 3.0 percent of pensionable compensation.
(D)The employees monthly contribution for prefunding other postemployment benefits for the 202021 fiscal year, as described in subparagraph (C), is suspended and shall not be withheld from employees salaries beginning with the July 2020 pay period and ending on June 30, 2021. The employers monthly contribution for prefunding other postemployment benefits will continue in the 202021 fiscal year, as described in subparagraph (C).
(E)Effective July 1, 2025, to June 30, 2027, inclusive, the employees and employers monthly contribution for prefunding other postemployment benefits for the 202526 and 202627 fiscal years, as described in subparagraph (C), is suspended and shall not be withheld from employees salaries or contributed by the employer.
(13)The employees in State Bargaining Unit 16 shall make contributions to prefund retiree health care based on the following schedule, and the state shall make a matching contribution:
(A)Effective July 1, 2017, 1 percent of pensionable compensation.
(B)Effective July 1, 2018, an additional 0.4 percent for a total employee contribution of 1.4 percent of pensionable compensation.
(C)The employees monthly contribution for prefunding other postemployment benefits for the 202021 fiscal year, as described in subparagraph (B), is suspended and shall not be withheld from employees salaries beginning on the first day of the pay period following ratification and ending on June 30, 2021. The employers monthly contribution for prefunding other postemployment benefits will continue in the 202021 fiscal year, as described in subparagraph (B).
(D)Effective the first day of the pay period following ratification by both parties, to June 30, 2027, inclusive, the employees and employers monthly contribution for prefunding other postemployment benefits for the 202526 and 202627 fiscal years, as described in subparagraph (B), is suspended and shall not be withheld from employees salaries or contributed by the employer.
(14)Notwithstanding Section 22944.3 of the Government Code, the state and employees in State Bargaining Unit 5 shall prefund retiree health care, with the goal of reaching a 50-percent cost sharing of actuarially determined total normal costs for both employer and employees by July 1, 2020.
(A)The employees in State Bargaining Unit 5 shall make contributions to prefund retiree health care based on the following schedule, and the state shall make a matching contribution:
(B)Effective July 1, 2020, 0.0 percent of pensionable compensation for employees and 3.4 percent of pensionable statutory salary increases redirected to prefund OPEB paid for by the employer.
(C)After July 1, 2020, the employer and employee contribution percentages will be adjusted based on actuarially determined total normal costs. Adjustments to both the employer and employee contribution percentages will occur if the actuarially determined total normal costs increase or decrease by more than 0.5 percent from the total normal cost contribution percentages in effect at the time. Commencing no sooner than July 1, 2021, and on July 1 of each fiscal year thereafter, if it is determined that an adjustment to the contribution rate is necessary, the employer and employee contribution percentages will be increased or decreased to maintain a 50-percent cost sharing of actuarially determined total normal costs. The increase or decrease to the employer or employee contribution in any given fiscal year shall not exceed 0.5 percent per year.
(D)The employees monthly contribution for prefunding other postemployment benefits for the 202021 fiscal year, as described in subparagraphs (B) and (C), is suspended and shall not be withheld from employees salaries beginning with the July 2020 pay period and ending on June 30, 2021. The employers monthly contribution for prefunding other postemployment benefits will also be suspended during the 202021 fiscal year, as described in subparagraphs (B) and (C), beginning with the July 2020 pay period and ending on June 30, 2021.
(E)Effective July 1, 2020, the statutory increase redirected as a result of subdivision (a) of Section 19827 shall count towards the employee contribution percentage when determining the 50-percent cost sharing of actuarially determined total normal costs.
(F)Effective the first day of the pay period following ratification by both parties, but no sooner than July 1, 2021, the parties shall incorporate the 3.4 percent employee share of pensionable compensation into the salary survey conducted pursuant to Section 19827 of Government Code.
(G)Effective the first day of the pay period following ratification by both parties, but no sooner than July 1, 2021, the employees in State Bargaining Unit 5 and the state shall make contributions to prefund retiree health care based on the following schedule:
(i)Effective the first day of the pay period following ratification by both parties, but no sooner than July 1, 2021, employees shall contribute 0.9 percent of pensionable compensation and the employer shall contribute 5.9 percent of pensionable compensation, for a total of 6.8 percent pensionable compensation.
(ii)Effective July 1, 2022, or July 1, 2024, employees shall contribute 1.7 percent of pensionable compensation and the employer shall contribute 5.1 percent of pensionable compensation, for a total of 6.8 percent pensionable compensation.
(iii)Effective July 1, 2023, or July 1, 2025, employees shall contribute 2.6 percent of pensionable compensation and the employer shall contribute 4.2 percent of pensionable compensation, for a total of 6.8 percent pensionable compensation.
(iv)Effective July 1, 2024, employees shall contribute 3.4 percent of pensionable compensation and the employer shall contribute 3.4 percent of pensionable compensation, for a total of 6.8 percent of pensionable compensation.
(v)Effective the first day of the pay period following ratification by both parties but no earlier than July 31, 2025, to June 30, 2027, inclusive, the employees and employers monthly contribution for prefunding other postemployment benefits for the 202526 and 202627 fiscal years, as described in clause (iv), is suspended and shall not be withheld from employees salaries or contributed by the employer.
(c)This section only applies to employees who are eligible for health benefits, including permanent intermittent employees.
(d)Contributions paid pursuant to this section shall be deposited in the Annuitants Health Care Coverage Fund and shall not be refundable under any circumstances to an employee or the employees beneficiary or survivor.
(e)If the provisions of this section are in conflict with the provisions of a memorandum of understanding or addenda, or both, reached pursuant to Section 3517.5, that memorandum of understanding or addenda, or both, shall be controlling without further legislative action, except that if those provisions of the memorandum of understanding or addenda require the expenditure of funds, the provisions shall not become effective unless approved by the Legislature in the annual Budget Act.
(f)This section shall also apply to a state employee related to a bargaining unit described in subdivision (a) who is excepted from the definition of state employee in subdivision (c) of Section 3513, and the Director of the Department of Human Resources may establish the total employee contribution to prefund retiree health care as a percentage of pensionable compensation.(g)(f)(1)With the goal of reaching a 50-percent cost sharing of actuarially determined normal costs for both employer and employees by July 1, 2020, the Director of the Department of Human Resources may establish the total employee and employer contribution to prefund retiree health care as a percentage of pensionable compensation for the following:
(A)A state employee related to a bargaining unit described in subdivision (a) who is excepted from the definition of state employee in subdivision (c) of Section 3513.
(A)(B)A state employee who is not related to a bargaining unit described in subdivision (a) and who is excepted from the definition of state employee in subdivision (c) of Section 3513.
(B)(C)An officer or employee of the executive branch of state government who is not a member of the civil service.
(2)An employee or officer to whom this subdivision applies shall make contributions to prefund retiree health care based on the percentages established in paragraph (1), and the state shall match the contributions. (1).
SEC. 12.Pursuant to the agreements reached between the state employer and State Bargaining Units 1, 3, 4, 5, 8, 10, 11, 14, 15, 17, 18, 20, and 21, Items 9800-001-0001, 9800-001-0494, and 9800-001-0988 of Section 2.00 of the Budget Act of 2025 shall be increased for a total of fourteen million five hundred ninety-seven thousand dollars ($14,597,000) in accordance with the following schedule:
(a)One million five hundred fifty-seven thousand dollars ($1,557,000) from the General Fund is increased from Item 9800-001-0001 of Section 2.00 of the Budget Act of 2025.
(b)Twenty-one million four hundred thirty-five thousand dollars ($21,435,000) from unallocated special funds is increased from Item 9800-001-0494 of Section 2.00 of the Budget Act of 2025.
(c)Eight million three hundred ninety-five thousand dollars ($8,395,000) from other unallocated nongovernmental cost funds is reduced from Item 9800-001-0988 of Section 2.00 of the Budget Act of 2025.
SEC. 13.This act is a bill providing for appropriations related to the Budget Bill within the meaning of subdivision (e) of Section 12 of Article IV of the California Constitution, has been identified as related to the budget in the Budget Bill, and shall take effect immediately.
SECTION 1.It is the intent of the Legislature to enact statutory changes relating to the Budget Act of 2025.It is the intent of the Legislature to enact statutory changes relating to the Budget Act of 2025.
|
Date
|
Status
|
|---|---|
| Sep 13, 2025 | Ordered to inactive file at the request of Senator Grayson. |
| Sep 11, 2025 | Read second time. Ordered to third reading. |
| Sep 11, 2025 | Senate Rule 29.4 suspended. (Ayes 30. Noes 10. Page 2935.) |
| Sep 10, 2025 | From committee: Do pass. (Ayes 13. Noes 0.) (September 10). |
| Sep 8, 2025 | From committee chair, with author's amendments: Amend, and re-refer to committee. Read second time, amended, and re-referred to Com. on B. & F. R. |
| Sep 8, 2025 | Senate Rule 29.3(b) suspended. (Ayes 28. Noes 8. Page 2568.) |
| Apr 2, 2025 | Referred to Com. on B. & F. R. |
| Mar 20, 2025 | In Senate. Read first time. To Com. on RLS. for assignment. |
| Mar 20, 2025 | Read third time. Passed. Ordered to the Senate. (Ayes 53. Noes 17. Page 743.) |
| Mar 18, 2025 | Read second time. Ordered to third reading. |
| Mar 17, 2025 | (Ayes 53. Noes 17. Page 643.) |
| Mar 17, 2025 | Ordered to second reading. |
| Mar 17, 2025 | Withdrawn from committee. |
| Feb 3, 2025 | Referred to Com. on BUDGET. |
| Jan 9, 2025 | From printer. May be heard in committee February 8. |
| Jan 8, 2025 | Read first time. To print. |
|
Date
|
Description
|
Location
|
Votes
|
|
|---|---|---|---|---|
| Sep 10, 2025 | Do pass | Senate Standing Committee on Budget and Fiscal Review |
Passed |
|
| Mar 20, 2025 | AB 161 Gabriel Assembly Third Reading | Assembly Floor |
Passed |
This list shows positions taken on this bill by organizations on the date displayed, which is linked to the original source.
Positions by individuals are not included.
|
Organization
|
Position
|
Date
|
|---|---|---|
| AFSCME - Union of American Physicians and Dentists (UAPD) | ** Support | |
| American Federation of State, County and Municipal Employees (AFSCME) | ** Support | |
| California Association of Highway Patrolmen (CAHP) | ** Support | |
| CALIFORNIA ASSOCIATION OF PROFESSIONAL SCIENTISTS CAPS | ** Support | |
| California Association of Psychiatric Technicians (CAPT) | ** Support | |
| California Department of Forestry and Fire Protection Firefighters, CAL FIRE Local 2881 | ** Support | |
| International Union of Operating Engineers (IUOE) | ** Support | |
| Service Employees International Union, Local 1000 (SEIU 1000) | ** Support |
SENATE RULES COMMITTEE Office of Senate Floor Analyses (916) 651-1520 Fax: (916) 327-4478 | AB 161 |
THIRD READING
Bill No: AB 161
Author: Committee on Budget
Amended: 9/8/25 in Senate
Vote: 21
ASSEMBLY FLOOR: 53-17, 3/20/25 - See last page for vote
SUBJECT: State employment: state bargaining units
SOURCE: Author
DIGEST:
Makes necessary statutory changes to codify and ratify a new memorandum of understanding (MOU), addenda to existing MOUs, side letter agreements and closure letters between the state and various state employee bargaining units (BUs).
ANALYSIS: The agreements cover state employees represented by eight exclusive employee representatives, as follows:
Service Employees International Union, Local 1000 (SEIU 1000)
- BU 1: Administrative, Financial, and Staff Services
- BU 3: Professional Educators and Librarians
- BU 4: Office and Allied
- BU 11: Engineering and Scientific Technicians
- BU 14: Printing Trades
- BU 15: Allied Services
- BU 17: Registered Nurses
- BU 20: Medical and Social Services
- BU 21: Education Consultants and Library Employees
California Association of Highway Patrolmen (CAHP)
- BU 5: Highway Patrol
California Department of Forestry and Fire Protection Firefighters, CAL FIRE Local 2881
- BU 8: California Firefighters
California Association of Professional Scientists (CAPS)
- BU 10: Professional Scientists
International Union of Operating Engineers (IUOE)
- BU 12: Craft and Maintenance
- BU 13: Stationary Engineers
AFSCME - Union of American Physicians and Dentists (UAPD)
- BU 16: Physicians, Dentists, and Podiatrists
California Association of Psychiatric Technicians (CAPT)
- BU 18: Psychiatric Technicians
American Federation of State, County and Municipal Employees (AFSCME)
- BU 19: Health and Social Services/Professional
Existing Law:
- Establishes the Ralph C. Dills Act, which requires the state to collectively bargain with the exclusive representatives of employee groups (i.e., bargaining units) - regarding wages and working conditions, and to define negotiated agreements in MOUs.
- Establishes the California Department of Human Resources (CalHR) as the official representative of the Governor in all matters related to collective bargaining with state employees.
- Requires that any MOU between the state and an exclusive representative be ratified by the Legislature.
- Establishes the California Public Employees' Retirement System (CalPERS), which administers health and retirement benefits for state employees.
- Requires the Legislative Analyst's Office (LAO) to analyze all state MOUs and to provide an analysis of an MOU and its fiscal impact to the Legislature within ten days of receipt of an MOU from CalHR.
- Provides that fully vested state retirees (e.g., with 20 or more years of state employment or with 25 years or more, depending on the bargaining unit) are entitled to an employer contribution for retiree health care equal to 80 or 100 percent of the weighted average premium of the four health plans most highly utilized by all members. Depending on the bargaining unit, dependents are eligible for a contribution based on 80 or 90 percent of the average additional premiums paid for dependents during the benefit year in which the formula is applied. These are referred to as the 80/80 and 100/90 formulas.
- Requires that Medicare-eligible retirees enroll in Medicare and choose a Medicare-coordinated health plan.
- Provides that the employer contribution for active state employee health care shall be determined through collective bargaining.
Proposed Law: This bill ratifies a new/successor MOU with BU 18 (CAPT), two addenda to current MOUs with BU 8 (CalFire Firefighters) and BU 10 (PECG), side letters agreements with BUs 1, 3, 4, 11, 14, 15, 17, 20 and 21 (SEIU 1000), BU 5 (CAHP), BUs 12 and 13 (IUOE) and closure letters with BU 16 (UAPD) and BU 19 (AFSCME).
Specifically, this measure does the following:
New Memoranda of Understanding or Successor Agreement with BU 18
Memorandum of Understanding with BU 18. This bill ratifies a new MOU entered into on August 14, 2025 between the state and BU 18, which is represented by the California Association of Psychiatric Technicians (CAPT). The MOU agreement is as follows:
Compensation
General Salary Adjustment and Special Salary Adjustments
- Effective the first day of the pay period following ratification by both parties, all BU 18 classifications shall receive a general salary increase of 3%.
- Effective July 1, 2027, all BU 18 classifications shall receive a general salary increase of 3%.
Personal Leave Program (PLP 2025)
- Effective the first day of the pay period following ratification by both parties through the June 2027 pay period, PLP 2025 will apply to BU 18-represented employees.
- Employees will continue to work their assigned work schedules and receive a 3% pay reduction.
- Each full-time employee shall be credited with five hours of PLP 2025 on the first day of each pay period for the duration of the PLP 2025.
- PLP 2025 may be cashed out upon separation from state service.
- PLP 2025 leave shall not be considered as “time worked” for overtime purposes except when an employee is “mandated” to work overtime.
Bilingual Pay Differential
- Effective the first day of the pay period following ratification by both parties, the bilingual pay differential will increase from $100 to $200 per month.
Health Benefits
Health, Dental, Vision (CoBen)
- The state’s monthly health benefit contribution for each employee shall continue to be a flat dollar amount equal to 80 percent of the weighted average of the basic health benefit plan premiums of the four largest enrolled basic health plans. The flat dollar amounts shall be increased or decreased as appropriate pursuant to the formula on January 1, 2026, January 1, 2027, and January 1, 2028.
Prefunding of Other Post-Employment Benefits (OPEB)
- The employees' and employer’s monthly contribution for prefunding other postemployment benefits for the 2025-26 and 2026-27 fiscal years, is suspended and shall not be withheld from employees' salaries or contributed by the employer beginning July 1, 2025, and ending June 30, 2027.
- Beginning July 1, 2027, with the goal of reestablishing a 50% cost sharing agreement of actuarially determined normal costs for both employer and employees, the amount of employees and matching employer contributions required to prefund retiree healthcare shall be phased in as follows:
- July 1, 2027: by 1.5%
- July 1, 2028: by 1.5%, for a total of 3%
- July 1, 2029: by 1.5%, for a total of 4.5%.
- Effective July 1, 2030, both the employer and employee contribution percentages will be increased or decreased to maintain a 50% cost sharing of actuarially determined normal costs.
- The increase or decrease to the employer or employee contribution in any given fiscal year shall not exceed 0.5% per year.
Retirement
State Miscellaneous/Industrial – First Tier A Retirement Formula (2% at age 55), First Tier B Retirement Formula (2% at age 60) and Public Employees’ Pension Reform Act (PEPRA) First Tier Retirement Formula (2% at age 62)/Employee Contribution/Final Compensation
- Effective July 1, 2025, the employee contribution for Miscellaneous and Industrial members shall remain in place through June 30, 2027.
- Cost sharing – effective July 1, 2027, when CalPERS determines the employee contribution rate for Miscellaneous or Industrial members increases or decreases by more than 1% from the 2026-27 fiscal year total normal cost, the rate shall be adjusted to 50% of the normal cost rate rounded to the nearest quarter of one percent on July 1 of the fiscal year after the determination, not exceed 1% per year.
State Safety A Retirement Formula (2.5% at age 55), State Safety B Retirement Formula (2% at age 55), and Public Employees’ Pension Reform Act (PEPRA) Retirement Formula (2% at age 57)/Employees Contribution/Final Compensation
- Effective July 1, 2025, the employee contribution for State Safety members shall remain in place through June 30, 2027.
- Cost sharing – effective July 1, 2027, when CalPERS determines the employee contribution rate for State Safety increases or decreases by more than 1% from the 2021-22 fiscal year total normal cost, the rate shall be adjusted to 50% of the normal cost rate rounded to the nearest quarter of .25% on July 1 of the fiscal year after the determination, not to exceed 1% per year.
Miscellaneous
Recruitment and Retention
- The parties shall meet twice each year through June 30, 2028, to discuss methods and opportunities to increase the recruitment and retention of BU 18 employees.
Overtime
- Reduces mandatory overtime from four shifts per month (five shifts for the Department of Developmental Services Stabilization, Treatment, Integration, and Reintegration (STAR) homes), to three shifts per month (four shifts for STAR homes), effective June 30, 2028.
Bereavement Leave
- Provides five days of unpaid bereavement leave for permanent probational, and non-permanent employees, unless the employee is eligible for other leave, as defined. All bereavement leave must be taken within three months of the date of death.
Business and Travel Expenses
- During the term of this agreement, the state agrees to apply any future changes to the business and travel expense reimbursement rates to BU 18 employees.
Floating
- Adds that contracted registry staff shall normally be floated before any BU 18 employees.
Union Release Time
- Increases the rate the union shall reimburse the state for union release time from 130% over three years to:
- 134% effective July 1, 2026,
- 138% effective July 1, 2027,
- 142% effective July 1, 2028, to cover costs associated with employee salary and benefits.
Contracting Out Committee
- The state agrees to meet with CAPT twice a year to examine existing personal services contracts that call for services found in BU 18 class specifications. The purpose of these meetings includes, but is not limited to, providing the opportunity for CAPT to present alternatives, which mitigate or avoid the need for contracting out, while still satisfying the needs of the state to provide services.
Term
- July 1, 2025, through July 1, 2028.
Fiscal
- Fiscal Year 2025-26 cost: $2.8 million ($2.7 million General Fund).
Addendum to the Memoranda of Understanding with BU 8
Addendum to the Memorandum of Understanding with BU 8. This bill ratifies an addendum to an MOU entered into on July 16, 2025 between the state and BU 8, which is represented by CAL FIRE Local 2881. The agreement is as follows:
Compensation
General Salary Adjustment
- Effective the first day of the pay period following ratification by both parties, all BU 8 represented employees shall receive a 2.5% general salary increase.
Personal Leave Program (PLP 2025)
- Effective the first day of the pay period following ratification by both parties through the June 2027 pay period, PLP 2025 will apply to BU 8-represented employees.
- Employees continue to work their assigned work schedules and shall have a reduction in pay equal to a 2.5% for all BU 8 employees.
- Each full-time employee shall be credited with PLP 2025 on the first day of each pay period for the duration of the PLP 2025 program. Six hours credited monthly for fire protection employees and four hours of PLP 2025 credited monthly for specialty classes.
- PLP 2025 accruals do not expire. PLP 2025 may be cashed out upon separation from state service.
Duration
- This side letter is effective the first day of the pay period following ratification by both parties and extends the MOU current term from June 30, 2026, to June 30, 2027.
Miscellaneous
- The state agrees that the 2027 successor MOU negotiations will include the 56-hour industry-standard work week in the MOU.
- The Department of Human Resources and CAL FIRE Local 2881 agree to meet on or before February 1, 2026, to allow the union an opportunity to present a Deferred Retirement Option Plan to the state.
Fiscal
- Fiscal Year 2025-26 Savings: $492,000 ($327,000 General Fund).
Addendum to the Memoranda of Understanding with BU 10
Addendum to the Memorandum of Understanding with BU 10. This bill ratifies an addendum to an MOU entered into on August 14, 2025 between the state and BU 10, which is represented by the California Association of Professional Scientists (PECG). The agreement is as follows:
Compensation
Special Salary Adjustments
- Group A: Employees in the Pest Prevention classification series will receive a Special Salary Adjustment as outlined below:
- Effective the first day of the pay period following ratification, these classifications will be adjusted by increasing the maximum salary range by 4% and increasing the minimum salary by 3.5%. Employees at the old maximum of the classification shall move to the new maximum of the classification. Employees not at the old maximum of the classification shall receive a Special Salary Adjustment of 3.5%. Employees in these classifications shall retain their anniversary date.
- Group B: Employees in the Energy Commission Specialist, Research Scientist, Research Specialist, Energy Resources Specialist, Energy Specialist, Energy Analyst, Toxicologist, and Spectroscopist classification series will receive a Special Salary Adjustment as outlined below:
- Effective the first day of the pay period following ratification, these classifications will be adjusted by increasing the maximum salary range by 4% and increasing the minimum salary by 3.5%. Employees at the old maximum of the classification shall move to the new maximum of the classification. Employees not at the old maximum of the classification shall receive a Special Salary Adjustment of 3.5%. Employees in these classifications shall retain their anniversary date.
- Group C: Employees in the Health Physicist, Ergonomic Specialist (State Compensation Insurance Fund), Industrial Hygienist, Public Health Biologists, Wildlife Forensic Specialist, Industrial Hygienist (State Compensation Insurance Fund), Ergonomic Specialist (State Compensation Insurance Fund), Economic Entomologist, Microbiologist Intern, Public Health Microbiologist, Examiner Laboratory Field Services, Cytotechnologist, Hazardous Materials Specialist, Cytotechnologist and Agricultural Biologist classification series will receive a Special Salary Adjustment as outlined below:
- Effective the first day of the pay period following ratification, these classifications will be adjusted by increasing the maximum salary range by 4% and increasing the minimum salary by 3.5%. Employees at the old maximum of the classification shall move to the new maximum of the classification. Employees not at the old maximum of the classification shall receive a Special Salary Adjustment of 3.5%. Employees in these classifications shall retain their anniversary date.
- Group D: Employees in the Veterinarian and Plant Sciences, Seismologist, Fish and Wildlife Interpreter, Archeologist, Environmental Scientist, Integrated Waste Management, Senior Geologist, Chemist, Senior Meteorologist Water Resources and Oceanographer classification series will receive a Special Salary Adjustment as outlined below:
- Effective the first day of the pay period following ratification, these classifications will be adjusted by increasing the maximum salary range by 5% and increasing the minimum salary by 3.5%. Employees at the old maximum of the classification shall move to the new maximum of the classification. Employees not at the old maximum of the classification shall receive a Special Salary Adjustment of 3.5%. Employees in these classifications shall retain their anniversary date.
Telework Stipend Program
- Effective the first day of the pay period following ratification, the telework stipend program will end.
Personal Leave Program (PLP) 2025
- Effective the first day of the pay period following ratification through the June 2027 pay period, BU 10 employees will participate in PLP 2025.
- Each full-time employee shall continue to work their assigned work schedule and shall have a reduction in pay equal to 3.5%.
- Each full-time employee shall be credited with 6 hours of PLP 2025 per month for the duration of the PLP 2025 Program.
- Employees in Work Week Group 2 may request and use PLP 2025 in 15-minute increments.
- PLP 2025 must be used before any other leave except for sick leave and Professional Development Days. Employees may elect to use PLP in lieu of approved sick leave.
- Employees should use all leave earned under PLP 2025 prior to voluntary separation. Appointing powers may schedule employees to take PLP 2025 time off to meet the intent of this section. In circumstances where an employee was not able to use their PLP 2025 prior to separation, PLP 2025 may be cashed out. If an employee’s separation is not voluntary and the separation date cannot be extended, PLP 2025 shall be cashed out.
- PLP 2025 accruals do not expire.
- Time during which an employee is excused from work because of PLP 2025 leave shall not be considered as "time worked" for purposes of determining the number of hours worked in a work week.
- Seasonal and temporary employees are not subject to PLP 2025.
- Part-time and permanent intermittent employees shall be subject to the same conditions as stated above, on a prorated basis.
Health Benefits
Health, Dental, Vision
- Effective the first day of the pay period following ratification, state employees shall receive the same level of state employer contributions for health, vision, dental, flex-elect cash option, and enhanced survivor’s benefits the represented employee would have received had the PLP 2025 not occurred.
Leave
Leave
- Effective the first day of the pay period following ratification, the 640-hour vacation and annual leave cap shall be increased by the equivalent number of PLP hours BU 10 employees have been credited with until June 30, 2028, thereby increasing the cap to 766 hours.
- Upon ratification of this side letter by both parties, BU 10 employees may elect to switch between either program, the Vacation and Sick Leave Program and the Annual Leave Program, until October 31, 2025. An employee may only elect to make the switch once during this time period.
Voluntary Personal Leave Program (VPLP)
- Continuation of the VPLP during the duration of PLP 2025 shall be at the discretion of the employee. If the employee elects to alter their participation in VPLP, they shall be allowed to opt out or change at any time during the PLP 2025 program. For the duration of any mandatory PLP program.
Retirement
Prefunding of Other Post-Employment Benefits
- Effective the first day of the pay period following ratification by both parties, the employees' and employer’s monthly contribution for prefunding other post-employment benefits is suspended and shall not be withheld from employees' salaries or contributed by the employer through the June 2027 pay period.
Miscellaneous
Telecommute/Telework Program
- The provision is modified to include examples of “office” work.
- The provision is modified to provide at least a 60-day notice prior to implementation of, or a change to, an existing telecommuting policy or program.
Electronic Monitoring
- This section is now subject to the grievance and arbitration provision as outlined in the MOU.
Reopener
- The parties agree to reopen depending on 2026 Budget Act, consistent with the Dills Act and the 2026 Budget Act.
- If the Legislature does not approve or fully fund any provision of the MOU which requires the expenditure of funds for the 2026-2027 fiscal year, either party may reopen negotiations on all or part of the MOU. The parties shall meet and confer in good faith on or before July 1, 2026.
Term
- Upon ratification by both parties, this Side Letter agreement becomes addendum to the July 1, 2024, through July 1, 2027, BU 10 MOU.
Fiscal
- Fiscal Year 2025-26 Savings: $6.7 million ($1.8 million General Fund).
State Special Schools Recruitment and Retention Side Letters
State Special Schools Employees. This bill ratifies three side letters and two closure letters related to recruitment and retention compensation adjustments for employees that work at California’s State Special Schools, located in Fremont, Riverside and the Diagnostic Center North. The agreements include employees represented by SEIU 1000 (BUs 1, 3, 4, 11, 14, 15, 17, 20 and 21), International Union of Operating Engineers – IUOE (BUs 12 and 13), Union of American Physicians and Dentists – UAPD (BU 16) and the American Federation of State, County and Municipal Employees – AFSCME (BU 19).
The agreements contain various compensation increases including special salary adjustments for specified employee classifications and recruitment and retention pay differentials for various identified job classifications.
In addition, the side letters and closure letters include workforce stability incentive stipends for staff employed at the California School for the Deaf in Fremont, the California School for the Blind in Fremont and the Diagnostic Center North.
Out-of-State Health Benefits Side Letter
Out-of-State Health Benefits. This bill ratifies a side letter entered into on August 12, 2025 between the state and BUs 1, 3, 4, 11, 14, 15, 17, 20, and 21, which are represented by SEIU 1000.
The agreement increases monthly payments to state employees who are headquartered out-of-state and enrolled in a CalPERS sponsored Preferred Provider Organization health plan because they unable to enroll in a CalPERS sponsored HMO plan.
Mass Transit Side Letter
Mass Transit. This bill ratifies a side letter entered into on August 3, 2025 between the state and BU 5, which is represented by California Association of Highway Patrolmen (CAHP). The agreement increases the amount employees can be reimbursed for public transit passes and vanpool services to 100% of the current maximum exclusion amount provided by the Internal Revenue Service.
Phlebotomy Differential Side Letter
Phlebotomy Differential. This bill ratifies a side letter entered into on August 6, 2025 between the state and BU 11, which is represented by SEIU 1000. The agreement increases the pay differential for the Laboratory Assistant Series and Laboratory Assistant, Correctional Facility Series classification specifications to include licensure/certification requirements for phlebotomy work.
FISCAL EFFECT: Appropriation: Yes Fiscal Com.: Yes Local: No
This bill results in an overall cost of $14.6 million ($1.6 million General Fund) after accounting for savings associated with the addenda to MOUs and side letters. Note: The appropriation in this bill includes $11.4 million in Proposition 98 General Fund associated with the State Special Schools Recruitment and Retention side and closure letters, as described above.
SUPPORT: (Verified 9/8/25)
None received
OPPOSITION: (Verified 9/8/25)
None received
ASSEMBLY FLOOR: 53-17, 3/20/25
AYES: Addis, Aguiar-Curry, Arambula, Ávila Farías, Bains, Bennett, Berman, Boerner, Bonta, Bryan, Caloza, Carrillo, Connolly, Elhawary, Fong, Gabriel, Garcia, Gipson, Mark González, Haney, Harabedian, Hart, Jackson, Kalra, Lee, Lowenthal, McKinnor, Muratsuchi, Nguyen, Ortega, Pacheco, Patel, Pellerin, Petrie-Norris, Quirk-Silva, Ramos, Ransom, Celeste Rodriguez, Michelle Rodriguez, Rogers, Blanca Rubio, Schiavo, Schultz, Sharp-Collins, Solache, Soria, Stefani, Valencia, Ward, Wicks, Wilson, Zbur, Rivas
NOES: Alanis, Castillo, Chen, Davies, DeMaio, Dixon, Ellis, Flora, Gallagher, Jeff Gonzalez, Hadwick, Lackey, Macedo, Patterson, Sanchez, Ta, Tangipa
NO VOTE RECORDED: Ahrens, Alvarez, Bauer-Kahan, Calderon, Essayli, Hoover, Irwin, Krell, Papan, Wallis
Prepared by: Hans Hemann / B. & F.R. / (916) 651-4103
9/12/25 9:14:12
**** END ****
SENATE COMMITTEE ON
Senator Scott Wiener, Chair
2025 - 2026 Regular
Bill No: Hearing Date: September 10, 2025
Author: | Committee on Budget | ||
Version: | As amended | ||
Urgency: | Fiscal: | ||
Consultant: | |||
Subject: – Memoranda of Understanding and Side Letters
Summary:
Makes necessary statutory changes to codify and ratify a new memorandum of understanding (MOU), addenda to existing MOUs, side letter agreements and closure letters between the state and various state employee bargaining units (BUs).
The agreements cover state employees represented by eight exclusive employee representatives, as follows:
Service Employees International Union, Local 1000 (SEIU 1000)
- BU 1: Administrative, Financial, and Staff Services
- BU 3: Professional Educators and Librarians
- BU 4: Office and Allied
- BU 11: Engineering and Scientific Technicians
- BU 14: Printing Trades
- BU 15: Allied Services
- BU 17: Registered Nurses
- BU 20: Medical and Social Services
- BU 21: Education Consultants and Library Employees
California Association of Highway Patrolmen (CAHP)
- BU 5: Highway Patrol
California Department of Forestry and Fire Protection Firefighters, CAL FIRE Local 2881
- BU 8: California Firefighters
California Association of Professional Scientists (CAPS)
- BU 10: Professional Scientists
International Union of Operating Engineers (IUOE)
- BU 12: Craft and Maintenance
- BU 13: Stationary Engineers
AFSCME - Union of American Physicians and Dentists (UAPD)
- BU 16: Physicians, Dentists, and Podiatrists
California Association of Psychiatric Technicians (CAPT)
- BU 18: Psychiatric Technicians
American Federation of State, County and Municipal Employees (AFSCME)
- BU 19: Health and Social Services/Professional
Existing Law:
- Establishes the Ralph C. Dills Act, which requires the state to collectively bargain with the exclusive representatives of employee groups (i.e., bargaining units) - regarding wages and working conditions, and to define negotiated agreements in MOUs.
- Establishes the California Department of Human Resources (CalHR) as the official representative of the Governor in all matters related to collective bargaining with state employees.
- Requires that any MOU between the state and an exclusive representative be ratified by the Legislature.
- Establishes the California Public Employees' Retirement System (CalPERS), which administers health and retirement benefits for state employees.
- Requires the Legislative Analyst's Office (LAO) to analyze all state MOUs and to provide an analysis of an MOU and its fiscal impact to the Legislature within ten days of receipt of an MOU from CalHR.
- Provides that fully vested state retirees (e.g., with 20 or more years of state employment or with 25 years or more, depending on the bargaining unit) are entitled to an employer contribution for retiree health care equal to 80 or 100 percent of the weighted average premium of the four health plans most highly utilized by all members. Depending on the bargaining unit, dependents are eligible for a contribution based on 80 or 90 percent of the average additional premiums paid for dependents during the benefit year in which the formula is applied. These are referred to as the 80/80 and 100/90 formulas.
- Requires that Medicare-eligible retirees enroll in Medicare and choose a Medicare-coordinated health plan.
- Provides that the employer contribution for active state employee health care shall be determined through collective bargaining.
Proposed Law: This bill ratifies a new/successor MOU with BU 18 (CAPT), two addenda to current MOUs with BU 8 (CalFire Firefighters) and BU 10 (PECG), side letters agreements with BUs 1, 3, 4, 11, 14, 15, 17, 20 and 21 (SEIU 1000), BU 5 (CAHP), BUs 12 and 13 (IUOE) and closure letters with BU 16 (UAPD) and BU 19 (AFSCME).
Specifically, this measure does the following:
New Memoranda of Understanding or Successor Agreement with BU 18
Memorandum of Understanding with BU 18. This bill ratifies a new MOU entered into on August 14, 2025 between the state and BU 18, which is represented by the California Association of Psychiatric Technicians (CAPT). The MOU agreement is as follows:
Compensation
General Salary Adjustment and Special Salary Adjustments
- Effective the first day of the pay period following ratification by both parties, all BU 18 classifications shall receive a general salary increase of 3%.
- Effective July 1, 2027, all BU 18 classifications shall receive a general salary increase of 3%.
Personal Leave Program (PLP 2025)
- Effective the first day of the pay period following ratification by both parties through the June 2027 pay period, PLP 2025 will apply to BU 18-represented employees.
- Employees will continue to work their assigned work schedules and receive a 3% pay reduction.
- Each full-time employee shall be credited with five hours of PLP 2025 on the first day of each pay period for the duration of the PLP 2025.
- PLP 2025 may be cashed out upon separation from state service.
- PLP 2025 leave shall not be considered as “time worked” for overtime purposes except when an employee is “mandated” to work overtime.
Bilingual Pay Differential
- Effective the first day of the pay period following ratification by both parties, the bilingual pay differential will increase from $100 to $200 per month.
Health Benefits
Health, Dental, Vision (CoBen)
- The state’s monthly health benefit contribution for each employee shall continue to be a flat dollar amount equal to 80 percent of the weighted average of the basic health benefit plan premiums of the four largest enrolled basic health plans. The flat dollar amounts shall be increased or decreased as appropriate pursuant to the formula on January 1, 2026, January 1, 2027, and January 1, 2028.
Prefunding of Other Post-Employment Benefits (OPEB)
- The employees' and employer’s monthly contribution for prefunding other postemployment benefits for the 2025-26 and 2026-27 fiscal years, is suspended and shall not be withheld from employees' salaries or contributed by the employer beginning July 1, 2025, and ending June 30, 2027.
- Beginning July 1, 2027, with the goal of reestablishing a 50% cost sharing agreement of actuarially determined normal costs for both employer and employees, the amount of employees and matching employer contributions required to prefund retiree healthcare shall be phased in as follows:
- July 1, 2027: by 1.5%
- July 1, 2028: by 1.5%, for a total of 3%
- July 1, 2029: by 1.5%, for a total of 4.5%.
- Effective July 1, 2030, both the employer and employee contribution percentages will be increased or decreased to maintain a 50% cost sharing of actuarially determined normal costs.
- The increase or decrease to the employer or employee contribution in any given fiscal year shall not exceed 0.5% per year.
Retirement
State Miscellaneous/Industrial – First Tier A Retirement Formula (2% at age 55), First Tier B Retirement Formula (2% at age 60) and Public Employees’ Pension Reform Act (PEPRA) First Tier Retirement Formula (2% at age 62)/Employee Contribution/Final Compensation
- Effective July 1, 2025, the employee contribution for Miscellaneous and Industrial members shall remain in place through June 30, 2027.
- Cost sharing – effective July 1, 2027, when CalPERS determines the employee contribution rate for Miscellaneous or Industrial members increases or decreases by more than 1% from the 2026-27 fiscal year total normal cost, the rate shall be adjusted to 50% of the normal cost rate rounded to the nearest quarter of one percent on July 1 of the fiscal year after the determination, not exceed 1% per year.
State Safety A Retirement Formula (2.5% at age 55), State Safety B Retirement Formula (2% at age 55), and Public Employees’ Pension Reform Act (PEPRA) Retirement Formula (2% at age 57)/Employees Contribution/Final Compensation
- Effective July 1, 2025, the employee contribution for State Safety members shall remain in place through June 30, 2027.
- Cost sharing – effective July 1, 2027, when CalPERS determines the employee contribution rate for State Safety increases or decreases by more than 1% from the 2021-22 fiscal year total normal cost, the rate shall be adjusted to 50% of the normal cost rate rounded to the nearest quarter of .25% on July 1 of the fiscal year after the determination, not to exceed 1% per year.
Miscellaneous
Recruitment and Retention
- The parties shall meet twice each year through June 30, 2028, to discuss methods and opportunities to increase the recruitment and retention of BU 18 employees.
Overtime
- Reduces mandatory overtime from four shifts per month (five shifts for the Department of Developmental Services Stabilization, Treatment, Integration, and Reintegration (STAR) homes), to three shifts per month (four shifts for STAR homes), effective June 30, 2028.
Bereavement Leave
- Provides five days of unpaid bereavement leave for permanent probational, and non-permanent employees, unless the employee is eligible for other leave, as defined. All bereavement leave must be taken within three months of the date of death.
Business and Travel Expenses
- During the term of this agreement, the state agrees to apply any future changes to the business and travel expense reimbursement rates to BU 18 employees.
Floating
- Adds that contracted registry staff shall normally be floated before any BU 18 employees.
Union Release Time
- Increases the rate the union shall reimburse the state for union release time from 130% over three years to:
- 134% effective July 1, 2026,
- 138% effective July 1, 2027,
- 142% effective July 1, 2028, to cover costs associated with employee salary and benefits.
Contracting Out Committee
- The state agrees to meet with CAPT twice a year to examine existing personal services contracts that call for services found in BU 18 class specifications. The purpose of these meetings includes, but is not limited to, providing the opportunity for CAPT to present alternatives, which mitigate or avoid the need for contracting out, while still satisfying the needs of the state to provide services.
Term
- July 1, 2025, through July 1, 2028.
Fiscal
- Fiscal Year 2025-26 cost: $2.8 million ($2.7 million General Fund).
Addendum to the Memoranda of Understanding with BU 8
Addendum to the Memorandum of Understanding with BU 8. This bill ratifies an addendum to an MOU entered into on July 16, 2025 between the state and BU 8, which is represented by CAL FIRE Local 2881. The agreement is as follows:
Compensation
General Salary Adjustment
- Effective the first day of the pay period following ratification by both parties, all BU 8 represented employees shall receive a 2.5% general salary increase.
Personal Leave Program (PLP 2025)
- Effective the first day of the pay period following ratification by both parties through the June 2027 pay period, PLP 2025 will apply to BU 8-represented employees.
- Employees continue to work their assigned work schedules and shall have a reduction in pay equal to a 2.5% for all BU 8 employees.
- Each full-time employee shall be credited with PLP 2025 on the first day of each pay period for the duration of the PLP 2025 program. Six hours credited monthly for fire protection employees and four hours of PLP 2025 credited monthly for specialty classes.
- PLP 2025 accruals do not expire. PLP 2025 may be cashed out upon separation from state service.
Duration
- This side letter is effective the first day of the pay period following ratification by both parties and extends the MOU current term from June 30, 2026, to June 30, 2027.
Miscellaneous
- The state agrees that the 2027 successor MOU negotiations will include the 56-hour industry-standard work week in the MOU.
- The Department of Human Resources and CAL FIRE Local 2881 agree to meet on or before February 1, 2026, to allow the union an opportunity to present a Deferred Retirement Option Plan to the state.
Fiscal
- Fiscal Year 2025-26 Savings: $492,000 ($327,000 General Fund).
Addendum to the Memoranda of Understanding with BU 10
Addendum to the Memorandum of Understanding with BU 10. This bill ratifies an addendum to an MOU entered into on August 14, 2025 between the state and BU 10, which is represented by the California Association of Professional Scientists (PECG). The agreement is as follows:
Compensation
Special Salary Adjustments
- Group A: Employees in the Pest Prevention classification series will receive a Special Salary Adjustment as outlined below:
- Effective the first day of the pay period following ratification, these classifications will be adjusted by increasing the maximum salary range by 4% and increasing the minimum salary by 3.5%. Employees at the old maximum of the classification shall move to the new maximum of the classification. Employees not at the old maximum of the classification shall receive a Special Salary Adjustment of 3.5%. Employees in these classifications shall retain their anniversary date.
- Group B: Employees in the Energy Commission Specialist, Research Scientist, Research Specialist, Energy Resources Specialist, Energy Specialist, Energy Analyst, Toxicologist, and Spectroscopist classification series will receive a Special Salary Adjustment as outlined below:
- Effective the first day of the pay period following ratification, these classifications will be adjusted by increasing the maximum salary range by 4% and increasing the minimum salary by 3.5%. Employees at the old maximum of the classification shall move to the new maximum of the classification. Employees not at the old maximum of the classification shall receive a Special Salary Adjustment of 3.5%. Employees in these classifications shall retain their anniversary date.
- Group C: Employees in the Health Physicist, Ergonomic Specialist (State Compensation Insurance Fund), Industrial Hygienist, Public Health Biologists, Wildlife Forensic Specialist, Industrial Hygienist (State Compensation Insurance Fund), Ergonomic Specialist (State Compensation Insurance Fund), Economic Entomologist, Microbiologist Intern, Public Health Microbiologist, Examiner Laboratory Field Services, Cytotechnologist, Hazardous Materials Specialist, Cytotechnologist and Agricultural Biologist classification series will receive a Special Salary Adjustment as outlined below:
- Effective the first day of the pay period following ratification, these classifications will be adjusted by increasing the maximum salary range by 4% and increasing the minimum salary by 3.5%. Employees at the old maximum of the classification shall move to the new maximum of the classification. Employees not at the old maximum of the classification shall receive a Special Salary Adjustment of 3.5%. Employees in these classifications shall retain their anniversary date.
- Group D: Employees in the Veterinarian and Plant Sciences, Seismologist, Fish and Wildlife Interpreter, Archeologist, Environmental Scientist, Integrated Waste Management, Senior Geologist, Chemist, Senior Meteorologist Water Resources and Oceanographer classification series will receive a Special Salary Adjustment as outlined below:
- Effective the first day of the pay period following ratification, these classifications will be adjusted by increasing the maximum salary range by 5% and increasing the minimum salary by 3.5%. Employees at the old maximum of the classification shall move to the new maximum of the classification. Employees not at the old maximum of the classification shall receive a Special Salary Adjustment of 3.5%. Employees in these classifications shall retain their anniversary date.
Telework Stipend Program
- Effective the first day of the pay period following ratification, the telework stipend program will end.
Personal Leave Program (PLP) 2025
- Effective the first day of the pay period following ratification through the June 2027 pay period, BU 10 employees will participate in PLP 2025.
- Each full-time employee shall continue to work their assigned work schedule and shall have a reduction in pay equal to 3.5%.
- Each full-time employee shall be credited with 6 hours of PLP 2025 per month for the duration of the PLP 2025 Program.
- Employees in Work Week Group 2 may request and use PLP 2025 in 15-minute increments.
- PLP 2025 must be used before any other leave except for sick leave and Professional Development Days. Employees may elect to use PLP in lieu of approved sick leave.
- Employees should use all leave earned under PLP 2025 prior to voluntary separation. Appointing powers may schedule employees to take PLP 2025 time off to meet the intent of this section. In circumstances where an employee was not able to use their PLP 2025 prior to separation, PLP 2025 may be cashed out. If an employee’s separation is not voluntary and the separation date cannot be extended, PLP 2025 shall be cashed out.
- PLP 2025 accruals do not expire.
- Time during which an employee is excused from work because of PLP 2025 leave shall not be considered as "time worked" for purposes of determining the number of hours worked in a work week.
- Seasonal and temporary employees are not subject to PLP 2025.
- Part-time and permanent intermittent employees shall be subject to the same conditions as stated above, on a prorated basis.
Health Benefits
Health, Dental, Vision
- Effective the first day of the pay period following ratification, state employees shall receive the same level of state employer contributions for health, vision, dental, flex-elect cash option, and enhanced survivor’s benefits the represented employee would have received had the PLP 2025 not occurred.
Leave
Leave
- Effective the first day of the pay period following ratification, the 640-hour vacation and annual leave cap shall be increased by the equivalent number of PLP hours BU 10 employees have been credited with until June 30, 2028, thereby increasing the cap to 766 hours.
- Upon ratification of this side letter by both parties, BU 10 employees may elect to switch between either program, the Vacation and Sick Leave Program and the Annual Leave Program, until October 31, 2025. An employee may only elect to make the switch once during this time period.
Voluntary Personal Leave Program (VPLP)
- Continuation of the VPLP during the duration of PLP 2025 shall be at the discretion of the employee. If the employee elects to alter their participation in VPLP, they shall be allowed to opt out or change at any time during the PLP 2025 program. For the duration of any mandatory PLP program.
Retirement
Prefunding of Other Post-Employment Benefits
- Effective the first day of the pay period following ratification by both parties, the employees' and employer’s monthly contribution for prefunding other post-employment benefits is suspended and shall not be withheld from employees' salaries or contributed by the employer through the June 2027 pay period.
Miscellaneous
Telecommute/Telework Program
- The provision is modified to include examples of “office” work.
- The provision is modified to provide at least a 60-day notice prior to implementation of, or a change to, an existing telecommuting policy or program.
Electronic Monitoring
- This section is now subject to the grievance and arbitration provision as outlined in the MOU.
Reopener
- The parties agree to reopen depending on 2026 Budget Act, consistent with the Dills Act and the 2026 Budget Act.
- If the Legislature does not approve or fully fund any provision of the MOU which requires the expenditure of funds for the 2026-2027 fiscal year, either party may reopen negotiations on all or part of the MOU. The parties shall meet and confer in good faith on or before July 1, 2026.
Term
- Upon ratification by both parties, this Side Letter agreement becomes addendum to the July 1, 2024, through July 1, 2027, BU 10 MOU.
Fiscal
- Fiscal Year 2025-26 Savings: $6.7 million ($1.8 million General Fund).
State Special Schools Recruitment and Retention Side Letters
State Special Schools Employees. This bill ratifies three side letters and two closure letters related to recruitment and retention compensation adjustments for employees that work at California’s State Special Schools, located in Fremont, Riverside and the Diagnostic Center North. The agreements include employees represented by SEIU 1000 (BUs 1, 3, 4, 11, 14, 15, 17, 20 and 21), International Union of Operating Engineers – IUOE (BUs 12 and 13), Union of American Physicians and Dentists – UAPD (BU 16) and the American Federation of State, County and Municipal Employees – AFSCME (BU 19).
The agreements contain various compensation increases including special salary adjustments for specified employee classifications and recruitment and retention pay differentials for various identified job classifications.
In addition, the side letters and closure letters include workforce stability incentive stipends for staff employed at the California School for the Deaf in Fremont, the California School for the Blind in Fremont and the Diagnostic Center North.
Out-of-State Health Benefits Side Letter
Out-of-State Health Benefits. This bill ratifies a side letter entered into on August 12, 2025 between the state and BUs 1, 3, 4, 11, 14, 15, 17, 20, and 21, which are represented by SEIU 1000.
The agreement increases monthly payments to state employees who are headquartered out-of-state and enrolled in a CalPERS sponsored Preferred Provider Organization health plan because they unable to enroll in a CalPERS sponsored HMO plan.
Mass Transit Side Letter
Mass Transit. This bill ratifies a side letter entered into on August 3, 2025 between the state and BU 5, which is represented by California Association of Highway Patrolmen (CAHP). The agreement increases the amount employees can be reimbursed for public transit passes and vanpool services to 100% of the current maximum exclusion amount provided by the Internal Revenue Service.
Phlebotomy Differential Side Letter
Phlebotomy Differential. This bill ratifies a side letter entered into on August 6, 2025 between the state and BU 11, which is represented by SEIU 1000. The agreement increases the pay differential for the Laboratory Assistant Series and Laboratory Assistant, Correctional Facility Series classification specifications to include licensure/certification requirements for phlebotomy work.
Fiscal Effect: This bill results in an overall cost of $14.6 million ($1.6 million General Fund) after accounting for savings associated with the addenda to MOUs and side letters. Note: The appropriation in this bill includes $11.4 million in Proposition 98 General Fund associated with the State Special Schools Recruitment and Retention side and closure letters, as described above.
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ASSEMBLY THIRD READING
ATR Bill Id:AB 161
Author:(Gabriel)
As Introduced Ver:January 8, 2025
Majority vote. Budget Bill Appropriation Takes Effect Immediately
SUMMARY
This bill expresses the intent of the Legislature to enact statutory changes relating to the Budget Act of 2025.
Major Provisions
COMMENTS
According to the Author
Arguments in Support
Arguments in Opposition
FISCAL COMMENTS
VOTES
UPDATED
VERSION: January 8, 2025
CONSULTANT: Christian Griffith / BUDGET / (916) 319-2099 FN: 0000104
Bill Author
Bill Co-Author(s):