Existing law requires the Department of Human Resources to establish and adjust salary ranges for each class of position in the state civil service.

This bill would require that the salaries of state attorneys and administrative law judges in State Bargaining Unit 2 be no less than the average salaries of public sector attorneys, as specified. The bill would require the Department of Human Resources to annually conduct a survey of salary structures by March 1 of each year, as specified, and determine the average salary of public sector attorneys for each attorney classification, including the minimum salaries for entry-level attorneys, intermediate classifications, and the most senior nonmanagerial attorneys, noninclusive of negotiated differentials. The bill would require that state administrative law judges have salaries not less than the maximum salary of state attorneys classified at a specified level. The bill would require the department to make a good faith offer of parity in salary with respect to public sector agency attorneys and administrative law judges salaries in any negotiations with the exclusive bargaining representative. The bill would provide that no state attorney or administrative law judge classification shall be reduced in salary as a result of these provisions.

This bill would state that its provisions supersede any memorandum of understanding and shall become effective with respect to salary increases on March 1 of each year. It would provide that its implementation, except for the annual survey, is contingent upon the appropriation of funds in the annual Budget Act and that implementation shall be phased in over 3 fiscal years commencing on July 1, 2026. The bill would also provide that the superior court has exclusive jurisdiction over disputes arising under these provisions.

SENATE COMMITTEE ON

Senator Anna Caballero, Chair

2025 - 2026 Regular Session

SB 605 (Cortese) - State attorneys and administrative law judges: compensation

Bill Summary:

SB 605 would require that the salaries of state attorneys and related state employees in Bargaining Unit (BU) 2 be no less than the average salaries of other public sector attorneys, as specified.

Fiscal Impact:

This bill would result in increased personnel costs to the State. The magnitude is unknown, but likely in the tens of millions dollars annually (General Fund, see Staff Comments). Increased administrative costs to the California Department of Human Resources (CalHR) have yet to be identified.

Background:

CalHR is responsible for overseeing the State's human resources management functions. Among other duties, it engages in collective bargaining with state employee unions and manages labor relations issues.

Budget documents indicate that over 250,000 people work for a State of California department or agency (other than a university). More than 80 percent of these employees are represented by one of the State’s 21 bargaining units in the collective bargaining process. The rest are excluded from the collective bargaining because they are managers, supervisors, or employees who assist management develop employee compensation policies.

The Dills Act authorized collective bargaining between these state employees and the Governor. The Governor is represented by CalHR. The product of the collective bargaining process is an MOU (“memorandum of understanding”). MOUs specify the terms and conditions of employment.

Employees represented by BU 2 are state-employed attorneys, administrative law judges, and other legal professionals who provide legal expertise for the State in many departments. The Department of Justice employs about a quarter of all BU 2 employees.

Proposed Law:

This bill would, among other things, do the following:

• Require that the salaries of state attorneys in BU 2 be no less than the average salaries of public sector attorneys, as determined by the creation of three geographical areas in California, as specified.
• Require that the salaries of state administrative law judges in each region be not less than the maximum salary of state attorneys classified as the Attorney IV level in each region.
• Require CalHR to annually conduct a survey of salary structures of specified public agencies in each region to determine the average salary of public sector attorneys, as specified.
• Require CalHR to conduct the survey each year, regardless of whether the Legislature appropriates funds to provide the salary increases that the survey may indicate.
• Provide that the provisions of the bill supersede any memorandum of understanding and becomes effective with respect to salary increases on March 1 of each year.
• Provide that the implementation of the bill's provisions is contingent upon the appropriation of funds in the annual Budget Act and phases in implementation over a three-year period, beginning July 1, 2026.

Related Legislation:

• AB 2872 (Calderon, 2024) would have required the state to pay sworn members of the Department of Insurance who are rank-and-file members of State BU 7 the same compensation paid to corresponding rank-and-file sworn peace officers of the Department of Justice The bill was vetoed by the Governor.
• AB 1254 (Flora, 2023) would have required CalHR to use a formula that would pay CAL FIRE BU 8 members within 15 percent of the average of the salary for corresponding ranks in 20 specified local fire departments instead of determining state firefighters’ pay through collective bargaining under the Dills Act as required by current law. The bill died on Senate inactive file.
• AB 1677 (McKinnor, 2023) would, among other things, have required the University of California at Berkeley Labor Center to undertake a study of the existing salary structure and provide recommendations for alternative models, if applicable, as applied to rank-and-file scientists in BU 10. The bill was vetoed by the Governor.
• SB 1160 (Polanco, 2001) was substantially identical to this bill, and was vetoed by the Governor.

Staff Comments:

CalHR has yet to determine the fiscal impacts that would result from this bill. However, in 2001 its predecessor, the Department of Personnel Administration (DPA), estimated the cost of SB 1160 in 2001 to be $23 million annually. As a proxy, adjusting the DPA estimate for 24 years of price changes (using the Implicit Gross Domestic Product Deflator for State and Local Governmental Purchases) suggests that this bill would result in increased personnel costs of $47 million annually.

As of 2025, BU 2 comprises approximately 3,800 positions. ​To the extent that BU 2 membership is higher than it was in 2001, the aforementioned proxy estimate could be higher. Finally, the estimate could be higher or lower, depending on whether the wage gap between BU 2 employees and the specified other public sector attorneys has increased or narrowed since 2001.

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SENATE COMMITTEE ON LABOR, PUBLIC EMPLOYMENT AND RETIREMENT

Senator Lola Smallwood-Cuevas, Chair

2025 - 2026 Regular

Bill No: SB 605 Hearing Date: March 26, 2025

SUBJECT: State attorneys and administrative law judges: compensation

KEY ISSUE

This bill requires that the salaries of state attorneys and related state employees in Bargaining Unit (BU) 2 be no less than the average salaries of other public sector attorneys, as specified.

ANALYSIS

Existing law:

1. Establishes the Dills Act, which provides collective bargaining rights to state employees and regulates labor relations between the state and its represented employees. (Government Code §3512 et seq.)
2. Requires the California Department of Human Resources (Department) to establish and adjust salary ranges for each class of position in the state civil service. (Government Code §19826(a))
   
3. Requires the Department, at least six months before the end of the term of an existing memorandum of understanding or immediately upon the reopening of negotiations under an existing memorandum of understanding, to submit to the parties meeting and conferring, and to the Legislature, a report containing the Department’s findings relating to the salaries of employees in comparable occupations in private industry and other governmental agencies. (Government Code §19826(c))
   
4. Requires the state, in order to recruit and retain the highest qualified employees in specified classifications, to consider the total estimated average compensation paid to employees in comparable occupations. (Government Code §19826(c))

This bill:

1. Requires that the salaries of state attorneys in Bargaining Unit (BU) 2 be no less than the average salaries of public sector attorneys, as determined by the creation of three geographical areas in California, as specified.
2. Requires that the salaries of state administrative law judges in each region be not less than the maximum salary of state attorneys classified as the Attorney IV level in each region.
3. Requires the California Department of Human Resources (CalHR) to annually conduct, by March 1 of each year, a survey of salary structures of specified public agencies in each region to determine the average salary of public sector attorneys, as specified.
4. Requires CalHR to conduct the survey each year, regardless of whether the Legislature appropriates funds to provide the salary increases that the survey may indicate.
5. Provides that the provisions of the bill supersede any memorandum of understanding and becomes effective with respect to salary increases on March 1 of each year.
6. Provides that the implementation of the bill's provisions is contingent upon the appropriation of funds in the annual Budget Act and phases in implementation over a three-year period, beginning July 1, 2026.
7. Provides that the superior court have exclusive jurisdiction over disputes arising from the bill's provisions.

COMMENTS

1. Committee Comments

Pursuant to the Dills Act, state employee compensation is subject to collective bargaining between the employees’ exclusive representative and the Governor who has designated CalHR as his representative. The committee notes that BU 2’s contract is expiring June 30, 2025, and that the sponsor is currently in negotiations with the Administration for a new Memorandum of Understanding (MOU).

The Legislature’s custom and practice has been to refrain from interfering with the bargaining process or attempting to set bargaining conditions between the parties. However, where the bargaining process has become fixed or frozen, the Legislature has periodically interceded to ensure that the state fulfills the Dills Act’s objectives of establishing efficient and effective labor relations in the state civil service. Obviously, the Governor has the last word on whether to sign off on this legislation should it pass both houses of the Legislature. Therefore, this bill’s success will be intricately linked to his and the sponsor’s ability to negotiate an amenable MOU.

Nevertheless, state agencies face recruiting and retention problems for BU 2 employees given the salary disparities between state attorneys/ hearing officers and those from local public agencies. State attorneys and administrative law judges are critical to insuring the proper functioning of state government, particularly in the challenging environment of recent events. Thus, the Legislature can appropriately support attempts to focus the Administration on the need to preserve and cultivate the state’s legal expertise in the face of substantial workload increases and the enticement of higher compensation in local government.

2. Need for this bill?

According to the author:

“State attorneys and administrative law judges face pay disparities compared to their counterparts in county, city, and other public sector agencies. Qualified legal professionals are leaving state service for better-paying opportunities in the public and private sectors.

Significant variations in compensation across California’s counties exacerbate the issue, as state attorneys headquartered in high-cost regions like Los Angeles and the Bay Area are not compensated at rates comparable to local public agencies. The lack of competitive salaries undermines the state’s ability to maintain a skilled workforce, which is essential for the timely enforcement of laws, the resolution of disputes, and the protection of public interests.”

3. Proponent Arguments

According to the California Attorneys, Administrative Law Judges, and Hearing Officers in State Employment:

“Despite the significant contributions these legal professionals make to the state, current salary levels for these positions lag behind those of comparable public sector roles, creating recruitment and retention challenges. Specifically, state attorneys are paid 20%-40% less in salaries and benefits than other public sector lawyers, such as district attorneys, public defenders, city attorneys, and county counsel. Additionally, there are significant variations in compensation across California’s counties, which only exacerbates this issue, as state attorneys headquartered in high-cost regions such as Los Angeles or the Bay Area are not compensated at rates comparable to local public agencies.

Ultimately, the lack of competitive salaries undermines the state’s ability to maintain a skilled workforce, which is essential for the timely enforcement of laws, resolution of disputes, and the protection of public interests.”

4. Opponent Arguments:

None received.

5. Prior Legislation:

AB 2872 (Calderon, 2024) would have required the state to pay sworn members of the Department of Insurance who are rank-and-file members of State Bargaining Unit (BU) 7 the same compensation paid to corresponding rank-and-file sworn peace officers of the Department of Justice The Governor vetoed this bill.

AB 1254 (Flora, 2023) would have required CalHR to use a formula that would pay CAL FIRE Bargaining Unit (BU) 8 members within 15 percent of the average of the salary for corresponding ranks in 20 specified local fire departments instead of determining state firefighters’ pay through collective bargaining under the Dills Act as required by current law. This bill died on Senate inactive file.

AB 1677 (McKinnor, 2023) would have required the University of California at Berkeley Labor Center to undertake a study of the existing salary structure and provide recommendations for alternative models, if applicable, as applied to rank-and-file scientists in State Bargaining Unit 10 (BU 10), among other provisions. The Governor vetoed the bill.

SB 1160 (Polanco, 2001) was substantially identical to this bill. The Governor vetoed the bill.

SUPPORT

California Attorneys, Administrative Law Judges, and Hearing Officers in State Employment (Sponsor)

OPPOSITION

None received.

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