sf.citi member companies,
I hope you are doing well this afternoon. Today is going to be a busy day and you will receive more updates from me later today with full details on GRT and other tax proposals.
I’m writing to you to provide you with an update on our meeting with Supervisor Mar regarding recent amendments made to the “Temporary Right to Reemployment Following Layoff Due to COVID-19 Pandemic”, as well as to provide you with a legislative timeline for this legislation. Before providing those details, please see a brief update on the GRT Proposal.
GRT Proposal, CEO Tax, and IPO Tax
Mayor Breed has introduced two measures for the November 2020 ballot – one focuses on unlocking Big C and Baby C funding and the other also encompasses these goals and includes the expected GRT proposals we have been discussing. As mentioned in the memo sent yesterday, titled “Mayor Breed’s GRT Proposal”, this proposal resembles Option 1 with some additional changes. Please refer to yesterday’s memo for more information. In the meantime, I have included the language of the second proposal below.
As a reminder, the Board of Supervisors is expected to introduce their own GRT Proposal at today’s Board of Supervisors meeting. Further, as you know, a CEO Tax proposal was also filed last week and we have now received word that an “IPO” (Stock Option) Tax may also be introduced today. We are monitoring this situation closely and will provide a full update soon. Please note that today is the final date for the Mayor or Board of Supervisors to introduce a ballot measure for the November 2020 election.
Discussion with Supervisor Mar’s Office: Amendments to “Return to Work” legislation
Supervisor Mar and his Chief of Staff, Edward Wright, hosted a call with representatives from SF Made, SF Chamber, Committee on Jobs, and sf.citi. On the call, we briefly discussed amendments that the Supervisor plans on discussing at this week’s Government Audit and Oversight (GAO) Committee on Thursday (6/18). The Supervisor communicated that he was appreciative of our collaborative approach and articulated his hope for the support of this ordinance once it is finalized.
Please note that two proposed amendments – the removal of the 90-day retention period and the clarification of the notification period (amendments 4 and 9) – are a significant win for the technology industry and concerned members. Please find the full amendments discussed below, as well as the updated version of the legislation which includes the proposed amendments attached.
Updated Amendments
- Exempts employers with fewer than 100 employees
- Exempts Healthcare Operations Employers
- Exempts employees making more than 120% of AMI
- Removes the 90-day retention requirement
- Adds an employee misconduct carveout for the re-employment offer
- Carves out employees with severance agreements
- Removes most of section 5(a)(4) and 5(a)(5) – all the list-building / employee opt-in requirements
- Allows for reemployment offer notification by email/text before mailing; require mail only if email/text are not an option.
- Clarifies that the notification period is longer for retroactive notification – 30 days from the effective date of the Emergency Ordinance
- Authorizes OLSE to issue regulations
- Directs layoff and reemployment notifications to OEWD, and replaces the hotline included in the employee notification with one managed by OEWD
While we are certainly glad to see that the Supervisor’s office was amenable to changes we previously recommended, the collective group provided feedback on several issues that remain of concern, namely the definition of “similar” in section 6(b) as it pertains to rehiring employees for the same or similar positions, the private right of action, and the AMI threshold.
On the definition of “similar”, the Supervisor acknowledged that the language around rehiring was a “gray area”; however, that the intention of keeping this portion of the legislation was to avoid potential workarounds to the law, especially as many companies will likely need to consolidate their workforce and change duties for many roles.
On this issue of private right of action and collective bargaining agreements, the Supervisor acknowledged the undue burdens that have been placed on businesses at this time, however, also explained that both OLSE and the City Attorney’s office are at maximum capacity to own this portion of the proposal. The Supervisor hopes to mitigate any ambiguity by prioritizing rulemaking through OLSE. The Supervisor’s hope is that OLSE will be able to provide the rules, regulation, and guidance necessary to avoid litigation.
Lastly, on the issue of AMI threshold, the Supervisor articulated that he will not be amenable to changing the threshold as this does not apply to median income employees. As currently drafted, the income threshold is $103,450 annual salary or the equivalent wage $49 per hour.
Please let us know if you have any questions on the amendments listed above. We will continue to monitor the GAO committee meeting this week and provide you with pertinent notes.
Legislative Timeline
As the legislation will be heard at committee this week, and because it’s an emergency ordinance, it’s our understanding that the ordinance could be voted on at next Tuesday’s (6/23) Board of Supervisors meeting, where it could also finally pass and be subsequently signed by the Mayor. Once signed by the Mayor, the emergency ordinance would be effective immediately.
Also, it has been communicated to us that the permanent version of this emergency ordinance will likely be introduced at next week’s Board of Supervisors meeting, as the Supervisor previously mentioned that he would like the emergency ordinance to be heard first in order to mitigate any confusion that may occur with two pieces of legislation in circulation. With that said, amendments made to the emergency ordinance would be reflected in the permanent version –the only difference being the timeframe, as the emergency ordinance needs to be extended every 60 days so long as we are still in a declared emergency. That being said, the Supervisor expressed that the City’s Public Health Officer, Dr. Tomás Aragón, and the head of SF Department of Public Health, Dr. Grant Colfax, have articulated that the Public Health Emergency directive could remain in place at some capacity for an additional year.
We will continue to keep you updated on these conversations and will provide you with a rundown on what transpires at Thursday’s GAO Committee meeting.
Please let me know if you have any questions and thank you for your continued membership.
Jen
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