SENATE BILL REPORT

                  SSB 5583

              As of Third Reading, March 17, 1999

Title:  An act relating to unfair practices with respect to eligibility for employment‑based benefits.

Brief Description:  Prohibiting employers from not providing benefits to employees.

Sponsors:  Senate Committee on Labor & Workforce Development (originally sponsored by Senators Franklin, Fairley and Kline).

Brief History:

Committee Activity:  Labor & Workforce Development:  2/4/99, 2/11/99 [DPS, DNPS].

Failed Senate, 3/17/99, 24-20.

SENATE COMMITTEE ON LABOR & WORKFORCE DEVELOPMENT

Majority Report:  That Substitute Senate Bill No. 5583 be substituted therefor, and the substitute bill do pass.

  Signed by Senators Fairley, Chair; Franklin, Vice Chair; Kline and Wojahn.

Minority Report:  Do not pass substitute.

  Signed by Senators Hochstatter and Oke.

Staff:  Jill Reinmuth (786-7452)

Background:  Under state laws and employer policies, part-time, temporary, leased, and other contingent workers are less likely than other workers to receive employment-based benefits.  Employers may terminate employees, misclassify employees, limit contract terms, or take other action with the intent to avoid providing employment-based benefits.

Summary of Bill:  It is an unfair practice for any employer to: (1) terminate any employee or limit the term of a contract with any employee with the intent to avoid providing employment‑based benefits; (2) misclassify any employee with the intent to avoid providing employment-based benefits; (3) include any language in a contract with an employee that requires the employee to forego employment‑based benefits; or (4) terminate or in any manner discriminate against an employee because the employee has filed an action alleging such an unfair practice.

AEmployment‑based benefits@ mean any benefits to which an employee is entitled under state laws or employer policies.

Any employee terminated or otherwise harmed by such an unfair practice has a civil action against the employer.  A prevailing employee is awarded either six months' wages or treble the actual damages, whichever is greater.  The prevailing employee is also awarded attorneys' fees and costs.

Appropriation:  None.

Fiscal Note:  Not requested.

Effective Date:  Ninety days after adjournment of session in which bill is passed.

Testimony For:  The number of people who have health care coverage and pension coverage is declining.  The costs of health care and pensions will fall on the backs of publicly-funded institutions.  Making it an unfair practice for employers to terminate employees or limit contracts with employees with the intent to avoid providing employment-based benefits begins to address this problem.

Testimony Against:  A new liability risk for employers who hire permanent employees is created.  An incentive for employers to hire independent contractors rather than permanent employees is created.  A double standard with regard to attorneys' fees is established.  Employers would incur significant costs defending actions alleging such an unfair practice.

Testified:  PRO: Robert Stern, Washington State Labor Council; CON: Clif Finch, Association of Washington Business; Gary Smith, Independent Business Association.