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Proposed labor bill could backfire on safety, costs and jobs

Posted by Jack Stewart, President on Aug. 30, 2013

California’s manufacturers place a high premium on a skilled workforce that produces world-class products while protecting their safety and the safety of their neighbors in the surrounding community.  So we are understandably alarmed by legislation that would not only put that safety at risk, but create an unprecedented mandate that would fundamentally alter the ability of private businesses to make critical hiring and compensation choices.

SB 54 (Senator Loni Hancock) is just such a bill.  It purports to be about safety but in fact could increase risks, displace highly skilled workers with excellent safety records, and remove the flexibility of employers to hire the best available workers.  SB 54 would establish arbitrary training requirements that would force refinery and petrochemical facilities to choose a large percentage of their workers from the membership of a single union, and to pay those workers government mandated wages.

In the case of the refining industry, California’s 14 facilities will be limited to far fewer qualified workers for essential projects that directly impact the safety of a facility and its surrounding community.  SB 54 impairs those employers’ ability to select their contractors on the basis of their expertise, experience, actual safety record, risk and safety management compliance and workforce training and availability.  SB 54 will materially increase payroll costs that likely would be passed on to consumers. As the first such law of its kind, SB 54 sets the stage to do real damage to the state’s economy just as we’re beginning to recover from one of the worst recessions in history.

The bill will displace, according to the United Steelworkers Union, up to 10,000 highly skilled and experienced workers for no cause other than that they belong to the “wrong” union.

Any manufacturer will tell you this is not a small matter of inconvenience for the targeted employers – it’s a recipe for an array of unintended consequences in terms of safety and consumer costs.  And it’s made even more frustrating because SB 54 is entirely unnecessary to improve safety. Thankfully, there is a common-sense alternative to SB 54.

In the wake of last August’s Richmond refinery incident, the Governor formed an Interagency Working Group on Refinery Safety, charged with strengthening emergency preparedness and improving worker and public safety through increased oversight. 

The Governor’s Working Group is already making good progress in tightening up monitoring and oversight, and in increasing the penalties for violations of safety, health and environmental regulations.  California’s refining industry boasts one of the best safety records in the nation. It makes sense to start a conversation about safety reform with solutions that build upon and improve standards rather than displacing thousands of workers, raising the cost to produce a fundamental energy source, and establishing a mandated wage precedent statewide.

California manufacturers are distinctively proactive when it comes to issues of safety, and look forward to working with the legislature and the administration in a thoughtful process to improve safety. SB 54 works in direct conflict with that goal.  In the interest of safety, cost, and fair employment practices, SB 54 must be defeated. 

 

(You can sign the petion to stop SB 54 online here)





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