“Any expansion of eligibility for UI benefits could increase California’s outstanding federal UI debt projected to be nearly $20 billion by the end of the year and could jeopardize California’s Benefit Cost Ratio add-on waiver application, significantly increasing taxed on employers,” Newsom said, adding that the state is responsible for the interest payments on the federal UI loan and has paid $362.7 million in interest with another $302 million due this month.
“Now is not the time to increase costs or incur this sizable debt,” he wrote.
His decision to veto the legislation comes after the WGA and AMPTP reached a tentative agreement to end the strike, with SAG-AFTRA returning to the bargaining table with studios next week.
The bill passed the state Senate last month by a vote of 27-12 and earlier cleared the Assembly 59-18.
In his statement, Newsom said that he has “deep appreciation and respect for workers who fight for their rights and come together in collective action.” But his veto still is a blow to organized labor, with unions pointing to the need for a “safety net” for the workers and their families.
“At a time when public support of unions and strikes is at an all-time high, this veto is out of step with American values,” said Lorena Gonzalez Fletcher of the California Labor Federation.
Supporters of the bill argued that, with the maximum unemployment benefit just $450 per week, the expansion of unemployment benefits would be to provide a bit of a safety net amid labor disputes. Striking workers in New York and New Jersey are entitled to collect unemployment benefits after two weeks, which the California bill also would have done. The legislation also would have codified into law that workers who were locked out of their jobs by their employer during a labor dispute also were eligible for the benefits.
The legislation would not have taken effect until January, making it unlikely that the WGA and SAG-AFTRA would be eligible unless their strikes dragged into the new year. But with the WGA agreement that ended the strike, and the renewed SAG-AFTRA talks, there is the very real possibility that the work stoppage will be over by then.
Meredith Stiehm, president of the WGA, and Joely Fisher, SAG-AFTRA Secretary-Treasurer, testified in Sacratmento in support of the bill.
“Writers are the present-day example of workers who could greatly benefit from UI, but we’re really here for the workers in the future who will need this protection if they make the difficult decision to go on strike,” Stiehm told a legislative committee.
Other unions and guilds also backed the legislation, including Actors Equity and IATSE. Business groups, including the state chamber of commerce, opposed the bill.
As overwhelming as the support for the bill was in the state legislature, Newsom tried to remain publicly neutral on the Hollywood labor disputes. He said that he instead remained in contact with representatives from both side. He did say that he would get involved in negotiations if asked.