Job Killer Chilling Employer Speech Similar to Legislation Vetoed in Colorado, Overturned in Court

Legislation opposed by the California Chamber of Commerce as a job killer is nearly identical to a Colorado bill vetoed recently due to concerns about its unintended consequences and ambiguous terms.

The bill, SB 399 (Wahab; D-Hayward), chills employer speech regarding political matters, including unionization, is likely unconstitutional under the First Amendment and is preempted by the National Labor Relations Act (NLRA). The bill is so broad that employers would be barred from discussing recently passed legislation or regulations with their employees absent a legal requirement that they do so.

A CalChamber-led coalition is opposing SB 399, pointing out, among other concerns, that the bill puts employers in a difficult place regarding restricting individual employees' speech. Under the NLRA, for example, an employer cannot stop an employee from discussing the merits of unionization or from talking to coworkers about how they support a candidate who wants to increase the minimum wage.

In a letter to members of the Assembly Appropriations Committee, the CalChamber coalition asks how employers can allow the speech protected by the NLRA while also ensuring that they are not violating SB 399.

Adding to employers' difficulty are vague exceptions in the bill and the lack of a definition for a "political organization." The undefined term and whether information employers communicate to employees is "necessary for those employees to perform their job duties" is likely to be tested through litigation, the coalition states.

In his May 17 veto message, the Governor of Colorado expressed many of the same concerns, saying the Colorado bill's broad definitions and narrow exemptions put employers "in the impossible position of determining when any form of speech or communication is legally protected political or religious speech."

California Liability

Because SB 399 creates a new section of the Labor Code and a private right of action, any good faith error in interpreting the bill or its exceptions creates liability, including penalties under the Private Attorneys General Act (PAGA) and punitive damages.

Other States

Laws similar to SB 399 have been enacted in other states. One was struck down in court, one had a provision repealed because the state agreed that the provision was preempted by the NLRA, one lawsuit was dismissed solely based on a ripeness issue, and two more are presently in litigation.

SB 399 is on the Assembly Appropriations Suspense File, set for consideration on Thursday.

Staff Contact: Ashley Hoffman

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