Business Focus

Gilroy Chamber Business Focus – May 2021

Gilroy Chamber Business Focus – May 2021

May 17, 2021

Gilroy Chamber Continues to Protect Gilroy’s Small Businesses

The Gilroy Chamber of Commerce along with other business organizations, including CalChamber, oppose AB 995, which would nearly double the requirement to provide paid sick leave from three days per year to five days per year.

Those businesses that can afford to offer more than three days of sick leave are doing so, but not all businesses can absorb that cost right now. While this one leave increase may not seem significant in isolation, it must be viewed in light of all of the increased costs businesses have had to sustain during COVID-19 and the new leaves that businesses have had to provide during the past year, including: 

  • Four weeks of COVID-19 supplemental paid sick leave 
  • 12 weeks of California Family Rights Act (CFRA) leave 
  • Two weeks of paid leave under the CalOSHA Emergency Temporary Standard 
  • Uncapped leave under the workers’ compensation system COVID-19 presumption 

This list does not include the dozens of local ordinances that have broader or different leave requirements than the state. Further, differences between city ordinances regarding accrual, use increments, and employee eligibility are an administrative nightmare for small businesses and this bill does nothing to address that issue. 

Recent data trends show that small business revenue is down around 30% in California, with some sectors being down more than 50%. Currently, the number of small businesses that are open is down 32% compared to January 2020. 

The employer community is asking that the Legislature not continue to pile on more mandates while businesses struggle to reopen and hire back employees. We are asking that the Legislature not move AB 995 forward this year. For these reasons, we respectfully OPPOSE AB 995 (Gonzalez).

Governor Proposes Additional Grants up to $25,000 for Small Businesses

By PATRICK MCGREEVY STAFF WRITER 

MAY 13, 2021 UPDATED 2:48 PM PT

SACRAMENTO — 

Gov. Gavin Newsom on Thursday proposed adding $1.5 billion to a program providing grants of up to $25,000 to small businesses harmed by the COVID-19 pandemic in California, allowing thousands more to get financial help.

The additional funds from federal COVID-19 aid to the state would bring the amount allocated in recent months for grants to $4 billion, which Newsom told business leaders would make it the largest state program of its kind in the country.

“Small businesses intimately understand the pain and stress of the last year — directly understand it — and the struggle now to reopen with all of the dust settling around us,” Newsom said during a virtual address to a meeting of the California Chamber of Commerce.

Officials estimate the $1.5 billion in additional funds, if approved by the Legislature, will provide grants to some 150,000 small businesses.

Even with the new funds, it is unlikely the grant money will be sufficient to help all of the California businesses suffering financially because of the pandemic, which led state officials in March to ask many of them to close or scale back operations to reduce the spread of the virus.

When the grant program was started earlier this year, 350,000 small businesses filed applications, seeking more than $4.5 billion in assistance, officials said.

Still, business groups said additional financial help was essential even as the state was expected to emerge from most COVID-19 restrictions on June 15.

“This is welcome news for mom-and-pop owners in the state who have been hanging on for dear life this past year,” said John Kabateck, California state director of the National Federation of Independent Business. “They don’t need more debt — they need resources that will get their lights back on, people back to work and communities 

The new funding proposal came during a week in which state officials said the state budget surplus had ballooned to a staggering $75.7 billion, allowing the governor to propose large amounts of additional financial resources for schools and housing for homeless people, and to provide $600 tax rebates to California taxpayers who make up to $75,000 annually. The state also is receiving $26 billion in federal COVID-19 relief aid, the governor noted.

The announcements have been made as Newsom faces a recall election in which several candidates wanting his job have accused him of mishandling the pandemic by shutting down businesses for too long.

Newsom’s announcements this week were criticized Thursday by California Republican Party Chairwoman Jessica Millan Patterson, who cast them as his effort to head off a recall.

“Gavin Newsom’s job-killing policies devastated small businesses during this pandemic, and now he thinks he can paper over facts with press conferences,” Patterson said. “Today’s announcement does nothing for the thousands of California businesses that have already shut their doors for good, costing owners their life savings and workers their employment.”

But some owners of small businesses that have survived during the pandemic say the grant program could make the difference as they struggle to stay afloat.

Timothy Ratcliff, owner of Shin, a sushi and ramen restaurant in Hollywood, said he plans to apply for one of the grants, though he has not been able to get financial assistance from the state in the past.

“Even though business is coming back, we haven’t made any money in a year,” Ratcliff said. “I had to sell my house. That’s the only way we have kept going.”

Ratcliff said revenue for his family restaurant dropped from $75,000 a month to $5,000 during the peak of the state shutdown and he had to lay off 90% of his staff. The revenue is returning to its previous level and he has hired back all the staff who wanted to come back, but he said the higher cost of goods means he is still struggling to break even.

David Atayan, who operates Firehouse Chicken restaurant in Van Nuys, said “a grant would be an incredible help.”

He said he had not heard about the program but thinks a grant would help him weather the slump in business as fewer people are going to work in nearby offices, bringing in fewer customers. He has had to adjust the schedules of his four employees.

“It’s been a struggle,” he said. “It’s still very slow right now.”

In January, Newsom launched the grant program with an executive order that provided $500 million for 21,000 small businesses.

In February, the Legislature and governor approved another $2.1 billion in grants, from $5,000 to $25,000, under a program administered by California’s Office of the Small Business Advocate.

So far, some 198,000 small businesses and nonprofits have been or will be awarded grants during the first two rounds of the program. State officials estimate that about 180,000 applications will remain unfunded.

The officials cited a survey by the advocacy group Small Business Majority that found 35% of small businesses were three months from closing if they did not get additional financial help.

Firms with an annual gross revenue of up to $2.5 million are eligible to apply for the grants. With demand outpacing available funds, applications are ranked and judged on criteria including whether the business is in an industry sector deemed most affected by the pandemic.

The state will also work to ensure that grants are distributed throughout California with a focus on assistance for businesses run by people of color.

More than 88% of the grants awarded so far have gone to businesses owned by people of color, women and veterans, or those that are located in low- to moderate-income communities, the governor said.

Grants have been finalized for 43,874 small businesses and nonprofits representing all 58 California counties for a total of $475 million.

Businesses that are notified they’ve been awarded a grant still must go through a process to verify their eligibility, and checks should be issued within 45 days, state officials said.

Newsom on Thursday also proposed boosting funding for the California Competes Tax Credit for businesses that create or retain jobs to $360 million annually, up from $180 million. The governor also wants to provide $250 million in grants to lure businesses to move to California, and $95 million for Visit California, to promote tourism in the state.

Chamber President Allan Zaremberg urged the state Legislature to approve the governor’s $1.5-billion proposal.

“Let’s not forget,” he said, “it is California’s successful businesses that have provided a once-in-a-generation budget surplus that will allow the state to address some of its most pressing needs.”

Annual Out-of-Pocket Maximum Adjustments Announced for 2022

Article by Dave Villar, CA Insurance License 0G55422, Pacific Coast Benefits Insurance Services LLC

On April 30, 2021, the Department of Health and Human Services (“HHS”) published its Annual Notice of Benefit and Payment Parameters for 2022. This guidance is a final rule that addresses certain provisions of the Affordable Care Act (“ACA”). For purposes of employer-sponsored health plans, the final rule includes:

  • Caps on out-of-pocket dollar limits for non-grandfathered group health plans with plan years that begin in
  • A policy to codify that individuals with COBRA coverage may qualify for a special enrollment period to enroll in individual health insurance coverage based on the cessation of employer contributions or government subsidies (such as those provided for under the American Rescue Plan Act of 2021) to COBRA continuation

Change to the Out-of-Pocket Maximums

Under the final rule, non-grandfathered group medical plans will see an increase in the out-of-pocket maximum for plan years beginning on or after January 1, 2022 as follows:

  • $8,700 for self-only coverage; and
  • $17,400 for coverage other than self-only.

Note that different out-of-pocket limits apply to high-deductible health plans, for purposes of making contributions to a health savings account (“HSA”). The 2022 HSA thresholds will likely be announced in June 2021.

Special Enrollment Period for Individual Coverage

The final rules create a special enrollment opportunity to access the individual coverage market upon the loss of all employer (or government) contributions toward COBRA coverage.

Specifically, when an individual or their dependent is enrolled in COBRA continuation of coverage (or state “mini- COBRA”) and the employer (or the government) contributes toward the cost of that coverage, the individual will have

a special enrollment opportunity into individual coverage when those employer contributions (or government subsidies) completely cease. It should be noted that this relief is limited to the individual coverage marketplace and does not extend to HIPAA special enrollment rights for purposes of enrollment in group health plan coverage. In other words, an individual with COBRA coverage that is subsidized by an employer (or government) generally will not have a special enrollment opportunity in an employer-sponsored group health plan when those contributions cease.

This relief applies market-wide to individual health insurance coverage, including coverage purchased outside of the Exchange, directly from carriers or through insurance agents, as well as coverage acquired from state Exchanges.

The triggering event for this special enrollment period is the last day of the period for which COBRA continuation coverage was paid for or subsidized, in whole or in part, by an employer or a government entity.

An individual eligible for this special enrollment period would have 60 days before and after the triggering event (in this case, the last day for which the qualified individual or dependent has COBRA continuation coverage to which an employer or governmental entity is contributing) to select an individual market plan through this special enrollment period.

These changes take effect on July 6, 2021.

Employer Action

Update out-of-pocket limits for plan years beginning on or after January 1, 2022.

Understand and communicate (as needed) that cessation of all employer (or government) contributions toward COBRA continuation of coverage may trigger a special enrollment opportunity for individual market coverage.

This article is designed to highlight various employee benefit matters of general interest to our readers. It is not intended to interpret laws or regulations, or to address specific client situations. You should not act or rely on any information contained herein without seeking the advice of an attorney or tax professional. ©2021 Emerson Reid, LLC. All Rights Reserved. CA Insurance License #0C94240.

Youth Vaccines Now Available

Santa Clara County officials announced yesterday that COVID-19 vaccination is now available for youth ages 12 to 15. Appointments can be scheduled now through the County’s website sccfreevax.org.

All County Health System fixed-location mass vaccination sites and all general community-based mobile sites will be able to accommodate the newly approved age group.

Youth between 12 to 17-years old need to provide a signed consent form from a parent or legal guardian. For County-operated sites, the consent form is available online.

Please visit sccfreevax.org for a list of walk-in sites and appointment availability, or call 2-1-1 or (408) 970-2000 for more vaccine information.

Join the Gilroy Chamber on a trip to Capitol Hill!

Washington DC trip flyer. Visit www.Gilroy.org/dctrip for more information.

May 10, 2021

It Just Got Easier to Raise Taxes

By CalMatters

The California Supreme Court may have just made it a lot easier to pass certain kinds of taxes. The state’s highest court on Wednesday declined to review an appeals court’s ruling permitting San Francisco to fund child care and early education programs with a tax approved by 51% of voters. Under a ballot measure California voters approved in 1996, any tax increase proposed by local government to fund specific programs must be passed by two-thirds of voters. But the child care tax was placed on the San Francisco ballot by residents collecting signatures, and that initiative power is “one of the most precious rights of our democratic process” and must be interpreted broadly, the appeals court ruled.  

The state Supreme Court in September declined to review a similar case, clearing the way for San Francisco to pay for homeless services with a citizen-proposed tax passed by a simple majority of voters. But the Howard Jarvis Taxpayers Association, which appealed both cases, isn’t backing down: It’s considering sponsoring yet another ballot measure that would require two-thirds of voters to approve any local tax increase, the San Francisco Chronicle reports

Laura Dougherty, lawyer for the HJTA said, “If politicians simply copy and paste a government tax proposal into a citizens’ initiative petition, they can dramatically reduce the voter approval needed to impose it.”

Bay Area Drought Conditions Become “Extreme”

Article by Kellie Hwang, San Francisco Chronicle

The drought situation in the Bay Area has officially gone from bad to worse.

According to the U.S. Drought Monitor, the entire Bay Area is now in the “extreme” drought category, along with nearly three-quarters of California. According to the latest summary, precipitation in the state for the water year that began Oct. 1 is well below normal, in the bottom 10th percentile, and the greater Bay Area is “experiencing record or near-record dryness.”

A week ago, parts of Alameda, Santa Clara and San Mateo counties hadn’t quite reached that designation yet, and the week before that, most of the Bay Area was in the “severe” drought category.

Currently, the Bay Area’s major cities are showing only 35% to 38% of normal rainfall for this time of year. The extreme drought category signals many impacts including water shortages or restrictions, loss of crops and inadequate water levels to sustain agriculture operations.

A more active wildfire season is also a concern, with fire agencies already on alert this year. So far 1,575 fires have started, more than twice the activity level compared to the five-year average.

The U.S. National Oceanic and Atmospheric Administration, Department of Agriculture and the University of Nebraska manage the monitor, which produces a weekly report and takes into account many factors including soil moisture, river levels and precipitation.

Some Bay Area counties have already responded to the dire drought conditions. The Marin Municipal Water District enacted widespread restrictions on customers last month, and on Tuesday, the agency’s board voted to impose more, including limiting overhead sprinkler irrigation to two days a week and requiring covers for pools and spas.

Last month, the East Bay Municipal Utility District asked customers to voluntarily conserve water, while Gov. Gavin Newsom declared a drought emergency for Sonoma and Mendocino counties.

California Taxpayers May Catch a Break This Year

Opinion by the Orange County Register

California taxpayers may catch a break this year as state revenue stages an impressive rebound, while progressive Democrats find their most ambitious proposals running aground on the rocks.

No doubt many progressives thought the Legislature’s Democratic supermajority, along with the party’s control of every statewide office, would enable smooth sailing for liberal policy priorities. Instead, some of the most ambitious bills, and the tax increases that would accompany them, have been stalled.

Assembly Bill 310 is an unprecedented tax on “extreme wealth” that aims to collect an annual percentage of the global assets of the wealthiest Californians. It failed to get out of the Assembly Revenue and Taxation Committee.

AB 65 is a bill that proposed a universal basic income of $12,000 per year for state residents earning less than twice the median income in their county of residence. It narrowly passed its first committee, but lawmakers said it will not move forward this year. A “funding source,” also known as a tax increase, was stripped out of the bill before the committee vote, leaving the bill’s author struggling to explain how all those UBI checks would be paid for.

AB 1400, a wildly expensive proposal to replace all private health insurance policies with single-payer government health insurance, was quietly shelved.

It’s noteworthy that these bills were halted at a time when the state is enjoying a surprising rebound in revenues after last year’s pandemic projections of fiscal doom.

The Department of Finance announced on April 23 that state revenue for the first three quarters of the current fiscal year is $16.7 billion ahead of projections. For the month of March alone, the state collected $2.3 billion more than the $8.9 billion that was predicted in the governor’s January budget.

Property tax collections are up, too. The State Board of Equalization released its 2019-2020 Annual Report showing that property tax revenue to schools rose from $38.1 billion in 2019 to $40.5 billion in 2020. In addition, local governments collected $34.9 billion, up from $32.7 billion.

These numbers should put to rest the perennial charge that Proposition 13 is hurting schools and local governments. Property tax revenue rises steadily under Prop. 13. If it’s never enough to meet the escalating demands of public employee unions, or the wish-list of big-government progressives, that may be a demand-side problem. 

It’s good news for taxpayers that state revenues have strongly rebounded, and it’s good news that the Legislature is not rushing headlong into adopting huge new entitlement programs. Talk of tax increases should end, full stop, in a state that already has the highest income tax, sales tax and gasoline tax in the nation.

There’s another factor in play this year that acts as a restraint on the tax-and-spend impulse: the looming recall election. It’s unlikely that Gov. Gavin Newsom will want to sign a bill that raises taxes just weeks or months before voters receive a ballot that asks if they want to remove him from office.

So although things could change, it appears that taxpayers have a good chance of getting out of this legislative session alive and without losing their shirts. It’s a reminder that no matter what happened in the last election, the most important election is always the next one.

Continued Investment Needed for Small Businesses

Commentary by Carolina Martinez, Special to CalMatters

Not long before Congress passed its latest COVID-19 relief package, California authorized a comprehensive $7.6 billion stimulus package of its own, with more than $2 billion allocated for small businesses. That legislation built on previous actions to keep California’s Main Streets afloat during the pandemic.

In all, it’s an unprecedented investment in California’s entrepreneurs. 

With rising hopes that the pandemic may soon come to an end, the state’s economic recovery plan must continue to invest in our most effective job and wealth creators: small businesses and the ecosystem that supports them.

California was one of the first states to go into lockdown – and while this was a necessary step for public health, the impacts on small businesses have been dramatic. At the start of the pandemic, California’s 4.1 million small businesses employed almost half of all workers, but COVID-19’s repercussions came quickly. An April 2020 poll by Small Business Majority found that 92% of small-business owners already were reporting negative impacts. 

The state of California stepped in to help, providing, among other things, $2.5 billion for a small business grant program, a $100 million Main Street Tax Credit, and an interest-free extension for businesses filing less than $5 million in sales tax. Recognizing how difficult it is for many entrepreneurs, especially women and people of color, to start a new business, the state also waived the $800 minimum license fee for new businesses.   

These actions undoubtedly saved thousands of small businesses and jobs. Yet, another poll in December 2020 found that 56% of small-business owners were still reporting reduced revenues compared to the same period the previous year. Six in 10 reported struggling to pay rent or mortgage on their commercial spaces. And 17% of business owners of color said they were likely to permanently close sometime in the next three months; 12% of white business owners said the same.

This highlights the fact that small businesses are still struggling and need continued support. Many have been unable to access relief from the federal government – only 17% of small-business owners who received a loan from the Paycheck Protection Program got the full amount they requested. The numbers were lower for entrepreneurs of color – at 14% versus 25% of white business owners.

Fortunately, the California latest relief package includes $2.1 billion in grants of $5,000 to $25,000 – quadruple the pandemic-related grant assistance previously available. In announcing the law, Gov. Gavin Newsom acknowledged that the “backbone of our economy is small business. We recognize the stress, the strain that so many small businesses have been under and we recognize our responsibility to do more.” 

For years, policymakers spoke about the importance of small businesses to our economy but did not follow up with significant action. The pandemic – and the specter of small businesses failing in mass – has changed that dynamic. California policymakers have made real investments in our small businesses in the last year. Now, as we shift from crisis to recovery, small businesses need the state to build on that progress and keep investing in the health of our Main Street entrepreneurs and the organizations that support them.

Small-business recovery is the foundation of our statewide recovery – and indeed, the recovery of the nation. The best way to get California’s economy back on track is to put our small businesses in a position to bring their employees back to work, create new jobs and bring vibrancy back to our neighborhoods. 

If continued investment is done right – placing an emphasis on helping women entrepreneurs and small-business owners of color – it can open new pathways to economic opportunity for communities that have historically been marginalized and are disproportionately impacted by the current crisis.

If California can get this right, our communities can not only recover; we can transform as a model system of resiliency that responds to the needs of these business owners. 

May 3, 2021

Gilroy Chamber Standing Up For Tourism and Hospitality Industries

The Gilroy Chamber of Commerce represents the business community’s interests at all levels of government.

The Gilroy Chamber of Commerce, along with the California Chamber of Commerce and other business organizations oppose AB 84/SB 93 which imposes a “right of recall” provision for specified industries that will interfere with and delay covered businesses’ ability to reopen during and after this pandemic. The targeted industries in AB 84/SB 93, are primarily in the hospitality industry, which has been the hardest hit as a result of the pandemic. Visit California has recently reported that tourism spending in California was only 41% of the 2019 amount. And, the Employment Development Department reported that the Leisure and Hospitality industry lost 24% of its workforce in 2020, which was the highest job loss percent/per industry. Despite the significant harm suffered, AB 84/SB 93 places additional onerous burdens on the industry as it struggles to reopen, that will ultimately slow down rehiring and their recovery.

Gilroy Chamber Fights for Healthcare Providers

The Gilroy Chamber of Commerce represents the business community’s interests at all levels of government.

The Gilroy Chamber of Commerce has partnered with the California Chamber of Commerce and other business organizations to oppose AB 650, which has been labeled as a JOB KILLER. 

AB 650 imposes at least an estimated $6 billion in direct payroll costs on healthcare providers, which have lost billions of dollars during the pandemic, jeopardizing access to affordable healthcare for Californians. 

It is undeniable that healthcare workers have been essential during the COVID-19 pandemic. Healthcare providers have recognized the value of their workers by providing increased benefits where financially possible and have put the health and safety of their workers above all else. 

They have spent millions of dollars to improve health and safety protocols, safety equipment, and access to personal protective equipment to protect workers from COVID-19. Like many other industries, healthcare providers also suffered significant decreases in revenue during the pandemic. 

In March 2020, hospitals and other medical providers stopped elective procedures, which account for a substantial portion of their revenues, and make up for costs associated with other necessary but unprofitable procedures. Without those elective procedures, revenue for hospitals plummeted. Decreased revenue combined with increased costs for health and safety equipment and increased employee benefits and compensation had a significant negative fiscal impact on healthcare providers. 

It is estimated that hospitals were losing as much as $1 billion per day during 2020.1 Many had been operating at a loss even before the pandemic. Healthcare providers were forced to lay off hundreds of thousands of employees nationwide. Even now, thousands of California healthcare workers remain unemployed. The $1,000-$2,500 quarterly bonuses retroactive to March 1, 2021 as proposed by AB 650 would financially devastate healthcare providers at a time when Californians depend on them most. 

The California Hospital Association estimates that AB 650 would cost health care providers at least $6 billion, likely more. With many hospitals and clinics still hemorrhaging revenue from the pandemic surge, this $6 billion-plus mandate will inevitably be passed onto patients in the form of higher costs and higher insurance premiums. 

Moreover, the bill explicitly prohibits a healthcare provider from reducing workers’ hours to avoid paying the mandated quarterly bonuses. A healthcare provider that cannot afford this mandate is therefore not allowed to reduce its staff to save costs. A similar mandate placed on other types of businesses during the pandemic.

Governor Newsom Provides Huge Financial Benefit to Small Businesses

Article by NFIB

SACRAMENTO, Calif., April 29, 2021—One of small businesses’ highest priorities is now law, after Gov. Gavin Newsom signed Assembly Bill 80 this afternoon.

According to legislative analysis of the bill, it “Conforms, with certain modifications, state law to federal law with respect to the tax treatment of Paycheck Protection Program (PPP) loans and Economic Injury Disaster Loan (EIDL) advance grants under the Coronavirus Aid, Relief, and Economic Security (CARES) Act and the Consolidated Appropriations Act of 2021.” Read the staff’s full analysis here. Click the top link.

“This law gives small-business owners more clarity, certainty, and security as Main Street begins to thaw from the COVID-19 freeze this past year,” said John Kabateck, California state director for the National Federation of Independent Business (NFIB), the state’s largest small-business association. “We thank Governor Newsom for his support and approval of it. The law is especially timely as small employers are now huddling with their CPA’s assessing their taxes. This tax relief could not have come a moment too soon. It, combined with the looming June 15 general reopening, will help to ensure California’s mom-and-pop enterprises are getting back on their feet, men and women are returning to work, and our communities and public services are thriving once again.”

AB 80 passed the State Assembly on a 75-0 vote and the State Senate, 37-0.

$20 Billion for Homelessness?! Where Will This End?

Article by CalMatters

The mayors of California’s 13 biggest cities gathered Thursday to ask Newsom and lawmakers to devote $20 billion over the next five years to permanently house nearly every Californian who entered a homeless shelter in 2020. The proposal’s annual price tag is significantly larger than the $2 billion in ongoing funding some mayors pushed for last year, and comes about a week after a federal judge ordered the city and county of Los Angeles to offer shelter and support services to the entire homeless population of Skid Row by Oct. 18. Although cities like Los Angeles, San Francisco and Sacramento have massively increased their homeless budgets in recent years, the state’s homeless population has continued to grow. Nevertheless, the mayors insisted Thursday that the main challenge was funding, not policy.

  • Oakland Mayor Libby Schaaf: “We know how to fix this problem. … We just need the resources.”
  • San Jose Mayor Sam Liccardo: “Spending half of a surplus on the biggest problem we face in California and making that commitment last for a half decade? That’s well spent.”

But there are a lot of competing demands for the state’s one-time budget surplus Liccardo is referring to: Also Thursday, a Senate committee passed a $3 billion drought relief plan that partially relies on surplus funds. And the surplus is also paying for the state’s $9.6 billion stimulus package, including a small business tax break Newsom signed into law Thursday.

Easing Employees Back to the Office – Here Are a Few Tips

Article by Mike McCluskey, CalChamber

As more and more people are getting vaccinated against COVID-19, a return to a degree normalcy is finally within sight. Many employers are likely itching to get their employees back into the office, and employees may be eager to see their virtual coworkers and bosses in real life. Returning employees to the work place after they’ve worked from home for over a year can be difficult, but employers have a few tricks to help ease the transition.

Prior to 2020, fewer than 6 percent of workers worked remote all or most of the time. That figure skyrocketed in the wake of the pandemic to at least 70 percent — and many employees are getting used to it. One-third of employees would quit their current jobs if required to return to the office full time, according to a recent Robert Half survey.

“After a year of drastic change, many business leaders are eager to restore a sense of normalcy and welcome staff back to the office,” said Paul McDonald, senior executive director at Robert Half, in a press release. “But reopening doors will bring new obstacles for companies to navigate. Not all employees will be ready — or willing — to return to the workplace, so staying flexible and responsive to their needs will be critical.”

For some employers, adopting — either temporarily or permanently — a “hybrid” workplace could be one possible strategy, as 49 percent of workers would prefer a balance between remote and office work. Employees want support from their employers as they make the transition back to the office, which Robert Half suggests could include:

  • Relaxed dress code
  • Freedom to set preferred office hours
  • A personal, distraction-free workspace
  • Employer-paid commuting costs
  • Employer-provided childcare

Even given the option to work remotely full-time, employees still worry that it would eventually harm their relationships with coworkers, decrease productivity and give them fewer opportunities for advancement.

Plus, some jobs just work better when people can work collaboratively, or employees need to be able to help customers physically. Other employers may have security concerns, or just want to avoid headaches with onboarding and training for remote workers. Regardless of why, if employers want to bring remote employees back to the workplace, they have a few ways to help ease the transition.

Mike McCluskey, Senior Technical Editor, CalChamber

CalChamber members can use the Return-to-Work Checklist on HRCalifornia. Not a member? See what CalChamber can do for you.

Gilroy Chamber Business Focus – April 2021

Gilroy Chamber Business Focus – April 2021

April 26, 2021

Mr. Smith Goes to Washington Along With Other Chamber Members

The Gilroy Chamber of Commerce is planning a history and advocacy trip to Washington DC, October 11-16, 2021. This 6-day/5-night trip will include tours of Arlington National Cemetery; Mount Vernon, the home of George Washington; Historic Old Town Alexandria; monuments and memorials; 5 nights at the Yotel Washington DC; bus transportation for tours scheduled on October 12 and 13; two dinners and two breakfasts. 

Early reservation fees are $1,750 per person for individual rooms and/or $1,500 per person double occupancy. A non-refundable deposit of $350 on or before June 4 secures the early bird reservation price. After June 4, the price increases to $1,950 per person for individual rooms and/or $1,700 per person double occupancy.

There will be plenty of free time allowing attendees to venture out and explore other sites such as Georgetown; National Cathedral; Supreme Court Building; Union Station; Library of Congress; just to name a few.

For additional information contact:

Victoria Valencia vwright@gilroy.org 

Mark Turner mturner@gilroy.org 

Gilroy Chamber Fighting to Protect Jobs and Entrepreneurs

The Gilroy Chamber of Commerce represents the business community’s interests at all levels of government.

The Gilroy Chamber of Commerce along with the Silicon Valley Chamber Coalition, OPPOSE AB 257 as it will devastate restaurants/franchise businesses throughout California. Many franchises are independent small businesses. Just because they are associated with a corporation for branding and marketing purposes, that does not mean that franchises are large businesses themselves or have similar profitability margins. Small franchise businesses make their own decisions when it comes to hiring and general business operations. 

In fact, the reason why so many minorities and independent entrepreneurs choose to open a franchise business is because they do not have the resources to start a new business by themselves. Minority entrepreneurs link themselves to a franchisor so that they can access a successful business model to access new opportunities that may otherwise be unattainable on their own. Nearly 33% of all franchises across the country are owned by minorities, compared to just 18% of non-franchise businesses. Restaurants and franchises are where minorities achieve financial success which uplifts up people from all walks of life and socioeconomic backgrounds. 

AB 257 would open the door to creating new barriers against minority business entrepreneurship. The legislation could create new costly regulations, independent from any elected official’s oversight, and would devastate small businesses that are linked to a franchisor. The bill would also eliminate autonomy for franchises/restaurants. Small businesses, especially restaurants, cannot afford new costly regulations and AB 257 relies on the false premise that all small franchises are as profitable as the parent corporation. 

Also, creating an 11-member council that does not bear the burden of meeting payroll, paying bills, covering overhead, or have any investment in the business at all make decisions about employment standards, wages, working hours and other working conditions does not make sense, especially when other state agencies already exist to regulate such issues. AB 257 will create a Fast Food Sector Council that is slanted against franchise owners to begin with, is completely biased, unfair, and will discourage job creation. 

The Gilroy Chamber Opposes Hurtful Legislation

The Gilroy Chamber of Commerce represents the business community’s interests at all levels of government.

The Gilroy Chamber of Commerce along with The California Chamber of Commerce and other business organizations respectfully OPPOSE AB 570 as amended on March 18, 2021, as it would require health plans and insurers to offer dependent coverage to parents and stepparents of enrollees and insureds. 

While the bill is certainly well-intentioned, it will place an additional strain on struggling businesses for coverage that is already accessible and affordable for those who need it.  

AB 570 would require a group or individual health insurance policy issued, amended, or renewed on or after January 1, 2022, that provides dependent coverage to make that coverage available to a parent or stepparent who meets the definition of a qualifying relative under Section 152(d) of Title 26 of the United States Code. Notably, the bill indicates if an employer offers dependent coverage then that employer must accommodate this coverage change. 

While the provision is well-intentioned, it is largely unnecessary. Covered California is currently offering a special enrollment period that allows individuals to sign up for health care coverage since approximately $3 billion in federal aid is being allocated towards health care subsidies. This federal aid infusion is paired with subsidies that have already been provided to low and middle-income individuals through the Affordable Care Act. Covered California estimates about 2.5 million people will benefit from the new and expanded help – including about 810,000 currently uninsured people. 

Additionally, AB 570 indicates that for dependent parents and stepparents to qualify for coverage they must meet the income threshold requirement contained within Section 152(d) of Title 26 of the United States Code. However, the availability of Medi-Cal already provides health care coverage for these individuals. Additionally, if the dependent parent or stepparent is 65 or older, they would qualify for Medicare coverage.  

The California Health and Benefits Review Program’s (CHBRP) analysis is due to be completed on April 30, 2021. While the cost impact has not been revealed yet, it is anticipated this bill will cause health care costs to increase. Employer group health plans are already difficult for employers to afford. Typically, employer plans, particularly in the small group market, include employers that contribute an apportioned payment towards dependent premiums in addition to employee premium contributions. 

AB 570 would introduce older and higher premium dependents to already strained employer budgets and potentially discourage any dependent contributions or encourage lower contributions to all dependents. This is not a trend that should be encouraged as it could lead to more uncovered Californians.

Drying Up and Drying Out

Article by CalMatters

On April 21, Governor Gavin Newsom declared a regional drought emergency, but stopped short of issuing a statewide proclamation or mandating water conservation measures — a decision that drew ire from some lawmakers.

Newsom’s emergency declaration applies to the Russian River watershed, which spans Sonoma and Mendocino counties and serves hundreds of thousands of Californians. The region relies on rainfall and is isolated from state and federal aqueducts, making it especially vulnerable to the drought parching California. Newsom’s order authorizes state agencies to restrict the amount of water diverted from the river and speed up contracts for certain services, such as relocating endangered fish stranded in drying puddles, CalMatters’ Rachel Becker reports.

Although the declaration also calls for a number of statewide actions — such as improved monitoring of groundwater pumping and reporting of dry wells — it wasn’t enough to satisfy lawmakers who have repeatedly called on Newsom to declare a state drought emergency and ensure Central Valley farmers receive enough water.

  • State Sen. Scott Wilk, a Santa Clarita Republican: “While the overwhelming majority of the state is experiencing extreme drought conditions, Governor Newsom has chosen to only serve his French Laundry wine and cheese crowd.”
  • Newsom: “We need to … approach the challenges with a laser-like recognition that you can’t focus this state as a one-size-fits-all solution, meaning we have to target our solutions regionally.”

The governor added that he will “add other counties to that list as necessary … based upon actual conditions on the ground.” He also said it isn’t yet necessary to mandate water conservation, noting that Californians in urban areas are using 16% less water than they were at the start of the last major drought in 2012. Nevertheless, a major Bay Area water agency — which receives about 25% of its water from reservoirs on the Russian River — on Tuesday approved mandatory water restrictions for its 200,000 residents.

Tensions are also rising on the Oregon-California border, where the federal government recently told farmers they will only get a tiny portion of the water they need even as endangered fish remain at risk.

Gina Lopez State Farm
Recology Recycling

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