State Watch

Newsom vetoes bill that would allow striking workers to get unemployment checks

California Gov. Gavin Newsom (D) on Saturday vetoed a bill that would have allowed workers on strike to become eligible for Unemployment Insurance (UI) benefits. 

In his note to the California State Senate, informing them of his decision, Newsom cited the state’s high UI debt and said the state is not collecting enough in taxes to fund support the fund, making it “vulnerable to insolvency.”

The fund is supported through a tax that businesses must pay on each work, but the tax applies just on the first $7,000 of workers’ wages, which is the lowest amount allowed under federal law, The Associated Press reported. The financial structure has remained unchanged since 1984. 

“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 taxes on employers,” Newsom wrote.

“Furthermore, the state is responsible for the interest payments on the federal UI loan and to date has paid $362.7 million in interest with another $302 million due this month,” he continued. “Now is not the time to increase costs or incur this sizable debt.”

Newsom’s veto comes amid major strikes in the state continue. While Hollywood writers ended their strike on Sept. 26, there are ongoing strikes by Hollywood actors and Southern California hotel workers. This bill represented an effort on behalf of Democratic state lawmakers to show support for striking workers. 

Democratic State Sen. Anthony Portantino, who authored the bill, noted to the AP that only two of the 56 strikes in California over the past decade have lasted more than two weeks. 

Lorena Gonzalez Fletcher, executive secretary-treasurer of the California Labor Federation described the veto as a win for corporations and executives, in an interview with the AP.

“This veto tips the scales further in favor of corporations and CEOs and punishes workers who exercise their fundamental right to strike,” Fletcher said. “At a time when public support of unions and strikes are at an all-time high, this veto is out-of-step with American values.”

“I have deep appreciation and respect for workers who fight for their rights and come together in collective action. I look forward to building on the progress we have made over the past five years to improve conditions for all workers in California,” Newsom wrote. 

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