NFIB California Main Street Minute

Date: June 20, 2022

For the legislative and political week June 20-24

Welcome to the June 20-24 edition of the NFIB California Main Street Minute from your NFIB small-business-advocacy team in Sacramento.

PAGA Pruned

  • The big state news of last week was a federal matter. On Wednesday (June 15), the U.S. Supreme Court, in the case of Viking River Cruises, Inc., v. Angie Moriana, tapped the brake pedals on California’s Private Attorneys General Act (PAGA).

  • Reported the San Francisco Chronicle, “Enacted in 2004, the Private Attorneys General Act, or PAGA, lets employees sue their employers, individually or collectively, in the name of the state for violating laws such as those regulating minimum wages, overtime, and meal and rest breaks. If these suits succeed, the employees collect 25% of the penalties provided by labor law, with the rest going to the state.” The court ruled that “the law, as currently written, violates an employer’s right to arbitration under federal law.”

  • Contributed the Los Angeles Times, “California is the only state to authorize such private suits as a means of enforcing its labor laws. But in doing so, the state has allowed employees to escape binding arbitration agreements they signed when they were hired, the court said.”

  • Victory for NFIB. “Small businesses greatly benefit from arbitration as it is a fast and inexpensive way to solve business issues and avoid costly litigation,” said Karen Harned, executive director of NFIB’s Small Business Legal Center. “The Supreme Court’s affirmation that the FAA’s [Federal Arbitration Act] pro-arbitration mandate should apply to individual California Private Attorneys General Act (PAGA) claims will go a long way in protecting small businesses from an onslaught of PAGA litigation, including many frivolous lawsuits, brought under PAGA and similar state laws.” More from Harned and a link to NFIB’s amicus brief filed in the case can be read here.

  • Bear in mind, the Supreme Court’s decision limits but does not abolish PAGA. Reaction from official Sacramento was resigned to the decision. Sen. Dave Cortese, chairman of the Senate Labor, Public Employment and Retirement Committee, said in a statement, “We are still studying the Supreme Court ruling, and I am prepared to author legislation to respond; I believe that this ruling has provided a roadmap as to how we can create for employees a new pathway to legal standing as well as safeguard the protections that state law puts in place for our workers.”

Member Action Needed at Thursday’s CARB Hearing

  • This morning, you will receive an NFIB Action Alert asking you to speak out against the California Air Resources Board’s Climate Change Scoping Plan when it meets this Thursday, June 23. The Alert has the Zoom address for those wanting to attend remotely.

  • All the scenarios the state agency put together ignore reality, including the lack of infrastructure and grid reliability that California is not prepared for. The Alert has more information. For even more, click here. And for State Director John Kabateck’s comments, click here.

  • You can also read the Action Alert on the NFIB California webpage here after it goes out.

Fast-Food Bill Advances

  • Speaking of being the only state, some lawmakers would like California to be the first with a new agency for fast-food workers. Assembly Bill 257 “would establish a Fast Food Sector Council within the Department of Industrial Relations, chaired by the secretary of the California Labor and Workforce Development Agency,” reports The Sacramento Bee. “This council, overseen by the Legislature, would set wage and workplace regulations for a subset of California’s food service industry.

  • “But Jesse Lara, an El Pollo Loco franchisee, testified against the bill saying that it would also impact ‘coffee shops, bakeries, yogurt and ice cream counters, juiceries, delis, pizzerias and tens of thousands of independently owned and operated restaurants throughout the state.’”

  • NFIB California and its coalition partners strongly oppose AB 257. This letter of opposition explains why. Perplexingly, you would think the bill’s author would know better. Assembly Member Chris Holden describes himself as a former franchisee in this news release announcing “several clarifying and substantive amendments to the measure that address stakeholder concerns for an industry employing 557,000 Californians.”

  • NFIB still isn’t buying any of it and remains vehemently opposed. AB 257 passed the Senate Labor Committee last Monday (June 13) and is now in the Senate Judiciary Committee.

In Other Legislative News

  • NFIB-backed Assembly Bill 2164 passed the Senate Governmental Organization Committee 14-0 last Tuesday (June 14) and will be heard in the Senate Judiciary Committee next week, June 28. The measure would provide small businesses with a financial pathway to be more accessible to people with disabilities.

    • As explained in last week’s Main Street Minute, double referral is “typically used for sensitive subject areas that transcend the jurisdiction of one policy committee. Both committees must approve the measure to keep it moving in the process,” according to this glossary of terms webpage provided by the State Senate.
  • Also on June 14, the Assembly Judiciary Committee passed NFIB-opposed Senate Bill 1149 on a 7-1 vote. According to a coalition letter of opposition, the measure “would prohibit confidential settlement agreements and protective orders in actions involving an allegation of product defect or environmental hazard and would subject attorneys engaged in these actions to professional discipline for noncompliance. California has repeatedly and rightfully rejected previous proposals to limit confidential protections fairly afforded all litigants in civil actions.”

    • Not so, argues the bill’s author in this news release. It “would protect the public’s right to know the facts about dangerous public hazards that are discovered during litigation.” The measure now goes to the full Assembly for a final vote.

Latest NFIB California Podcast

  • Solar energy is more than just a way to take “charge of our own destiny, not the utility’s destiny.” It can also help alleviate the state’s water shortage and secure its power grid. These are not the claims made by a solar evangelical, but by a small-business owner whose firm also sells and installs the traditional heating, ventilation, and air conditioning products and services.
  • Check out State Director John Kabateck’s interview with Duane Knickerbocker, president and co-owner of Brower Mechanical, a commercial and residential HVAC company based in Rocklin California. You’ll also enjoy his take and regulations and whom you should never listen to when pursuing your small-business-owning dreams. Click here to listen in.

Staycations Looking Better and Better

  • “July 1 is shaping up to be a big day for California,” reports Emily Hoeven of CalMatters. “That’s when the Golden State’s sky-high gas prices are set to tick up even more due to a scheduled increase to the excise tax rate, which will tack nearly 3 cents per gallon onto prices at the pump. On Wednesday [June 15], drivers were already paying an average of $6.44 for a gallon of regular gas, compared to the national average of $5.01.”


Highlights from NFIB Legislative Program Manager Caitlin Lanzara’s weekly report.

  • Last week, the NFIB DC Fly-In amplified the voice of small business. NFIB members flew in and directly told their powerful stories to their Members of Congress to “Do No Harm” to the small business recovery.

    • Politico Influence highlighted NFIB’s 2022 Fly-In: “The National Federation of Independent Business is kicking off its annual fly-in today, the trade group’s first in-person since 2019. More than 100 small business owners from across the country will meet with lawmakers to discuss several issues affecting their businesses, including inflation, labor shortages, and supply chain problems, and will also press lawmakers to make permanent the small business tax deduction.”

  • On June 14, NFIB President Brad Close spoke out on inflation, “How Congress Can Help Small Businesses Fight Inflation.”

  • Also on June 14, the NFIB Optimism Index fell 0.1 points in May to 93.1, marking the fifth consecutive month below the 48-year average of 98. Inflation continues to be the No. 1 problem as owners raising selling prices matches record high. Read here.

Next Main Street Minute June 27.


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