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Newsom Vetoes Unemployment Benefits for Striking Workers
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By CalMatters
Published 7 months ago on
October 2, 2023

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Supporters who celebrated as Gov. Gavin Newsom signed a fast food bill Thursday bemoaned his decisions Saturday night when he announced he had vetoed two other high-profile labor bills.

Newsom rejected Senate Bill 799, which would have paid striking workers California unemployment benefits after two weeks, and SB 686, which would have extended workplace safety protections to domestic workers, such as housekeepers and nannies.

Both bills are among several labor-backed measures that prompted public rallies and won approval from the Democratic-controlled Legislature, as thousands of Californians — including hotel workers and Hollywood actors — walked picket lines this year.

Unions are often major financial supporters of Democrats and of Newsom’s political campaigns. In 2021, during the failed attempt to recall Newsom, unions gave at least $23.6 million to defend him.

After Newsom’s announcement, labor leaders vowed to keep fighting for the unemployment measure. Lorena Gonzalez Fletcher, who heads the California Labor Federation, said it’s a top priority for the entire labor movement.

“This veto tips the scales further in favor of corporations and CEOs and punishes workers who exercise their fundamental right to strike,” she wrote in a statement.  “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.”

Later she posted on X, formerly Twitter: “Good thing we believe in second chances, because we will put this back on your desk next year @GavinNewsom and every year after if necessary. Workers deserve better.”

From Cheers to Disappointment

That sentiment was a far cry from the accolades and appreciation Newsom received from workers and union leaders Thursday, when Newsom signed another high-profile labor bill that will raise fast food wages to at least $20 an hour next April and give workers seats on a new restaurant industry council to set pay standards and influence workplace conditions.

The press conference, held at a union headquarters in downtown Los Angeles, featured ecstatic worker testimonies, a mariachi band, and cheers as Newsom signed what many called landmark legislation.

Newsom’s actions Saturday evening were decidedly quieter. There was no press conference when his office released a list of 34 bills he signed and, at the bottom, included five bills he vetoed, including the unemployment measure and the domestic worker bill.

Newsom said in a veto message that he rejected giving California unemployment checks to strikers because it would have cost too much, given the state’s already debt-ridden unemployment insurance trust fund that struggles to fulfill existing responsibilities while owing the federal government $18.5 billion.

That debt would have grown to $20 billion by the end of the year, Newsom said. Also the state, which has paid $362.7 million in interest on that debt, has to make another $302 million interest payment this month.

“Now is not the time to increase costs or incur this sizable debt,” he wrote.

Unemployment Benefits Battle

Workers who lose their jobs through no fault of their own can receive California unemployment benefits. Employers fund it by contributing to the state trust fund on behalf of each employee. Newsom said the trust fund’s financing structure hasn’t been updated since 1984, which has made it “vulnerable to insolvency.”

Business groups strongly opposed the bill, noting it would have required companies to essentially pay for strikes.

About CalMatters

CalMatters is a nonprofit, nonpartisan newsroom committed to explaining California policy and politics.

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