Sen. Laird Introduces Legislation Recommended by the State Auditor to Improve the EDD
SB 390 will require the EDD to establish and routinely revise a recession plan to increase the department’s efficiency during an economic downturn
SACRAMENTO – State Senator John Laird (D – Santa Cruz), who serves as the Vice Chair of the Joint Legislative Audit Committee, revealed SB 390. This bill will require the Employment Development Department (EDD) to establish, and routinely revise, a recession plan to ensure the department can rapidly, and efficiently respond to an increase of claims due to an economic downturn. The recession plan will contain procedures, practices, and protocols to ensure the department is better equipped to handle an increased workload due to an economic downturn. This legislation reflects the recommendations of the State Auditor’s report of the department and urges the rapid implementation of a recession plan, as Californians deserve much-needed assistance now.
“The audit that was released regarding the performance of California’s Employment Development Department is simply damning – there’s no other way to describe it,” stated Senator Laird. “Unemployment insurance is a life-saving resource that government can offer to individuals and their families when life comes down on them hard. This bill cannot be more timely as our state works to ensure all struggling Californians never have to suffer like this again.”
Earlier this year, the State Auditor released a report titled, Employment Development Department: EDD's Poor Planning and Ineffective Management Left It Unprepared to Assist Californians Unemployed by COVID‑19 Shutdowns, which revealed various inefficiencies within the department. According to the report, “had EDD begun the recession planning process earlier, it likely would have been able to provide more timely assistance to more Californians during 2020.”
“This is an issue that has spanned the administration of three governors of both parties,” Laird said. “But it is up to us now to make sure these problems are corrected.”
“SB 390 is a common-sense measure to force EDD to take the necessary steps to plan for the surges in unemployment that we have seen during the pandemic and as outlined by the Auditor‘s report from the last downturn over a decade ago,” said Assemblymember Salas. “With this important bill, we can put into law the necessary reforms that will ensure that families are not left without assistance again.”
“If the Legislature is serious about ensuring this doesn’t happen again, we will adopt this plan and hold EDD’s feet to the fire. We owe that to both workers and employers who pay into the Unemployment Insurance system, said Senate Republican Leader Scott Wilk. “The creation of a recession plan was a recommendation by the State Auditor to EDD almost a decade ago, and It is well past time to enact it into law.”
SB 390 will require the EDD to establish the initial recession plan by March 1, 2022, and every two years after that. The Joint Legislative Budget Committee and the Department of Finance will be receive the plan to increase transparency and accountability.