“Los Angeles County is the nation’s number one manufacturing center, in terms of employment, with a total of 434,000 employed in the sector. Supporting these many manufacturers is a strong base of component and tool suppliers. Currently, about 123,000 people create the pieces, parts, and machines required to assemble the finished goods of manufacturers.    The aerospace industry and its suppliers have led the way in creating new ways to fabricate the exotic materials they employ. Traditional mills, lathes, and presses are giving way to extruders, injectors, autoclaves, and kilns to shape a myriad of components. Precision components are also a specialty. Utilizing advanced computer numerical controlled (CNC) machining tools, skilled tradesmen aided by talented mechanical engineers turn out unique components honed to the tightest tolerances.  The largest segment in this industry cluster is fabricated metal products, which employs some 49,000 workers. Often supplying key components for aircraft and military hardware, these shops work to exacting specifications and tight security. Tool and machinery manufacturing employ 19,000 people in the County, while plastic parts fabrication keeps 15,000 workers busy.”    Los Angeles County Economic Development Corporation

Jack Kyser,  founding economist of the Kyser Center for Economic Research at the Los Angeles County Economic Development Corporation has told NTMA-Los Angeles Chapter members and guests that our “economy has hit bottom locally” but we will have to wait until 2010 for recovery.
 
At the annual LA/NTMA Economic Luncheon held September 15, 2009 at the Maggiano’s Little Italy Restaurant, in Los Angeles, Kyser told the LA chapter members and guests that “We are at the turning point” but we will be facing a “very slow recovery.”

Using a series of PowerPoint slides to show his findings he reflected on business and unemployment issues facing the community. He stated that Los Angeles unemployment is at 12.5 percent and it has reached 23 percent in South Los Angeles. He predicted that job losses may continue into 2010.
 
He reported that retail sales are holding steady and no longer dropping but predicted that Christmas sales may be down and retailers have reduced their inventories to account for the projected lower sales. He said small retailers are using credit cards to purchase inventory, while at the same time many credit card companies have cancelled cards devoted to small businesses.  “Access to capital is a continuing problem in this difficult market,“ he said.
 
Kyser said housing starts are slightly improving in the single family home construction area but it is nowhere near the successes of a few years ago. He reported that the closing of NUMMI plant was a big loss to California and auto production nationally is in the doldrums.

MANUFACTURING DOWN
Kyser said manufacturing in L.A. County is down 36.2 percent, and manufacturing in Orange County, while leveling off, is also down.
 
He noted that bank lending continues to face constraints and he predicted more banks will fail in the coming months  In answer to an audience question he reported that Los Angeles County, if measured separately, would be the 16th largest economy in the world. He predicted by 2011 we will have stopped the losses although it could take until 2013 before we regain most of our losses.
  
GOVERNOR BACKS DOWN
Governor Schwarzenegger, facing the first override of a governor’s veto by the legislature since the 1960’s, joined with Assemblymember Paul Cook (R-Yucca Valley) at the Twentynine Palms Marine Base to sign AB 717 which establishes an annual "Welcome Home Vietnam Veterans Day" on March 30.
 
This bill carries the exact same wording as AB 264 which the governor vetoed September 8, 2009. In fact The governor’s staff, at his direction, worked with Assemblymember Cook to gut another Cook bill, designed to recognize the positive involvement of Filipinos in World War II and replace it with this same wording that had been vetoed.  The legislators then rushed this identical bill through in two weeks.
 
In September Schwarzenegger told the legislators that he wanted them to pass bills on water issues facing the state or he would veto every other bill sent to him. The legislators had passed some bills and submitted them to the governor for signature. Knowing that last year the governor vetoed a number of bills as being non-responsive to the needs of the state, they rushed to pull every bill back from the governor’s office except AB 264.
 
Piqued, on September 8 Schwarzenegger wrote: “I am returning Assembly Bill 264 without my signature.  
‘Our state is facing significant challenges, including the need for comprehensive changes in our policies on water, energy, and corrections and the need to take meaningful steps to stimulate the economy and rein in the rising levels of unemployment. This bill does nothing to address any of these issues. I look forward to considering this measure when these other major issues are addressed.

FIRST VETO OVERRIDE IN 50 YEARS
The legislature is scheduled to reconvene in special session in October, and one of the first business issues scheduled was the veto override vote. It was obvious Republicans would join with Democrats to override this veto. The last governor to have a veto overridden was Governor Pat Brown.
 
Recognizing that the veto override would have succeeded, Governor Schwarzenegger signed the bill and said:  "Our Vietnam veterans fought for our freedoms, kept America safe and dedicated their lives to this nation. We are forever thankful for their unwavering strength and courage while fighting in the Vietnam War. By signing this legislation we join together to express our gratitude, remember their service and say ‘welcome home.”
 
Both bills encourage all public schools in California to observe "Welcome Home Vietnam Veterans Day" on March 30 and conduct exercises recognizing the contributions of all those involved in the Vietnam War. The U.S. Census Bureau reports there are 8.2 million Vietnam-era veterans throughout the U.S. 

KNOW THE LAW
Can an employer reduce the work week hours and salary for exempt employees?
 
On August 24, 2009 the California Department of Labor Standards Enforcement issued an opinion letter stating that under California law salary reductions that accompany reductions in hours for exempt employees is permitted, according to labor attorneys from Atkinson, Andelson, Loya, Ruud, & Romo.
 
The letter, issued by DLSE Chief Counsel, Robert Roginson, an alumnus of AALRR, was based upon the salary basis test for payment of an exempt employee covered by the Industrial Welfare Commission wage orders.
 
“Before implementing cost-cutting strategies based upon the new DLSE enforcement policy, employers should be aware that opinion letters are merely persuasive, not binding upon courts,” the AALRR attorneys wrote.
 
Specifically, a questioner wrote to the DLSE asking if they could reduce the work schedule hours for exempt employees, coupled with a salary reduction in order to avoid or limit the need for job layoffs in the current difficult economic environment.

ALL POINTS MUST BE MET
The DLSE determined through legal analysis that reducing the workweek hours and corresponding salary of an exempt employee working under wage orders is permissible if:
1) The employee’s job duties qualify as exempt.
2) The employee, after the deductions, still earns the minimum required salary ($2773.33/month or $640 per week)
3) The reduction in workweek and salary is temporary.
4) The reduction is an alternative to full layoffs to the extent possible.
5) The reduction is due to serious economic issues; and
6) The company intends to restore the employees to full schedule when the economy recovers.
 
This DLSE opinion, which is contrary to an earlier opinion letter  issued in 2002 is based up analysis that was very fact intensive and if an employer is considering making this change they are encouraged to consult with an attorney.
 
Also, remember that in California, employees can receive partial unemployment benefits if their salary is reduced, which may impact exempt employees who have a salary reduction.
 
Employers and employees can visit the EDD web site for more information about partial unemployment claims.

BE PAID TO “BRING INJURED BACK “
The California Division of Workers’ Compensation has launched a campaign to help small employers bring their employees back to work or keep them working following workplace injuries.
 
The “Bring ‘em back” campaign provides the specific information small employers need in a user friendly Web site, to apply for reimbursement for purchases they make to help employees stay working while they recover.
(Any employer with fewer than 50 full-time employees, whose employee was injured on the job after July 1, 2004 qualifies as a small employer for this program.)
 
According to RAND Corporation, a non-profit think tank, both employers and injured workers benefit when employees return to work quickly following a workplace injury. That’s why the workers comp reforms implemented in 2004 placed the emphasis on providing injured workers with sound medical treatment and getting them back to work as soon as possible.
 
It’s also why the state developed an incentive program that helps small employers accomplish this goal by providing up to $2,500.00 in reimbursement for dollars spent on workplace modifications that bring an injured worker back to the job.
 
Specifically, any employer with fewer than 50 full-time employees, whose employee was injured on the job after July 1, 2004, may qualify for reimbursement of up to
• $1,250 for workplace modification that bring a temporarily disabled employee back to work
• $2,500 for workplace modifications that bring a permanently disabled employee back to work.

REIMBURSEMENT FOR THESE ITEMS
Reimbursement can be for any of the following expenses, provided they are prescribed by a physician or are reasonably required by work restrictions laid out in a medical report.
1) Modification to the work site
2) Equipment
3) Furniture
4) Tools
5) Any other necessary costs reasonably required to accommodate your employer’s restrictions.
 Some examples of purchases the state has reimbursed:
• A platform and extended eyepiece for a biological analyst
• Custom knee pads for a tile setter
• A computer keyboard tray and document holder for an office administrator

While there are some restrictions in the program, getting reimbursement can be as easy as filling out a few forms and providing receipts.
 
In addition to providing reimbursement for purchases that bring an employee back to work, or keep them on the job, the state has return to work experts to provide consultations and presentations for employers or employer organizations.
 

For information contact the Return To Work Reimbursement Program at 510-286-6990 or DWCReturntoWork@dir.ca.gov.

BEWARE OF POISON TEXTS
Textual harassment is nothing to LOL about, employment lawyers warn, according to reporter Tresa Baldas.
According to Baldas, writing in Law Technology News, Attorneys say that text messaging in the workplace is turning into a growing liability for employers, which are landing in court over inappropriate and offensive texts that are popping up on employees’ cell phones.
 
Perhaps the biggest culprits, according to the attorneys, are male bosses who are sending scandalous text messages to female employees, asking them out on dates or promising promotions in exchange for sexual favors. These texts are explosive evidence in lawsuits, they said, and pretty tough to dispute. “We’re actually seeing it happening … lawsuits are being filed where an employee will testify that one of the means that they were harassed by someone was through text messages,” according to Los Angeles based attorney Clint Robison, who is handling several textual harassment lawsuits on behalf of employers.

Text messages, he says, “come up in pure harassment claims and wrongful termination lawsuits, where employees are being deposed and saying ‘Well, I can prove [harassment] because the dinner date invitation from my boss was sent to me by my boss late at night.’”
 
Robison is currently handling four lawsuits in which employees are suing their employers over inappropriate texting at work. Two cases involve female workers who allege their supervisors harassed them by sending inappropriate text messages, hinting at promotions for sexual favors.
 
Another involves co-workers creating a hostile work environment by exchanging messages back and forth that another employee found offensive.
 
“There is a workplace bullying aspect of it, too,” Robison said of text messaging in the workplace. “Maybe it started as a little harmless joke, but not everyone has the same sense of humor. Suddenly what was funny to a couple of people is no longer funny to one person.”
 
Before a company knows it Robison said, a complaint gets filed, then an investigation, and the inevitable lawsuit. For employee right attorneys, text messages have turned into powerful ammunition in workplace disputes during the past year.
 
In April, text messages helped two female soccer players, who accused their coach of sexual harassment secure a $450,000 settlement from Central Michigan University.
 
The women alleged that the coach used manipulation to carry out secret sexual relationships with them. He also sent the players inappropriate text messages which were used to help bolster their claims and settle the claims before they were filed in federal court.

PROBLEMS FOR WORLD WRESTLING
Text messages may also prove problematic for the World Wrestling Entertainment Company, a defendant in a pending federal sexual harassment lawsuit in Connecticut brought by a former licensing coordinator. The woman claims she was sexually harassed by a married senior director of a consumer products division, who allegedly pursued her intimately via late night text messages and phone calls.
 
In West Virginia four waitresses at Famous Dave’s Restaurant also pointed to text messages in pursuing sexual harassment claims against a supervisor last year, alleging among other things that he sent text messages asking sexual favors.
 
Make no mistakes, plaintiff’s attorneys say, text messages are potent evidence, and plaintiff’s attorneys are grabbing hold of them whenever they can. “Those have really been a gold mine in terms of finding evidence to support and corroborate claims of sexual harassment in the workplace,” employee rights attorney Jennifer Salvatore said of the text messages. “In the he-said she-said cases, you look at the texts and you can see who is telling the truth.”

Salvatore, of Ann Arbor Michigan was the attorney who represented the soccer players at Central Michigan University.
 
David Walton, a management attorney concedes there are incidents of sexual harassment via text messages, but he noted that text messages are not frequently monitored or reviewed by management because it is a time intensive activity. He said most reviews are done after the fact, most often after a complaint has been filed or as part of some internal investigation.
 
Walton said there are privacy issues that employers need to consider before reviewing text messages. If the employer owns the device it has the right to review it. But if the employee owns the advice and the employer reimburses the costs, that does not give the employer the unfettered right to review it.

TAX COLLECTIONS STILL DOWN
Compared to estimates found in the Amended 2009-10 Budget Act enacted on July 21, 2009, total General Fund revenue collections in August were down $237 million (3.6%), according to state Controller John Chiang. This was driven by personal income tax revenues that were $247 million below (-8.9%) estimates and sales taxes that were down $185 million (-5.5%). Corporate taxes were $27.3 million above (22.6%) the estimates. The total for the three largest taxes was below the estimates by $405 million (-6.5%).
 
Compared to August 2008, General Fund revenue in August 2009 was down $486 million
(-7.1%). The total for the three largest taxes was below 2008 levels by $518 million (-8.1%). Personal income taxes came in $401 million below (-13.7%) last August. Sales taxes were down $56.6 million (-1.7%), (Ed. Note: this is after a 1% tax increase) and corporate taxes dropped by $60 million (-28.8%) from last August.