Legislature(1997 - 1998)
03/19/1998 08:02 AM House STA
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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
HB 468 - DAMAGE AWARDS HUMAN RIGHTS COMMISSION Number 409 CHAIR JAMES announced the next order of business is HB 468, "An Act relating to damages awarded in complaints before the State Commission for Human Rights," sponsored by the House Rules Committee. Number 0411 JAMES HORNADAY, Legislative Assistant to Representative Pete Kott, Alaska State Legislature, came before the committee to present HB 468. He said you should have before you HB 468, a sponsor statement, a fiscal note and a letter from Paula Haley, the director for the State Commission for Human Rights. Mr. Hornaday read the following statement: "House Bill 468 amends AS 18.80.130(1) to the effect that if the decision of the State Commission for Human Rights is delayed more than 90 days after the complaint was filed, the commission may not award back pay for wages that the complainant would have earned after the 90th day after the complaint was filed. "The State Commission for Human Rights investigates claims of discrimination by employers, including cases alleging wrongful discharge due to alleged discrimination. Some 5,000 calls are received each year, with nine investigators and two supervisors doing investigative work. Two hundred seventy-five cases are presently on hold. "We are advised that there is a major problem with delay. Sometimes cases take over two years to come to a determination. If the findings show probable cause, a reconciliation agreement is presented to the employer which includes payment of back wages for the entire time period the matter was under consideration. The potential monetary impact can be staggering. Further, the claim is still subject to review by other jurisdictions (local human rights commissions, Equal Employment Opportunity Commission and so forth). "This legislation provides incentive to the employee to find other employment as well as encouragement to the commission to expedite the process. We are advised that some 62 percent of cases do not have substantial evidence to proceed. Quick and speedy decisions are in the best interest of both the employee and employer." Number 0439 REPRESENTATIVE ETHAN BERKOWITZ asked does he get to ask questions of somebody now. CHAIR JAMES replied let's hear from Mitch Gravo first. Number 0432 MITCHELL GRAVO, Lobbyist, Alaska Hotel Motel Association, came before the committee to provide information on HB 468. He noted the Alaska Hotel Motel Association asked to have this bill brought forward. He indicated some members are on teleconference and could probably speak better to specific examples. MR. GRAVO said the bill really tries to balance the interest of three different parties, the commission which has to resolve these issues, the complainant which brings the complaint before the commission, and then the defendant or the employer that has to wait for a decision by the commission. Mr. Gravo stated the association thought a 90-day window is a reasonable time to reach or not reach a decision and that if a decision isn't reached within 90 days, the employer shouldn't be further penalized. The employee would get back-wages for 90 days and it would be an inducement on the commission's part to take action. He deferred to the folks on teleconference that actually have been through this process for a year-and-a-half or two years. Number 0460 REPRESENTATIVE BERKOWITZ asked, in this provision, what happens if the defendant causes the delay. MR. GRAVO replied he didn't know how a defendant can cause a delay. REPRESENTATIVE BERKOWITZ said for example you'll drag while the investigation is going on, attempt to continue dates. He noted that there are all kinds of ways. MR. GRAVO said he thinks that would probably need to be addressed, the examples that were brought to his attention were not as a result of the defendant causing the delay. He added that he thinks that's a good point and would need to be addressed. Number 0471 REPRESENTATIVE BERKOWITZ mentioned that he fundamentally has a concern with this in terms of the equities for the situation. In an instance where a plaintiff has a legitimate complaint, the plaintiff bears the burden of the inefficiencies of the system. That doesn't seem like the most equitable resolution if we're trying to generate an incentive so the Human Rights Commission can go through its case load faster, he is not sure how Mr. Gravo can explain to him philosophically why a deserving plaintiff bears the burden for the failings of the system. MR. GRAVO said he thinks he'll have to address that to the Human Rights Commission because they're not making the decision in a timely manner. REPRESENTATIVE BERKOWITZ acknowledged that he understands that but the proposition sets a time limit. He asked how the time limit is fair to a deserving plaintiff. Number 0484 REPRESENTATIVE JAMES agreed that dragging it out isn't to the benefit of the plaintiff. She mentioned she has known people on both sides of this issue and has also known people who have had a valid claim. Chair James indicated the trauma that they've had to go through for a long period, of not knowing whether they're on, is terrible. So she thinks speeding up the process that certainly everyone wins. She said, "The other thing is, is there's a cause and effect. That having been doing my life work ... as a small business accounting and tax preparation, payroll, all of those issues, it seems to me like that, if we could speed up the process, there would be less resistance from employers to have a better ability to understand what's right and what's wrong." REPRESENTATIVE JAMES said she doesn't believe that these employers ever do anything purposely, but sometimes they are trapped because they've done something they thought was okay and it turns out it wasn't. If they could get those decisions quicker that would help them - many times they have another one pending before that one is settled because they don't know what they're doing, and they think they're doing it right but they're not. So speeding up the process will have a cause and effect to having fewer people be unfairly discharged. REPRESENTATIVE BERKOWITZ said, "I agree completely I just don't care to (indisc. - laughter). Madam Chairman, I'm just not sure this is the best mechanism." Number 0506 REPRESENTATIVE ELTON said he believes they are kind of getting to the nub of it and it seems to him that there are two ways of resolving the situation on speeding things up. And one of the ways is this way, which is a way that punishes a person who has made a complaint that may be a legitimate complaint. REPRESENTATIVE ELTON stipulated the other way is to put the resources that Human Rights Commission needs in place. He expressed that anybody who has dealt with the Human Rights Commission - we're not questioning its mission, but anybody's that's dealt with the Human Rights Commission knows that they don't have the resources to do it. The delay isn't because of the Human Rights Commission dragging their feet, and in many cases he said he doesn't believe the delay is because somebody in industry, or that owns a small business, is dragging their feet. REPRESENTATIVE ELTON indicated the delay is because they have many more complaints then they have the staff to deal with it. He called attention to the fiscal note, he said he believes it dramatically demonstrates the resources that they need. What bothers him is that we're going to try to fix the situation in which somebody that makes a complaint is going to be ultimately the person that suffers the most, rather than put the resources in place that they need to work in a timely manner. Representative Elton pointed out that this isn't the only place that those resources are short. For example the Office of the Ombudsman, sometimes it takes well over a year to get something through the system. They're burdened with the same kinds of procedural things that the Human Rights Commission does. He said you have to give probably 30 days for a person to respond to a request for information, we don't want to put the kind of burden on a small business in which they're told they have to respond in five days, that just doesn't work. What bothers him about this approach, is this is the punitive approach. He said he would be willing to guess, if this bill makes it through the system, this fiscal note won't be attached to it when it comes out the other end. And this is what we need to solve the situation. CHAIR JAMES added that because there are no deadlines now, she doesn't believe there is an incentive to get things done. She noted she's not questioning whether the 90 days is a good number or not, she's suggesting there needs to be some kind of closure in some length of time. Chair James said, "Given, we would pass something like this, the Human Rights Commission, or whoever it is, whoever was asking for a budget for them, would certainly have better numbers to deal with, to request that then they do currently. In fact is, there's probably no willingness to give them any more money now because there's nothing driving it, and we need to have a driver on here that would make them do that." Number 0548 REPRESENTATIVE MARK HODGINS said he believes it's imperative that we put a closure on this and put a time limit on it for the plaintiff. He implied you can have things that are drug-out for years for the plaintiff and that their life is topsy-turvy. He said they need to understand that they're going to have a certain amount of time, and then there is going to be a resolution. REPRESENTATIVE HODGINS referred to the fiscal note. He said, "Unless the Human Rights Commission is falling further, and further, and further behind, they don't need 55 people. If they're right now at a year-and-a-half, is there time for closure, and they're constant with that, then somehow or another they've screwed up in not getting the process going. If they are indeed falling behind every day, to where it's now a year-and-a-half, next month it's two years, and then further than that, then they do need more people. But the fact is, is if they are sitting at a constant delay, then they don't need more people, they need to clean up their act. And I want to be very specific in talking with somebody during the course of this bill that can answer some of those questions for me to find out what the delay actually is and how constant it is." Number 0564 REPRESENTATIVE DYSON suggested they go slower and be more careful because he is a little bit outraged with some the comments that have been made. He informed the committee that he has served on the Human Rights Commission for two-and-a-half years. He said, "Their [Human Rights Commission's] caseload has gone up (indisc.) of magnitude in the last seven or eight years and until recently, got no more resources. The Human Rights Commission itself, the commissioners continually push the staff to get the cases closed. And I believe we're the second state in the nation to do the radical thing that has a downside, is to do triage and not investigate every case. And certainly some of the cases are frivolous, some of them are spiteful, some of them are misapplied and ignorant, and so on. But the very serious decision that folks who file a discrimination complaint, that some of them weren't going to be done. And for the first time in seven or eight years they're actually making progress on reducing the backlog. And in the two-and-a-half years I served there, I didn't see mismanagement, people goofing off you know, I saw folks absolutely overwhelmed with the workload and trying to make it work." REPRESENTATIVE DYSON continued. He said "I also saw the tragedies on both ends. The small business who had a disgruntled employee who filed a complaint that then put the business owner in the grips of a monster that was going to have a hold of him and jerking him around, for whatever it took to get through the process. And I saw the ones where people were really badly treated, and it takes a long time to sort them out. And you look at the extremes and you see real problems with doing it, you know, with how the system works. So there is (indisc.), people, the commissioners really pushing to get things resolved as quickly as possible. Steps have been made and I think to just keep saying you've got to do better without providing a means to do so, there's got to be real limits to that. So I don't think..." Number 0601 CHAIR JAMES stated Representative Dyson made a really good point, and it's one of the same points she has made on every single budget for the state and disagrees with just cutting the bottom line of the budget. Chair James said, "But what I do agree that ought to be done is take a look, and what are we doing we shouldn't be doing." She indicated there are quicker and more efficient ways of doing things. And just because it's taking this long, it doesn't mean that there aren't ways to simplify it. She noted, as a commissioner, that wasn't Representative Dyson's chore, that would be the staff. CHAIR JAMES said one of the things we get ourselves into is, "we've always done it this way." An example is the Ombudsman's Office. And that's what she's [the ombudsman] has set up now - with greatly reduced funds, she has set up this triage, where they have this sieving process. The ombudsman said some 5,000 calls are received each year with nine investigators. Chair James said it's the same thing we put the Board of Fisheries and the Board of Game through, they have to review every single suggestion that comes to them. And there has to be a sieving process because we can't afford as a state to pay for all these things, we have to have a sorting system. CHAIR JAMES indicated she is not really comfortable with the 90 days, but will wait and hear what the testimony is. She said, "But I think we need a number. And I think then we also need to ask them to figure out how they can do it faster by sorting and taking those who are suspicious of being false claims and get rid of them quickly instead of maybe putting them off longer. ... I have done efficiency work in offices and I have been amazed when you get through and there's two less people in the office because there's so many things you don't need to do. I think it's really important that we look at that." Number 0624 REPRESENTATIVE BERKOWITZ said first of all we're proceeding on the assumption that they're not screening that way. He said he thinks it would be fair to hear from the Human Rights Commission to see what their screening process is. Because if it turns out that they are indeed screening, then they're working at what we would consider a fully efficient mode, then this criticism is a little premature. REPRESENTATIVE BERKOWITZ said the second point he wants to make is the alternative to taking causes of action in front of the Human Rights Commission is to take it to court. He said, "You want to talk about delays, I can assure you that the court delays will be extreme and the cost will be much higher. And that's particularly so if you take a civil rights action to (indisc. - coughing) court and win a judgement there. So this is a pretty cost-effective alternative at this point." CHAIR JAMES announced she would like to hear from the people on teleconference before they went any further. MR. GRAVO indicated he has one closing comment. He said, "What I'm hearing is that if you put a number in the bill it will force a very focused discussion of the budget issue at the next committee. This will have a fiscal note now, so it will have to go to House Finance and there will be a real thorough discussion of all of the equities including the budget issue and I'm sure you'll hear about that from the commissioner. But if this bill does anything, it will do that." CHAIR JAMES thanked Mr. Gravo for reminding us again that it's the responsibility of the State Affairs Committee to sort out pieces of legislation that have either a good effect or bad effect on the affairs of the state. She concluded this is the proper place to hear this first and it does go to finance who will deal with the fiscal note of it. Chair James indicated she is not real convinced that 90 days is effective, and we might want to change that because we do have some responsibility in that area. Number 0649 PAULA HALEY, Executive Director, Alaska Human Rights Commission, spoke in opposition to HB 468 via teleconference. She mentioned one of their volunteer commissioners, Chairperson Martha Gore, is also present. Ms. Haley indicated her testimony will perhaps help answer some of the questions that have already been posed. MS. HALEY noted the Human Rights Commission fully understands the frustration to parties created by current backlog and the resulting delays in investigation. Their case load has nearly tripled in the past 15 years and they've seen their inventory rise even when they have completed more cases each year than the year before. To more promptly resolve complaints of discrimination, the agency has revised procedures, amended its regulations to reduce the time for filing complaints, and with our help amended its statute last year to allow for cost savings. In addition, resources provided to the commission, with the support of the governor and legislature last year, allowed the agency to reduce its backlog by 24 percent. MS. HALEY said, "While the commission appreciates that employers want prompt resolution of complaints, it believes that HB 468 is unnecessary. But more importantly, this bill will likely have the opposite affect and increase costs and workloads for employers and I'd like to tell you why. First of all, the commission is not aware of any instance where delay in processing a claim has resulted in an increase in the amount of damages. This is because employment discrimination law does not allow for unlimited damages to accrue while the clock is ticking. The law requires every person with a pending complaint must find alternative or try to find alternative employment, or other means of income to offset the potential damages. This legal principal can be seen in the amount of back-pay awards that are arrived at through the decisions or settlements of employment cases before the agency." Number 0690 MS. HALEY pointed out that over the last ten years the average amount of back pay provided by private employers, in cases where the commission found substantial evidence of discrimination, is $4,713. She said the commission is aware of the particular concerns expressed by some employers who would like a 90-day prejudgement cap on back-pay awards. Notably, in none of those examples raised by the employers were damages increased because of the time it took to process a complaint. In fact, in only one of those cases was any back-pay provided. In that case, a 61-year-old Alaska Native woman brought an age and race discrimination complaint against the former managers of Chena Hot Springs Resort, the staff found substantial evidence of discrimination. In this instance, the fired employee secured another higher paying job three weeks after she was terminated. Chena Hot Springs Resort paid only $2,400 in back-pay in a pre-hearing settlement. MS. HALEY stated, "While the commission does not see the need for a 90-day prejudgement cap, it does see disadvantages. This bill may expose employers to double-jeopardy and more serious consequences than they now face. The Equal Employment Opportunity Commission, our federal counterpart, has reviewed HB 468 stating that a 90-day damage cap is not compatible with federal law. If this bill passes, EEOC will have to pursue additional remedies available to it in every case where we find substantial evidence of discrimination. These remedies, of the federal agency include full back pay as well as compensatory and punitive damages. So where now, when cases are brought to the Alaska Human Rights Commission, employers may be only liable for back-pay. In the future, if the bill passes, they could be subjected to compensatory and punitive damages in amounts far greater than our average back-pay award of $4,713." MS. HALEY said, additionally, the bill could subject employers to the added burdens of duel investigation. Presently under a contract with the federal agency, the commission investigates the vast majority of discrimination complaints filed by Alaskans. Because the 90-day cap is not compatible with federal law, EEOC may terminate our contract. In that case, employers would have to face separate investigations by both agencies. Also, when people learn that damages have been capped at 90 days, they may choose to go to court, federal or state, where damages could be greatly increased. MS. HALEY explained, "We at the commission strive to make our procedures as informal as possible, and employers can now respond to charges of discrimination without hiring lawyers, and many many do. However, if they must defend complaints in courts of law, employers will logically feel compelled to secure a legal representation." Number 0703 MS. HALEY said, "Finally, I think you may have the fiscal note, we just sent it down yesterday. To me the legislative mandate and to safeguard the rights of Alaskans with claim of discrimination, if this bill passes we would seek to process all our cases within 90 days. Accomplishing this within 90 days will require an enormous increase to the agency's budget. In the first year we would need to eliminate our backlog in order to process the new cases coming in within the time frame. This would require almost five times our current budget and then once we got rid of the backlog and could face just the new cases coming in we would still need a total of approximately 24 additional staffs to process in the time contemplated by this particular piece of legislation." MS. HALEY stated, for these reasons, the commissioners and I ask that you not support HB 468. Number 0714 REPRESENTATIVE BERKOWITZ asked approximately what percentage of your cases are employment discriminations. MS. HALEY replied the vast majority of their cases are employment discrimination, but did not have a percentage number. She said, "But I would tell you that most of our Alaskans do view the Human Rights Commission as the agency to assist in that area. Out of 471 [cases, 415 were employment discrimination]..." TAPE 98-38, SIDE B Number 0001 MS. HALEY continued. "...investigator because of the rise in filings. At the same time we had a reduction in staff. We went from 26 staffs to 15 - at that same time our complaint load tripled." She said they ended up putting cases on hold and they stay on hold anywhere from nine months to a year. That's the big problem. Once they get to an investigator, depending on the nature of the case, they could be completed in two months, nine months or a year - if there's very complicated facts and many many witnesses, and volumes of evidence, so it varies. Ms. Haley reported the national average for processing cases is over 440 days, that's national - all of our civil rights enforcement agencies in the country. Number 0017 REPRESENTATIVE BERKOWITZ asked what is the screening process. MS. HALEY replied, "Well you might get the sense from the numbers alone. If we get 5,000 calls a year, and that's 5,000 people who have problems, they think we can help them with, we accept anywhere between 400 and 500 complaints. So many of those people, first of all are clearly in the wrong place, we try to hook them up with the right people. But some of them we, by virtue of explaining what the obligation is under the statute, are dissuaded from filing because of our process of education, that they may not have enough to make a claim, they may not be within the jurisdiction of the agency, etcetera. So many of our callers never become complainants." CHAIR JAMES asked how many, of the ones that you do, are brought to successful conclusion and how many are denied. MS. HALEY responded, "Well, in last year's statistics, and they're probably a little bit off, and I can explain to you why from prior years, but in last years statistics 62 percent we found no substantial evidence of discrimination, so around 60 percent of the cases we found that there was not enough evidence to go forward to a hearing. Now I would say, Madam Chairman and committee members, that may in fact be a problem in the employment situation, but it was not discriminatory. There may have been some unfairness, some miscommunication, some misunderstanding, but it was not discrimination. So there may have been good reason for the employee to bring the complaint, but once we listened to both sides and talked to witnesses and gathered evidence we found that indeed the promoted individual was more qualified or other people were also penalized for certain transgressions in the workplace." Number 0061 CHAIR JAMES asked you don't do this until you actually find them, so if they're down on the list somewhere, or up on the list, you spend time on them as they come in, is that how that works. MS. HALEY replied because of the delays, the Human Rights Commission tries to resolve them in reverse chronological order, with some exceptions. If they see a complaint that was jurisdictional, but they believed there is really not good reason, they had to take it because it's jurisdictional, they will assign that sooner. She said they have some individuals who may have disabilities where they're very ill. We may assign them sooner. But for the most part, they do handle them in reverse chronological order. The problem they have, is they can't preinvestigate, but they do try to get as much information up-front so that if a case looks like it is probably not going anywhere a supervisor might be able to handle it out of order in its backlog holding area. Number 0081 CHAIR JAMES said if 60 percent of them turn out to be nondiscriminatory and they stayed in the process, and were handled in the reverse chronological order, it's very likely if there was a way to sort them out that the process for the valid cases would go quicker. MS. HALEY said she could appreciate that point of view. She said she believes, that what is sometimes problematic, is that even in some of these cases where there's no substantial evidence of discrimination, it took a lot of information hunting and witness testimony and reviewing of records to determine that that indeed was the case. Not all of the no-substantial evidence cases are necessarily quick cases. CHAIR JAMES indicated she can understand that too, because she understands that process. Number 0099 REPRESENTATIVE HODGINS referred to Ms. Haley's comments on the length of backlog. He reiterated that they hold things for nine months to a year, the national average is 440 days, and asked do you think you're getting close to the national average. MS. HALEY replied, "We may be hitting close, or a little bit over the national average. I have to say that we have seen a huge increase in our complaints at the same time we saw a decrease in staff. And what happens nationally, is most of the agencies saw a huge increase without the decrease in staff. And I can tell you a lot of that was the result of the Americans With Disabilities Act and awareness in the area of that particular issue." REPRESENTATIVE HODGINS said well, working those numbers, it looks like maybe 90 days would be fairly close, 90 days to 120 days would probably fit in your process if you didn't have the backlog. He said, "And I say that because if you hold something for nine months to a year, and the national average is 440 days, and you're actually doing that, or did I misunderstand, and after the year, then it's 440 days for you." MS. HALEY replied that he did not misunderstand, what she is not understanding, in terms of his question, is that he thought the 90 or 120 days would work. She said, "Our cases aren't even assigned for close to a year. And what I must say so I don't mislead the committee members is the average of 440 days that I had given you, which is from the EEOC database, is for cases to be completed through investigation, it doesn't include the hearing process which I think this bill contemplates." REPRESENTATIVE HODGINS asked how much time does the hearing process take. Number 0138 MS. HALEY replied they currently have a little bit over 40 cases in their hearing unit and they're developing, unfortunately, a backlog in that unit as well. The Human Rights Commission has right now, cases scheduled in 1999 to go to hearing. Now, that scheduling is not always simply because the commission can't get the cases to hearing, the respondents sometimes can't get to hearing as quickly as they might like because of their schedule, or the schedules of their attorneys if they choose to hire one. So many times the delays of the hearing's stage are due to the scheduling problems of all the parties not simply the commission's workload. REPRESENTATIVE HODGINS asked if you did not have the backlog, would you have to hold the cases nine months to a year before you assigned them. MS. HALEY replied no, in fact the Human Rights Commission's backlog is a new problem. She indicated, when she first came to the agency 10 years-ago, her mission was to resolve cases more quickly and she accomplished that. But that was a short-lived victory because cases went up so quickly in the "90s." Ms. Haley said they actually got most of their cases, the vast majority of them, to complete resolution within approximately a year. But that was at a time when they had only 260 filings per year and the filings were driven up by increase in population, greater awareness, and other things. And as a result, with their staff static and down from 26 to 15, they just lost the ability to keep up. REPRESENTATIVE HODGINS asked if they had no backlog, and somebody brought in a case today, you're saying that it's going to be 440 days on average before it's resolved. MS. HALEY said, "If you were talking about getting the case all the way through hearing, I think that it might be a reasonable assumption. I think that most of the cases - I dont' know of any fair employment practice agencies across the country that are state agencies with the kind of inventory we have that are doing things faster than a year, I can say that." REPRESENTATIVE HODGINS asked so you think 440 days is a valid amount for somebody that comes in and puts in a case today, 440 days from today it should be resolved, is that correct. Number 0182 MS. HALEY responded, "Well, it's hard for me to say, I think everything in a perfect world would be resolved in a year or less. That's what I truly believe - if you had the adequate resources." REPRESENTATIVE HODGINS said it looks like they kick out about 90 percent of potential plaintiffs in their screening. He asked how much time do you spend in the screening to kick out 90 percent versus the hearing situations and preparing cases, is that a big portion of your time. MS. HALEY replied it can take a fair amount of time to screen because usually the people who call their agency are not sophisticated, they understand that they experienced something that they believe is bad, and the commission has to try to ferret out, whether the bad thing meets the four corners of our statute. She said they try to get all those calls through in 15 to 20 minutes - maximum time spent on the call, some of them, of course, are much shorter, but it does take a fair amount of time. If an investigator is assigned to what they call "inquiry week," it basically takes all of his or her time during that week, just given the volume of calls, it's better than 100 calls a week. REPRESENTATIVE HODGINS noted the commission can actually screen somebody in 15 minutes and then they probably would have different levels that they would kick them into different interview situations if they fall within certain parameters of a screener's judgement. Number 0211 MS. HALEY said, "Let me give you a thumbnail sketch. If the person has basically articulated a claim under AS 18.80, we actually send them, or they can walk in and get it if they're in the Anchorage area, a questionnaire. And we put, at that point, the burden on them to write down what their claim is and why they feel it's appropriate before the agency. And we added that step because we found, when the potential complainant had no involvement early on, some times they would just have us do the drafting of a complaint and then they would vanish. So this puts a little bit of a burden on the complainant or potential complainant, up-front. Once that comes in, we turn that with their assistance usually in a telephonic interview into a draft complaint which is what the statute contemplates, we draft the complaint. We make it clear to them we're not their advocates, nor do we represent the potential respondent's interests. And if we didn't have the backlog that complaint would be immediately assigned for investigation. Because we have the backlog that complaint now goes into a hold bin." REPRESENTATIVE HODGINS asked Ms. Haley if she was experiencing a longer and longer delay in the resolution of these cases on an average. Number 0232 MS. HALEY replied yes, the commission had more and more time, but because of the assistance from the legislature last year with additional resources they're seeing that trend turn. She indicated it's turning more slowly than they would like it, but they did a number of things in the past two years, they changed their regulation to reduce the time for filing, they streamlined their internal procedures, they amended the statute to save them money at the hearing level - and they could use that money toward other things. They also were able to get two additional investigators. Last year, if the committee looked at them, they only had seven investigators and two supervisors. REPRESENTATIVE HODGINS asked, what you're saying then is that with seven additional people, you've actually turned the tide on the backlog, where you don't have quite as long a backlog now. MS. HALEY replied yes. The Human Rights Commission has reduced its backlog by 24 percent. They have seen in nine months the positive impact of additional resources and their backlog is closer to a nine-months backlog than a year-long backlog. REPRESENTATIVE HODGINS referred to the fiscal note. He said, "You initially say 55 positions would be added to the agency to clear its backlog of cases. Then I assume you would be looking at seven or less for continuing employment to keep those down, is that correct." Number 0258 MS. HALEY replied, "Representative Hodgins, that's not correct because I was doing the fiscal note based on the bill itself which doesn't simply say we have to process promptly, but we have to process in 90 days. And to do it in 90 days - which means an investigation, a conciliation where we try to settle if we found that there was in fact substantial evidence of discrimination, discovery, setting a hearing, holding a hearing, having a decision, in 90 days would be incredibly labor intensive. And that's why you see for the long term 24 additional staff." REPRESENTATIVE HODGINS asked if she would assume then that maybe a figure like 100 days or 120 days would be more appropriate. MS. HALEY said she thinks there would be very little difference to the fiscal note if it was 90 versus 100 or 120 days. REPRESENTATIVE HODGINS asked if there was a discrimination season where you have more people during certain times of the year that come in with more complaints such as in the fall when there might be layoffs after summer. Number 0276 MS. HALEY replied no, the commission actually hasn't seen a season, but if you note for example, new companies coming into town, they will see more complaints then for failure to hire. If you note that a large company does a major layoff, they will see more complaints at that time. So, if you see something in the news, that reflects some major employment activity, they will usually see the impact of that. But they don't see it, for example at the end of seasonal employment. REPRESENTATIVE HODGINS asked what changes would she recommend to the Human Rights Commission if you have to sit on a 90-day -- if this bill goes through the way it does. What would be the massive changes you'd have to make to comply with this. MS. HALEY said, "I think that if I had to tell the current staff that we were going to process within 90 days, we would need to - basically a five times the staff in a short term, and three times the staff in the long term. I don't know how we could simply tweak the process (indisc. - teleconference interference) and make small changes to the statute and accomplish that end." Number 0301 CHAIR JAMES asked Ms. Haley if she had any calculations, or averages of the time it takes to settle a claim from the time that you start the investigation. She said it seems like the commission does a little bit of process, and then you put them on a list. From the time that they're picked up off the list and to conclusion, do you have any average time limit - that length of time that takes. MS. HALEY stated she doesn't have an average, she could certainly provide it to the committee members from the day it's assigned. One of the reasons she doesn't carry that figure around in her head is that it is so varied, depending on the case, as she said some of them may be a couple of months. She said, "We had one instance where a case went on for better than two years in investigation because the respondent would not provide the documentation and would not respond to our lawful subpoena, and that kind of delay occurs with some regularity." CHAIR JAMES announced we've talked about that issue too, if we do anything with this bill, we probably need to address that. Number 0318 REPRESENTATIVE ELTON said if you have a caseload in the neighborhood of 500, but you get 5,000 calls, you're taking like one in ten cases. He indicated he was curious, if you have any sense on how many people don't pursue a claim with the commission simply because of the time line, simply because it's nine months before you even assign a case and then it takes longer after that. He asked is that a threshold that some people just don't want to bother with. MS. HALEY said she thinks that the commission believes anecdotally that some people in fact are choosing not to file with them now due to the delay. She indicated they don't have a significantly staggering statistical trend to say that in fact is true. But if the State Affairs Committee looked at their annual report we would see that their filings are in slight decline now, and it's too early for that decline to be due to their regulatory change to 180 days. Ms. Haley said, "So our guess is, that's given the population of Alaska's continuing to rise, and that we don't believe as much as we'd like that discrimination or employment concerns have gone away, that we're probably seeing that impact because neither side wants to wait. The commission staff doesn't want to delay it. It makes it harder to do our job." Number 0339 REPRESENTATIVE ELTON asked Ms. Haley how much time do you or members of your staff spend in training with employers so that it's not just an agency that is resolving conflicts, but is an agency that also tries to prevent conflicts. MS. HALEY said, "I think that that's an area that we see as we deal with sort of the emergency room of many many more complaints than in the past that does slip away from us. I'm the primary trainer, and as division director, I don't have the time to be away from the shop as often as people request my presence. I must say though that when we go out and educational seminars, I think they're really positive and people do learn what their rights and responsibilities are. But I also have to tell you that we generally see complaint filings go up if I've been in a community and I've been talking to people about their rights and responsibilities. While I am training managers and supervisors about the right thing, I'm also making employees aware of rights they might not have been aware of up until that point and we tend to see complaint filings go up in that area." Number 0361 REPRESENTATIVE DYSON said, "Paula, Representative Hodgins was kind of relentlessly I think pursuing a line of logic that I think kind of paints you into a trap, logically, and I think you kind of spoke to me about this a little bit on the phone. But indeed if, with your present whatever it is seven or nine investigators, you're gaining on the backlog, I don't think that you have made it clearer why you would need 24 investigators if the backlog was eliminated. I want to give you an opportunity to make that apparent discrepancy a little clearer or be more logical." MS. HALEY stressed the reason that there would be a difference is that this doesn't - were currently in a statute that says resolve promptly and we recognize we're not doing that. This bill says resolve from start to finish, from complaints to decision in 90 days. In order to do that, the commission couldn't simply look at how long it would take them to get rid of the backlog, they had to look at how many cases an investigator could handle, if an investigator had to investigate the case. The commission figured it would have to be done in 45 days maximum, or 40 days because, if they find substantial evidence of discrimination, it then has to go to the hearing unit, it has to be set for hearing, there has to be an opportunity for discovery, and aside from the due process concerns they would have employers that might not want to have to respond to their queries in five days or ten days. But aside from that, the Human Rights Commission figured they would have to dramatically reduce the caseload of their current staff so they could be on that particular case and moving it all of the time. That's why you see more staff attached to this particular bill. REPRESENTATIVE DYSON said he believes Ms. Haley is still not addressing the "logic problem." We, who are not involved in your work, perhaps ignorantly think that each investigative case is going to take the same amount of time to do the investigation, process the paper, appear at the hearings and so on regardless of what the time frame is. A case is going to take a certain amount of man-hours regardless of the deadlines on it. He indicated, from his perspective, that he has not yet heard her explain why. It must be that the number of hours each case would take would dramatically expand - if with the time deadline. He asked if he was making himself clear. Number 0400 MS. HALEY said she thinks she understands, but if she doesn't provide the information that clarifies it please ask again. She emphasized the difference is, under the Human Rights Commission's current system, they ask employers for information at the front end and they may or may not give it, it's permissive. Then as they go along and focus in on complainant witnesses, they also obtain information, they talk to respondent witnesses, they may put out a request for information and that would be a 30-day turnaround. Those procedures, as they know them, would have to go out the window. Because with 90 days you can't give people 30 days to reply, then review it, and maybe you have to ask them something else, and give them another ten days. You wouldn't have that, you would have to be on the phone to them all of the time, you would have to be following them, explaining why you need it quickly. You wouldn't be able to wait a week to call the second witness and work on another case, you'd have to call the second witness the next day or the next hour. So that would be the difference. MS. HALEY pointed out each investigator now has 40 cases, in fact they're closer to 50, and that drops back because they can't manage more than 50. If you had to process 40 cases in 90 days you just couldn't do it. You couldn't move 40 cases in 90 days. Ms. Haley said, "So they would probably be only carrying a handful of cases, definitely less than 10. I think it would probably be like 3 or 4, or 5 - in order to move those 4 or 5 cases in 90 days. Otherwise we would in effect continue with the concept of a damage cap and complainants - if we took too long would suffer had there been discrimination." Number 0432 REPRESENTATIVE DYSON said, "What I just heard you say was that because of the tighter time-frame, you'd have to be bugging people more often to get the information going. And are you saying then it's going to take three times as much staff because of the increased intensity of the bugging or nagging the folks to get their paperwork in." MS. HALEY replied in part she is saying that. She further explained, if you have a 90-day time-frame, you basically have to have that case with you at all times. You can't put the case down, you have to be moving it all the time, you can't put it aside and address something else, you can't put it aside and draft up a determination in another case. You have to work it, you just don't get a chance to exhale, you have to work them constantly. REPRESENTATIVE DYSON affirmed the commission loses a great deal of efficiency because they can't fill out their work day with other work because they have to stay right on top of it in order to meet the time frames. Number 0450 CHAIR JAMES said, "One of the things that - just kind of building on a question that I asked you, it isn't necessarily how much - you indicated didn't have any kind of an average length of time from the day that they're assigned. But it seems to me like, that what I've been hearing you testify now about the procedure that you have to go through the witness issue, all of those kinds of things, I could visualize what it is that you're doing. And it seems unreasonable to me that you wouldn't be able to provide, and maybe you said you would, an average." Chair James asked Ms. Haley what's the shortest time as an example that she's ever been able to solve a problem, what's the longest time, or what is the average time that it takes? She said, "Because it seems to me like, to be able to satisfy the requirement that is being requested here that whether we pass this bill or not there needs to be an answer when there's a public out there that is being damaged in some way, shape or form. And so we need to have those kinds of numbers to know what's reasonable." She indicated she hasn't heard that yet because of the backlog and because of the extra amount of cases that people are working on together. CHAIR JAMES referred to her private accounting business as an example. She said, "And I know myself, from my work, is that if I'm working on one account, and I don't do anything else but that account, I can get it done in a fairly short time because to continue to keep my mind on the account makes me more efficient. Every time I lay that account down and go to something else, when I come back to that one I have to refresh my mind all over again and I have to figure out now let's see, where did I leave off, and what did I do and where am I. And so, I know that there's a greater efficiency from taking something from the start to the finish. And I'm not advocating this, that's the way you need to do things, because I know that there are times when you can't get people on the phone and you can't get the information, and you're waiting for something, you need to go to something else. But, it seems to me like you could give us some numbers like what is a reasonable time to expect that once a claim is filed and it goes to be assigned, what is a normal length of time to anticipate to getting a response." Number 0483 MS. HALEY said she would be happy to provide the committee with their average, she can give it both from beginning to end and will also calculate it from assignment to end. She stated, "I will also though say with the caveat that the average time has gone up enormously because of the increase in the workload. But I think you are right, in fact we talk to the investigators all the time about this as a training tool. If you put a case down, for a very long time, and you go back to it, you do have to refresh your memory. So there is some value in a lower caseload per investigator and we recognize that and would like to work to that end. And so we have that in mind, but if you look at the 90 days, I think Madam Chairman, you mentioned something else that's key, if I'm asking someone to provide me with comparative personnel files, I don't think it's going to be fair to ask that 'mom and pop' employer to do that in 5 days. And these constraints would require me to really have staff put the pressure on the employer to turn things around immediately. They wouldn't be able to have their normal 30 days to provide information, and that is also a concern of mine in terms of its impact on business." Number 0503 FRANK ROSE, Alaska Lodging Management, President, testified on HB 468 via teleconference. He said, after listening to the discussion, he indicated he might be misunderstanding what the intent of this bill happens to be. He indicated he doesn't believe that there's an intent here, with what is being proposed, to get around or not go through proper due process to resolve complaints. He also said he doesn't believe that there's a limitation on the time-frame that the due process should take relative to resolving the complaint. Mr. Rose said he believes what the bill is being presented for is to provide a limitation on the liability that an employer might incur relative to back-wages. Due process can continue to go forward. MR. ROSE said some of the comments that he has heard today provide for, or have indicated that the employee would be unduly penalized because of the 90-day requirement. He stated, "I would say that both the employee and employer have great potential to be penalized because of the longevity of some of these cases that happen to arise or come up, or the liability associated with the back-wages. From an employer's standpoint, I understand that the employee certainly has a right to go out and search for other employment, and should they find other employment then the cumulation of back- wages would stop. But there is no guarantee. And I can tell you from a small businessman's perspective, the fact that a case could go on for two years, and if the employee does not get a job or (indisc.) of that even a $6.00 an hour employee could accumulate back-wages of $24,000 - $25,000 and that is without consideration of overtime and perhaps other issues or legal costs. By far the employer is going to look toward settlement of this thing regardless if they're at fault or not. I assume that most employers are going to think they're not at fault, but I can tell you that specific case that I was involved in, which is the one that Ms. Haley had indicated, I was quite sure I wasn't at fault, but there was no way that I could sit back and potentially incur the huge liabilities, rather it would be in my benefit to settle the case even though I felt strongly that I was in the right." MR. ROSE stated the 90-day requirement, or the 90-days liability limitation seems to be in line with what Ms. Haley indicates in that the average award has been between $3,000 and $4,000 as far as back-wages are concerned. He said he thinks that's what she said. That is a rate of $6.00 to $7.00 an hour, it would prove to be somewhere on the order of 3 months or 90 days back-wages or so. So that seems to be in line. Mr. Rose implied that 90 days is ample time for an employee, who has lost their job for whatever reason, to find another job and also provide incentive for that employee to look for another job. If it takes 465 days to process a claim, and all the resources are available, then perhaps that should be looked at as far as the procedure is concerned. It seems like an awful long time to come to a conclusion on a particular case. Number 0553 REPRESENTATIVE BERKOWITZ said, "Just sort of looking at this roughly, it seems to me there's three types of plaintiffs. There's those people, who perhaps have insufficient evidence to make their case, that have something that they can perceive as legitimate. There's those people who have legitimate complaints, and there's sort of the out and out extortion effort. And on the other side of the ledger you can have defendants who are innocent and those who are guilty." REPRESENTATIVE BERKOWITZ pointed out he has a concern with the 90- day limit on back-pay. He said it's not for those people who are trying to do extortion, but it's for those people who have legitimate complaints and they might be going against someone who's culpable. He said, "My experience has been culpable defendants tend to drag out the process much as possible. They'll 'heel-drag' when it comes time to providing discovery. They'll be unavailable. We heard testimony here that on occasion they don't comply with subpoenas. There's an incentive built in to stay out there longer than 90 days because that's the only cap you've got. And I appreciate that you're very scrupulous in what you do. What I'd ask you, if there was a less scrupulous employee who was culpable, can't you see the possibility for abuse with a 90-day scheme." Number 0568 MR. ROSE said his comment to that would be that, if deadlines are not met, relative to providing certain discovery materials or other information, he certainly feels that end employer should be held responsible for that. And perhaps there, again as we've heard today from Representative James, should be an addition or amendment to this proposed bill that would allow for that. He said, "What I am referring to is a situation where all information has been provided that has been requested by the Human Rights Commission, that information is in hand, and then there's still another two- years wait before we come to any conclusion on what the outcome of that case may be." He indicated that's where his concern lies. REPRESENTATIVE BERKOWITZ said, "And I agree wholeheartedly with that concern. I grew up in a small business so I understand how hamstrung you can get by even seemingly small issues of $10,000 or $20,000." Number 0580 CHAIR JAMES said, "If there was this time limit on and we heard testimony from the Human Rights Commission that many people do find another job and so therefore the amount, if they are to win their case is less, it would appear to me that those people who - that the Human Rights Commission might hurry up faster on those people that didn't have a job. And those people that did have a job, maybe there's no rush on them. There might be a different way of evaluating who's first on this issue. I don't necessarily know that the 90 days is a good number, but having a limit to me is interesting." CHAIR JAMES pointed out that she has experienced having someone file against her in the Human Rights Commission and she ended up home free, however, it was pretty shaky. And the reason wasn't because of what she or her staff did, it's what they didn't do. She said, "It was like a bookkeeping problem, and many cases are made on what you don't have in your files - not on what you did. And that's a part of the human rights law that is terribly distressing to me because, as an accountant for small business, I found I had some small business people who literally had to lock their door because they had made a good decision in letting someone go. And yet they didn't have all of the documents in their personnel file and those other things that they needed ... and they were just a small 'mom and pop' business. And that's, I think very very sad because this nation was build on 'mom and pops' in their backyard and in their garage. And I think we have made the laws so severe that those are some of the people who are also being penalized." Number 0609 KAREN ROGINA, Executive Director, Alaska Hotel and Motel Association, testified on HB 468 via teleconference. She said they are the number one employer of entry-level workers in the State of Alaska, and due to the transient nature of entry-level workers and the seasonality of their industry, issues of hiring and termination are of great interest to their membership. Ms. Rogina stated they are in support of the concept of having reasonable time limits on the time in which these cases can be resolved. She said they see it as a fairness issue to the employee and to the employer where timely resolution allows everyone to get on with things and take responsibility for their future. In the case of an employee, it provides more incentive to have them seek other employment instead of having drag out, and it places responsibility on the employer to provide the information and to avoid the situation in the first place. MS. ROGINA indicated their association receives a lot of questions from their members statewide, and the American Hotel and Motel Association spends a lot of time training employers on how to avoid these kinds of things. She said, "And so we see that this kind of bill would put a little more teeth into the whole resource issue and put it where it belongs in terms of educating employers on how to avoid these claims in the first place, and also perhaps additional investigators so that timely resolution can occur." CHAIR JAMES said she was glad that Ms. Rogina mentioned the education process because there is a great learning curve for people who are employers. She said she believes the Hotel and Motel Association is not only the biggest hiring of entry-level people but they also have the biggest hiring of various ethnic groups and so forth, so they're the most vulnerable for these kinds of discrimination cases to come forward. Chair James urged Ms. Rogina to continue her education process with her employers so they know just exactly what is required of them to be able to substantiate whatever decision that they make. CHAIR JAMES announced HB 468 will be held in the House State Affairs Standing Committee for further discussion.
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