SENATE BILL NO. 132 "An Act relating to complaints filed with, investigations, hearings, and orders of, and the interest rate on awards of the State Commission for Human Rights; making conforming amendments; and providing for an effective date." Representative Foster MOVED to ADOPT Work Draft 24- GS1110\Y, Kane, 4/17/06. Representative Kertulla OBJECTED to allow time to review upcoming amendments. Following brief discussion, it was determined that amendments could be addressed subsequently, and she REMOVED HER OBJECTION. There being NO OBJECTIONS, the Committee Substitute was ADOPTED. RANDY RUARO, LEGISLATIVE LIAISON, DEPARTMENT OF LAW testified regarding the Y Version of the bill. He explained that this version maintained changes made the House Judiciary Committee, with the exception of two amendments which had been made by Representative Gara: 1) to place a statute of limitations for filing claims with the Commission into statute and extend the limit from 180 days to a year and 2) to allow for an award of full attorney's fees in court cases where a plaintiff prevailed on a claim of discrimination. These two amendments were dropped from the bill. One of the more important changes was to give the Executive Director of the Commission the ability to decide when to go forward with a case. He explained that currently, the Commission was required to proceed on all cases with substantial evidence of discrimination. The bill allows the Director to look at an employer's defenses and decide whether or not to proceed. The passage of the Y version would also zero out the fiscal note, since the two positions necessitated by the amendments were no longer necessary. He pointed out that the Committee would need to adopt Fiscal Note #3, a previously published zero fiscal note. 9:34:57 AM Representative Kerttula clarified that the Judiciary Committee version originally contained the statute of limitations extension and allowed for attorney's fees. 9:35:15 AM Representative Stoltze opened the floor to public testimony. COMMISSIONER MERKES, HUMAN RIGHTS COMMISSION, testified via teleconference. She commented on the amendments which had been deleted. She stated that the Commission believed the 365 statute of limitations had been too long a period, and that 180 days was sufficient. She also noted that they would like to keep this out of statute and in regulations. Regarding the awarding of attorney's fees, she stated that the Commission did not believe that this bill was the proper vehicle to carry this provision. 9:37:32 AM Co-Chair Meyer closed public testimony. Representative Kerttula MOVED Amendment #1, 24-GS1110\Y.2, Kane, 4/19/06. Co-Chair Meyer OBJECTED. Representative Kertulla explained that the Amendment would allow one year within which a plaintiff could file a complaint, as opposed to 180 days currently in regulation. This was the amendment originally added in the House Judiciary Committee and then dropped in the current Committee Substitute. She conceded that this might result in new cases for the Human Rights Commission. Mr. Ruaro pointed out opposition to the amendment. He stated that the Commission has handled the statute of limitations for 43 years, and would like to maintain that control. 32 out of 46 states with a Human Rights Commission utilize the 180-day standard. Also, he stressed that the public had not indicated by testimony that this time was too short. Most cases are against employers, many of them small businesses, and 70 percent of the cases were dismissed for lack of evidence, after having incurred time and expense for these employers to defend themselves. He noted that more employers would then have to go through this process and expense. He added that the State Chamber opposes the amendment. Representative Joule asked if by regulation the Commission can currently choose to hear a case that is past the statue of limitations. Mr. Ruaro responded that the Commission has statutory authority to set the time period for filing a claim. The time limit has been set at 180 days, meaning that they could not arbitrarily hear a case that was past this time period. By putting the limitation into statute, as opposed to regulations, the Commission could no longer change the limitation except through the legislative process. 9:42:50 AM Representative Joule asked whether the caseload prevents hearing of current cases. Mr. Ruaro noted that there was some backlog, but not inordinate. Commissioner Merkes stated that the backlog was extensive, at nearly 100 cases, and that these take up to eight months to process. Representative Joule asked about the reason for the backlog. Commissioner Merkes noted that by the time the backlog was caught up, much of the information was outdated. She noted that in the new budget two additional staff positions were requested. She pointed out that with the 365 days limit, intake cases would be increased by approximately 125 cases. STEVE KOTEFF, HUMAN RIGHTS COMMISSION, testified via teleconference. Responding to a follow up question by Representative Joule, Mr. Koteff stated that the Commission reviewed cases in the order in which they were filed. He also noted that at times cases might be taken out of order, if violence or an egregious nature warranted it. 9:45:58 AM Representative Joule observed that if the amendment was put in place, the waiting list would increase. Mr. Koteff confirmed that this would increase the backlog of cases. He pointed out the fiscal note that included more personnel to handle the backlog were the amendment adopted. 9:46:45 AM Representative Kerttula maintained that the bill gave a basis to dismiss cases more expediently, based upon the evidence available. She proposed that this would help to clean up a backlog and offset any waiting list. Mr. Koteff commented that the discretion of the bill leaned more toward cases with substantial evidence. He indicated that presently the law read that a complainant had an absolute right to a hearing. The Commission would then decide whether it was appropriate to go forward. He observed that it would not change the backlog of cases waiting to be investigated. He noted that it would be arbitrary for the staff to dismiss cases prior to investigation. 9:48:51 AM Representative Kerttula asked if there was a regulatory ability to go immediately to the Director if evidence was not available from the onset. Mr. Koteff noted that there was a screening process, but not a regulatory discretion to which she referred. Once a complaint is filed, the Commission has a mediation program to handle cases more quickly. As for evaluation of evidence, statute mandates that every case be investigated thoroughly. The standard of substantial evidence was not so high as to make determination difficult. Some cases are resolved more easily without as much evidence. He explained that sometimes discrimination is not immediately apparent. 9:51:42 AM Representative Kerttula also asked how many cases were turned down after the 180-day limitation, and whether any were pre-screened. Mr. Koteff did not have these figures. He stated that the Commission established a regulation for the time for filing of 180 days. The time for filing has always been in regulation but not always the same time; it was previously 300 days, changed due to resources available. It was believed that the 180 days were adequate. Although he conceded that perhaps some cases had not been filed, he stated that it was difficult to quantify the number of cases that were not investigated past the time limit. He added that Alaskans could be referred to the federal Equal Employment Opportunity Commission (EEOC) whose limit was 300 days to file. This occurred when employers employ 15 people or more. Responding to a follow up by Representative Kerttula, Mr. Koteff conceded that there were valid cases that had exceeded the 180 time limit, and stated that in those cases they were usually referred to the EEOC. Since those cases were presented just through recitation of facts by a potential complainant, they could not evaluate evidence without benefit of a full investigation. 9:55:13 AM Representative Kerttula observed that the main problem was adequate staffing to handle the number of cases, and not the length of the timeline. She proposed that 180 days was too short a timeline. 9:55:53 AM Representative Joule concurred that the resources of personnel seemed to be the main issue of operating the Commission. But he proposed that expanding the time would not solve this issue. He maintained that unless the resources were granted, changing the timeline might be counterproductive. Representative Kerttula WITHRDREW Amendment #1. 9:57:17 AM Representative Kerttula MOVED Amendment #2. Representative Kelly OBJECTED. Representative Kerttula explained the amendment. She proposed that since the Commission might not be able to quickly investigate cases, a complainant could approach a private attorney with the case, and if the case proved successful, they could recoup the attorney's fees. She added that there would also be a denial if the case was proven frivolous, causing the complainant to be liable for attorney's fees. She noted that the Judiciary Committee had worked on this approach, and suggested that the Committee ought to defer to their work. 9:59:01 AM Mr. Ruaro stated that the Commission opposed Amendment #2. He pointed out that no one from the public had come forward to request the Amendment. He also proposed that if the amendment were passed, employers would receive demand letters from plaintiff's attorneys, threatening them with the payment of legal fees unless they made amends. 10:00:16 AM Representative Kerttula maintained that such threatening behavior was not tolerated by the Bar Association, and noted that it was unethical. She also noted that lawyers often did not take these kinds of cases, since they were difficult and represented small fees. She expressed her belief that not to prosecute these kinds of cases was not good for society. She proposed that this was one method of ensuring that people with these complaints received justice. She expressed openness to working with the industry and the Department of Law to streamline the amendment and make it more successful on the Floor. 10:02:26 AM Representative Stoltze referred to his history as a legislator, and frustrations he experienced in advocating for small businesses in his district when dealing with this kind of process. He suggested that there were protections in our society for individuals, and that businesses also needed protections. He proposed that there were two sides to the issue. 10:04:56 AM Representative Joule discussed his experience as being discriminated against for height in trying to become a State Trooper. He stated that at the time, he was unaware of avenues through which he could pursue a claim of discrimination. 10:05:40 AM Representative Kerttula acknowledged that small businesses had a difficult time dealing with these issues and committed to advocating for them as well. Mr. Ruaro noted that the cost of discrimination claims were not typically covered by the insurance of small businesses, and that attorney fees would come from their pocket. A ROLL CALL VOTE was taken on Amendment #2. In Favor: Kertulla; Joule Opposed: Stoltze; Foster; Holm; Kelly; Chenault Amendment #2 FAILED on a vote of 5 to 2. Representative Chenault pointed out the two zero fiscal notes, previously prepared prior to the amendments, from the Office of the Governor, Commissions and the Department of Law. Representative Foster MOVED to REPORT SB 132 out of Committee with two zero fiscal notes (#3, OOG; #4 LAW) and individual recommendations. There being NO OBJECTIONS it was so ordered. CSSB132 (FIN) was REPORTED OUT of Committee with two previously published zero fiscal notes (#3, OOG; #4, LAW) and No Recommendation.