This chapter shall be known, and may be cited, as the 32-hour Workweek Pilot Program.

The Legislature finds and declares that the intent of this program is all of the following:

(a)To encourage employers to institute a 32-hour workweek.

(b)To provide grants to employers to be used to develop and administer a 32-hour workweek for its employees.

(c)To study and gather information on the impact of 32-hour workweeks.

The 32-hour Workweek Pilot Program is hereby established, under the administration of the Department of Industrial Relations, to provide grants to employers for the purposes of administering pilot programs that provide each employee the option to work a 32-hour workweek.

For purposes of this chapter, all of the following shall apply:

(a)“Applicant” means an employer who applies to participate in the 32-hour Workweek Pilot Program.

(b)“Department” means the Department of Industrial Relations.

(c)“Employer” means any person, as defined by Section 18, who employs five or more employees.

(d)“Pilot program” means the 32-hour Workweek Pilot Program established under this chapter.

(e)“Workweek” and “week” have the same meaning as in Section 500.

An employer may apply to the department for a grant in a form and manner prescribed by the department. The application shall include all of the following:

(a)A 12-month plan for a 32-hour workweek. At a minimum, this plan shall include all of the following:

(1)Description of the applicant’s plan to transition employees to 32-hour workweek.

(2)Detail of any resources needed.

(3)Number of employees transitioning to a 32-hour workweek.

(4)Salary range for these employees, including whether they are paid hourly or paid a salary.

(5)Proposed work schedule for the employees transitioning to a 32-hour workweek.

(6)To the extent authorized by law, demographics of the employees transitioning to a 32-hour workweek.

(b)The amount of money the applicant is requesting as a grant and an explanation of what that money will be used for.

(c)A description on how the applicant intends to collect information on the following:

(1)Employee and employer satisfaction with the pilot program.

(2)Revenue changes.

(3)Customer satisfaction.

(4)Employee productivity.

(d)A statement affirming that the applicant’s participation in the pilot program will not result in a loss of pay or benefits for any employee. This subdivision shall not apply to an employer that is party to a collective bargaining agreement with provisions in conflict with the requirements of this subdivision.

(e)Information confirming that the applicant did not have a prior plan to transition its employees from a 40-hour workweek to a 32-hour workweek prior to applying for the pilot program.

(a)Upon receipt of a grant, an employer shall implement the program within 90 calendars days.

(b)Grant money awarded under the pilot program shall be used by an employer for the limited purpose of developing and administering a 32-hour workweek for its employees.

(c)Within the first six months, and upon the completion of the pilot program, the employer shall evaluate the impact of the pilot program on employer and employee satisfaction, and shall provide that evaluation to the department.

(d)Employers shall provide any additional information requested by the department as necessary for the department’s evaluation of the pilot program and preparation of the report pursuant to Section 908.

(e)An employer that receives a grant may apply to renew the grant annually in a form and manner prescribed by the department until funds appropriated to the program are exhausted.

(a)In administering the program, the department shall do all of the following:

(1)Develop criteria to evaluate the applications and annual renewals for eligible applicants beginning on March 1, 2024.

(2)Accept applications for the pilot program.

(3)Review, and approve, disapprove, or conditionally approve, applications and annual renewals on a quarterly basis, beginning July 1, 2024, until the appropriated funds are exhausted.

(b)When awarding grants, the department shall prioritize funding to applicants who are transitioning hourly employees to 32-hour workweeks.

(c)The department may establish an appropriate method, process, and structure for grant management, fiscal accountability, payments to applicants to ensure transparency, and accountability in the use of state funds.

(d)The department may audit and request additional information from the applicants to ensure the grants provided to employers pursuant to this section are used to develop and administer a 32-hour workweek for its employees.

(e)The department may adopt regulations to implement this chapter. The adoption, amendment, repeal, or readoption of a regulation authorized by this section is deemed to address an emergency, for purposes of Sections 11346.1 and 11349.6 of the Government Code, and the department is hereby exempted for this purpose from the requirements of subdivision (b) of Section 11346.1 of the Government Code. For purposes of subdivision (e) of Section 11346.1 of the Government Code, the 180-day period, as applicable to the effective period of an emergency regulatory action and submission of specified materials to the Office of Administrative Law, is hereby extended to 240 days.

(a)(1)Upon appropriation by the Legislature, the Controller shall transfer the appropriated sum to the 32-hour Workweek Pilot Program Fund, which is hereby created in the State Treasury and, notwithstanding Section 13340 of the Government Code, is continuously appropriated without regard to fiscal years to the department for purposes of this chapter.

(b)The department may recover reimbursement for the costs to administer the grant program from the fund. The reimbursement shall be capped at 10 percent of the aggregate grant amount awarded in that fiscal year.

(a)The department shall submit a report to the Legislature on or before January 1, 2028, on the 32-hour Workweek Pilot Program, and shall include all of the following:

(1)Number of employers that have instituted a 32-hour workweek.

(2)Number of employees participating in the program.

(3)Type of industries that have instituted a 32-hour workweek.

(4)Any findings and recommendations, including its recommendation on expanding the pilot program on a statewide basis or for an extended period of time.

(b)The report shall be submitted in compliance with Section 9795 of the Government Code.

(a)This chapter shall become operative upon appropriation by the Legislature to the fund established in Section 907.

(b)This chapter shall remain in effect only until January 1, 2029, and as of that date is repealed.