In a move that could redefine public sector work dynamics in California, Governor Gavin Newsom’s administration has taken decisive steps to bring state employees back to the office. This decision, underscored by a recent arbitration ruling, has overridden previous union-negotiated contracts that allowed for teleworking—highlighting the complexities of post-pandemic workforce management.
The heart of this change lies in an arbitration decision involving the California Public Employees’ Retirement System (CalPERS) and the California Attorneys, Administrative Law Judges, and Hearing Officers in State Employment (CASE) union. The arbitrator ruled that state agencies could mandate office attendance despite existing contract clauses favoring telework, citing “operational needs” as a sufficient counter to telework requests, according to a report in CalMatters.
This ruling came at a crucial time as the Newsom administration aims to normalize office attendance among state workers. The administration’s drive includes a plan, revealed in a January budget proposal, to cut $51 million by eliminating telework stipends introduced during the COVID-19 pandemic. This was followed by an April directive mandating state employees to work from the office at least two days a week starting next month.
The arbitration focused on a March 2022 directive by CalPERS, which required employees to work from the office three days a week. While CalPERS leaders, including General Counsel Mathew Jacobs, argued that in-office work was essential for maintaining organizational culture and addressing performance issues, many attorneys preferred the flexibility of working from home, claiming it did not affect their productivity.
The shift led to a significant increase in turnover at CalPERS, suggesting dissatisfaction with the new policy. As vacancies rose, CalPERS was compelled to outsource some of its legal work to the Department of Justice, which continued to allow teleworking for its attorneys at a rate of $220 an hour.
Despite these challenges, Arbitrator Katherine Thomson sided with CalPERS executives, ruling that the operational needs justified the office attendance requirement, particularly to enhance communication among staff.
This decision does not exist in isolation. Timothy O’Connor, President of CASE, noted that the union is actively contesting return-to-office mandates through other grievances, indicating that the conflict over telework policies is far from over. Additionally, other unions, including the sizable SEIU Local 1000, are gearing up to challenge the Newsom administration’s order.
As state workers navigate these changes, the balance between operational efficiency and employee satisfaction remains precarious. The outcome of these disputes will likely set significant precedents for how public agencies manage their workforce in the post-pandemic era, making this an important issue to watch for both public sector employees and policymakers in California and beyond.
