2023-104 The California Labor Commissioner’s Office

Audit Recommendations Disclosure

When an audit is completed and a report is issued, auditees must provide the State Auditor with information regarding their progress in implementing recommendations from our reports at three intervals from the release of the report: 60 days, six months, and one year. Additionally, Senate Bill 1452 (Chapter 452, Statutes of 2006), requires auditees who have not implemented recommendations after one year, to report to us and to the Legislature why they have not implemented them or to state when they intend to implement them. Below, is a listing of each recommendation the State Auditor made in the report referenced and a link to the most recent response from the auditee addressing their progress in implementing the recommendation and the State Auditor’s assessment of auditee’s response based on our review of the supporting documentation.

Recommendation 3

Require all staff to use the existing fields in the case management system to capture the date they determine whether a hearing is needed so that staff can track and monitor compliance with the 30‑day statutory requirement for making such a determination and notifying the parties of whether a claim will be referred to a hearing.

Recommendation 4

Require all staff to consistently enter the date that claims are referred to the Enforcement Unit.

Recommendation 5

Modify the case management system to properly identify and capture all settlement conference dates to ensure that multiple records are not created when a claim has multiple conferences and to allow tracking and monitoring of conferences and hearings independently.

Recommendation 6

Work with DIR to ensure that its process improvement initiative to redesign the case management system is completed in a timely manner and that the necessary staffing levels at the LCO headquarters and each field office exist to ensure that these initiatives have appropriate levels of support and supervisory oversight.

Recommendation 7

Develop and implement a regular review process for supervisory staff so that they ensure that staff have entered all necessary data, including dates, accurately.

Recommendation 8

To improve employee retention and to reduce the number of vacancies, the LCO should identify by December 2024 whether it will need any additional analyses of employee salaries following the completion of the classification and compensation studies. (9) If so, the LCO should prepare and execute a plan for conducting such analyses and, if appropriate, request salary increases for relevant positions from CalHR as soon as possible.

Recommendation 9

If so, the LCO should prepare and execute a plan for conducting such analyses and, if appropriate, request salary increases for relevant positions from CalHR as soon as possible.

Recommendation 10

Reduce the number of positions it includes in a single recruitment so that the interview process can be completed in a timely manner.

Recommendation 11

Work with DIR to improve its applicant screening criteria so that candidates selected for a position are more likely to meet the minimum qualifications for the position.

Recommendation 12

To the extent possible, re‑use duty statements, interview questions, and other hiring documentation that DIR has already approved to avoid delays in approvals for the various stages of the hiring process.

Recommendation 13

To adequately identify the staffing levels necessary to resolve both newly filed and backlogged claims, the LCO should perform a workload assessment by December 2024 that includes the following:

• Using the alternative methods for determining whether a hearing is to be held, identify for each position the number of staff needed to address the backlog of claims. This assessment should take into account any new claims the LCO expects to receive during a year, extrapolating from historical data and the statutory time frames required for each stage of claim processing.
• Identifying the number and type of supervisors required to support and oversee field office staff and operations.

Recommendation 14

If the LCO believes that it cannot meet the required time frames for certain claims because of their complexity, the LCO should assess the extent to which it cannot meet statutory time frames. It should then work with the Legislature to revise claim processing time frames accordingly.

Recommendation 15

To the extent budgetarily feasible and to ensure that it has the staffing necessary to process all claims within the statutory time frames, the LCO should fill all vacant positions at field offices for the Adjudication Unit. It should then request additional staff according to the results of its workload assessment.

Recommendation 16

To ensure that all field office supervisors manage the office’s workload in an effective and efficient manner, the LCO should develop procedures by December 2024 for monitoring whether field office supervisors are assigning claims in a timely and appropriate manner.

Recommendation 17

By November 2024, centralize the tracking and retention of all training records.

Recommendation 18

By November 2024, develop procedures for regularly reviewing all training records to ensure that all staff are meeting training standards.

Recommendation 19

By May 2025, ensure that its training unit has adequate number of staff dedicated to training only.

Recommendation 20

To ensure that it has complete and accurate data to measure the effectiveness of its Enforcement Unit, the LCO should ensure by May 2025 that its Adjudication Unit’s case management system captures the closure date of claims referred to the Enforcement Unit for which full payment has been collected.

Recommendation 21

By July 2024, develop operating procedures for Enforcement Unit staff, outlining how to determine appropriate judgment collection methods to use for a claim and requiring supervisors to ensure that staff implement all applicable methods.

Recommendation 22

By November 2024, determine whether certain collection methods similar to the mechanic’s lien allowed in the construction industry would be helpful in increasing judgement collection. If so, it should develop and present a proposal to the Legislature that would allow the use of such methods.