Court OKs Health-Care Referendum

Times Staff Writer

In a victory for employers and a setback for organized labor, physicians and others, a state appeals court cleared the way Thursday for Californians to vote in November on a proposed referendum that would roll back a new law requiring employers to purchase health insurance for uninsured workers.

The 1st District Court of Appeal found that a Sacramento County Superior Court judge had been wrong when he ruled last month that the title and summary statement on referendum petitions contained “misleading and prejudicial” information and that the petitions themselves were technically flawed.

Rejecting arguments of referendum proponents, the San Francisco-based court said the attorney general’s title and summary of the measure can be “reasonably read to accurately describe the ‘chief purposes and points’ ” of the controversial new law.


The court also said the failure to print the short title of the measure on each petition page after the first was “not confusing or misleading” because it was apparent that the text was a continuation of the first page, which listed the short title.

Originally, employers backing the referendum wanted to put it on the March 2 ballot. But the appeals court said that by the time it had received all the judicial documents for the case, the deadline to print ballots for March had passed. Instead, it cleared the issue to appear on the November ballot.

Sara Lee, a spokeswoman for the California Chamber of Commerce, said opponents of the new law were thrilled at the ruling. She said executives believe voters will approve the referendum when they fully understand the adverse effect the law will have on “jobs and the economy.”

The referendum opposes a law that grew out of SB2, a bill by state Senate President Pro Tem John L. Burton of San Francisco and Sen. Jackie Speier (D-Hillsborough). The law requires large employers, starting in 2006, to purchase health insurance for uninsured workers and their families. Employers of 20 to 49 workers would provide the insurance for workers only in the next year, if the state has enough extra cash to provide a subsidy.

Burton said it had not been decided whether the ruling would be appealed to the state Supreme Court.

The bill, signed by former Gov. Gray Davis last fall during his campaign against a recall, was vigorously opposed in the Legislature by major employer organizations, which said businesses could not afford the extra cost. The referendum campaign is being financed by such organizations as McDonalds, Macy’s and Wal-Mart.


Beth Capell of Health Access, a backer of the new law, said the referendum would not only knock down the law but open the way for such corporations to “deprive working Californians” of current health insurance protections.

Art Pulasky, secretary-treasurer of the California Labor Federation, AFL-CIO, expressed disappointment at the ruling, saying it flew in the face of a new public opinion poll indicating that 65% of Californians favor such a law.