How Julie Su’s successes and setbacks in California shape her contentious nomination for Labor secretary
In the eyes of Julie Su’s supporters, President Biden’s pick to be the next Labor secretary personifies the promise of California: a daughter of immigrants who made groundbreaking advances in protecting workers’ rights.
Her detractors also paint Su as an embodiment of California. In their telling, though, she would replicate what they describe as the state’s overregulation of business, bloated bureaucracy and coziness with organized labor on a national level.
The increasingly contentious Senate confirmation, which begins Thursday, mirrors many of the partisan fights in Washington, with the fate hinging on votes of a few conservative Democrats. But underlying that battle is a referendum on California itself and the unique place it holds in the national psyche, a state that is at once a liberal beacon and conservative bogeyman.
Her supporters see Su’s California roots as a selling point about her expertise and readiness for the job.
“California is the big game,” said Roy Bahat, head of Bloomberg Beta, an early-stage venture firm, who worked with Su on the Newsom administration’s Future of Work Commission. “If you can do it in a state like California, chances are you’re able to succeed on the national stage too.”
Her detractors, meanwhile, say the state’s errors in doling out pandemic unemployment benefits, which included cases of fraud and fell under her purview, call into question her fitness for the role. Others say a much-contested labor policy in the state, which she helped implement, raises the specter of a creeping California-zation into the rest of the country.
Julie Su, who oversaw California unemployment agency amid fraud wave, nominated U.S. Labor secretary
Julie Su is poised to become the first Asian American member of Biden’s Cabinet, but the former California labor chief has faced criticism in her home state.
Rep. Kevin Kiley (R-Rocklin) at a Sacramento news conference last month described Biden’s pick as “his most consequential move yet towards bringing the policies, politics and personnel of Sacramento to Washington, D.C., towards making California’s problems the nation’s problems.”
Su faces a rocky path to confirmation, as Republicans construct a solid bloc of opposition and several Democratic senators remain uncommitted, such as Sens. Jon Tester of Montana and Joe Manchin III of West Virginia. The labor movement has declared her nomination to be a top priority, along with immigrant rights advocates and Asian American organizations. Su, if confirmed, would be the sole Asian American serving in Biden’s Cabinet.
“Her qualifications and track record show that any doubts about her ability to get the job done are unfounded. And stalling a history-making nominee who’s ready to hit the ground running and work with all sides would hurt our economy,” said a White House official, adding that the administration is “confident about Julie’s confirmation process.”
Su, 54, grew up in the Los Angeles area, the oldest daughter of Chinese immigrant parents who struggled economically for most of her childhood before climbing into the middle class. She graduated from Stanford University and Harvard Law School, then returned to Southern California at the Asian Pacific American Legal Center — now known as Asian Americans Advancing Justice Southern California — a civil rights organization.
“Her story of having that immigrant background just stuck with her,” said Bonnie Tang, who worked as a fellow attorney at the legal center. “It gave her a huge heart for immigrants as well as low-wage workers.”
Just a year out of law school, Su took on the case of 72 Thai garment workers who were detained by immigration authorities after a raid had found them being kept as slaves in an El Monte sweatshop. Su helped negotiate their release and then led a civil lawsuit to help the workers recoup $4 million in back wages.
It is with nostalgia that Julie Su recalls her only arrest back in 1989.
Kent Wong, director of the UCLA Labor Center, called the litigation “path-breaking [for] going after not only the sweatshop owners and contractors who were on the front lines of exploitation, but demanding accountability from retailers and wholesalers who were involved in the production chain.”
The novel legal strategy led to a state law that made retailers and garment manufacturers legally liable if workers at their contractors’ facilities did not receive minimum wage and overtime pay.
The anti-sweatshop work won her international recognition, a visit to the White House and an award fellowship from the MacArthur Foundation, commonly known as a “genius grant.”
Su entered government service in 2011 when Gov. Jerry Brown appointed her labor commissioner, the state’s chief enforcer of wage and other labor laws. She prioritized cracking down on wage theft, launching a “wage theft is a crime” public education campaign and swapping out random raids on businesses for targeted investigations into employers who committed infractions such as paying less than minimum wage or not allowing employees to take meal breaks.
Though she didn’t come out of organized labor, Su was championed by California union leaders, some of whom dropped her name as a worthy Labor secretary pick for Hillary Clinton had Clinton won the 2016 presidential election.
Typically, an official embraced by organized labor would face chillier relationships with employers. But business leaders in California said Su was accessible and receptive, both as labor commissioner and then as state Labor secretary in Gov. Gavin Newsom’s administration.
“From the moment I met in her office, there was openness of communication — ‘Call at any time, email at any time,’” said Lance Hastings, president of the California Manufacturers and Technology Assn.
Su was appointed state Labor secretary in January 2019. The job oversees administering unemployment benefits, labor law and workplace safety enforcement, jobs training programs and, in a new initiative started by Newsom, a Future of Work Commission to make long-term plans for a changing jobs market.
Her tenure was upended by COVID-19, when the statewide shutdown in the pandemic’s early days threatened to decimate California’s economy.
Most of the money will be turned over to the U.S. government because the claims went through a federal pandemic assistance program, state officials said.
The first week after restrictions went into place, recalled Lenny Mendonca, Newsom’s chief economic and business advisor at the time, “when they announced the unemployment claims to the team, there was a gasp. It was a year’s worth of claims in a week.”
“There is no organization in the world that could withstand that magnitude of change so quickly,” he said.
Su became the face of the administration’s struggles responding to out-of-work Californians who reported endless telephone hold times for the Employment Development Department, which fell under her purview, and weeks, if not months, of unresolved claims. The response was hobbled by antiquated technology that was overdue for an update.
The department’s woes worsened when a state audit found that at least $10 billion in claims paid by the state were fraudulent (that figure later grew to at least $20 billion). Among the improper claims were some filed under names of California prison inmates, including convicted murderer Scott Peterson.
“There is no sugarcoating the reality,” Su said in response to the audit. “California did not have enough security measures in place.”
Though California, the nation’s most populous state, reported the highest amount of fraud, the problem existed throughout the country. A pandemic oversight report by the federal government estimates at least $60 billion in fraud from the 22 states that reported such figures.
Her opponents say the fraud that occurred under her watch should be disqualifying.
“She has a record of incompetence in the role she had here in California,” said Assembly Republican Leader James Gallagher of Yuba City. “You don’t give someone who has not done well for employers or employees a promotion.”
The Flex Assn. asked that the nominee, Julie Su, explain how she would implement a proposed rule that could make it easier for workers to be considered employees rather than independent contractors.
Others rallying against Su’s confirmation are linking her to AB 5, a controversial labor law passed in 2018 that limited the use of independent contractors. The measure, building off a ruling by the California Supreme Court a year prior, reclassified a large swath of workers as employees, making them eligible for stricter labor protections and compensation such as overtime pay.
The measure was strongly promoted by labor groups, who saw more opportunities for unionizing workers. Vocal opponents included ride-hailing companies such as Uber and Lyft, freelancers and other industries such as trucking, where drivers were commonly classified as independent contractors.
“It is an all-out assault, in our opinion, on a very vital component of our workforce,” said Chris Spear, head of the American Trucking Assn.
“We feel she should atone for the time she spent shaping those policies,” he added.
Those involved with the crafting of AB 5 say Su’s opponents are overstating her involvement.
“She was not involved with the bill at all,” said Lorena Gonzalez, who carried the measure in the Assembly and now leads the California Labor Federation. She said Su and other officials in Newsom’s administration engaged only very late in the legislative process to weigh in on implementation and technical assistance.
In 2021, Biden nominated Su to be deputy secretary of Labor, serving as No. 2 to Marty Walsh, the former mayor of Boston. She was confirmed by a 50-47 vote, a far narrower margin than Walsh’s confirmation vote. The lingering controversy around AB 5 was an oft-cited reason for opposition, as was a subtext of disapproval of California itself.
“California is not a model to emulate for the rest of the country,” said then-Sen. Richard M. Burr (R-N.C.) in 2021, who had voted for Walsh but against Su. Now that Walsh has departed to lead the National Hockey League players union and Biden has tapped Su to replace him, similar themes are surfacing.
“Longtime locals often tell incoming refugees, ‘Don’t California my Arizona,’” wrote one opinion columnist in the Arizona Republic. “Seeing Su’s money-wasting, job-killing track record, taxpayers should expand that to ‘Don’t California my America.’”
Angie Wei, formerly a top lobbyist for the California Labor Federation and an aide to Newsom, said the use of California as a cudgel isn’t surprising in this political moment.
“It’s a microcosm of where we are in this country,” said Wei, who is a close friend of Su’s. “Some celebrate our fight for diverse communities, our fight for and defense of the most vulnerable among us. And some hate that.”
An array of industry groups, including the International Franchise Assn. and the National Restaurant Assn., are leading the opposition to Su. One notable business group, the U.S. Chamber of Commerce, has not taken a position on her nomination. And a number of employer groups, particularly those based in California, have been active supporters.
“I feel like we have the real story about who she is and what she can bring to the table when it comes to having a conversation with employers, with business leaders,” said Maria Salinas, president and CEO of the Los Angeles Area Chamber of Commerce.
John Arensmeyer, founder of the Small Business Majority, said reducing Su’s nomination to a battle of business versus labor misses the mark.
“Of course she comes out of the labor world — she’s nominated to be Labor secretary; that’s not surprising,” Arensmeyer said. “There’s not this dichotomy, a zero-sum game between employers and employees. There’s a lot of issues we can collaborate with her on.”
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