The union has until June 25, 2026, to voluntarily withdraw its initiative. If it doesn’t, the California secretary of state will certify it as qualified for the November ballot on that date. A person familiar with SEIU-UHW’s position said the union would pull the measure if Newsom could push a 2% version through the state legislature and sign it into law before that deadline.
What’s behind the urgency
The SEIU-UHW has framed the tax as an emergency response to the federal funding cuts signed into law under President Trump’s administration, which the union estimates will strip roughly $100 billion from California’s healthcare system over five years. The initiative was designed to fund Medi-Cal, California’s Medicaid program, as well as food assistance and public education.
A 2025 policy brief from the UC Berkeley Labor Center on Medicaid job loss projections found that California could lose between 109,000 and 217,000 jobs if federal Medi-Cal funding is cut by $10 billion to $20 billion annually. Approximately two-thirds of those losses would hit healthcare directly, including hospitals, nursing homes, clinics, and home care providers, with the remaining third cascading into auxiliary industries that supply and support the healthcare sector.
For HR leaders in California managing large workforces, particularly in healthcare, hospitality, food service, or any sector with significant Medi-Cal-covered employees, the ripple effects of either an unresolved funding gap or the instability of a prolonged ballot battle have direct implications for benefits strategy, workforce planning, and employee retention.
A labor movement divided
What makes the current environment especially complicated is that California’s labor movement is no longer speaking with one voice. The California Teachers Association, Planned Parenthood Affiliates of California, and the California Medical Association, which represents more than 50,000 physicians, have all aligned against the tax. So has Newsom and Xavier Becerra, who led this month’s open primary and is widely seen as a likely successor to the governorship.