Information contained in this publication is intended for informational purposes only and does not constitute legal advice or opinion, nor is it a substitute for the professional judgment of an attorney.
Call it “Fast and Furious – The Sacramento Version.”
We are now in the last two weeks of the 2013 California legislative session. August 30 was the formal deadline for any bills to be acted upon to clear the fiscal committees of either house this session. From here on out, according to the legislative calendar, there will be floor sessions only -- no committee, other than conference committees and the Rules Committee, may meet for any purpose. And Friday, September 6, is the last day to amend a bill on the floor – again, according to the legislative calendars. But be alert for the notorious “gut-and-amend” bills in these final weeks.
The following outlines major California legislative developments as of August 30, 2013, as well as a summary of significant pending bills affecting California private sector employers.
Major Recent Developments
- The current version of the minimum wage bill (AB 10) would increase California’s minimum wage by 25% over a five-year period. The bill was passed out of the Senate Appropriations Committee on the last possible day and is pending at this writing in the Senate Rules Committee. Look for this bill to come to final floor votes by September 13.
- The Senate passed a bill (SB 400) that would extend current protections required of employers for employees who are victims of domestic violence and sexual assault to employees who are known or suspected victims of stalking, and require reasonable accommodations, which could be any of more than a dozen possible accommodations listed in the current version of the bill. The bill is pending a floor vote in the Assembly.
- For employers who have unionized employees, another bill of interest would create a new evidentiary privilege, making confidential most communications between a union agent and union member (AB 729). This bill is awaiting a final Senate floor vote.
- Unfair immigration-related practices could be the subject of heavy fines and private enforcement actions under proposals contained in AB 263 and SB 666.
- A bill would create an additional protected category under the Fair Employment and Housing Act (FEHA) for military and veteran status (AB 556).
- Governor Brown signed a bill on August 26 amending the California Labor Code to authorize the award of attorney's fees and costs in an action brought for the non-payment of wages, fringe benefits or health and welfare pension fund contributions, where the prevailing party is not the employee (i.e., the employer), contingent on a finding by a trial court that the employee brought the court action in bad faith (SB 462).
- Governor Brown signed a bill on August 27 that amends section 1773.1 of the Labor Code to modify existing law concerning permissible credits employers may take against the obligation to pay the general prevailing rate of per diem wages for prevailing wage payments, and prohibits credit from being granted for employer payments made to monitor and enforce laws related to public works if those payments are not required by a collective bargaining agreement (SB 776).
The last day for any bill to be passed is September 13. Any bill passed by the Legislature on or before September 13 and in the Governor’s possession after September 13 must be signed or vetoed by Sunday, October 13.
Summary and Status of Significant Bills
Following is a summary of significant bills affecting California private employers1 now pending in the Legislature and their status in the legislative process.
AB 10 (amended June 19) would amend section 1182.12 of the Labor Code to increase the minimum wage on and after January 1, 2014, to not less than $8.25 per hour. The bill would further increase the minimum wage, on and after January 1, 2015, to not less than $8.75 per hour; on and after January 1, 2016, to not less than $9.25 per hour; on and after January 1, 2017, to not less than $9.50 per hour; and on and after January 1, 2018, to not less than $10 per hour. Passed Assembly and Senate Labor and Industrial Relations; pending in Senate Appropriations.
AB 241 (last amended July 1) would enact the “Domestic Worker Bill of Rights” covering childcare providers; caregivers of people with disabilities; sick, convalescing, or elderly persons; house cleaners; housekeepers; maids; and other household occupations. Senate floor vote pending.
AB 263 (last amended August 12) would, among other things, add Labor Code section 1019 to prohibit specified "unfair immigration-related practices," increase civil penalties to as high as $10,000 per employee per violation for any retaliation against an employee, authorize a private right of action for equitable relief, damages, and penalties, and require a court to order the appropriate government agencies to suspend or revoke an offending employer’s business license. The bill would expand the protected conduct to include a written or oral complaint by an employee that he or she is owed unpaid wages. The bill would also expand the prohibited actions to include preventing an employee from, or retaliating against an employee for, providing information to, or testifying before, any public body conducting an investigation, hearing, or inquiry. Senate floor vote pending.
AB 302 (last amended August 12) would amend Labor Code section 1720. Existing law requires that, except as specified, not less than the general prevailing rate of per diem wages, determined by the Director of Industrial Relations, be paid to workers employed on public works projects. Existing law defines “public works” to include, among other things, construction, alteration, demolition, installation, or repair work done under contract and paid for, in whole or in part, out of public funds, but exempts from that definition, among other projects, an otherwise private development project if the state or political subdivision provides, directly or indirectly, a public subsidy to a private development project that is de minimis in the context of the project. A “public subsidy” is de minimis if it is both less than $25,000 and less than 1% of the total project cost. The bill would specify that those provisions do not apply to a project that was advertised for bid, or a contract that was awarded, before January 1, 2014. Final Senate floor vote pending.
AB 442 would amend Labor Code sections 1194.2 and 1197.1 to expand the civil penalty and the payment of restitution of wages an employer must pay to the employee for a Labor Commissioner citation to also include payment of liquidated damages. Final Senate floor vote pending.
AB 556 (last amended April 11) would amend Government Code section 12920 and related sections to add the protected category of “military and veteran status” to the FEHA. Final Senate floor vote pending.
AB 729 (last amended August 21) would amend sections 912 and 917, and adds sections 1048-1048.1, of the Labor Code to provide that a union agent, as defined, and a represented employee or represented former employee, have a privilege to refuse to disclose any confidential communication between the employee or former employee and the union agent while the union agent was acting in his or her representative capacity, except as specified. The bill would provide that, in most instances, a represented employee or represented former employee also has a privilege to prevent another person from disclosing a privileged communication. The bill would further provide that this privilege may be waived in accordance with existing law and does not apply in criminal proceedings. The bill is double-jointed2 with AB 267. Bill source: California Labor Federation, AFL-CIO. Final Senate floor vote pending.
AB 1165 (last amended June 13) would amend Labor Code section 6600 to provide that an appeal of an OSHA citation or notice, as specified, that is classified and cited as a serious violation, repeat serious violation, willful serious violation, willful violation, willful repeat violation, or failure to abate shall not stay abatement dates and requirements. Senate floor vote pending.
AB 1336 (last amended June 24) would amend Labor Code sections 1741, 1771.2, and 1776 to change the deadline for service of wage and penalty assessments by the Labor Commissioner on public works projects, modify the date by which any action by a joint labor-management committee to enforce prevailing wage requirements must be filed, and would also change the permissible modification of the redaction of payroll records kept for inspection by public works contractors. Final Senate floor vote pending.
AB 1383 would amend section 1205 of the Labor Code to establish that no provision of the Labor Code shall be deemed to restrict the exercise of local police powers in a more stringent manner. On Senate inactive file.
AB 1386 would amend Labor Code section 98.2 to require that the amount due under a Labor Commissioner order, decision, or award that becomes final and has become a superior court order shall be a lien on the employer’s personal and real property, as specified, and would require the county recorder to record and index the order as a mortgage on real estate and to file and index the order as a security interest. Final Senate floor vote pending.
AB 1387 (amended April 18) would amend section 2055 and repeal section 2067 of the Labor Code to increase the car wash employer’s bond requirement amount from $15,000 to $150,000, but would exempt an employer from that requirement if the employer has a collective bargaining agreement in place that meets specified criteria, and would delete the existing sunset date for the statute governing car washes, thus extending those provisions indefinitely. Passed Assembly and Senate Labor and Industrial Relations; final Senate floor vote pending.
SB 7 (last amended August 7) would make certain findings and add Labor Code section 1782 to prohibit a charter city from receiving or using state funding or financial assistance for a construction project if the city has a charter provision or ordinance that authorizes a contractor to not comply with prevailing wage provisions on any public works contract. The bill would, except as specified, prohibit a charter city from receiving or using state funding or financial assistance for a construction project for up to two calendar years if after January 1, 2014 the city has awarded, within the prior two years, a public works contract without requiring the contractor to comply with prevailing wage provisions. This bill would authorize charter cities to receive or use state funding or financial assistance if the city has adopted a local prevailing wage ordinance, applicable to all of its public works contracts, that includes requirements that are equal to or greater than the state’s prevailing wage requirements. This bill would exclude contracts for projects of $25,000 or less for construction work, or projects of $15,000 or less for alteration, demolition, repair, or maintenance work. This bill would require the Director of Industrial Relations to maintain a list of charter cities that may receive and use state funding or financial assistance for their construction projects. This bill would provide that it does not restrict a charter city from receiving or using state funding or financial assistance that was awarded to the city prior to January 1, 2015, or from receiving or using state funding or financial assistance to complete a contract that was awarded prior to January 1, 2015, and that a charter city would not be disqualified from receiving or using state funding or financial assistance for its construction projects based on the city’s failure to require a contractor to comply with prevailing wage provisions in performing a contract the city advertised for bid or awarded prior to January 1, 2015. Assembly floor vote pending.
SB 25 (last amended June 19) would amend Labor Code section 1164 to require an agricultural employer or labor organization filing an impasse declaration to additionally declare that it has made itself available to meet and bargain with the other party at reasonable times and places during the applicable period. This bill would permit the filing of a declaration as described above without having to meet the condition that the parties have not previously had a binding contract between them. The bill would also provide that an action to enforce the order of the Agricultural Labor Relations Board may be filed within 60 days whether or not the other party is seeking judicial review of the order. The bill would also increase the evidentiary threshold for the court to grant a stay of the board’s order and require the court to make written findings supporting any order granting a stay of the order during the pendency of the appeal. Final Senate floor vote on Assembly amendments pending.
SB 54 (last amended August 5). In its first four versions, this bill was an urgency measure concerning county employees’ retirement. In its fifth version, it was transformed by the “gut-and-amend” process into a bill that would add Health and Safety Code section 25536.7 to require an owner or operator of a stationary source with one or more covered processes that is required to prepare and submit a risk management plan, when contracting for the performance of construction, alteration, demolition, installation, repair, or maintenance work at the stationary source, to require that its contractors and any subcontractors use a skilled and trained workforce to perform all onsite work within an apprenticeable occupation in the building and construction trades, including skilled journeypersons paid at least a rate equivalent to the applicable prevailing hourly wage rate. The bill would not apply to oil and gas extraction operation. Assembly floor vote pending.
SB 288 (last amended August 30) would add Labor Code section 230.5 to prohibit an employer from discharging or discriminating or retaliating against an employee who is a victim, as defined, of specified offenses, as defined, for taking time off from work to appear in court to be heard at any proceeding, including any delinquency proceeding, involving a post-arrest release decision, plea, sentencing, post-conviction release decision, or any proceeding in which a right of the victim is at issue. Final Assembly floor vote pending.
SB 377 (last amended May 9) would amend Labor Code sections 1726, 1741, 1771.2, and 1773.5 to require a political subdivision that believes a project in which it is interested, as specified, is not a public work, to provide notice, as specified, to the Director of Industrial Relations, the Labor Commissioner, and any other person who requests that notice. This bill would require the director to determine, within 60 days of receipt of a request for a determination, except as specified, whether a project is a public work. This bill would also require an administrative appeal of that determination to be made within 30 days of the date of the determination, and would require the Director of Industrial Relations to issue a determination on an appeal within 30 days after the receipt of the appeal, except as specified. This bill would grant to the director quasi-legislative authority to determine coverage of projects under prevailing wage requirements and provide that a final determination on any appeal is subject to judicial review. The bill would also toll the period for service of assessments for the period of time required by the Director of Industrial Relations to make a determination whether the project is a public work, as specified. The bill would also toll the period of time that a contractor or subcontractor fails to provide certified payroll records pursuant to a request from the Labor Commissioner, a joint labor-management committee, or an approved labor compliance program. In addition, the bill would toll the period for commencing an action during the period of time in which a request to determine whether a project is a public work, including the period of a timely administrative appeal, is pending before the director, as specified. Assembly floor vote pending.
SB 390 (amended June 25) would amend Labor Code section 227 to make it a crime for an employer to fail to remit withholdings from an employee’s wages that were made pursuant to state, local, or federal law; and would prescribe how recovered withholdings or court-imposed restitution, if any, are to be forwarded or paid. Assembly floor vote pending.
SB 400 (last amended August 6) would amend sections 230 and 230.1 of the Labor Code to extend the protections available to persons in FEHA-protected categories to victims of stalking; prohibit an employer from discharging or in any manner discriminating or retaliating against an employee because of the employee’s known status as a victim of domestic violence, sexual assault, or stalking; require the employer to provide reasonable accommodations for such a victim; create a private right of action for an aggrieved employee to seek enforcement of those victim status protection and reasonable accommodation provisions; and permit the recovery of reasonable attorney’s fees by a prevailing employee only. Assembly floor vote pending.
SB 404 (last amended July 3) would amend sections 12920, 12921, 12926, 12940, and 12955.2 of the Government Code to add “familial status" to the FEHA as an additional protected status. Cosponsors: California Employment Lawyers Association, Center for Worklife Law, Equal Rights Advocates. Pending in Assembly Appropriations.
SB 435 (amended August 22) would amend section 226.7 of the Labor Code to require employees of specified piece rate workers to pay those employees for any meal or rest breaks, or recovery periods, and set the rate of pay for rest and recovery periods for piece rate workers. Final Assembly floor vote pending.
SB 516 (last amended August 20) would amend various sections of the Business and Professions Code to, among other things, add new registration and bonding requirements (some effective January 1, 2015) for certain foreign labor contractors, create joint and several liability between both foreign labor contractors and employers who use their services, and impose and increase penalties for noncompliance. On Assembly Appropriations suspense file.
SB 530 (last amended August 30) would amend section 432.7 of the Labor Code, and add section 4852.22 to the Penal Code, to exclude prior criminal convictions from consideration in employment decisions when the conviction has been judicially dismissed. Final Assembly floor vote pending.
SB 556 (last amended August 26) would add section 3273 to the Civil Code to prohibit a person, firm, corporation, or association that is a nongovernmental entity and contracts to perform labor or services for a public entity from displaying on a vehicle or uniform a logo of a public agency, as defined, that reasonably could be interpreted as implying that the labor or services are being provided by employees of the public agency, unless the vehicle or uniform conspicuously displays a disclosure. Co-sponsors: California Labor Federation; California Professional Firefighters. Final Assembly floor vote pending.
SB 655 (last amended August 6) would amend section 12965, and add section 12940.5, of the Government Code to provide that, in a claim of discrimination or retaliation under the FEHA, the person claiming to have been aggrieved shall prevail if he or she has proven that a protected characteristic or activity was a substantial motivating factor, as defined, in the employment action or decision. If an employer pleads and proves that it would have made the same employment action or decision regardless of the protected characteristic or activity, the remedies available to the employee would be limited as specified. If an employer fails to prove that it would have made the same employment action or decision at the same time without considering the protected characteristic or activity, the bill would authorize noneconomic damages, injunctive relief, and attorney’s and expert’s fees against the employer, and would require a specified civil penalty to be paid by that employer to the employee. The bill purports to codify the California Supreme Court's decision in Harris v. City of Santa Monica (2013) 56 Cal.4th 203, on consideration of an employer’s mixed motives in discrimination cases, and defines “substantial motivating factor.” Final Assembly floor vote pending.
SB 666 (last amended August 22) would add sections 494.6 and 6103.7 to the Business and Professions Code, amend sections 98.6 and 1102.5 of, and add section 244 to, the Labor Code, to subject specified business licenses to suspension or revocation, with a specified exception, if a current, former, or prospective employee of the licensee attempts to exercise a right related to his or her employment or any terms, conditions, or benefits of that employment protected by state law and, in reaction, the licensee threatens to retaliate or retaliates based on the employee’s citizenship or immigration status. The bill would make it a cause for suspension, disbarment, or other discipline for any member of the State Bar to report immigration status or threaten to report immigration status of a witness or party to a civil or administrative action or his or her family member, as defined, to a federal, state, or local agency because the witness or party exercises or has exercised a right related to his or her employment. The bill would also prohibit an employer from retaliating or taking adverse action against any employee or applicant for employment because the employee or applicant has engaged in protected conduct. The bill would expand the protected conduct to include a written or oral complaint by an employee that he or she is owed unpaid wages. The bill would subject an employer to a civil penalty of up to $10,000 per violation of these provisions. Existing law entitles an employee to reinstatement and reimbursement for lost wages and benefits if the employee has been discharged, demoted, suspended, or in any way discriminated against because the employee engaged in protected conduct or because the employee made a bona fide complaint or claim or initiated any action or notice, as prescribed. The bill would similarly grant these entitlements to an employee who is retaliated against or subjected to an adverse action. According to committee reports, the bill is sponsored by the California Labor Federation. Final Assembly floor vote pending.
SB 718 (last amended June 22) would require a hospital, as specified, as a part of its injury prevention program and in conjunction with affected employees, to adopt a workplace violence prevention plan designed to protect health care workers, other facility personnel, patients, and visitors from aggressive or violent behavior. As part of that plan, the bill would require a hospital to adopt safety and security policies, including, among others, a system for the reporting to the Division of Occupational Safety and Health of any violent incident, as defined, against a hospital employee, as specified. The bill would further require all medical staff and health care workers who provide direct care to patients to receive, at least annually, workplace violence prevention education and training, as specified. The bill would prohibit a hospital from preventing an employee from, or taking punitive or retaliatory action against an employee for, seeking assistance and intervention from local emergency services or law enforcement for a violent incident. The bill would also require a hospital to provide evaluation and treatment, as specified, for an employee who is injured or is otherwise a victim of a violent incident. The bill would require a hospital to document and keep for five years a written record of all violent incidents against a hospital employee, as defined, and to report to the division any violent incident, as specified. The bill would also authorize the division to assess a civil penalty against a hospital for failure to report a violent incident, as specified. The bill would further require the division to post on its public website a report regarding violent incidents at hospitals, as specified, and to adopt regulations implementing these provisions by January 1, 2015. Assembly floor vote pending.
SB 770 (amended August 5) would amend section 3300, and amend, repeal, and add sections 2708, 3301, 3302, and 3303, of the Unemployment Insurance Code to, beginning July 1, 2014, expand the scope of the family temporary disability program to include time off to care for a seriously ill grandparent, grandchild, sibling, or parent-in-law. Sponsor: Legal Aid Society-Employment Law Center. Assembly floor vote pending.
Bills passed by the Legislature and pending at the Governor’s Office
AB 1140 (last amended May 24) would amend Labor Code section 1773.6 to require that if the Director of Industrial Relations determines, within a semiannual period, that there is a change in any prevailing rate of per diem wages in a locality, that determination applies to any public works contract that is awarded or for which notice to bidders is published on or after January 1, 2014. The bill would authorize any contractor, awarding body, or specified representative affected by a change in rates on a particular contract to, within 20 days, file with the director a verified petition to review the determination of that rate. The bill would require the director to, upon notice to the interested parties, initiate an investigation or hold a hearing, and, within 20 days after the filing of that petition, except as specified, make a final determination and transmit the determination in writing to the awarding body and to the interested parties. The bill would make that determination issued by the director effective 10 days after its issuance, and until it is modified, rescinded, or superseded by the director.
AB 1384 would add Labor Code section 2676.55 to subject any person registered as a garment manufacturer who fails to display his or her name, address, and garment manufacturing registration number on the front entrance of his or her business, as specified, to a civil penalty, as specified.
SB 168 (last amended August 5) would add section 1698.9 to the Labor Code to make a successor farm labor contractor liable, as specified, for wages and penalties, owed by a predecessor farm labor contractor.
1 Excluding legislation concerning workers’ compensation and unemployment insurance.
2 Double jointing refers to technical amendments necessary when two or more bills propose to amend the same code section (i.e., are in conflict).
Contact Chris Cobey, Special Counsel in Littler’s San Jose office (email@example.com), with any questions on these or other bills.