BILL ANALYSIS
Senate Committee on Labor and Industrial Relations
Carole Migden, Chair
Date of Hearing: June 25, 2008 2007-2008 Regular
Session
Consultant: Rodger Dillon Fiscal:Yes
Urgency: No
Bill No: AB 2537
Author: Furutani
As Amended: June 19, 2008
SUBJECT
Public works: exemption: volunteers.
KEY ISSUES
Should the Legislature allow volunteers to continue to perform
certain work on public works projects by extending the sunset
date, from 1/1/2009 to 1/1/2012, on the exemption that allows
volunteers to perform such work and not be paid the prevailing
wage, as otherwise required?
Should the Legislature require the Director of the Department of
Industrial Relations to conduct a study evaluating the impact of
allowing volunteers on public works projects?
PURPOSE
To allow volunteers to continue contributing their labor to
public works projects, and to provide for an evaluation of the
impact of such participation.
ANALYSIS
Existing law defines public works as any construction,
alteration, demolition, installation or repair work done under
contract and paid for in whole or in part from public funds.
This includes work performed during the design and
pre-construction phase, including, but not limited to,
inspection and land surveying.
Existing law requires, with certain exceptions, contracted
public works projects to be submitted for bids by the public
entity requesting the work, and that the contract is awarded to
the lowest responsible bidder. The awarding body is required to
ensure that the winning contractor is appropriately licensed
with the Contractors' State Licensing Board, and has not been in
barred from bidding on, accepting, or performing public
contracts.
Existing law requires all employees who work on public works
projects with a budget of $1,000 or more to be paid the general
prevailing rate of per diem wages and the general prevailing
rate for holiday and overtime work for the specific location
where the public work is to be performed. This prevailing wage
is determined by the Department of Industrial Relations.
Existing law exempts from public work requirements any project
where the Department of Fish and Game (DFG) contracts with
public agencies, Indian tribes, or nonprofit organizations for
fish and wildlife habitat preservation, restoration, and
enhancement. Existing law also allows the DFG to contract with
public and private entities for fish and wildlife habitat
preservation, restoration, and enhancement, but these contracts
are only exempt from public work requirements if they are less
than $50,000.
Existing law exempts any work performed by volunteers from the
public works requirements, but the exemption allowing volunteers
on public works projects is set to expire on January 1, 2009.
Under existing law volunteers are defined as:
Individuals who perform works for civic, charitable, or
humanitarian reasons for a public agency or tax-exempt
organization, such as a 501(c)(3), without any compensation;
Volunteer coordinators.
Members of the California Conservation Corps (CCC) or the
Community Conservation Corps are also exempt.
Existing law excludes from the definition of a volunteer:
Anyone who works on the public works project for
compensation; or
Anyone who received payment from the contractor on the public
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Senate Committee on Labor and Industrial Relations
works project for construction, alteration, demolition,
installation, repair, or maintenance work on the same
project.
This Bill:
Extends the sunset on the exemption for volunteers on public
works project out three years, from 1/1/2009 to 1/1/2012;
Requires the Director of the Department of Industrial
Relations to conduct a study that evaluates the impact of the
exemption for volunteers since 8/30/2004, and to submit the
findings of the study to the Legislature by June, 30, 2011.
The report shall include, but not be limited to:
? The number of hours volunteers have worked on public
works projects;
? The costs of the public works projects that utilized
volunteers and the percentage of work performed by
volunteers;
? The types of work performed by volunteers;
States that the Legislature finds and declares that:
? It is the intent of the Legislature that public works
projects should never undermine the wage base in a
community;
? The requirement that workers on public works projects be
paid the prevailing rate of per diem wages ensures that the
local wage base is not lowered;
? This Act shall not apply to the work of state and local
public sector employees.
COMMENTS
1. Background
This bill revisits an issue that arose in 2004 concerning the
use of volunteer labor on certain public works projects. Much
of the attention that arose at that time was a result of an
enforcement action taken by DIR in July 2003 in relation to a
stream restoration project in Shasta County.
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Senate Committee on Labor and Industrial Relations
In fiscal year 2000-01, the Department of Water Resources
(DWR) provided grant funding to the Sacramento Watersheds
Action Group for a stream restoration project on Sulphur Creek
in the City of Redding. According to media reports, students
from nearby Shasta College were used for various activities
including planting seeds, clearing brush, repairing culverts,
installing rock beds to prevent erosion, and trash removal.
The students reportedly earned course credit for classes in
watershed restoration.
Responding to a complaint from a local labor organization, DIR
investigated and determined that, based on the submitted job
descriptions of the work performed by students and volunteers,
prevailing wages were required for the following work: willow
staking, spreading seeds and mulch, planting shrubs, operating
heavy equipment, site cleanup, off-hauling garbage, and
planting vegetation. The subsequent DIR enforcement action
assessed back wages and civil penalties.
In September 2003, DWR issued a memorandum that stated, "Due
to the serious implications to our programs that would arise
from being unable to support volunteerism, DWR is taking a
conservative approach until these issues can be clarified. We
will not enter into any new contracts possibly affected by
these issues until we have a clearer picture of the
obligations of DWR and the grantees under the Labor Code."
Following the July 2003 enforcement action, there was an
outcry among many in the environmental community that the
prior Labor Code Section 1720.4, as interpreted by DIR,
effectively prohibited the mixed use of volunteer and paid
labor on public works projects.
After lengthy negotiations between the environmental community
and representatives of organized labor, the Legislature
enacted AB 2690 (Hancock), Chapter 330, Statutes of 2004. AB
2690 amended Labor Code Section 1720.4 into its current form.
In order to address concerns that there may be abuses of any
"volunteer" exemption to California's prevailing wage laws,
AB2690 contained a January 1, 2009 sunset date.
2. Related Legislation:
Hearing Date: June 25, 2008 AB 2537
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Senate Committee on Labor and Industrial Relations
Earlier this year, the Senate Labor Committee heard SB1345
(Ashburn), which would have permanently eliminated the sunset
on the exemption for volunteers. That bill was first heard
on March 26, 2008; it failed to pass out of the committee for
lack of affirmative votes but was granted reconsideration.
The bill was taken up again on April 9, 2008, and at that time
it again failed passage (2-3).
3. Need for this bill?
The ability of volunteers to help on public works projects
will certainly be curtailed when the current exemption expires
on January 1, 2009, so if it is reasonable public policy to
allow volunteers to participate in this way the Legislature
needs to act. While there is a legitimate role for volunteers
serving in some capacity on public works projects, there are
serious issues that should be of concern to the Legislature.
Volunteers may contribute valuable work/skills to a public
works project, may lower the costs of the project as whole,
and may allow work to be done that might not otherwise be
completed. However, at a time of growing unemployment it may
be crucial for the Legislature to protect the opportunities
for good jobs at decent wages. Those who are looking for work
may not always be happy to see volunteers - who may be
economically secure - take work that might provide the
unemployed with an income. So, some checks need to remain in
place. Currently, there is no maximum size to the public
works projects in this bill, so this work could conceivably
involve millions of dollars and hundreds of jobs. Finally,
the Legislature needs to be sensitive to liability issues when
work is done by volunteers who may or may not have the
technical skills to deal with, say, a toxic spill, or to build
truly safe facilities the public may depend on.
During the debate in the Senate Labor Committee on SB1345
(Ashburn) there was some discussion of AB2537 as an
alternative approach. AB2537 extends, rather than eliminates,
the sunset and - with the requirement for a report - allows
for what might be seen as a more sensitive approach and for a
survey/evaluation of any issues as the next sunset date would
be reached.
Hearing Date: June 25, 2008 AB 2537
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Senate Committee on Labor and Industrial Relations
4. Staff Questions:
Have there been any specific instances of abuse of the
volunteer exemption by employers or any other party?
Beyond the initial complaint from 1993, no reports of abuse
have been received by the Department of Industrial Relations
(DIR). However, in conversations with the committee, some
labor officials felt that some volunteers in certain
situations may not have the appropriate training to safely
complete all of the tasks that they have been given, and that
these tasks should be given to workers who have years of
experience in working on these projects.
What workplace protections do the volunteers have while on
the job?
The Labor Code excludes individuals who volunteer for a
public agency or private non-profit organization from the
definition of an employee. Since most labor law protections
are centered on employees, this would exclude volunteers from
many of the protections and requirements employers have for
their employees, including workers' compensation . However,
since these positions are voluntary, issues like meal and
rest breaks and hours of work probably would be handled by
the volunteer. For members of the California Conservation
Corps or Community Conservation Corps, however, wages are
paid to the participants of both of those programs, and
therefore they are covered by Workers Compensation and other
labor law protections.
5. Proponent Arguments :
The author argues that volunteer use maximizes available and
limited grant funds that are designated for important
community purposes. In 2006, California volunteers
contributed approximately 860 million hours of community
service. Volunteers continue to support California every day
as they build Little League fields, create school gardens,
plant trees, beautify neighborhoods, and engage in numerous
other important activities. There have been no complaints of
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Senate Committee on Labor and Industrial Relations
exemption abuse to the State Labor Commissioner or to the
Department of Industrial Relations, say supporters, and
California volunteers should remain exempted from the
prevailing wage requirement. This bill would extend the
sunset on the exemption and allow for an evaluation of any
problems.
6. Opponent Arguments :
None received.
SUPPORT
California Association of Local Conservation Corps - Sponsor
Sacramento Local Conservation Corps - Sponsor
Board of Supervisors of Sacramento County
California Council of Land Trusts
California Invasive Plant Council
California Native Plant Society
California Outdoor Heritage Alliance
California Park and Recreation Society
California Regional Council of Rural Counties
California ReLeaf
California Special Districts Association
City of El Cerrito
City of Long Beach
City of Redding
Coalition to Protect Watershed Volunteers and California's
Prevailing Wages
Community Services Employment Training
Friends of Harbors, Beaches, and Parks
Glenn County Resource Conservation District
Marin Conservation Corps
Maritime Museum of San Diego
Newport Beach Chapter of the Surfrider Foundation
Ocean Institute
Planning and Conservation League
Regional Council of Rural Counties
Regional Open Space
Sacramento Valley Rugby Foundation
Salmonid Restoration Federation
Hearing Date: June 25, 2008 AB 2537
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Senate Committee on Labor and Industrial Relations
San Diego Association of Nonprofits
San Francisco Conservation Corps
San Francisco Maritime National park Association
Save The Bay
Sierra Nevada Alliance
Solano County Water Agency
The Nature Conservancy
The Trust for Public Land
Urban Corps of San Diego County
OPPOSITION
None received.
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Hearing Date: June 25, 2008 AB 2537
Consultant: Rodger Dillon Page 8
Senate Committee on Labor and Industrial Relations