BILL ANALYSIS
SB 657
Page 1
SENATE THIRD READING
SB 657 (Steinberg)
As Amended June 30, 2010
Majority vote
SENATE VOTE :24-13
JUDICIARY 7-2
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|Ayes:|Feuer, Brownley, Evans, | | |
| |Huffman, Jones, Monning, | | |
| |Saldana | | |
| | | | |
|-----+--------------------------+-----+--------------------------|
|Nays:|Hagman, Knight | | |
| | | | |
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SUMMARY : Seeks to provide consumers with new and easily
accessible information made available by specified large
retailers and manufacturers about these businesses' voluntary
efforts, whatever they may be, to try to eradicate slavery and
human trafficking that could inadvertently be in their product
supply chains. Specifically, this bill :
1)Makes various legislative findings, including that it is the
policy of this state to ensure large retailers and
manufacturers provide consumers with information regarding
their efforts to eradicate slavery and human trafficking from
their supply chains, to educate consumers on how to purchase
goods produced by companies that responsibly manage their
supply chains, and, thereby, to improve the lives of victims
of slavery and human trafficking.
2)Requires, after a one year "phase in" period, beginning
January 1, 2012 every retail seller and manufacturer doing
business in this state and having annual gross receipts that
exceed $100 million to disclose its voluntary efforts,
including none, to eradicate slavery and human trafficking
from its supply chain.
3)Requires this consumer disclosure to be posted on the retail
seller's or manufacturer's web site, and for it also to be
available in writing upon request by a consumer. In the event
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the retail seller or manufacturer does not have a web site,
consumers must be provided the written disclosure within 30
days that the business receives the consumer request.
4)Requires the disclosure, at a minimum, to disclose to what
extent, including none, that the retail seller or manufacturer
does each of the following: a) engages in third-party
verification of product supply chains to evaluate and address
risks of human trafficking and slavery; b) conducts
independent, unannounced audits of suppliers to evaluate
supplier compliance with company standards for trafficking and
slavery in supply chains; c) requires suppliers to certify
that raw materials incorporated into the product comply with
the laws regarding slavery and human trafficking of the
country or countries in which they are doing business; d)
maintains internal accountability standards and procedures for
employees or contractors failing to meet company standards
regarding slavery and trafficking; and, e) provides company
employees and management training on human trafficking and
slavery, particularly with respect to mitigating risks within
the supply chains of products.
5)Provides that the exclusive remedy for a violation of this
measure shall be an action brought by the Attorney General for
injunctive relief, and that nothing in the bill shall limit
remedies available for a violation of any other state or
federal law.
6)Provides that the bill's provisions shall not take effect
until January 1, 2012, to provide the designated retail
sellers and manufacturers substantial time to comply with the
bill's disclosure requirements.
FISCAL EFFECT : None
COMMENTS : This important consumer empowerment bill is part of a
continuing effort by the author to fight the continuing
international tragedy of slavery and human trafficking. Through
this measure the author seeks to harness the immense economic
power of the purchasing decisions of California consumers to
help tackle this complex and challenging problem. The bill
simply seeks to ensure interested California consumers have
reasonable access to basic information to aid their purchasing
decisions. It does so by requiring designated major retailers
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and manufacturers to disclose their efforts to eradicate slavery
and human trafficking that could inadvertently be in their
product supply chains. The disclosure must be conspicuously
posted on a large retailer's or manufacturer's web site, and
also be made available in writing upon request.
As shocking as it is to note in the 21st century, human
trafficking involves the modern-day recruitment, transportation,
or sale of people for forced labor. Through violence, threats,
and coercion, these victims are forced to work in, among other
things, the sex trade, domestic labor, factories, hotels, and
agriculture.
California regrettably has been reported to be one of the top
four destination states for trafficking victims in the United
States. Over 500 victims from 18 countries were identified in
California between 1998 and 2003. Trafficking victims in
California reportedly tend to be concentrated in three
"industries": prostitution, sweat shops, and domestic service.
In October 2007, the California Department of Justice released
the final report produced by the California ACTS Task Force
entitled "Human Trafficking in California," which contained a
comprehensive list of findings and recommendations to combat
human trafficking. The report stated, "California bears a moral
responsibility to exert leadership, through government and
business purchasing practices, to implement and monitor codes of
conduct assuring fair and human labor practices throughout their
supply chain." Indeed, California has had stringent procurement
policies in place since 2000 which prohibit state agencies from
purchasing goods or services produced by or with the benefit of
exploitative forms of labor.
In a joint letter, the California Chamber of Commerce,
California Grocers Association, California Manufacturers and
Technology Association, California Retailers Association, and
TechAmerica write in opposition to the bill, making three
principal contentions:
SB 657 would require companies to develop
policies with regard to [sic] its entire supply
chain, which can include entities far outside
the borders of California or the United States.
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The policies would need to address specific
issues such as third-party verification of
product supply chain, independent unannounced
audits and certification of raw materials.
However it should be noted that the measure does not in
fact require companies to develop any policies at all.
Instead the bill solely requires, as noted above, that
beginning one year after the bill's enactment, only those
relatively few giant retail sellers and manufacturers doing
business in this state which have annual gross receipts
exceeding $100 million (less than 5% of the state's
businesses) need disclose their efforts, whatever they may
be including if there are none, to eradicate slavery and
human trafficking from its supply chain.
Private businesses should not be used as the
enforcement arm for federal and state laws regarding
slavery and human trafficking. That responsibility
falls with the federal and state government entities
themselves.
However it should be noted that the measure does not, as
noted above, require the relative narrow number of
designated large companies to do anything other than post
specified information on their Web sites and also make such
information available to interested consumers. The bill
does not in any way require these private businesses to act
as an enforcement arm of government; indeed, the bill
acknowledges that these businesses are still completely
free to do anything they want about their efforts to fight
human trafficking and slavery, they simply need to note
this information on their Web sites and make such
information available to interested consumers.
[T]he practical effect [of this legislation] will be
to hold certain companies up for ridicule and
condemnation for "failing" to address issues they are
powerless to address.
However it should be noted that the measure does not require the
relative narrow number of designated large companies to do
anything other than post specified information on their Web
sites and also make such information available to interested
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consumers. If the information the business provides is found by
some consumers to reflect inadequate attention to this issue,
then that is a business choice as to whether that is a wise
course of action.
As to whether businesses here in California are completely
"powerless to address" the presence of human trafficking and
slavery in their product supply chains, as the business trade
groups contend, there is ample evidence, as noted above, that to
the contrary, some respected California businesses, according to
the report issued by the California ACTS Task Force, have
already taken the lead to adopt their own codes of conduct that
set out minimum labor standards for their suppliers and
sub-contractors, voluntarily using their substantial economic
power to influence labor and human rights practices within their
supply chains.
Analysis Prepared by : Drew Liebert / JUD. / (916) 319-2334
FN: 0005160