BILL NUMBER: SB 1231	INTRODUCED
	BILL TEXT


INTRODUCED BY   Senator Corbett
   (Principal coauthor: Senator DeSaulnier)
   (Coauthor: Senator Price)

                        FEBRUARY 19, 2010

   An act to amend Section 6108 of the Public Contract Code, relating
to public contracts.


	LEGISLATIVE COUNSEL'S DIGEST


   SB 1231, as introduced, Corbett. Public contracts: state agency:
sweatshop labor: slave and sweat free code of conduct.
   Existing law requires every contract entered into by a state
agency for the procurement of equipment, materials, supplies,
apparel, garments, and accessories and the laundering thereof,
excluding public works contracts, to require a contractor to certify
that no equipment, materials, supplies, apparel, garments, or
accessories provided under the contract are produced by sweatshop
labor, forced labor, convict labor, indentured labor under penal
sanction, abusive forms of child labor, or exploitation of children
in sweatshop labor. If a contractor knew or should have known the
specified products furnished to the state were laundered or produced
by the specified types of prohibited labor, the contractor may be
removed from the bidder's list for 360 days. Existing law provides
for misdemeanor liability in the case of a knowing false
certification. Existing law requires the Department of Industrial
Relations to establish a contractor responsibility program, on or
before February 1, 2004, including a Sweatfree Code of Conduct.
Existing law also requires the appropriate procurement agency, in
consultation with the Director of Industrial Relations, to employ an
approach to implement the Sweatfree Code of Conduct, as specified.
Existing law requires the Department of Industrial Relations to
explore mechanisms to ensure that businesses that contract with state
agencies are in compliance with this section, as prescribed.
   This bill would require every contract entered into by a state
agency for the procurement of equipment, materials, supplies,
apparel, garments, and accessories and the laundering thereof,
including public works contracts, to require a contractor to certify
that no equipment, materials, supplies, apparel, garment, or
accessories provided under the contract are produced by abusive forms
of labor performed by all persons, not only abusive forms of child
labor. This bill would require the certification to include all raw
materials in the supply chain used to produce or manufacture the
goods procured. This bill would only apply to contracts for building
materials in excess of $20,000 in a public works contract, as
prescribed. This bill would extend the period that the contractor is
removed from the bidder's list to 2 years, if the contractor knew or
should have known the specified products were laundered or produced
by the specified prohibited labor. This bill would rename the
Sweatfree Code of Conduct to be the Slave and Sweat Free Code of
Conduct and would require the Department of Industrial Relations to
establish a contractor responsibility program on or before January 1,
2012. This bill would delete the requirements that the appropriate
agency, with the Director of Industrial Relations, employ an approach
to implement the Slave and Sweat Free Code of Conduct, and that the
Department of Industrial Relations explore mechanisms to ensure that
businesses that contract with state agencies are in compliance with
this section. This bill would additionally require contractors whose
manufacturing and assembly locations are outside the United States to
comply with international laws or treaties binding on their
countries. By changing the definition of a crime, this bill would
impose a state-mandated local program
   The California Constitution requires the state to reimburse local
agencies and school districts for certain costs mandated by the
state. Statutory provisions establish procedures for making that
reimbursement.
   This bill would provide that no reimbursement is required by this
act for a specified reason.
   Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: yes.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:

  SECTION 1.  Section 6108 of the Public Contract Code is amended to
read:
   6108.  (a) (1) Every contract entered into by any state agency for
the procurement or laundering of apparel, garments, or corresponding
accessories, or the procurement of equipment, materials, or supplies
 , other than procurement related to a public works
contract,  shall require that a contractor certify that no
apparel, garments, corresponding accessories, equipment, materials,
or supplies furnished to the state pursuant to the contract have been
laundered or produced in whole or in part by sweatshop labor, forced
labor, convict labor, indentured labor under penal sanction, abusive
forms of  child  labor, or exploitation of children
in sweatshop labor, or with the benefit of sweatshop labor, forced
labor, convict labor, indentured labor under penal sanction, abusive
forms of  child  labor, or exploitation of children
in sweatshop labor.  For   purposes of this subdivision,
the certification shall include all raw materials in the supply
chain used to produce or manufacture the goods procured.  The
contractor shall agree to comply with this provision of the contract.

   (2) The contract shall specify that the contractor is required to
cooperate fully in providing reasonable access to the contractor's
records, documents, agents, employees, or premises if reasonably
required by authorized officials of the contracting agency, the
Department of Industrial Relations, or the Department of Justice
determine the contractor's compliance with the requirements under
paragraph (1). 
   (3) If the contract is for the procurement of supplies or
materials to be used in a public works project, this section shall
apply only if the contract for building materials is in excess of
twenty thousand dollars ($20,000). A contractor shall not divide a
contract into separate contracts to avoid the minimum financial
threshold of this paragraph. 
   (b) (1) Any contractor contracting with the state who knew or
should have known that the apparel, garments, corresponding
accessories, equipment, materials, or supplies furnished to the state
were laundered or produced in violation of the conditions specified
in subdivision (a) when entering into a contract pursuant to
subdivision (a), may, subject to subdivision (c), have any or all of
the following sanctions imposed:
   (A) The contract under which the prohibited apparel, garments, or
corresponding accessories, equipment, materials, or supplies were
laundered or provided may be voided at the option of the state agency
to which the equipment, materials, or supplies were provided.
   (B) The contractor may be assessed a penalty that shall be the
greater of one thousand dollars ($1,000) or an amount equaling 20
percent of the value of the apparel, garments, corresponding
accessories, equipment, materials, or supplies that the state agency
demonstrates were produced in violation of the conditions specified
in paragraph (1) of subdivision (a) and that were supplied to the
state agency under the contract.
   (C) The contractor may be removed from the bidder's list for a
period not to exceed  360 days   two years 
.
   (2) Any moneys collected pursuant to this subdivision shall be
deposited into the General Fund.
   (c) (1) When imposing the sanctions described in subdivision (b),
the contracting agency shall notify the contractor of the right to a
hearing, if requested, within 15 days of the date of the notice. The
hearing shall be before an administrative law judge of the Office of
Administrative Hearings in accordance with the procedures specified
in Chapter 5 (commencing with Section 11500) of Part 1 of Division 3
of Title 2 of the Government Code. The administrative law judge shall
take into consideration any measures the contractor has taken to
ensure compliance with this section, and may waive any or all of the
sanctions if it is determined that the contractor has acted in good
faith.
   (2) The agency shall be assessed the cost of the administrative
hearing, unless the agency has prevailed in the hearing, in which
case the contractor shall be assessed the cost of the hearing.
   (d) (1) Any state agency that investigates a complaint against a
contractor for violation of this section may limit its investigation
to evaluating the information provided by the person or entity
submitting the complaint and the information provided by the
contractor.
   (2) Whenever a contracting officer of the contracting agency has
reason to believe that the contractor failed to comply with paragraph
(1) of subdivision (a), the agency shall refer the matter for
investigation to the head of the agency and, as the head of the
agency determines appropriate, to either the Director of Industrial
Relations or the Department of Justice.
   (e) (1) For purposes of this section, "forced labor" shall have
the same meaning as in Section 1307 of Title 19 of the United States
Code.
   (2) "Abusive forms of  child  labor" means any of
the following:
   (A) All forms of slavery or practices similar to slavery, such as
the sale and trafficking of  children   persons
 , debt bondage, and serfdom and forced or compulsory labor,
including forced or compulsory recruitment of  children
  persons  for use in armed conflict.
   (B) The use, procuring, or offering of a child for prostitution,
for the production of pornography, or for pornographic performances.
   (C) The use, procuring, or offering of a  child 
 person  for illicit activities, in particular for the
production and trafficking of illicit drugs.
   (D) All work or service exacted from or performed by any person
under the age of 18 years either under the menace of any penalty for
its nonperformance and for which the worker does not offer oneself
voluntarily, or under a contract, the enforcement of which can be
accomplished by process or penalties.
   (E) All work or service exacted from or performed by a child in
violation of all applicable laws of the country of manufacture
governing the minimum age of employment, compulsory education, and
occupational health and safety.
   (3) "Exploitation of children in sweatshop labor" means all work
or service exacted from or performed by any person under the age of
18 years in violation of more than one law of the country of
manufacture governing wage and benefits, occupational health and
safety, nondiscrimination, and freedom of association.
   (4) "Sweatshop labor" means all work or service exacted from or
performed by any person in violation of more than one law of the
country of manufacture governing wages, employee benefits,
occupational health, occupational safety, nondiscrimination, or
freedom of association.
   (5) "Apparel, garments, or corresponding accessories" includes,
but is not limited to, uniforms.
   (6) Notwithstanding any other provision of this section, "forced
labor" and "convict labor" do not include work or services performed
by an inmate or a person employed by the Prison Industry Authority.
   (7) "State agency" means any state agency in this state.
   (f) (1) On or before  February   January
 1,  2004   2012  , the Department of
Industrial Relations shall establish a contractor responsibility
program, including a  Sweatfree   Slave and
Sweat Free  Code of Conduct, to be signed by all bidders on
state contracts and subcontracts. Any state agency responsible for
procurement shall ensure that the  Sweatfree  
Slave and Sweat Free  Code of Conduct is available for public
review at least 30 calendar days between the dates of receipt and the
final award of the contract. The  Sweatfree  
Slave and Sweat Free  Code of Conduct shall list the
requirements that contractors are required to meet, as set forth in
subdivision (g).
   (2)  Upon implementation in the manner described in
paragraph (4) every,   Every  contract entered into
by any state agency for the procurement or laundering of apparel,
garments, or corresponding accessories, or for the procurement of
equipment or supplies, shall require that the contractor certify in
accordance with the  Sweatfree   Sla  
ve and Sweat Free  Code of Conduct that no apparel, garments, or
corresponding accessories, or equipment, materials, or supplies,
furnished to the state pursuant to the contract have been laundered
or produced, in whole or in part, by sweatshop labor. 
   (3) The appropriate procurement agency, in consultation with the
Director of Industrial Relations, shall employ a phased and targeted
approach to implementing the Sweatfree Code of Conduct. Sweatfree
Code of Conduct procurement policies involving apparel, garments, and
corresponding accessories may be permitted a phasein period of up to
one year for purposes of feasibility and providing sufficient notice
to contractors and the general public. The appropriate procurement
agency, in consultation with the Director of Industrial Relations,
shall target other procurement categories based on the magnitude of
verified sweatshop conditions and the feasibility of implementation,
and may set phasein goals and timetables of up to three years to
achieve compliance with the principles of the Sweatfree Code of
Conduct.  
   (4) In order to facilitate compliance with the Sweatfree Code of
Conduct, the Department of Industrial Relations shall explore
mechanisms employed by other governmental entities, including, but
not limited to, New Jersey Executive Order 20, of 2002, to ensure
that businesses that contract with this state are in compliance with
this section and any regulations or requirements promulgated in
conformance with this section, as amended by Section 2 of Chapter 711
of the Statutes of 2003. The mechanisms explored may include, but
not be limited to, authorization to contract with a competent
nonprofit organization that is neither funded nor controlled, in
whole or in part, by a corporation that is engaged in the procurement
or laundering of apparel, garments, or corresponding accessories, or
the procurement of equipment, materials, or supplies. The Department
of Industrial Relations, in complying with this paragraph, shall
also consider any feasible and cost-effective monitoring measures
that will encourage compliance with the Sweatfree Code of Conduct.
 
   (5) 
    (3)  To ensure public access and confidence, the
Department of Industrial Relations shall ensure public awareness and
access to proposed contracts by postings on the Internet and through
communication to advocates for garment workers, unions, and other
interested parties. The appropriate agencies shall establish a
mechanism for soliciting and reviewing any information indicating
violations of the  Sweatfree   Slave and Sweat
Free  Code of Conduct by prospective or current bidders,
contractors, or subcontractors. The agencies shall make their
findings public when they reject allegations against bidding or
contracting parties. 
   (6) 
    (4)  Contractors shall ensure that their subcontractors
comply in writing with the  Sweatfree   Slave
and Sweat Free  Code of Conduct, under penalty of perjury.
Contractors shall attach a copy of the  Sweatfree 
 Slave and Sweat Free  Code of Conduct to the certification
required by subdivision (a).
   (g) No state agency may enter into a contract with any contractor
unless the contractor meets the following requirements:
   (1) Contractors and subcontractors in California shall comply with
all appropriate state laws concerning wages, workplace safety,
rights to association and assembly, and nondiscrimination standards
as well as appropriate federal laws. Contractors based in other
states in the United States shall comply with all appropriate laws of
their states and appropriate federal laws. For contractors whose
locations for manufacture or assembly are outside the United States,
those contractors shall ensure that their subcontractors comply with
the appropriate laws of countries where the facilities are located
 or international laws or treaties binding upon those countries
 .
   (2) Contractors and subcontractors shall maintain a policy of not
terminating any employee except for just cause, and employees shall
have access to a mediator or to a mediation process to resolve
certain workplace disputes that are not regulated by the National
Labor Relations Board.
   (3) Contractors and subcontractors shall ensure that workers are
paid, at a minimum, wages and benefits in compliance with applicable
local, state, and national laws of the jurisdiction in which the
labor, on behalf of the contractor or subcontractor, is performed.
Whenever a state agency expends funds for the procurement or
laundering of apparel, garments, or corresponding accessories, or the
procurement of equipment, materials, or supplies, other than
procurement related to a public works contract, the applicable labor
standards established by the local jurisdiction through the exercise
of either local police powers or local spending powers in which the
labor, in compliance with the contract or purchase order for which
the expenditure is made, is performed shall apply with regard to the
contract or purchase order for which the expenditure is made, unless
the applicable local standards are in conflict with, or are
explicitly preempted by, state law. A state agency may not require,
as a condition for the receipt of state funds or assistance, that a
local jurisdiction refrain from applying the labor standards that are
otherwise applicable to that local jurisdiction. The Department of
Industrial Relations may, without incurring additional expenses,
access information from any nonprofit organization, including, but
not limited to, the World Bank, that gathers and disseminates data
with respect to wages paid throughout the world, to allow the
Department of Industrial Relations to determine whether contractors
and subcontractors are compensating their employees at a level that
enables those employees to live above the applicable poverty level.
   (4) All contractors and subcontractors shall comply with the
overtime laws and regulations of the country in which their employees
are working.
   (5) All overtime hours shall be worked voluntarily. Workers shall
be compensated for overtime at either (A) the rate of compensation
for regular hours of work, or (B) as legally required in the country
of manufacture, whichever is greater.
   (6) No person may be employed who is younger than the legal age
for children to work in the country in which the facility is located.
In no case may children under the age of 15 years be employed in the
manufacturing process. Where the age for completing compulsory
education is higher than the standard for the minimum age of
employment, the age for completing education shall apply to this
section.
   (7) There may be no form of forced labor of any kind, including
slave labor, prison labor, indentured labor, or bonded labor,
including forced overtime hours.
   (8) The work environment shall be safe and healthy and, at a
minimum, be in compliance with relevant local, state, and national
laws. If residential facilities are provided to workers, those
facilities shall be safe and healthy as well.
   (9) There may be no discrimination in hiring, salary, benefits,
performance evaluation, discipline, promotion, retirement, or
dismissal on the basis of age, sex, pregnancy, maternity leave
status, marital status, race, nationality, country of origin, ethnic
origin, disability, sexual orientation, gender identity, religion, or
political opinion.
   (10) No worker may be subjected to any physical, sexual,
psychological, or verbal harassment or abuse, including corporal
punishment, under any circumstances, including, but not limited to,
retaliation for exercising his or her right to free speech and
assembly.
   (11) No worker may be forced to use contraceptives or take
pregnancy tests. No worker may be exposed to chemicals, including
glues and solvents, that endanger reproductive health.
   (12) Contractors and bidders shall list the names and addresses of
each subcontractor to be utilized in the performance of the
contract, and list each manufacturing or other facility or operation
of the contractor or subcontractor for performance of the contract.
The list, which shall be maintained and updated to show any changes
in subcontractors during the term of the contract, shall provide
company names, owners or officers, addresses, telephone numbers,
e-mail addresses, and the nature of the business association.
   (h) Any person who certifies as true any material matter pursuant
to this section that he or she knows to be false is guilty of a
misdemeanor.
   (i) The provisions of this section, as amended by Section 2 of
Chapter 711 of the Statutes of 2003, shall be in addition to any
other provisions that authorize the prosecution and enforcement of
local labor laws and may not be interpreted to prohibit a local
prosecutor from bringing a criminal or civil action against an
individual or business that violates the provisions of this section.
   (j) (1) The certification requirements set forth in subdivisions
(a) and (f) do not apply to a credit card purchase of goods of two
thousand five hundred dollars ($2,500) or less.
   (2) The total amount of exemption authorized herein shall not
exceed seven thousand five hundred dollars ($7,500) per year for each
company from which a state agency is purchasing goods by credit
card. It shall be the responsibility of each state agency to monitor
the use of this exemption and adhere to these restrictions on these
purchases.
  SEC. 2.  No reimbursement is required by this act pursuant to
Section 6 of Article XIII B of the California Constitution because
the only costs that may be incurred by a local agency or school
district will be incurred because this act creates a new crime or
infraction, eliminates a crime or infraction, or changes the penalty
for a crime or infraction, within the meaning of Section 17556 of the
Government Code, or changes the definition of a crime within the
meaning of Section 6 of Article XIII B of the California
Constitution.