BILL ANALYSIS Ó
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|SENATE RULES COMMITTEE | AB 1744|
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THIRD READING
Bill No: AB 1744
Author: Bonnie Lowenthal (D)
Amended: 8/16/12 in Senate
Vote: 21
SENATE LABOR & INDUSTRIAL RELATIONS COMM. : 4-0, 7/03/12
AYES: Lieu, DeSaulnier, Leno, Padilla
NO VOTE RECORDED: Wyland, Runner, Yee
SENATE APPROPRIATIONS COMMITTEE : Senate Rule 28.8
ASSEMBLY FLOOR : 49-26, 5/30/12 - See last page for vote
SUBJECT : Employee compensation: itemized statements
SOURCE : Author
DIGEST : This bill requires, on and after July 1, 2013,
that an employees itemized pay stub statement include, if
the employer is a temporary services employer, the rate of
pay for each assignment and total hours worked for each
legal entity. This bill requires that, if the employer is
a temporary services employer, staffing agency, or
professional employer organization, the notice include the
name, the physical address of the main office, the mailing
address if different from the physical address of the main
office, and the telephone number of the legal entity for
whom the employee will perform work, and any other
information the Labor Commissioner deems material and
necessary.
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ANALYSIS : Existing law defines a temporary services
employer as an employing unit that contracts with clients
or customers to supply workers to perform services for the
clients or customers and that performs a variety of
functions, including negotiating with clients, assigning
workers, pays those workers, and retains the right to hire
and fire those workers.
Existing law provides that every employer must furnish each
employee with an itemized statement at the time of each
payment of wages that shows, among other things, the name
and address of the legal entity that is the employer. A
knowing and intentional violation of this provision is a
misdemeanor.
Existing law also:
Exempts the state or a city, county, city and county,
district, or other governmental entity from the above
provisions; and
Provides that the listing by an employer of the name
and address of the legal entity that secured the
services of the employer on the itemized payroll
statement shall not create any liability on the part of
that legal entity.
Existing law also requires the payroll statement to
include, if the employer is a farm labor contractor, the
name of the legal entity that secured their services on an
employee's payroll statement.
Existing law also requires employers to provide a notice to
their employees at the time of hiring containing, among
other things, rates of pay, the name and physical address
of employer, and the name, address, and telephone number of
the employer's workers' compensation carrier.
This bill requires, on and after July 1, 2013, that the
itemized pay stub statement include, if the employer is a
temporary services employer, the rate of pay for each
assignment and total hours worked for each legal entity.
This bill requires that, if the employer is a temporary
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services employer, staffing agency, or professional
employer organization, the notice include the name, the
physical address of the main office, the mailing address if
different from the physical address of the main office, and
the telephone number of the legal entity for whom the
employee will perform work, and any other information the
Labor Commissioner deems material and necessary.
Comments
Temporary services employers and existing law . According
to the author's office, the percentage of Californians
whose jobs are temporary has nearly quadrupled in the past
30 years. The author's office states that "temporary
services employers" are not required to include the length
of time the employee worked for a specific legal entity on
the employee's paystub. According to the author's office,
listing the legal entities who secure the employee's
services and the hours worked will bring clarity to
temporary employees and modernize the Labor Code to reflect
this growing form of alternative employment.
Research suggests that the temporary service industry is
expanding and moving from a stopgap-staffing provider to a
more systematic and continuous role as an intermediary
between companies and labor supplies across a broad array
of industries and occupations. According to the United
States Bureau of Labor Statistics, temporary employment in
the U.S. increased from 1.1 million in 1990 to 2.3 million
and in 2008, and also noted that only 16 percent of the
industry's revenues came from clerical positions; 65
percent came from office and administrative support,
transportation and material moving, and production
occupations. Additionally, 15 percent of the industry's
revenues also came from construction and extraction,
healthcare practitioner, and business and financial
operations occupations.
Despite the evolution of the industry, the current body of
law of temporary services employers has largely remained
the same since the early 1980s. However, among certain
employer classifications, existing law has evolved specific
wage statement requirements. For example, farm labor
contractors are required to disclose on the itemized
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statement the name of the legal entity that secured the
employers' services, as well as the name and address of the
legal entity that secured the services of the employer on
the itemized payroll statement shall not create any
liability on the part of that legal entity.
This bill applies the same provisions currently in place
for farm labor contractors to temporary services employers.
Related Legislation
AB 469 (Swanson), Statutes of 2011, Chapter 655, requires
the provision of a notice at the time of hiring that lists
the relevant details of a worker's employment. The Labor
Commissioner was tasked with creating the template for the
notice, and completed a template in early May of this year.
FISCAL EFFECT : Appropriation: No Fiscal Com.: Yes
Local: Yes
SUPPORT : (Verified 8/16/12)
AFSCME
California Amalgamated Transit Union
California Employment Lawyers Association
California Labor Federation
California Nurses Association
California Pipe Trades Council
Engineers and Scientists of California
International Brotherhood of Electrical Workers
International Longshore and Warehouse Union
Professional & Technical Engineers, Local 21
San Francisco Labor Council
UNITE HERE
United Food and Commercial Workers Union, Western States
Council
Utility Workers Union of America, Local 132
Warehouse Workers United
Western States Council of Sheet Metal Workers
OPPOSITION : (Verified 8/16/12)
American Staffing Association
California Association for Health Services at home
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California Chamber of Commerce
California Grocers Association
California Independent Grocers Association
California Staffing Professionals
National Federation of Independent Business
Plumbing-Heating-Cooling Contractors Association of
California
Pridestaff
Prostaff Search LLC
TrueBlue, Inc.
Western Electrical Contractors Association, Inc.
ARGUMENTS IN SUPPORT : Proponents argue that this bill
ensures that temporary employees are properly paid.
Proponents also argue that temporary workers are
particularly vulnerable to abuse and often have no
guarantee of work and do not know ahead of time where they
will be dispatched or what they will be asked to do.
Proponents note that some temporary workers rotate between
assignments with different rates of pay for different tasks
or sites. Proponents believe that this bill provides
essential protection to temporary workers and will
modernize labor law to reflect the growing form of
alternate employment.
ARGUMENTS IN OPPOSITION : Other opponents, such as the
Chamber of Commerce, believe that, by tying the reporting
requirements to the payroll statement, this bill opens
businesses up to litigation risks.
ASSEMBLY FLOOR : 49-26, 5/30/12
AYES: Alejo, Allen, Ammiano, Atkins, Beall, Block,
Blumenfield, Bonilla, Bradford, Brownley, Buchanan,
Butler, Charles Calderon, Campos, Carter, Cedillo,
Chesbro, Davis, Dickinson, Eng, Feuer, Fong, Fuentes,
Furutani, Gatto, Gordon, Gorell, Hall, Hayashi, Roger
Hernández, Hill, Hueso, Huffman, Lara, Bonnie Lowenthal,
Ma, Mendoza, Mitchell, Monning, Pan, V. Manuel Pérez,
Skinner, Solorio, Swanson, Torres, Wieckowski, Williams,
Yamada, John A. Pérez
NOES: Achadjian, Bill Berryhill, Conway, Cook, Donnelly,
Beth Gaines, Garrick, Grove, Hagman, Halderman, Harkey,
Jeffries, Jones, Knight, Logue, Mansoor, Miller, Morrell,
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Nestande, Nielsen, Norby, Olsen, Portantino, Silva,
Smyth, Wagner
NO VOTE RECORDED: Fletcher, Galgiani, Huber, Perea, Valadao
PQ:d 8/17/12 Senate Floor Analyses
SUPPORT/OPPOSITION: SEE ABOVE
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