BILL ANALYSIS Ó
AB 2675
Page 1
ASSEMBLY THIRD READING
AB 2675 (Labor and Employment Committee)
As Amended April 16, 2012
Majority vote
LABOR & EMPLOYMENT 7-0
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|Ayes:|Swanson, Morrell, Alejo, | | |
| |Allen, Torres, Gorell, | | |
| |Yamada | | |
| | | | |
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SUMMARY : Clarifies that portions of payments withheld to
satisfy civil wage and penalty assessments are deemed forfeited
upon receipt of a final order that is no longer subject to
judicial review.
EXISTING LAW :
1)Specifies that, before making payments to the contractor of
money due under a contract for public work, the awarding body
shall withhold and retain therefrom all amounts required to
satisfy any civil wage and penalty assessment issued by the
Labor Commissioner under existing law.
2)Provides that the amounts required to satisfy a civil wage and
penalty assessment shall not be disbursed by the awarding body
until receipt of a final order that is no longer subject to
judicial review.
3)Provides that if the awarding body has not retained sufficient
money under the contract to satisfy a civil wage and penalty
assessment based on a subcontractor's violations, the
contractor shall, upon the request of the Labor Commissioner,
withhold sufficient money due to the subcontractor under the
contract to satisfy the assessment and transfer the money to
the awarding body. These amounts shall not be disbursed by
the awarding body until receipt of a final order that is no
longer subject to judicial review.
FISCAL EFFECT : Unknown
COMMENTS : This bill makes a technical change to current law
AB 2675
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which was brought to the Assembly Labor and Employment
Committee's attention through discussions with the Department of
Industrial Relations.
Current Labor Code Section 1727 is entitled, "Withholding
payment of amounts forfeited." The existing law requires
awarding bodies and contractors to withhold from specified
payment amounts necessary to satisfy civil wage and hour
penalties issued by the Labor Commissioner. The final outcome
is resolved when there is a final order that is no longer
subject to judicial review. However, despite the fact that the
title to Labor Code Section 1727 states "forfeited," the actual
text of the law does not refer to these amounts as "forfeited."
The courts have previously characterized the amounts withheld or
retained under Section 1727 as a "forfeiture." Therefore, to
avoid any potential confusion, this bill simply clarifies that
once there is a final order that is no longer subject to
judicial review, these amounts withheld are indeed deemed
forfeited.
Analysis Prepared by : Ben Ebbink / L. & E. / (916) 319-2091
FN: 0003465