BILL ANALYSIS                                                                                                                                                                                                    Ó






                 Senate Committee on Labor and Industrial Relations
                                 Ted W. Lieu, Chair

          Date of Hearing: March 23, 2011              2009-2010 Regular 
          Session                              
          Consultant: Gideon L. Baum                   Fiscal:No
                                                       Urgency: No
          
                                   Bill No: SB 644
                                   Author: Hancock
                      Version: As Introduced February 18, 2011
          

                                       SUBJECT
          
                              Public works: volunteers


                                      KEY ISSUE

          Should the Legislature allow volunteers to continue to perform 
          certain work on public works projects by extending the sunset 
          date, from January 1, 2012 to January 1, 2017, on the exemption 
          that allows volunteers to perform such work and not be paid the 
          prevailing wage, as otherwise required?
          

                                       PURPOSE
          
          To extend the sunset for the exemption of volunteers from public 
          works requirements. 

                                      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 (Fish and Game Code §1501.5).
           
          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, 2012.

           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 
             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 
          Hearing Date:  March 23, 2011                            SB 644  
          Consultant: Gideon L. Baum                               Page 2

          Senate Committee on Labor and Industrial Relations 
          








          public works project out five years, from January 1, 2012 to 
          January 1, 2017.  
           

                                      COMMENTS
          
          1.  Need for this bill?

             In 2004, AB 2690 (Hancock), Chapter 330, Statutes of 2004, 
            created an exemption for volunteers from public works 
            requirements, but also included the sunset of January 1, 2009. 
              This bill came about from a 2003 Department of Industrial 
            Relations (DIR) decision, which found that a stream 
            restoration project using student volunteers should have paid 
            prevailing wages and assessed back wages and civil penalties. 

            At the time, the proponents argued that a public works 
            exemption for volunteers was needed due to the "importance of 
            volunteers in building community support for local projects", 
            many of which included environmental projects such as stream 
            restoration, beach clean-up, wetlands restoration, and trail 
            building.  In 2008, this sunset was extended until January 1, 
            2012 by AB 2537 (Furutani), Statutes of 2008, Chapter 678.  

            The proponents of this bill argue that this exemption has 
            proven successful, and therefore it is important to extend 
            this exemption for an additional 5 years to allow volunteers 
            to continue to participate in preservation activities on 
            public lands, including removing invasive species, river and 
            beach clean-ups, and maintaining walking trails.

          2.  Staff Questions:  

             Have there been any specific instances of abuse of the 
             volunteer exemption by employers or any other party?  
             
             According to the Department of Industrial Relations report on 
             volunteer labor on public works projects, there was one 
             complaint involving volunteer labor on public works projects 
             in 2009 and 2010.  In that case, a complaint was filed 
             against a contractor for failing to provide payroll reports 
             for electrical work done in a firehouse.  However, the Fire 
          Hearing Date:  March 23, 2011                            SB 644  
          Consultant: Gideon L. Baum                               Page 3

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             Chief for that district issued a statement confirming that 
             eight volunteer firemen were completing the electrical work 
             on the firehouse.

             Prior to that complaint, the only reports of abuse received 
             by the Division of Labor Standards Enforcement (DLSE) was the 
             initial complaint from 2003.  

             If the sunset were deleted, what avenues for complaint or 
             action would be available for someone who felt the volunteer 
             exemption was being abused?  
             
             Any affected party, including the body that awarded the 
             contract, can go to the Labor Commissioner and ask that an 
             investigation take place.  If it is found that a violation 
             has occurred and prevailing wages should have been paid and 
             weren't, the Labor Commissioner is empowered to assess back 
             wages and penalties.

             In certain cases, employees who were denied the prevailing 
             wage may turn to the courts for relief as well.

             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.  

          3.  Proponent Arguments  :
          Hearing Date:  March 23, 2011                            SB 644  
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            Proponents argue that during these difficult fiscal times, 
            local government need to be able to call upon volunteers to 
            complete important projects and maintain local park 
            infrastructure.  Proponents also note that hundreds of 
            restoration projects are taken up by local governments in 
            partnership with non-profits and local business, and that 
            project managers work hard to ensure that there is a clear 
            delineation between tasks for volunteers and tasks for paid 
            employees and contractors.  Proponents also note that there 
            have been no reported labor law violations on environmental 
            and restoration projects since the public works exemption was 
            put in law in 2004.

          4.    Current Legislation:  

            AB 587 (Gordon), which is currently before the Assembly 
            Committee on Labor and Employment, is nearly identical to this 
            bill.  

            AB 987 (Grove), which is currently before the Assembly 
            Committee on Labor and Employment, would make significant 
            changes to public works requirements, including the removal of 
            the sunset on the volunteer exemption. 

          5.  Prior Legislation  :

            AB 2537 (Furutani) Statutes of 2008, Chapter 678, was 
            discussed above.

            AB 2690 (Hancock), Chapter 330, Statutes of 2004, created the 
            initial public work exemption for volunteers.


                                       SUPPORT
          
          California Park and Recreation Society (CPRS)
          California Watershed Network
          Newport Bay Conservancy
          
                                     OPPOSITION
          
          Hearing Date:  March 23, 2011                            SB 644  
          Consultant: Gideon L. Baum                               Page 5

          Senate Committee on Labor and Industrial Relations 
          








          None on file.








































          Hearing Date:  March 23, 2011                            SB 644  
          Consultant: Gideon L. Baum                               Page 6

          Senate Committee on Labor and Industrial Relations