Amended in Senate June 24, 2013

Amended in Senate June 14, 2013

Amended in Assembly April 17, 2013

California Legislature—2013–14 Regular Session

Assembly BillNo. 1336


Introduced by Assembly Member Frazier

February 22, 2013


An act to amend Sections 1741, 1771.2, and 1776 of the Labor Code, relating to public works.

LEGISLATIVE COUNSEL’S DIGEST

AB 1336, as amended, Frazier. Prevailing wages: payroll records.

Existing law requires the Labor Commissioner, if the commissioner or his or her designee determines after an investigation that there has been a violation of the public works provisions, to issue a civil wage and penalty assessment to the contractor or subcontractor, or both. The assessment is required to be in writing, describe the nature of the violation and the amount of wages, penalties, and forfeitures due, and include the basis for the assessment. The assessment is required to be served not later than 180 days after the filing of a valid notice of completion in the office of the county recorder in each county in which the public work or some part thereof was performed, or not later than 180 days after acceptance of the public work, whichever occurs last. If the assessment is served after the expiration of the 180-day period, but before the expiration of an additional 180 days, and the awarding body has not yet made full payment to the contractor, the assessment is valid up to the amount of the funds retained.

This bill would change the deadline for service of the assessment to not later than 18 months after the filing of a valid notice of completion in the office of the county recorder in each county in which the public work or some part thereof was performed, or not later than 18 months after acceptance of the public work, whichever occurs last. The bill would delete the provisions with regard to an assessment served after the expiration of the 180-day period.

Existing law requires contractors engaged in public works to pay employees the prevailing wage, as determined by the Director of Industrial Relations, and to comply with requirements relating to recordkeeping and employee work schedules. A joint labor-management committee, established pursuant to a specified provision of federal law, is authorized to bring an action against any employer who fails to pay prevailing wages as required by state law. The action is required to be commenced not later than 180 days after the filing of a valid notice of completion in the office of the county recorder in each county in which the public work, or some part thereof, was performed, or not later than 180 days after acceptance of the public work, whichever occurs last.

This bill would delete the 180-day requirement and would instead require that the action be commenced not later than 18 months after the filing of a valid notice of completion in the office of the county recorder in each county in which the public work or some part thereof was performed, or not later than 18 months after acceptance of the public work, whichever occurs last. The bill would require, among other things, the court, in an action on prevailing wages, to award restitution to an employee for unpaid wages, plus interest, from the date the wages became payable, and liquidated damages equal to the amount of unpaid wages owed, and would authorize the imposition of civil penaltiesbegin insert only against an employer that failed to pay the prevailing wage to its employeesend insert, injunctive relief, or any other appropriate equitable relief.

Existing law requires each contractor and subcontractor to keep accurate payroll records showing the name, address, social security number, work classification, straight time, and overtime hours worked each day and week, and the actual per diem wages paid to each journeyman, apprentice, worker, or other employee employed by him or her in connection with the public work. Any copy of records made available for inspection by, or furnished to, a joint labor-management committee is required to be marked or obliterated only to prevent disclosure of an individual’s name and social security number.

This bill would instead require that any copy of payroll records made available for inspection by, or furnished to, a joint labor-management committee, established pursuant to federal law, is required to be marked or obliterated only to prevent disclosure of an individual’s social security number. The bill would also require that any copy of records made available for inspection by, or furnished to, a multiemployer Taft-Hartley trust fund that requests the records for the purposes of allocating contributions to participants be marked or obliterated only to prevent disclosure of an individual’s full social security number, but provide the last 4 digits of the social security number. The bill would make other technical, nonsubstantive changes to these provisions.

Vote: majority. Appropriation: no. Fiscal committee: yes. State-mandated local program: no.

The people of the State of California do enact as follows:

P3    1

SECTION 1.  

Section 1741 of the Labor Code is amended to
2read:

3

1741.  

(a) If the Labor Commissioner or his or her designee
4determines after an investigation that there has been a violation of
5this chapter, the Labor Commissioner shall with reasonable
6promptness issue a civil wage and penalty assessment to the
7contractor or subcontractor, or both. The assessment shall be in
8writing, shall describe the nature of the violation and the amount
9of wages, penalties, and forfeitures due, and shall include the basis
10for the assessment. The assessment shall be served not later than
1118 months after the filing of a valid notice of completion in the
12office of the county recorder in each county in which the public
13work or some part thereof was performed, or not later than 18
14months after acceptance of the public work, whichever occurs last.
15 Service of the assessment shall be completed pursuant to Section
161013 of the Code of Civil Procedure by first-class and certified
17mail to the contractor, subcontractor, and awarding body. The
18assessment shall advise the contractor and subcontractor of the
19procedure for obtaining review of the assessment. The Labor
20Commissioner shall, to the extent practicable, ascertain the identity
21of any bonding company issuing a bond that secures the payment
22of wages covered by the assessment and any surety on a bond, and
23shall serve a copy of the assessment by certified mail to the bonding
24company or surety at the same time service is made to the
P4    1contractor, subcontractor, and awarding body. However, no
2bonding company or surety shall be relieved of its responsibilities
3because it failed to receive notice from the Labor Commissioner.

4(b) Interest shall accrue on all due and unpaid wages at the rate
5described in subdivision (b) of Section 3289 of the Civil Code.
6The interest shall accrue from the date that the wages were due
7and payable, as provided in Part 7 (commencing with Section
81720) of Division 2, until the wages are paid.

9(c) (1) The Labor Commissioner shall maintain a public list of
10the names of each contractor and subcontractor who has been found
11to have committed a willful violation of Section 1775 or to whom
12a final order, which is no longer subject to judicial review, has
13been issued.

14(2) The list shall include the date of each assessment, the amount
15of wages and penalties assessed, and the amount collected.

16(3) The list shall be updated at least quarterly, and the
17contractor’s or subcontractor’s name shall remain on that list until
18the assessment is satisfied, or for a period of three years beginning
19from the date of the issuance of the assessment, whichever is later.

20

SEC. 2.  

Section 1771.2 of the Labor Code is amended to read:

21

1771.2.  

(a) A joint labor-management committee established
22pursuant to the federal Labor Management Cooperation Act of
231978 (29 U.S.C. Sec. 175a) may bring an action in any court of
24competent jurisdiction against an employer that fails to pay the
25prevailing wage to its employees, as required by this article. This
26action shall be commenced not later than 18 months after the filing
27of a valid notice of completion in the office of the county recorder
28in each county in which the public work or some part thereof was
29performed, or not later than 18 months after acceptance of the
30public work, whichever occurs last.

31(b) (1) In an action brought pursuant to this section, the court
32shall award restitution to an employee for unpaid wages, plus
33interest, under Section 3289 of the Civil Code from the date that
34the wages became due and payable, and liquidated damages equal
35to the amount of unpaid wages owed, and may impose civil
36penaltiesbegin insert, only against an employer that failed to pay the prevailing
37wage to its employees,end insert
in accordance with Section 1775, injunctive
38relief, or any other appropriate form of equitable relief. The court
39shall follow the same standards and have the same discretion in
40setting the amount of penalties as are provided by subdivision (a)
P5    1of Section 1775. The court shall award a prevailing joint
2labor-management committee its reasonable attorney’s fees and
3costs incurred in maintaining the action, including expert witness
4fees.

5(2) An action pursuant to this section shall not be based on the
6employer’s misclassification of the craft of a worker in its certified
7payroll records.

8(3) Liquidated damages shall be awarded only if the complaint
9alleges with specificity the wages due and unpaid to the individual
10workers, including how that amount was calculated, and the
11defendant fails to pay the wages, deposit that amount with the
12court to be held in escrow, or provide proof to the court of an
13adequate surety bond to cover the wages, within 60 days of service
14of the complaint. Liquidated damages shall be awarded only on
15the wages found to be due and unpaid. Additionally, if the
16defendant demonstrates to the satisfaction of the court that the
17defendant had substantial grounds for contesting that a portion of
18the allegedly unpaid wages were owed, the court may exercise its
19discretion to waive the payment of the liquidated damages with
20respect to that portion of the unpaid wages.

21(4) This subdivision does not limit any other available remedies
22for a violation of this chapter.

23

SEC. 3.  

Section 1776 of the Labor Code is amended to read:

24

1776.  

(a) Each contractor and subcontractor shall keep accurate
25payroll records, showing the name, address, social security number,
26work classification, straight time and overtime hours worked each
27day and week, and the actual per diem wages paid to each
28journeyman, apprentice, worker, or other employee employed by
29him or her in connection with the public work. Each payroll record
30shall contain or be verified by a written declaration that it is made
31under penalty of perjury, stating both of the following:

32(1) The information contained in the payroll record is true and
33correct.

34(2) The employer has complied with the requirements of
35Sections 1771, 1811, and 1815 for any work performed by his or
36her employees on the public works project.

37(b) The payroll records enumerated under subdivision (a) shall
38be certified and shall be available for inspection at all reasonable
39hours at the principal office of the contractor on the following
40basis:

P6    1(1) A certified copy of an employee’s payroll record shall be
2made available for inspection or furnished to the employee or his
3or her authorized representative on request.

4(2) A certified copy of all payroll records enumerated in
5subdivision (a) shall be made available for inspection or furnished
6upon request to a representative of the body awarding the contract
7and the Division of Labor Standards Enforcement of the
8Department of Industrial Relations.

9(3) A certified copy of all payroll records enumerated in
10subdivision (a) shall be made available upon request by the public
11for inspection or for copies thereof. However, a request by the
12public shall be made through either the body awarding the contract
13or the Division of Labor Standards Enforcement. If the requested
14payroll records have not been provided pursuant to paragraph (2),
15the requesting party shall, prior to being provided the records,
16reimburse the costs of preparation by the contractor, subcontractors,
17and the entity through which the request was made. The public
18may not be given access to the records at the principal office of
19the contractor.

20(c) The certified payroll records shall be on forms provided by
21the Division of Labor Standards Enforcement or shall contain the
22same information as the forms provided by the division. The
23payroll records may consist of printouts of payroll data that are
24maintained as computer records, if the printouts contain the same
25information as the forms provided by the division and the printouts
26are verified in the manner specified in subdivision (a).

27(d) A contractor or subcontractor shall file a certified copy of
28the records enumerated in subdivision (a) with the entity that
29requested the records within 10 days after receipt of a written
30request.

31(e) Except as provided in subdivision (f), any copy of records
32made available for inspection as copies and furnished upon request
33to the public or any public agency by the awarding body or the
34Division of Labor Standards Enforcement shall be marked or
35obliterated to prevent disclosure of an individual’s name, address,
36and social security number. The name and address of the contractor
37awarded the contract or the subcontractor performing the contract
38shall not be marked or obliterated. Any copy of records made
39available for inspection by, or furnished to, a multiemployer
40Taft-Hartley trust fund (29 U.S.C. Sec. 186(c)(5)) that requests
P7    1the records for the purposes of allocating contributions to
2participants shall be marked or obliterated only to prevent
3disclosure of an individual’s full social security number, but shall
4provide the last four digits of the social security number. Any copy
5of records made available for inspection by, or furnished to, a joint
6labor-management committee established pursuant to the federal
7Labor Management Cooperation Act of 1978 (29 U.S.C. Sec. 175a)
8shall be marked or obliterated only to prevent disclosure of an
9individual’s social security number.

10(f) (1) Notwithstanding any other provision of law, agencies
11that are included in the Joint Enforcement Strike Force on the
12Underground Economy established pursuant to Section 329 of the
13Unemployment Insurance Code and other law enforcement
14agencies investigating violations of law shall, upon request, be
15provided nonredacted copies of certified payroll records. Any
16copies of records or certified payroll made available for inspection
17and furnished upon request to the public by an agency included in
18the Joint Enforcement Strike Force on the Underground Economy
19or to a law enforcement agency investigating a violation of law
20shall be marked or redacted to prevent disclosure of an individual’s
21name, address, and social security number.

22(2) An employer shall not be liable for damages in a civil action
23for any reasonable act or omission taken in good faith in
24compliance with this subdivision.

25(g) The contractor shall inform the body awarding the contract
26of the location of the records enumerated under subdivision (a),
27including the street address, city, and county, and shall, within five
28working days, provide a notice of a change of location and address.

29(h) The contractor or subcontractor has 10 days in which to
30comply subsequent to receipt of a written notice requesting the
31records enumerated in subdivision (a). In the event that the
32contractor or subcontractor fails to comply within the 10-day
33period, he or she shall, as a penalty to the state or political
34subdivision on whose behalf the contract is made or awarded,
35forfeit one hundred dollars ($100) for each calendar day, or portion
36thereof, for each worker, until strict compliance is effectuated.
37Upon the request of the Division of Labor Standards Enforcement,
38these penalties shall be withheld from progress payments then due.
39A contractor is not subject to a penalty assessment pursuant to this
P8    1section due to the failure of a subcontractor to comply with this
2section.

3(i) The body awarding the contract shall cause to be inserted in
4the contract stipulations to effectuate this section.

5(j) The director shall adopt rules consistent with the California
6Public Records Act (Chapter 3.5 (commencing with Section 6250)
7of Division 7 of Title 1 of the Government Code) and the
8Information Practices Act of 1977 (Title 1.8 (commencing with
9Section 1798) of Part 4 of Division 3 of the Civil Code) governing
10the release of these records, including the establishment of
11reasonable fees to be charged for reproducing copies of records
12required by this section.



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