Amended in Senate June 2, 2014

Amended in Assembly April 24, 2014

California Legislature—2013–14 Regular Session

Assembly BillNo. 1939


Introduced by Assembly Member Daly

February 19, 2014


An act to add Section 1784 to the Labor Code, relating to public works.

LEGISLATIVE COUNSEL’S DIGEST

AB 1939, as amended, Daly. Public works: prevailing wages: contractor’s costs.

Existing law generally requires the payment of not less than the prevailing rate of per diem wages for work of a similar character in the locality in which the public work, as defined, is performed, and not less than the prevailing rate for holiday and overtime work, to workers employed on public works projects of greater than $1,000. Existing law requires an awarding body, as defined, to obtain the general prevailing rate of per diem wages, as determined by the Department of Industrial Relations.

Existing law authorizes a contractor to bring an action in a court of competent jurisdiction to recover from an awarding body specified labor costs, penalties, and legal fees if either the awarding body previously affirmatively represented to the contractor that the work to be covered by the bid or contract was not a “public work” or the awarding body received actual written notice from the Department of Industrial Relations that the work to be covered by the bid or contract is a “public work” and failed to disclose that information to the contractor. Existing law also authorizes a contractor to bring an action to recover from the body awarding a contract for a public work, or otherwise undertaking any public work, any increased costs incurred by the contractor as a result of a decision of the awarding body, the Department of Industrial Relations, or a court that classifies the work as a “public work,” if that body, before the bid opening or awarding of the contract, failed to identify as a “public work” in the bid specification or in the contract documents that portion of the work that the decision classifies as a “public work.”

This bill would authorize a contractorbegin insert, as defined,end insert to bring an action in a court of competent jurisdiction to recover from thebegin delete party itend deletebegin insert hiring party, as defined, that the contractorend insert directly contracts with, any increased costs, including labor costs, penalties, and legal fees incurred as a result of any decision by the Department of Industrial Relations, the Labor and Workforce Development Agency, or a court that classifies, after the time at which thebegin delete contractingend deletebegin insert hiringend insert party accepts the contractor’s bid, awards the contractor a contract when no bid is solicited, or otherwise allows construction to proceed, the work covered by the project, or any portion thereof, as a public work, except under the circumstances specified.

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

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

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SECTION 1.  

Section 1784 is added to the Labor Code, to read:

2

1784.  

(a) Notwithstanding any other law, a contractor may
3bring an action in a court of competent jurisdiction to recover from
4thebegin delete party itend deletebegin insert hiring party that the contractorend insert directly contracts with,
5any increased costs attributable solely to the provisions of this
6chapter, including, but not limited to, the difference between the
7wages actually paid to an employee and the wages that were
8required to be paid to an employee under this chapter, any penalties
9or other sums required to be paid under this chapter, and costs and
10attorney’s fees for the action incurred by the contractor as a result
11of any decision by the Department of Industrial Relations, the
12Labor and Workforce Development Agency, or a court that
13classifies, after the time at which thebegin delete contractingend deletebegin insert hiringend insert party
14accepts the contractor’s bid, awards the contractor a contract under
15circumstances when no bid is solicited, or otherwise allows
P3    1construction by the contractor to proceed, the work covered by the
2project, or any portion thereof, as a “public work,” as defined in
3this chapter,begin delete unlessend deletebegin insert except to the extent thatend insert either of the following
4is true:

5(1) Thebegin insert owner orend insert developerbegin delete of a construction projectend delete or its agent
6expressly advised the contractor that the work to be covered by
7the contract would be a “public work,” as defined in thisbegin delete chapter.end delete
8begin insert chapter, or is otherwise subject to the payment of prevailing wages.end insert

9(2) Thebegin insert hiringend insert partybegin delete with whom the contractor has a direct
10contractend delete
expressly advised the contractor that the work subject to
11the contract would be a “public work,” as defined in thisbegin delete chapter.end delete
12begin insert chapter, or is otherwise subject to the payment of prevailing wages.end insert

13(b) To be entitled to the recovery of increased costs described
14in subdivision (a), the contractor shall notify thebegin insert hiringend insert partybegin delete with
15whom the contractor has a direct contractend delete
and thebegin insert owner orend insert
16 developer within 30 days after receipt of the notice of a decision
17by the Department of Industrial Relations or the Labor and
18Workforce Development Agency, or the initiation of any action
19in a court alleging, that the work covered by the project, or any
20portion thereof, is a “public work,” as defined in this chapter.

21(c) A contractor is not required to list any prevailing wages or
22apprenticeship standard violations on a prequalification
23questionnaire that are the direct result of the failure of the begin delete developer
24of a construction project or its agent, or a contractor, to notify
25contractorsend delete
begin insert owner or developer or its agent, or a hiring party, to
26notify the contractorend insert
that the project, or any portion thereof,begin delete should
27have beenend delete
begin insert wasend insert a “public work,” as defined in this chapter.

28(d) This section does not apply to private residential projects
29built on private property unless the project is built pursuant to an
30agreement with a state agency, redevelopment agency, or local
31public housing authority.

32(e) This section does not apply if the conduct of the contractor
33caused the project to be a “public work,” as defined in this chapter,
34or if the contractor has actual knowledge that the work is a “public
35work,” as defined in this chapter.

begin insert

36(f) For purposes of this section, “hiring party” means the party
37that has a direct contract for services provided by the contractor
38who is seeking recovery pursuant to subdivision (a) on a private
39works project that was subsequently determined to be a public
40work by the Department of Industrial Relations or the Labor and
P4    1Workforce Development Agency, or by the initiation of any action
2in a court alleging that the work covered by the project, or any
3portion thereof, was a public work.

end insert
begin insert

4(g) A contractor may seek recovery pursuant to this section only
5from a hiring party with whom the contractor has a direct contract.

end insert
begin insert

6(h) For purposes of this section, “contractor” means a person
7or entity licensed by the Contractors’ State Licensing Board that
8has a direct contract with the hiring party to provide services on
9private property or for the benefit of a private owner or developer.

end insert


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