BILL ANALYSIS Ó
SB 54
Page 1
Date of Hearing: August 14, 2013
ASSEMBLY COMMITTEE ON LABOR AND EMPLOYMENT
Roger Hernández, Chair
SB 54 (Hancock) - As Amended: August 5, 2013
SENATE VOTE : (vote not relevant)
SUBJECT : Hazardous materials management: stationary sources:
skilled and trained workforce.
SUMMARY : Enacts specified provisions related to construction
and related work performed by contract at specified stationary
sources. Specifically, this bill :
1)Requires an owner or operator of specified stationary sources,
when contracting for the performance of construction,
maintenance and related work, to require that its contractors
and any subcontractors use a "skilled and trained workforce"
to perform all onsite work within an apprenticeable occupation
in the building and construction trades.
2)Defines a "skilled and trained workforce" to mean a workforce
that meets the following criteria:
a) All the workers are either registered apprentices or
"skilled journeypersons."
b) As of January 1, 2014, at least 30 percent of the
"skilled journeypersons" are graduates of approved
apprenticeship programs, as specified.
c) As of January 1, 2015, at least 45 percent of the
"skilled journeypersons" are graduates of approved
apprenticeship programs, as specified.
d) As of January 1, 2016, at least 60 percent of the
"skilled journeypersons" are graduates of approved
apprenticeship programs, as specified.
3)Defines a "skilled journeyperson" as a worker who meets all of
the following criteria:
a) The worker either graduated from an approved
apprenticeship program or has at least as many hours of
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on-the-job experience that would be required to graduate
from an approved apprenticeship program.
b) The worker is being paid at least a rate equivalent to
the prevailing hourly wage rate, as defined.
c) For work performed on or after January 1, 2018, the
worker has completed within the prior two calendar years at
least 20 hours of approved advanced safety training for
workers at high hazard facilities.
4)Provides that the requirements of this bill shall not apply to
oil and gas extraction operations.
5)Provides that the requirements of this bill shall not apply to
contracts awarded before January 1, 2014, unless the contract
is extended or renewed after this date.
6)Provides that the requirements of this bill shall not apply to
the employees or the owner or operator of the stationary
source or prevent the owner or operator from using its own
employees to perform any work that has not been assigned to
contractors while the employees of the contractor are present
and working.
7)Provides that specified provisions of the bill related to the
qualifications for skilled journeypersons shall not apply to
either of the following:
a) To the extent that the contractor has requested
qualified workers from local hiring halls but is unable to
obtain sufficient workers within 48 hours of the request.
b) To the extent that compliance is impracticable because
an emergency requires immediate action to prevent harm to
public health or safety or to the environment.
8)Requires the Chief of the Division of Apprenticeship Standards
to approve a curriculum of in-person classroom and laboratory
instruction for approved advanced safety training for workers
at high hazard facilities by January 1, 2016.
9)Makes related and conforming changes.
10)Makes related legislative findings and declarations.
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EXISTING LAW :
1)Establishes an accidental release prevention program
implemented by the Office of Emergency Services and the
appropriate administering agency in each city or county.
2)Provides that stationary sources subject to the accidental
release prevention program are required to prepare a risk
management plan (RMP) when required under certain federal
regulations or if the administering agency determines that
there is a significant likelihood of a regulated substances
accident risk.
FISCAL EFFECT : Unknown
COMMENTS : The California Accidental Release Prevention (CalARP)
Program was implemented on January 1, 1997 and replaced the
California Risk Management and Prevention Program (RMPP). The
purpose of the CalARP program is to prevent accidental releases
of substances that can cause serious harm to the public and the
environment, to minimize the damage if releases do occur, and to
satisfy community right-to-know laws. This is accomplished by
requiring businesses that handle more than a threshold quantity
of a regulated substance listed in the regulations to develop a
Risk Management Plan (RMP). An RMP is a detailed engineering
analysis of the potential accident factors present at a business
and the mitigation measures that can be implemented to reduce
this accident potential.
Among other things, the RMP contains safety information, a
hazard review, operating procedures, training requirements,
maintenance requirements, compliance audits, and incident
investigation procedures.
The CalARP program is implemented at the local government level
by Certified Unified Program Agencies (CUPAs) also known as
Administering Agencies (AAs). The CalARP program is designed so
these agencies work directly with the regulated businesses. The
CUPAs determine the level of detail in the RMPs, review the
RMPs, conduct facility inspections, and provide public access to
most of the information. Confidential or trade secret
information may be restricted.
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Stated Need for the Bill
According to the author, under existing law there are no
requirements that employees of outside contractors working at
chemical manufacturing and processing facilities, including
refineries, have a minimum level of skills training, including
safety training. This poses a risk to public health and safety
as unskilled and untrained workers may be unfamiliar with the
construction work associated with such facilities, general
facility operations and emergency plans.
Therefore, the author states that ensuring that outside
contractors that work at chemical refineries have properly
trained workers through approved apprenticeship programs will
reduce public health and safety risks.
This bill extends the Health and Safety Code provisions
applicable to industrial facilities performing hazardous
activities (e.g. refineries and chemical plants) to require that
outside contractors performing on-site work at these facilities
use a skilled and trained workforce. These facilities operate
on a 24/7 basis and present potentially serious risks to public
health and safety and to the environment. Outside contractors
at these facilities should be using a qualified workforce, not
unskilled, low-wage workers hired off the street or brought in
from other states to save money.
The bill defines a skilled and trained workforce to mean a
workforce consisting of qualified journeypersons and apprentices
registered in state-approved apprenticeship programs. Qualified
journeypersons must be graduates of an apprenticeship program or
have at least the same amount of experience as would be required
to graduate from an apprenticeship program. They also must have
completed at least 20 hours of advanced safety training in a
curriculum approved by the Chief of the Division of
Apprenticeship Standards. Contractors and subcontractors must
pay their journeypersons at least the prevailing wage for the
craft to ensure that there is no economic incentive to use less
qualified workers for these high-hazard jobs. Beginning on
January 1, 2014, at least 30 percent of a contractor's
journeyperson workforce must consist of graduates of a
state-approved apprenticeship program. That figure rises to 45
percent on January 1, 2015 and to 60 percent on January 1, 2016.
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These workforce requirements would not apply to the facility
owner's or operator's own employees, who are likely to be
familiar with high-hazard operations, only to outside
contractors. These workforce requirements also would apply
only to on-site work within an apprenticeable craft in the
building and construction trades, i.e. a skilled craft for which
the state has approved a multi-year program of classes and
supervised on-the-job training to develop skilled
journeypersons.
The bill also contains exceptions for situations in which hiring
halls cannot dispatch sufficient qualified workers within 48
hours and for emergencies.
In addition, the bill contains the following legislative
findings and declarations which provide the author and the
sponsor's justification for several specific provisions of the
bill:
"(1) The use of unskilled and untrained workers at chemical
manufacturing and processing facilities that generate,
store, treat, handle, refine, process, and transport
hazardous materials is a risk to public health and safety,
and the risk to public health and safety is particularly
high when workers are employed by outside contractors
because they generally will be less familiar with the
operations of the facility and its emergency plans and the
owner or operator of the facility will have less incentive
to invest in their training.
(2) Requiring that workers employed by outside contractors
at these facilities be paid at least at a rate equivalent
to the prevailing journeyperson wage for the occupation, or
be registered in an approved apprenticeship program, is
necessary to provide an economic incentive for employers to
use only the most skilled workers to perform work that
poses a risk to public health and safety. The wage scale is
also necessary to provide an economic incentive for the
workers to obtain the mandatory advanced safety training
required by Section 2 of this act.
(3) Requiring that apprentices be registered in programs
approved by the Chief of the Division of Apprenticeship
Standards is necessary to ensure that these workers are
receiving the proper training and on-the-job supervision
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and that the programs are subject to proper oversight.
(4) The requirement that at least 60 percent of the
journeypersons working for a contractor be graduates of an
approved apprenticeship program is necessary to ensure that
the majority of the journeypersons will have had
appropriate classroom and laboratory instruction for their
occupations. A phase-in for this requirement will avoid
disruption of the industry."
Proposed Applicability of this Bill
As discussed above, this bill applies to specified facilities
regulated under the California Accidental Release Prevention
(CalARP) Program.
The language of this bill states that it applies to the owner or
operator of a "stationary source with one or more covered
processes that is required to prepare and submit a [risk
management plan] pursuant to" a specified provision of the
Health and Safety Code (specifically Section 25531 et seq.).
A "stationary source" is defined under Health and Safety Code
Section 25532(k) by a cross-reference to a definition in federal
regulations. That federal regulation defines "stationary
source," in part, as follows:
"Stationary source means any buildings, structures,
equipment, installations, or substance emitting stationary
activities which belong to the same industrial group, which
are located on one or more contiguous properties, which are
under the control of the same person (or persons under
common control), and from which an accidental release may
occur. The term stationary source does not apply to
transportation, including storage incident to
transportation, of any regulated substance or any other
extremely hazardous substance under the provisions of this
part. A stationary source includes transportation
containers used for storage not incident to transportation
and transportation containers connected to equipment at a
stationary source for loading or unloading?" (40 C.F.R. §
68.3).
A "covered process" is defined as a process that has specified
regulated substances in more than a threshold quantity as
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determined by federal or state law. Health and Safety Code
Section 25532(c). Existing law generally provides that if the
Administering Agency (AA) determines that there is a significant
likelihood of a regulated substances accident risk, it shall
require the stationary source to prepare and submit an RMP.
Health and Safety Code Section 25534.
Therefore, the language of this bill specifies that it would
apply to the owner or operator of a "stationary source with one
or more covered processes that is required to prepare and submit
a [risk management plan]" pursuant to these provisions of
existing law. The legislative findings and declarations refers
to the target of this bill as "chemical manufacturing and
processing facilities that generate, store, treat, handle,
refine, process, and transport hazardous materials."
The author and the sponsor may wish to ensure that the current
definition contained in the bill adequately and narrowly covers
the intended facilities the legislation is designed to cover.
Interagency Working Group on Refinery Safety
In the aftermath of a serious chemical release and fire at
Chevron's Richmond oil refinery in August, 2012, the Brown
Administration formed an Interagency Working Group to examine
ways to improve public and worker safety through enhanced
oversight of refineries, and to strengthen emergency
preparedness in anticipation of any future incident. The
Working Group consisted of participants from 13 agencies and
departments, as well as the Governor's office. Over an
eight-month period, the Working Group met internally and with
industry, labor, community, environmental, academic, local
emergency response and other stakeholders. In July 2013, the
Working Group issued a draft report with numerous findings and
recommendations.
The draft report may be accessed at:
http://www.dir.ca.gov/DOSH/Reports/InteragencyWorkingGroupReport.
pdf
According to the author, this bill "augments the recommendations
in Governor Brown's Interagency Working Group on Refinery
Safety, which released a report in July 2013 titled 'Improving
Public and Worker Safety at Oil Refineries.' The report lists
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several recommendations [to] improve public and worker safety
through enhanced oversight of refineries, and to strengthen
emergency preparedness in anticipation of any future incident."
RELATED LEGISLATION :
This bill contains language that is similar, but not identical,
to language contained in AB 26 (Bonilla) of this year. However,
AB 26 is limited to refinery projects funded by the AB 32
Greenhouse Gas Reduction Fund. AB 26 passed the Assembly by a
51-25 vote in May, but was not heard in the Senate Committee on
Labor and Industrial Relations.
ARGUMENTS IN SUPPORT :
This bill is sponsored by the State Building and Construction
Trades Council of California, who writes the following in
support:
"This legislation will improve the safety of chemical
manufacturing facilities, including refineries, by creating
a standard for training on the industrial work performed at
these facilities and will encourage chemical manufacturers
to hire California workers.
Refinery safety has been an increasing problem in
California and across the United States. Due to growing
concerns and recent incidents that have risked the public's
health, Governor Brown and members of the Legislature
called for changes to improve safety at these facilities.
An interagency group was formed to study this issue through
various methods including meetings with stakeholders. The
Labor Occupational Health Program at UC Berkeley, which
helped facilitate both the labor and community stakeholder
meetings, published a report, "Refinery Safety in
California: Labor, Community and Fire Agency Views", and
Governor Brown's Interagency Working Group on Refinery
Safety followed up with their own draft report issued in
July 2013, titled "Improving Public and Worker Safety at
Oil Refineries."
The Interagency Working Group report provided various
recommendations, including the following statement,
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"Workers involved in maintenance, represented by building
and construction trades unions, reported that training of
most maintenance workers (non-refinery employees) is
inadequate." They also reported, "refineries use mostly
contract workers, including out-of-state workers, to
conduct maintenance during planned shutdowns of a refinery
process (also referred to as turnarounds), and that
contract workers have less training and experience and,
therefore, are less safe."
[This bill] directly responds to the need for a trained and
highly skilled workforce performing contracted out work to
improve worker and public safety for the communities
surrounding these facilities?
?The public policy supporting the law is the need to avoid
unqualified workers performing skilled work inside
high-hazard facilities. The contractors at these
facilities should be using the most skilled and qualified
workers."
ARGUMENTS IN OPPOSITION :
At the time of preparation of this analysis, there was no
opposition on file to this measure. However, the similar
measure discussed above (AB 26) generated significant opposition
from, among others, the United Steelworkers.
As the analysis of AB 26 prepared by the Senate Committee on
Labor and Industrial Relations noted:
"[Opponents] believe that this bill and the proponents are
trying to 'blame the workers' for events such as the
Chevron Richmond Refinery explosion and fire last year,
despite scientific evidence to the contrary. The United
Steelworkers (USW) argues that the US Chemical Safety
Board's Interim Investigative Report clearly states that
management's decisions were at full fault for the explosion
and fire and, in fact, it is because of the skills of the
highly trained steelworkers that there was no loss of life.
The United Steelworkers also argue that this bill replaces
permanent, long-term, certified and trained refinery
workers with temporary, contract employees. Additionally,
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they argue that this bill jeopardizes refinery safety,
refinery workers, and surrounding communities by minimizing
inclusion of safety records as a mandatory qualifying
factor for project contracts. USW would like to see the
training requirement in the bill eliminated because 20
hours of training is not sufficient to adequately train
someone. Overall, they argue that the substitution of
proprietary, fully trained United Steelworkers with
transient, migratory workers would do nothing to enhance
public safety."
REGISTERED SUPPORT / OPPOSITION :
Support
California Professional Firefighters
California Teamsters Public Affairs Council
International Association of Heat and Frost Insulators, Local 5
International Brotherhood of Boilermakers, Western States
Section
State Building and Construction Trades Council of California
(sponsor)
Opposition
None on file.
Analysis Prepared by : Ben Ebbink / L. & E. / (916) 319-2091