Amended in Senate April 1, 2013

Senate Bill No. 516

Introduced by Senator Steinberg

February 21, 2013

An act begin insert to amend Sections 9998.1, 9998.6, and 9998.8 of, to add Sections 9998.1.5, 9998.2.5, 9998.10, and 9998.11 to, and to repeal and add Section 9998.2 of, the Business and Professions Code, end insert relating to begin delete human trafficking end delete begin insert foreign labor contractors end insert .

LEGISLATIVE COUNSEL’S DIGEST

SB 516, as amended, Steinberg. begin delete Human trafficking. end delete begin insert Foreign labor contractors: registration. end insert

begin insert

Existing federal law permits certain aliens to engage in employment in the United States under specified conditions. Existing state law regulates the services of foreign labor contractors, as defined, with regard to contracts, recruitment procedures and representations, and information as to terms and conditions of employment. Existing law provides that any person who violates the latter provisions is guilty of a misdemeanor. Existing law also permits any person aggrieved by a violation of these provisions to bring an action for injunctive relief or damages, or both, and authorizes recovery of damages, costs, and reasonable attorney’s fees, in an amount not less than $500, if the aggrieved person prevails on the action.

end insert begin insert

Under existing state law, the Division of Labor Standards Enforcement in the Department of Industrial Relations, under the direction of the Labor Commissioner, enforces and administers the licensing and supervision of farm labor contractors.

end insert begin insert

This bill would require a foreign labor contractor to register with the Labor Commissioner and pay a specified fee, upon satisfying specified conditions. The bill would require the commissioner to enforce and administer the registration and supervision of foreign labor contractors. The bill would prohibit a person from entering into an agreement for the services of a foreign labor contractor that is not registered with the commissioner. The bill would also require foreign labor contractors to disclose specified information and deposit with the commissioner a surety bond in a specified amount, for payment of any amount adjudicated against the foreign labor contractor, as a condition of registration, as specified. The bill would further require persons using the services of foreign labor contractors to obtain foreign workers to disclose specified information and deposit with the commissioner a surety bond in a specified amount, for payment of any amount adjudicated against that person, as specified.

end insert begin insert

The bill would require a foreign labor contractor to disclose in writing to each foreign worker who is recruited for employment certain information, as specified. The bill would prohibit a foreign labor contractor and its agent from assessing a fee or cost to a foreign worker for employment services, as defined. The bill would also prohibit charging a foreign worker with any costs or expenses not customarily assessed against similarly situated workers, and would limit the amount of housing costs charged to the foreign worker to the market rate for similar housing. The bill would prohibit requiring a foreign worker to pay any costs or expenses prior to commencement of work.

end insert begin insert

The bill would authorize a civil penalty for violations of these provisions, and would authorize the commissioner or a person aggrieved by a violation of these provisions to bring an action for injunctive relief or damages, or both, and would authorize recovery of damages, costs, and reasonable attorney’s fees, as specified, including enforcement of liability against the bonds deposited with the commissioner. The bill would provide for the joint and several liability of foreign labor contractors and persons using the foreign labor contractors’ services. The bill would further authorize a person who, upon information and belief, claims a violation of these provisions has been committed to bring a civil action for injunctive relief on behalf of the general public and, upon prevailing, recover reasonable attorney’s fees and costs. Because this bill would expand the scope of the provisions regulating foreign labor contractors, a violation of which is a misdemeanor, this bill would impose a state-mandated local program.

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The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.

end insert begin insert

This bill would provide that no reimbursement is required by this act for a specified reason.

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Existing law, as amended by Proposition 35, the Californian’s Against Sexual Exploitation Act, an initiative measure approved by the voters at the November 6, 2012, statewide general election, provides that any person who deprives or violates the personal liberty of another with the intent to obtain forced labor or services is guilty of human trafficking and is punishable by imprisonment in the state prison, as specified, and by a fine of not more than $500,000.

end delete begin delete

This bill would express the intent of the Legislature to enact legislation aimed at eradicating slavery and human trafficking.

end delete

Vote: majority. Appropriation: no. Fiscal committee:  begin delete no end delete begin insert yes end insert . State-mandated local program:  begin delete no end delete begin insert yes end insert .

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

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begin insert SECTION 1. end insert   

end insert begin insert

The Legislature finds and declares all of the
following:

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(a) Foreign labor contractors are increasingly relied upon to
facilitate the movement of labor from one country to another.
California is the leading destination state in the United States for
temporary foreign workers. As of January 2011, there were
130,000 temporary foreign workers in California.

end insert begin insert

(b) While many foreign labor contractors behave ethically and
are engaged in lawful conduct, some foreign labor contractors
are often complicit with, or are directly involved in, the illegal
trafficking of foreign workers.

end insert begin insert

(c) Unscrupulous foreign labor contractors often charge
exorbitant fees for their services, force foreign workers into debt
bondage, falsify documents, and deceive foreign workers about
the terms and conditions of work, thereby increasing their
vulnerability to human trafficking.

end insert begin insert

(d) The incidence of known human trafficking cases involving
foreign labor recruiters is increasing dramatically in the United
States. Stricter regulation of foreign labor contractors will ensure
the integrity of the Californian economy, which is undermined
when unregulated persons conspire to fraudulently deceive foreign
workers about the terms and conditions of work.

end insert begin insert

(e) California already regulates farm labor contractors through
a comprehensive licensing system and provides some oversight of
the activities of foreign labor contractors. This bill expands
regulation of the activities of foreign labor contractors by the
following:

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(1) Requiring foreign labor contractors to register with the
appropriate state agency.

end insert begin insert

(2) Requiring disclosure of the use of foreign labor contractors,
and their agents, by persons seeking to employ foreign workers.

end insert begin insert

(3) Imposing penalties on a person using an unregistered foreign
labor contractor to obtain foreign workers or employees.

end insert begin insert

(4) Expanding the remedies available to foreign workers
aggrieved by the actions of foreign labor contractors and those
acting in concert with them.

end insert

begin insert

begin insert SEC. 2. end insert   

end insert

begin insert Section 9998.1 of the end insert begin insert Business and Professions Code end insert
begin insert is amended to read: end insert

9998.1.  

The following definitions are applicable to this chapter:

(a) “Person” includes any natural person, company, firm,
partnership begin delete , end delete or joint venture, association, corporation, limited
liability company, or sole proprietorship.

(b) “Compensation” means all forms of remuneration or
consideration for the provision of employment services to foreign
workers by a foreign labor contractor.

(c) “Employment services” includes, but is not limited to,
procuring employment, marketing labor, begin insert processing visa
applications, end insert or otherwise arranging the employment or
transportation, housing, and other living accommodations for
foreign workers either on behalf of those begin insert foreign end insert workers or on
behalf of another begin delete party. end delete begin insert person, including services performed
outside the United States. end insert

(d) “Foreign worker” means any person seeking employment
who is not a United States citizen but who is authorized by the
federal government to work in the United States, including a person
who engages in temporary nonagricultural labor pursuant to Section
1101(a)(15)(H)(ii)(b) of Title 8 of the federal Immigration and
Nationality Act.

(e) “Foreign labor contractor” means any person who for
compensation agrees to assist in securing or who actually secures
for or provides employment services to foreign workers.

begin insert

begin insert SEC. 3. end insert   

end insert

begin insert Section 9998.1.5 is added to the end insert begin insert Business and
Professions Code end insert begin insert , to read: end insert

begin insert

begin insert 9998.1.5. end insert   

(a) On and after July 1, 2015, a person acting as a
foreign labor contractor shall register with the Labor
Commissioner in accordance with the terms and procedures for
registration established by the commissioner by January 1, 2015.
On and after August 1, 2015, the commissioner shall post on its
Internet Web site the names and contact information for all
registered foreign labor contractors and a list of the names and
contact information for any foreign labor contractors denied
renewal or registration.

(b) The Labor Commissioner may not register a person to act
as a foreign labor contractor, and may not renew a registration,
until all of the following conditions are satisfied:

(1) The person has executed a written application in a form
prescribed by the commissioner, subscribed and sworn to by the
person, and containing all of the following:

(A) A statement by the person of all facts required by the
commissioner concerning the applicant’s character, competency,
responsibility, and the manner and means by which the person
proposes to conduct operations as a foreign labor contractor if
registered.

(B) The names and addresses of all persons, except bona fide
employees on stated salaries, financially interested, either as
partners, associates, or profit sharers, in the proposed operation
as a foreign labor contractor, together with the amount of their
respective interests.

(C) A declaration consenting to the designation by a court or
the commissioner as an agent available to accept service of
summons in any action against the registrant, if the registrant has
left the jurisdiction in which the action is commenced or otherwise
has become unavailable to accept service.

(2) The commissioner, after investigation, is satisfied as to the
character, competency, and responsibility of the person.

(3) (A) The person has deposited with the commissioner a surety
bond in an amount based on the size of the person’s annual gross
receipts from operations as a foreign labor contractor, as follows:

(i) For gross receipts up to five hundred thousand dollars
($500,000), a twenty-five-thousand-dollar ($25,000) bond.

(ii) For gross receipts of five hundred thousand dollars
($500,000) to two million dollars ($2,000,000), a
fifty-thousand-dollar ($50,000) bond.

(iii) For gross receipts greater than two million dollars
($2,000,000), a seventy-five-thousand-dollar ($75,000) bond.

(B) If the foreign labor contractor has been the subject of a final
judgment in a year in an amount equal to that of the bond required,
that contractor shall be required to deposit an additional bond
within 60 days. The bond shall be payable to the people of the
State of California and shall be conditioned on the foreign labor
contractor complying with all the terms and provisions of this
chapter and paying all damages occasioned to any person by
failure to do so, or by any violation of this chapter, or false
statements or misrepresentations made in the registration process.
The bond shall also be payable for interest on wages and for any
damages arising from violation of applicable orders of the
Industrial Welfare Commission, and for any other monetary relief
awarded to a foreign worker as a result of a violation of law by
the foreign labor contractor.

(4) The person has paid to the commissioner a registration fee
of five hundred dollars ($500) plus a filing fee of ten dollars ($10).

(c) The commissioner may not register a person as a foreign
labor contractor, if the person was found by a court, the Secretary
of Labor, or the commissioner to have violated any of the following
provisions:

(1) The federal Trafficking Victims Protection Act of 2000
(Division A, Public Law 106-386), as amended.

(2) Sections 1682 to 1699, inclusive, of the Labor Code.

(3) Section 236.1 of the Penal Code.

(4) An applicable guest worker program.

end insert

begin insert

begin insert SEC. 4. end insert   

end insert

begin insert Section 9998.2 of the end insert begin insert Business and Professions Code end insert
begin insert is repealed. end insert

begin delete

9998.2.  

Every contract for the provision of employment
services to foreign workers shall be written in the primary language
of the foreign worker and shall include all material terms including,
but not limited to, any and all compensation or consideration to
be provided to the foreign worker in exchange for that worker’s
labor or services, any wages, housing, transportation, other living
accommodations, and other benefits which are to be provided.

end delete

begin insert

begin insert SEC. 5. end insert   

end insert

begin insert Section 9998.2 is added to the end insert begin insert Business and Professions
Code end insert begin insert , to read: end insert

begin insert

begin insert 9998.2. end insert   

(a) On and after July 1, 2015, a person using the
services of a foreign labor contractor to procure foreign workers
or employees shall disclose this information to the Labor
Commissioner in accordance with the terms and procedures
established by the commissioner by January 1, 2015.

(b) The disclosure shall include, but is not limited to, the
following:

(1) The names and addresses of all persons, except bona fide
employees on stated salaries, financially interested, either as
partners, associates, or profit sharers, in the person’s business
enterprise, together with the amount of their respective interests.

(2) A declaration consenting to the designation by a court of
the commissioner as an agent available to accept service of
summons in any action against the person, if the person has left
the jurisdiction in which the action is commenced or otherwise
has become unavailable to accept service.

(3) A copy of the foreign labor contractor’s disclosure as
required under Section 9998.2.5 to all foreign workers or
employees obtained by the person through the services of the
foreign labor contractor or its agents.

(4) Information about the steps the person has taken to verify
the accuracy of the information provided in the foreign labor
contractor’s disclosure under Section 9998.2.5 and submitted
under paragraph (3).

(c) A person may not knowingly enter into an agreement for the
services of a foreign labor contractor that is not registered under
this chapter.

(d) (1) A person using or anticipating using the services of a
foreign labor contractor to obtain workers or employees shall
deposit with the commissioner a surety bond in an amount based
on the size of the person’s annual payroll for all employees, as
follows:

(A) For payrolls up to five hundred thousand dollars ($500,000),
a twenty-five-thousand-dollar ($25,000) bond.

(B) For payrolls of five hundred thousand dollars ($500,000)
to two million dollars ($2,000,000), a fifty-thousand-dollar
($50,000) bond.

(C) For payrolls greater than two million dollars ($2,000,000),
a seventy-five-thousand-dollar ($75,000) bond.

(2) If the person has been the subject of a final judgment in a
year in an amount equal to that of the bond required, that person
shall be required to deposit an additional bond within 60 days.
The bond shall be payable to the people of the State of California
and shall be conditioned on the person complying with all the
terms and provisions of this chapter and paying all damages
occasioned to any person by failure to do so, or by any violation
of this chapter, or false statements or misrepresentations made in
complying with this section. The bond shall also be payable for
interest on wages and for any damages arising from violation of
applicable orders of the Industrial Welfare Commission, and for
any other monetary relief awarded to a foreign worker as a result
of a violation of law by the person.

end insert

begin insert

begin insert SEC. 6. end insert   

end insert

begin insert Section 9998.2.5 is added to the end insert begin insert Business and
Professions Code end insert begin insert , to read: end insert

begin insert

begin insert 9998.2.5. end insert   

(a) A foreign labor contractor shall ascertain and
disclose in writing to each foreign worker who is recruited for
employment in English and in the primary language of the foreign
worker being recruited, at the time of the foreign worker’s
recruitment, the following information:

(1) The identity of the employer and the identity of the person
conducting the recruiting on behalf of the employer, including any
subcontractor or agent involved in the recruiting.

(2) A signed copy of the work contract, including all assurances
and terms and conditions of employment, from the prospective
employer for whom the foreign worker is being recruited, including
the compensation to be paid, the place and period of employment,
a description of the type and nature of employment activities, any
withholdings or deductions from compensation, and any penalties
for terminating employment.

(3) The type of visa under which the foreign worker is to be
employed, the length of time the visa is valid, and the terms and
conditions under which the visa will be renewed with a clear
statement of whether the employer will secure renewal of the visa
or if renewal must be obtained by the foreign worker, and any
expenses associated with securing or renewing the visa.

(4) An itemized list of any costs or expenses to be charged to
the foreign worker, including, but not limited to, the costs of
housing or accommodation, transportation to and from the
worksite, meals, medical examinations, health care or safety
equipment costs, and any other costs, expenses, or deductions to
be charged the foreign worker.

(5) A statement, in a form specified by the Labor Commissioner,
that does each of the following:

(A) States that no foreign labor contractor, or agent or employee
of a foreign labor contractor, can lawfully assess any fee, including
visa fees, processing fees, transportation fees, legal expenses,
placement fees, and other costs to a foreign worker for employment
services, and that the employer may bear the costs or fees for the
foreign labor contractor, but that these fees cannot be assessed to
the foreign worker.

(B) Explains that no additional requirements or changes may
be made from the terms of the contract originally signed by the
foreign worker, unless the foreign worker is provided at least 48
hours to review and consider the additional requirements or
changes and the foreign worker gives specific consent, voluntarily
and without threat of penalty, to each additional requirement or
change.

(C) Describes the protections afforded the foreign worker by
this chapter and by the federal Trafficking Victims Protection Act
of 2000 (Division A, Public Law 106-386), as amended, and any
applicable guest worker program, including relevant information
about the procedure for filing a complaint under this chapter, and
the telephone number for the national human trafficking resource
center hotline.

(6) Any education or training to be provided or required,
including the nature, timing, and cost of training and the person
who will pay training costs, whether the training is a condition of
employment, continued employment, or future employment, and
whether the foreign worker will be paid or remunerated during
the training period, including the rate of pay or remuneration.

(7) Any other information that the commissioner may require
by regulation.

(b) A foreign labor contractor, or the agent, subcontractor, or
employee of a foreign labor contractor, or a person using the
services of a foreign labor contractor to obtain foreign workers
or employees, may not assess any fee, including, but not limited
to, visa fees, processing fees, transportation fees, legal expenses,
placement fees, and other costs, to a foreign worker for employment
services.

(c) A foreign worker may not be required to pay any costs or
expenses that are not customarily assessed against all workers
similarly employed. No costs or expenses shall be required to be
paid by the foreign worker prior to the commencement of work.
The amount charged for providing housing to the foreign worker
shall be limited to market rate for similar housing.

end insert

begin insert

begin insert SEC. 7. end insert   

end insert

begin insert Section 9998.6 of the end insert begin insert Business and Professions Code end insert
begin insert is amended to read: end insert

9998.6.  

begin delete No end delete begin insert A end insert person begin delete shall take end delete begin insert may not intimidate, threaten,
restrain, coerce, discharge, or in end insert any begin delete action end delete begin insert manner discriminate end insert
against a foreign worker begin insert or a member of his or her family end insert in
retaliation for the foreign worker’s exercise of any right under this
chapter.

begin insert

begin insert SEC. 8. end insert   

end insert

begin insert Section 9998.8 of the end insert begin insert Business and Professions Code end insert
begin insert is amended to read: end insert

9998.8.  

(a)  begin delete Any end delete begin insert A end insert person who violates this chapter or who
causes or induces another to violate this chapter is guilty of a
misdemeanor punishable by a fine of not more than one thousand
dollars ($1,000), or imprisonment in the county jail for not more
than six months, or both.

begin insert

(b) A person who violates any provision of this chapter shall
be subject to a civil penalty of no less than one thousand dollars
($1,000) and no more than twenty-five thousand dollars ($25,000)
per violation, in addition to any other civil remedies available to
the Labor Commissioner or an aggrieved person.

end insert begin delete

(b) Any

end delete

begin insert (c) end insert begin insert   end insert begin insert The commissioner or a end insert person aggrieved by a violation of
this chapter may begin delete bring an action for injunctive relief or damages,
or both. If the person aggrieved prevails on the action, this person
shall recover damages, costs, and reasonable attorney’s fees, but
in no case shall recovery be less than five hundred dollars ($500). end delete
begin insert do all of the following: end insert

begin insert

(1) Bring an action for injunctive relief against a person who
violates this chapter and, upon prevailing, recover costs and
reasonable attorney’s fees.

end insert begin insert

(2) Bring an action for damages, against a person who violates
this chapter to recover the greater of all of his or her actual
damages or five hundred dollars ($500) per employee per violation
for an initial violation, and one thousand dollars ($1,000) per
employee for each subsequent violation, and, upon prevailing in
an action brought pursuant to this section, recover costs and
reasonable attorney’s fees.

end insert begin insert

(3) Enforce the liability on the bonds required under Section
9998.1.5 or 9998.2.

end insert begin insert

(d) Foreign labor contractors and those persons using their
services to obtain foreign workers or employees are jointly and
severally liable for violations of this chapter.

end insert begin insert

(e) Nothing in this section shall be construed to preempt or alter
any other rights or remedies, including any causes of action,
available under any other federal or state law.

end insert

begin insert

begin insert SEC. 9. end insert   

end insert

begin insert Section 9998.10 is added to the end insert begin insert Business and
Professions Code end insert begin insert , to read: end insert

begin insert

begin insert 9998.10. end insert   

The Labor Commissioner and the deputies and
representatives authorized by the commissioner in writing may
take assignments of actions on the bonds required under Section
9998.1.5 or 9998.2 by aggrieved persons and may prosecute the
actions on behalf of persons who, in the judgment of the
commissioner, are financially unable to employ counsel, in the
same manner that claims are prosecuted under Section 98 of the
Labor Code.

end insert

begin insert

begin insert SEC. 10. end insert   

end insert

begin insert Section 9998.11 is added to the end insert begin insert Business and
Professions Code end insert begin insert , to read: end insert

begin insert

begin insert 9998.11. end insert   

A person who, upon information and belief, claims
a violation of this chapter has been committed may bring a civil
action for injunctive relief on behalf of the general public and,
upon prevailing, shall recover reasonable attorney’s fees and
costs.

end insert

begin insert

begin insert SEC. 11. end insert   

end insert begin insert

No reimbursement is required by this act pursuant
to Section 6 of Article XIII B of the California Constitution because
the only costs that may be incurred by a local agency or school
district will be incurred because this act creates a new crime or
infraction, eliminates a crime or infraction, or changes the penalty
for a crime or infraction, within the meaning of Section 17556 of
the Government Code, or changes the definition of a crime within
the meaning of Section 6 of Article XIII B of the California
Constitution.

end insert

begin delete

SECTION 1.  

It is the intent of the Legislature to enact
legislation aimed at eradicating slavery and human trafficking.

end delete