BILL ANALYSIS Ó
SB 516
Page 1
SENATE THIRD READING
SB 516 (Steinberg)
As Amended September 4, 2013
Majority vote
SENATE VOTE :38-0
LABOR & EMPLOYMENT 5-0 JUDICIARY 7-3
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|Ayes:|Roger Hernández, Alejo, |Ayes:|Wieckowski, Alejo, Chau, |
| |Chau, Gomez, Holden | |Dickinson, Garcia, |
| | | |Muratsuchi, Stone |
|-----+--------------------------+-----+--------------------------|
| | |Nays:|Wagner, Gorell, |
| | | |Maienschein |
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APPROPRIATIONS 12-5
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|Ayes:|Gatto, Bocanegra, | | |
| |Bradford, | | |
| |Ian Calderon, Campos, | | |
| |Eggman, Gomez, Hall, | | |
| |Holden, Pan, Quirk, Weber | | |
| | | | |
|-----+--------------------------+-----+--------------------------|
|Nays:|Harkey, Bigelow, | | |
| |Donnelly, Linder, Wagner | | |
| | | | |
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SUMMARY : Requires foreign labor contractors to register with
the Labor Commissioner, as well as follow additional contractual
and bonding requirements, as specified. Specifically, this
bill :
1)Requires, on and after July 1, 2015, any person acting as a
foreign labor contractor to register with the Labor
Commissioner.
2)Exempts from the definition of foreign labor contractor any
person licensed as a talent agency under existing law or
entities or persons that have obtained designation under
specified federal law related to work and study-based exchange
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visitor programs.
3)Defines "foreign labor contracting activity" to mean
recruiting or soliciting for compensation with respect to a
foreign worker who resides outside of the United States in
furtherance of that worker's employment in California.
4)Specifies that "foreign labor contracting activity" does not
include the services of an employer, or employee or an
employer, if those services are provided directly to foreign
workers solely to find workers for the employer's own use.
5)Requires the Labor Commissioner (on and after August 1, 2015)
to post on its Web site the names and contact information for
all registered foreign labor contractors.
6)Provides that 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:
a) The person has executed a written application containing
specified information.
b) The Labor Commissioner, after investigation, is
satisfied as to the character, competency, and
responsibility of the person.
c) The person has deposited a surety bond as follows:
i) For gross receipts up to $500,000, a $50,000 bond.
ii) For gross receipts of $500,000 to $2 million, a
$100,000 bond.
iii) For gross receipts over $2 million, a $150,000 bond.
d) The person has paid a registration fee of $500 plus a
filing fee of $10.
7)Provides that the Labor Commissioner may not register a person
as a foreign labor contractor if the person was found to have
violated specified provisions of state and federal law.
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8)Requires, on and after July 1, 2015, a person who knows or
should have known it is using the services of a foreign labor
contractor to disclose specified information to the Labor
Commissioner.
9)Prohibits a person from knowingly entering into a contract for
the services of a foreign labor contractor that is not
registered.
10)Requires a foreign labor contractor to disclose in writing
specified information to each foreign worker who is recruited
for employment.
11)Prohibits a foreign labor contractor or a person using the
services of a foreign labor contractor from assessing 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.
12)Provides that a foreign worker may not be required to pay any
costs or expenses that are not customarily assessed against
all workers similarly employed, as specified.
13)Provides that a person may not intimidate, threaten,
restrain, coerce, discharge, or in any manner discriminate
against a foreign worker or a member of his or her family in
retaliation for a foreign worker's exercise of any rights
under the law.
14)Provides that a person who violates any provision of these
requirements shall be subject to a civil penalty of not less
than $1,000 and not more than $25,000 per violation.
15)Provides that the Labor Commissioner or an aggrieved person
may bring enforcement actions, as specified.
16)Provides that a person shall not be jointly and severally
liable shall for any act or omission by a foreign labor
contractor engaged by the person provided the foreign labor
contractor was registered no later than the first day of such
engagement.
17)Authorizes the Labor Commissioner to adopt regulations or
policies and procedures to carry out or implement these
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provisions.
18)Makes related and conforming changes.
19)Makes related legislative findings and declarations.
FISCAL EFFECT : According to the Assembly Appropriations
Committee, this bill will result in administrative costs of
approximately $900,000 (special fund), to the Department of
Industrial Relations (DIR) to establish a foreign labor
contractor enforcement program. Of this cost, approximately
$200,000 is one-time to develop a database for online
registration and renewal similar to the farm labor contractor
enforcement program. This measure establishes a registration
and filing fee to offset implementation costs. DIR estimates
these fees will only partially offset costs and the department
will likely incur annual on-going, special fund costs of
approximately $450,000.
COMMENTS : The Coalition to Abolish Slavery & Trafficking
(CAST), sponsor of this bill, asserts that foreign workers
entering California on temporary work visas are vulnerable to
exploitation and human trafficking. Foreign labor contractors,
after making false promises to foreign workers to entice them to
work in California, employ intimidation, threats, restraint, and
coercion against foreign workers to enslave them in debt bondage
by charging exorbitant recruitment fees to the foreign worker,
who is then forced to work to pay off of the recruitment fees.
The author further asserts that "businesses are profiting at the
expense of enslaved workers, often unwittingly. Businesses need
the additional information and support of the registration
systems to ensure they protect both [U.S.] workers [as] well as
those recruited internationally by foreign labor recruiters.
Companies who behave ethically and use registered foreign labor
recruiters will benefit from the system and not be liable.
Workers will benefit as well since they will be provided more
information and access to relief if they are abused while
working in California. Moreover, in a broader context,
subjecting all employers who employ foreign workers to a common
standard will level the competitive playing field for
all-particularly the many businesses who do treat workers
fairly."
SB 516
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Analysis Prepared by : Ben Ebbink / L. & E. / (916) 319-2091
FN: 0002147