BILL NUMBER: SB 1109 AMENDED
BILL TEXT
AMENDED IN SENATE MARCH 27, 2014
INTRODUCED BY Senator Hueso
FEBRUARY 19, 2014
An act to add Sections 10338 and 10339 to the Public Contract
Code, and to amend Section 19404 of the Welfare and Institutions
Code, relating to public contracts.
LEGISLATIVE COUNSEL'S DIGEST
SB 1109, as amended, Hueso. Public State
contracts: integrated employment : persons with
disabilities .
Existing
(1) Existing law establishes
specified requirements applicable to contracts entered into
the acquisition of services by state
agencies, as provided agencies . Existing law
establishes a minimum wage for all industries but permits mentally or
physically handicapped persons to be employed at less than the
minimum wage, under specified circumstances.
This bill would remove the authorization of a successful bidder to
use lower minimum wage exemptions for specified contracts entered
into by a state agency for services rendered to the state.
(2) Existing law establishes participation goals for specified
enterprises to participate in contracts with state agencies for
construction, services, materials, supplies, equipment, alterations,
repairs, or improvements..
This bill would establish statewide participation goals of not
less than 3% for persons with disabilities business enterprises, as
defined, to participate in contracts awarded by a state agency for
services, as specified.
(3) Existing law authorizes a state agency, city or county,
political subdivision, or district of this state to purchase
materials and supplies manufactured and services provided by public
or private nonprofit California corporations operating community
rehabilitation programs serving persons with disabilities that have
indicated an interest in supplying those goods without advertising or
calling for bids.
This bill would require that a corporation employing persons with
disabilities under a contract with a state agency for goods or
services described above pay all of its employees at least the state
minimum wage for work on the contract.
This bill would state the intent of the Legislature to enact
legislation to provide that the state serve as a model for employers
in California in increasing competitive integrated employment for
individuals with disabilities by prohibiting the entering into of
contracts by the state with organizations that pay employees with
disabilities less than the minimum wage.
Vote: majority. Appropriation: no. Fiscal committee: no
yes . State-mandated local program: no.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Section 10338 is added to the
Public Contract Code , to read:
10338. (a) A successful bidder on a contract awarded under this
article is not authorized to use the minimum wage exemption under
Section 1191 or 1191.5 of the Labor Code for any employee, engaged in
any way, in providing services under the contract.
(b) This section shall apply to a contract awarded under this
article that is not subject to competitive bidding requirements.
(c) This section shall apply only to contracts entered into or
renewed on or after January 1, 2015.
SEC. 2. Section 10339 is added to the
Public Contract Code , to read:
10339. (a) Each state agency shall have a goal of awarding 3
percent of its contracts under this article to a disability business
enterprise.
(b) For purposes of this section, "disability business enterprise"
means a public or private nonprofit California corporation operating
community rehabilitation programs serving persons with disabilities.
(c) (1) Contracts performed by a disability business enterprise
under this section shall be performed by a labor force comprised
primarily of persons with disabilities, as measured by the percentage
of person-hours of direct labor devoted to the contract work.
(2) For purposes of paragraph (1), "primarily" means 75 percent or
greater.
SEC. 3. Section 19404 of the Welfare
and Institutions Code is amended to read:
19404. Any state agency, city or county, political subdivision,
or district of this state may, without advertising or calling for
bids, purchase materials and supplies manufactured and services
provided by public or private nonprofit California corporations
operating community rehabilitation programs serving persons with
disabilities who have indicated an interest in supplying those goods
and services and may, on an equitable basis apportion the business
among the interested community rehabilitation programs, provided the
goods or services meet the specifications and needs of the purchasing
agency and are purchased at a fair market price, as determined by
the appropriate state or local agency and provided that the public or
private nonprofit California corporations comply with all of the
following requirements:
(a) (1) Contract work obtained under this section shall be
performed by a labor force which is comprised primarily of persons
with disabilities, as measured by the percentage of person-hours of
direct labor devoted to the contract work.
(2) For purposes of this paragraph, "primarily" means 75 percent
or greater.
(3) Agree to make those elections permitted of any nonprofit
corporation under the federal Insurance Contributions Act and the
California Unemployment Insurance Code in order to provide social
security and unemployment and disability benefits for its employees
commencing with its first contract or purchase order under this
section and continuing thereafter. In the event that the nonprofit
corporation ceases to provide those benefits, any existing contract
or purchase order under this section with the corporation is
terminated and no further contracts or purchase orders shall be
awarded to that corporation for the period of two years after the
corporation ceases to provide the benefits. For the purposes of this
subdivision, a person with a disability shall be considered an
employee when performing productive work.
(4) Provide in its articles of incorporation that at least two of
the directors of its board of directors shall be comprised of persons
with disabilities or the parents, guardians, or conservators of
individuals with disabilities. Directors who are also employees of
the nonprofit corporation shall not participate in or be present at
discussions of the board of directors concerned with labor-management
contract negotiations.
(5) Provide for disabled employees of the nonprofit corporation
benefits and other employer-employee agreements substantially equal
to those benefits and agreements entered into between each nonprofit
corporation and the representatives designated by a majority of the
employees.
(6) Not commit any unfair labor practices as defined in Section 8
(a) of the National Labor Relations Act.
(7) Abide by the provisions of the Federal Fair Labor Standards
Act, the Walsh-Healy Public Contract Act, the Wagner O'Day Act, and
the regulations of the State Division of Industrial Welfare.
(8) Notwithstanding any other law, each employee who performs work
for a state agency under a contract pursuant to this section, shall
be paid at the state minimum wage rate or a higher rate.
(b) For purposes of this section a "person with a disability"
means any person, other than a person who is blind, who is so
severely incapacitated by any physical or mental disability that he
or she cannot currently engage in normal competitive employment
because of the disability.
SECTION 1. It is the intent of the Legislature
to enact legislation to provide that the state serve as a model for
employers in California in increasing competitive integrated
employment for individuals with disabilities by prohibiting the
entering into of contracts by the state with organizations that pay
employees with disabilities less than the minimum wage.