BILL ANALYSIS Ó AB 20 Page A Date of Hearing: April 22, 2015 ASSEMBLY COMMITTEE ON LABOR AND EMPLOYMENT Roger Hernández, Chair AB 20 (Alejo) - As Amended March 26, 2015 SUBJECT: Undocumented workers: California Agricultural Act SUMMARY: Enacts a framework work permit program for undocumented individuals who are agricultural employees, as specified. Specifically, this bill: 1)Requires the Employment Development Department (EDD) and the Department of Food and Agriculture, no later than February 1, 2017, to convene a working group to consult with the United States Department of Homeland Security and the United States Department of Justice to determine the legal roles and responsibilities of federal and state agencies in implementing a program to provide undocumented persons who are agricultural employees with a permit to work and live in California. 2)Provides that the working group shall consist of representatives from EDD, the Department of Food and Agriculture, the Attorney General, two Members of the Senate, two Members of the Assembly, and stakeholders, including, but not limited to, agricultural employers, farm labor contractors, and farm labor organizations. AB 20 Page B 3)Specifies issues to be addressed by the working group. 4)Requires the working group to create a report expressing its recommendations to be submitted to the Legislature and the Governor no later than July 1, 2017. 5)Requires the Governor, by August 1, 2017 to either make a formal request to the federal government to implement a program to provide undocumented persons who are agricultural employees with a permit to work and live in California, or issue an explanation as to why a formal request was not made and make recommendations to the Legislature for how a program to provide undocumented persons who are agricultural employees with a permit to work and live in California should be structured. 6)Provides that if the federal government approves or adopts a program to provide undocumented persons who are agricultural employees with a permit to work and live in California, it is the intent of the Legislature to enact necessary implementing legislation. 7)Outlines model program requirements as follows: a) The program should not be implemented until a certification is made by a designated entity that not enough legal residents in California will fill all open agricultural jobs in California. b) The program should be limited to undocumented persons who are 18 years of age and older, live in California and have performed agricultural employment in the United States for at least 863 hours or 150 workdays during the 24-month AB 20 Page C period ending on January 26, 2015, or earned seven thousand five hundred dollars ($7,500) or more from agricultural industry employment in the United States, and has maintained agricultural employment for 431 hours or 75 workdays, or earned three thousand seven hundred fifty dollars ($3,750) or more from that employment, on an annual basis after receiving the permit. c) An undocumented person shall be allowed to conclusively establish employment status by submitting specified records demonstrating the employment. d) The program shall be implemented in a manner that recognizes and takes into account the difficulties encountered by an undocumented person in obtaining evidence of employment due to the person's undocumented status, including the crediting of work in cases in which an undocumented person has been employed under an assumed name. e) The undocumented person shall submit to a fingerprinted criminal history background check. f) The undocumented person has not been convicted of a felony, or three or more misdemeanors, as confirmed by the fingerprinted criminal history background check. g) The undocumented person shall pay a fee to cover the costs of administering the program. h) The program shall extend to an undocumented person who is an immediate family member of a person to whom a work permit has been issued. The immediate family member shall AB 20 Page D be required to meet specified criteria. 8)Provides that once the program becomes authorized and operational, specified requirements including, but not limited to the following apply: a) An official or employee of the state government may engage in specified activities. b) Any person who files an application under the program and knowingly and willfully falsifies, conceals, or covers up a material fact or makes any false, fictitious, or fraudulent statements or representations, or makes or uses any false writing or document knowing that it contains any false, fictitious, or fraudulent statement or entry shall be disqualified from applying under the program. c) The entities administering the program shall ensure that employers employing workers authorized under the program make each of the following assurances: i) That the job opportunity for which an employer employs an undocumented person authorized under the program is not vacant because a worker is involved in a strike, lockout, or because of a work stoppage in the course of a labor dispute involving the job opportunity at the same place of employment. ii) That the wages and benefits provided to undocumented persons working under a permit issued under the program are comparable to the wages and benefits provided to legal residents, but in no case less than the state minimum wage. AB 20 Page E iii) That an employer participating in the program shall comply with all applicable federal, state, and local labor laws, including laws affecting migrant and seasonal agricultural workers, with respect to all United States workers and undocumented workers. d) An employer of a person permitted to work in this state under the program should provide a written record of employment, demonstrating the hours worked and wages paid, to the employee issued a permit, and provide a copy of the record to the state. 9)Provides that an employee permitted to work in this state under the program shall be entitled to the same wage, hour, and working condition protections provided to an employee who is a legal resident of California. 10)Provides that a permit issued under the program may not limit an employee to a single employer or occupation. 11)Provides that no later than three years after the program is implemented, the administering entities shall prepare and transmit to the Assembly Committee on Labor and Employment and the Senate Committee on Labor and Industrial Relations a report describing the results of a review of the implementation of, and compliance with, the requirements of the program, including specified information. 12)Makes related changes. 13)Contains legislative findings and declarations. AB 20 Page F FISCAL EFFECT: Unknown COMMENTS: This bill proposes to enact the California Agricultural Act to provide a model and framework for a program to provide undocumented persons who are agricultural employees with a permit to work and live in California. The bill's legislative findings and declarations state the following: Since 2007, California's agricultural industry has experienced the highest agricultural sales recorded to date ($36,300,000,000 in 2007, $38,400,000,000 in 2008, $34,800,000,000 in 2009, $37,500,000,000 in 2010, $43,500,000,000 in 2011, $44,300,000,000 in 2012, and $46,400,000,000 in 2013) and continues to lead the nation in gross agricultural cash receipts. California's agricultural industry is dependent on immigrant labor. One recent study of 13 California counties gathered information from 2,300 farmworkers. The profile data reported in this study suggests that 95 percent of California agricultural workers were born outside the United States and 91 percent in Mexico. On average, they have been in the United States 11.1 years. Twenty-two percent have been in the United States two years or less, 10 percent are United States citizens, 33 percent have green cards, and 57 percent are unauthorized. Of the newcomers who have been here less than two years, 99 percent are unauthorized. Immigration policies that seek to deport unauthorized farmworkers or force them to abandon their jobs in agriculture would wreak swift and substantial damage to the AB 20 Page G agricultural industry in California. California agriculture would lose much of its experienced work force that has made it the most productive agricultural area in the world. At the same time, these policies would impose a substantial human cost on hundreds of thousands of farmworkers and their children, most of whom are United States citizens. The federal employment-based immigration system is broken. The programs for admitting foreign workers for temporary and permanent jobs are rigid, cumbersome, inefficient, do little to protect the wages and working conditions of foreign and domestic workers, do not respond very well to employers' needs, and give almost no attention to adapting the number and characteristics of foreign workers to domestic labor shortages. Nevertheless, Congress has repeatedly failed to pass comprehensive immigration reform including the Agricultural Job Opportunity, Benefits, and Security Act. Instead Congress is considering making the E-Verify program mandatory for all employers. Requiring agricultural employers to verify whether workers are employment-authorized would eliminate a significant portion of the existing agricultural workforce with no certainty that these vacancies will be filled by legal residents. Due to the absence of federal action on comprehensive immigration reform, the counterproductive results of E-Verify, and the unworkable framework of the federal H-2A guest worker program, agricultural interests in Oklahoma and Utah have introduced legislation creating state guest worker programs and several other states are considering the introduction of similar state initiatives. Recognizing the significant contributions that AB 20 Page H unauthorized workers make to California's economy and the need to bring these workers out of the shadows in order to improve worker conditions and at the same time provide a legal workforce for the agricultural industry, it is imperative that a program be created for current unauthorized workers in these industries. PREVIOUS EFFORTS AT FEDERAL "AgJOBS" LEGISLATION: For several years, bipartisan legislation was introduced with broad support in Congress. This legislation has generally been referred to as the Agricultural Job Opportunities, Benefits and Security Act (or "AgJOBS"). The "AgJOBS" compromise was carefully negotiated by employee groups such as the United Farm Workers and major agribusiness employers after years of intense conflict. AgJOBS has traditionally been endorsed by major labor and management representatives, as well as a broad spectrum of organizations, including community leaders, civil rights organizations, religious groups and farmworkers themselves. "AgJOBS" represented a major compromise between farmworker advocates and major agricultural employers to address the agricultural immigration crisis. The federal proposals have generally contained two main parts: (1) An "earned legalization" program enabling many undocumented farmworkers and H-2A guest workers to earn a "blue card" temporary immigration status with the possibility of becoming permanent residents of the U.S. by continuing to work in agriculture and by meeting additional requirements; and (2) Revisions to the existing H-2A temporary foreign AB 20 Page I agricultural worker program. In 2003, the first "AgJOBS" bill was introduced in Congress when United States Senators Larry Craig (R-ID) and Edward M. Kennedy (D-MA) and Representatives Chris Cannon (R-UT) and Howard Berman (D-CA) introduced the federal immigration reform bill.<1> On May 14, 2009, Senator Dianne Feinstein (D-CA) and Representatives Berman (D-CA) and Putnam (R-FL) introduced "AgJOBS" in the 111th Congress. In 2011, "AgJOBS" was included in the comprehensive immigration reform bill introduced in the Senate by Senators Menendez (D-NJ), Leahy (D-VT), Durbin (D-IL), Schumer (D-NY), Kerry ( D-MA), and Gillibrand (D-NY) known as the Comprehensive Immigration Reform Act of 2011. FEDERAL PREEMPTION Aside from policy rationale, a fundamental issue concerning this bill is whether or not it is preempted by federal immigration law. Under the Supremacy Clause of the United States Constitution (Article VI, Clause 2), federal law may either expressly or implicitly preempt state or local law. See Hillsborough County v. Auomated Med. Labs., 471 U.S. 707, 713 (1985). In cases of express preemption, Congress "ma[kes] its intent known through --------------------------- <1> In 2006, AJR 20 (Nunez) was introduced to demonstrate the California State Legislature's support of the immigration reform bill known as the Agricultural Job Opportunity, Benefits, and Security Act (AgJOBS) introduced by Members of Congress. AJR 20 passed the Assembly Committee on Labor and Employment but was moved to the Inactive File on the Assembly Floor. AB 20 Page J explicit statutory language. English v. Gen. Elec. Co.< 496 U.S. 72, 78-79 (1990). Implied preemption, on the other hand, arises in one of two circumstances. Field preemption occurs when a state or municipality purports to "regulate conduct in a field that Congress intended the Federal Government to occupy exclusively." Id. Conflict preemption can occur "where state law stands as an obstacle to the accomplishment and execution of the full purposes and objectives of Congress." Id. Federal preemption carries particular force in the context of immigration because regulation of immigration and immigrants, legal and illegal, is "unquestionably exclusively a federal power." De Cana v. Bica, 424 U.S. 351, 354 (1976). Federal Law "Congress shall have the Power? To regulate Commerce with foreign Nations, and among the several States, and with the Indian Tribes? To establish an uniform Rule of Naturalization?throughout the United States?" U.S. Const. Art. I § 8 cl. 3, 4. "This Constitution, and the Laws of the United States which shall be made in Pursuance thereof; and all Treaties made, or which shall be made, under the Authority of the United States, shall be the supreme Law of the Land; and the Judges in every State shall be bound thereby, any Thing in the Constitution or Laws of any State to the Contrary notwithstanding." U.S. Const. Art. VI cl. 2. In 1986, Congress passed the Immigration Reform and Control Act (IRCA) in order to make "combatting the employment of illegal aliens" the central approach to immigration policy. Hoffman Plastic Compounds, Inc. v. NLRB, 535 U.S. 137, 147 (2002). IRCA AB 20 Page K makes it unlawful for an employer to knowingly employ an unauthorized alien. 8 U.S.C. § 1324(a)(1) (2006). Section (h)(3) defines 'unauthorized alien' with respect to the employment of an alien to mean that "at a particular time, that the alien is not at that time either (A) an alien lawfully admitted for permanent residence, or (B) authorized to be so employed by this Act or by the Attorney General." Section (h)(2) states that " [T]he provisions of this section preempt any State or local law imposing civil or criminal sanctions ? upon those who employ, or recruit or refer for a fee for employment, unauthorized aliens." An employer can confirm an employee's authorization to work by reviewing the employee's United States passport, resident alien card, alien registration card, or other document approved by the Attorney General; or by reviewing a combination of other documents such as a driver's license and social security card. § 1324a(b)(1)(B)-(D). The employer must attest under penalty of perjury on Department of Homeland Security Form I-9 that he "has verified that the individual is not an unauthorized alien" by reviewing these documents. § 1324a(b)(1)(A). Employers that violate IRCA may be subject to both civil and criminal sanctions. Immigration and Customs Enforcement, an entity within the Department of Homeland Security, is authorized to bring charges against a noncompliant employer under § 1324a(e). Depending on the circumstances of the violation, a civil fine ranging from $250 to $16,000 per unauthorized worker may be imposed. § 1324a(e)(4)(A); 73 Fed.Reg. 10136 (2008). Federal Preemption Doctrines The federal preemption doctrine has been divided into the three following categories by the U.S. Supreme court: express preemption, field preemption, and conflict preemption. Express preemption is when the scheme of federal regulation is so pervasive as to make reasonable the inference that Congress left AB 20 Page L no room for the states to supplement it. Wisconsin Public Intervenor v. Mortier, 501 U.S. 597 (1991). Field preemption is when a federal statute touches a field in which the federal interest is so dominant that the federal system must be assumed to preclude enforcement of state laws on the same subject. PA. v. Nelson, 350 U.S. 497 (1956). And, conflict preemption is when enforcement of the state statute presents a serious danger of conflict with the administration of a federal program. Id.; see also People v. Giese, 408 N.Y. S.2d 693 (1979). The standard for the federal preemption doctrine is not based on fairness to the parties, but instead is determined by Congressional intent. In re MTBE Products Liability Litigation, 739 F. Supp. 2d 576 (S.D. N.Y. 2010). Courts do not have to decide whether preemption applies solely based on express preemption language in a statute. Jones v. Rath Packing Co., 430 U.S. 519 (1977). In fact, in the absence of express preemptive language, Congressional intent to preempt state law in a particular area may be inferred when the scheme of federal regulation is sufficiently comprehensive to make the reasonable inference that Congress did not leave room for supplementary state regulation. Id. However, finding preemption is inappropriate without clear evidence that federal policy and state law are in sharp conflict or that it would have been physically impossible to comply with both federal and state requirements. Id. However, preemption may be inferred if the scope of statute indicates that Congress intended federal law to occupy the legislative field, or if there is actual conflict between state and federal law. See In re Garrett, 435 B.R. 434 (Bankr. S.D. Tex. 2010). In Plyer v. Doe, the US Supreme Court agreed that states "might have an interest in mitigating the potentially harsh economic effects of sudden shifts in population", and thereby concluded that States sometimes do have the power to regulate rights afforded to undocumented aliens when these rights have "a discernible impact on "traditional state concerns" 457 U.S. at AB 20 Page M 228 (1982). However, in the actual process of excluding or including undocumented aliens under the protection of U.S. laws, courts have consistently held that this remains the purview of the federal government. See State v. Patel, 770 P.2d 390, 393 (Ariz. Ct. App. 1989). As discussed above, in 1986 Congress passed the Immigration Reform and Control Act (IRCA). IRCA criminalized knowingly hiring undocumented workers, by imposing a heavy fine and a short prison sentence on employers who knowingly continue to employ undocumented aliens. 8 U.S.C. § 1324a (a)(1), (f)(1). However, under the Illegal Immigration Reform and Immigrant Responsibility Act (IIRIRA) or 1996, only the federal government is required to use the E-verify system, the electronic system used to verify the legal status of an employee. Pub. L. No. 104-208; 8 U.S.C. § 402(a). In the perceived absence of proper enforcement since its passage in 1986, several states including Arizona, Alabama, South Carolina and Utah have passed a series of immigration statutes that prohibit undocumented aliens from performing a variety of activities such as living in public housing, securing employment, applying for driver's licenses or attending publically funded schools and universities. One such bill, Act 69, was approved by the South Carolina General Assembly in June 2011, which among other things, imposes employer sanctions and mandates to local law enforcement regarding the identification and apprehension of persons unlawfully present in the United States. U.S. v. South Carolina, 2011 WL 6973241, 1 (D.S.C. 2011). During a Senate floor debate, proponents of Act 69 stated that rather than attempting to enter into a 287(g) agreement (a written agreement with the federal government regarding immigration enforcement) with the federal government as expressly authorized by the Immigration and Nationality Act, 8 U.S.C. § 1357(g)(1), the State elected to go forward with its own immigration bill because it was "really important" to have State "control." Id. at 1. Supporters of the bill also voiced the hope that "the Act would encourage persons AB 20 Page N unlawfully present in South Carolina to find "a different state to go to." Id. at 2. Supporters also stated their expectation that the Act would make the federal government's "phone ring?off the hook." Id. Section 8-14 of the final Act 69 established an elaborate scheme of employer licenses and making it unlawful for an employer to knowingly employ "an unauthorized alien." Id. In addition to challenging four specific sections of the Act, not including the employer licensing section, the United States made a preemption challenge to the Act in its entirety. Id. at 3. In deciding whether preemption applies here, the court stated that "a court should start preemption analysis with a presumption against preemption. Id. at 3. The presumption against presumption only applies when the federal government is legislating in traditionally state controlled areas. Id. However, the court notes that when a state legislates in a traditionally federally controlled area, the presumption against presumption does not apply. Id. The court then cites to numerous recent decisions involving state immigration statutes where "courts have generally declined to apply a presumption against preemption because the field of immigration has traditionally been a responsibility of the federal government and not the states. Id.; See also U.S. v. Arizona, 641 F.3d 339, 348 (2011); Ga. Latino Alliance for Human Rights, 793 F.Supp.2d 1317, 1330 (2011); U.S. v. Alabama, 2011 WL 4863957, 12, 30, 39 (2011). RECENT LEGISLATION IN OTHER STATES: As mentioned above, the legislative findings and declaration in this bill note that "agricultural interests in Oklahoma and Utah have introduced legislation creating state guest worker programs and several other states are considering the introduction of AB 20 Page O similar state initiatives." In 2011, Utah enacted a package of immigration legislation that has some bearing on the preemption issues applicable to this bill. HB 116 or the Guest Worker Act was proposed by Utah Representative Bill Wright and sponsored on the Utah Senate floor by Senator Stuart Reid in 2011. The Act listed a procedure for workers to obtain permits to work in agriculture or service related sectors. Utah Code Annotated § 35A-8-201 (1) (a)-(c) (2011). Furthermore, the Act contained a list of requirements that are to be met by each applicant for such a permit, and allows for immediate family members of the permit-holder to reside in the state for the duration of the permit. Utah Code Annotated § 35A-8-301-303. Finally, the Act requires the state government to petition the Department of Justice to receive permission to carry out the guest worker program. Id. The Utah bill also compels the state government to coordinate with the FBI and the Department of Homeland Security to ensure that the guest worker applicants do not pose a threat to national security. Utah Code Annotated § 76-8-1505 (1) (2011). HB 116 and HB 467 (a bill similar to Arizona's S.B. 1070), were signed into law by Governor Herbert on March 15th, 2011. Between March and November, the Department of Justice (DOJ) engaged in talks with Utah state officials. However, in November 2011, the DOJ filed a lawsuit in Utah's District Court claiming that HB 467's attempts to regulate immigration on a state level is clearly preempted by federal law. The DOJ's press release stated that the "federal government has the ultimate authority to enforce federal immigration laws and the Constitution does not permit a patchwork of local immigration policies. A state setting its own immigration policy interferes with the federal government's enforcement efforts." Attorney General Eric Holder AB 20 Page P also emphasized that "patchwork of immigration laws is not the answer and will only create further problems in our immigration system. The federal government is the chief enforcer of immigration laws and while we appreciate cooperation from states, which remains important, it is clearly unconstitutional for a state to set its own immigration policy." With regards to HB 116 however, the DOJ did not immediately file suit. In fact, in November 2011 the DOJ said that it has notified state officials that Utah's Immigration Guest Worker statute is clearly preempted by federal law. However, given that the provisions of HB 116 were not to take effect until 2013, the DOJ opted to continue exploring resolutions short of litigation with state officials. The DOJ statement noted that if "Utah fails to comply with federal law in this area, the department will not hesitate to take the legal action necessary to vindicate the important federal interests in this matter before these laws go into effect." Since the Utah statute was predicated on the federal government granting Utah a waiver to proceed, the Utah Legislature has extended the effective date twice. With little action occurring at the federal level, some have called on lawmakers to repeal the statute in its entirety. In 2011 and 2012, Oklahoma State Senator Harry Coates introduced legislation to create a state-administered guest worker program. The proposals would have allowed undocumented adults to stay in the state legally if they purchased a guest worker permit fee for $1,000 and found a program sponsor who would agree to hire them and provide basic health insurance coverage. It does not appear that those proposals passed the Oklahoma Legislature. PRIOR LEGISLATION: AB 20 Page Q This bill is similar, but not identical, to AB 1544 (V. Manuel Perez) from 2012. While this bill applies only to agricultural employees, AB 1544 defined "employee" to mean an agricultural employee and a person employed to provide domestic services, janitorial or building maintenance services, food preparation services, or housekeeping services. AB 1544 was moved to the Inactive File on the Assembly Floor. Subsequently, similar language was amended into AB 916 (V. Manuel Perez) of 2012 in the Senate. However, AB 916 was held in the Senate Rules Committee without further action. ARGUMENTS IN SUPPORT According to the author: AB 20 Page R "Since 2007, California's agricultural industry has generated the highest agricultural sales ever recorded in the nation, with 2013 reporting a record $46.4 billion. A key factor making this economic success has been the industry's access to workers from outside of the U.S. The U.S. Department of Labor estimates that half of the agricultural work force in the U.S. is comprised of unauthorized workers, while the agricultural industry believes the number to exceed 75 percent. While programs such as the federal H-2A guest worker program and E-verify have been highlighted as options to protect jobs for U.S. citizens and legal residents, most growers in the U.S. agriculture industry argue that these programs threaten the viability and sustainability of their businesses. According to state agricultural industry leaders, media reports, and recent studies, California farmers have been experiencing a farm labor shortage of approximately 20%-25% less workers than in 2010. The current agricultural worker shortage poses a real threat to the ability of California farmers to produce many of the global market's popular labor-intensive crops including, but not limited to, strawberries, leafy greens, blueberries, raspberries, asparagus, broccoli, cauliflowers, fresh tomatoes, artichokes, and melons. AB 20 Page S In the absence of federal comprehensive immigration reform, the state of Utah has passed legislation creating a state guest worker program. In addition, the states of Oklahoma, Kansas, New Mexico, and Texas have introduced legislation creating state guest worker programs and other states have studies or are considering the introduction of such state initiatives." In addition, a coalition of agricultural employer groups supports this measure, stating, "Our organizations share your frustration with the lack of action at the Federal level to address labor shortages and ensure long-term labor security. We have promoted Comprehensive Immigration Reform for the past few years to no avail. [This bill] seeks to build upon consensus language found in past versions of the Federal AgJobs legislation. We believe using this language as a model will send an important message to Congress about California's interest in making something happen in this area, even if Washington, DC is not able to act." REGISTERED SUPPORT / OPPOSITION: Support American Federation of State, County and Municipal Employees AB 20 Page T CalChamber California Association of Nurseries and Garden Centers California Citrus Mutual California Cotton Ginners Association California Cotton Growers Association California Farm Bureau Federation California Fresh Fruit Association Western Agricultural Processors Association Western Growers Association Opposition None on file. AB 20 Page U Analysis Prepared by:Benjamin Ebbink / L. & E. / (916) 319-2091