BILL ANALYSIS Ó
AB 219
Page 1
ASSEMBLY THIRD READING
AB
219 (Daly)
As Amended June 1, 2015
Majority vote
-----------------------------------------------------------------
|Committee |Votes |Ayes |Noes |
| | | | |
| | | | |
|----------------+------+--------------------+--------------------|
|Labor |5-2 |Roger Hernández, |Harper, Patterson |
| | |Chu, Low, McCarty, | |
| | |Thurmond | |
| | | | |
|----------------+------+--------------------+--------------------|
|Appropriations |12-5 |Gomez, Bonta, |Bigelow, Chang, |
| | |Calderon, Daly, |Gallagher, Jones, |
| | |Eggman, |Wagner |
| | | | |
| | | | |
| | |Eduardo Garcia, | |
| | |Gordon, Holden, | |
| | |Quirk, Rendon, | |
| | |Weber, Wood | |
| | | | |
| | | | |
-----------------------------------------------------------------
SUMMARY: Expands the definition of "public works" to include the
hauling and delivery of ready-mixed concrete, as specified.
AB 219
Page 2
Specifically, this bill:
1)Expands the definition of "public works" to include the hauling
and delivery of ready-mixed concrete or asphaltic concrete to
carry out a public works contract, with respect to contracts
involving any state agency or any political subdivision of the
state.
2)Provides that "ready-mixed concrete" means concrete that is
manufactured in a factory or batching plant, according to a set
recipe, and then delivered in a liquefied state by mixer truck
for immediate incorporation into a project.
3)Provides that the "hauling and delivery of ready-mixed concrete
to carry out a public works contract" means the job duties for a
ready mixer driver that are used by the Department of Industrial
Relations (DIR) under existing law, and includes receiving the
concrete at the factory or batching plant and the return trip to
the factory or batching plant.
4)Provides that the applicable prevailing wage rate shall be the
current prevailing wage rate as determined for the geographic
area in which the factory or batching plant is located.
5)Provides that the entity hauling or delivering ready-mixed
concrete to carry out a public works contract shall enter into a
written subcontract agreement with the party that engaged the
entity to supply the ready-mixed concrete. The written
agreement shall require compliance with specified requirements
of existing law.
6)Requires the entity hauling or delivering ready-mixed concrete
to carry out a public works contract to submit a certified copy
AB 219
Page 3
of the payroll records to the party that engaged the entity and
to the general contractor within three working days after the
employee has been paid, accompanied by a written time record
certified by each driver.
7)Provides that this bill does not apply to contracts advertised
for bid or awarded prior to the effective date of this bill.
FISCAL EFFECT: According to the Assembly Appropriations
Committee:
1)This bill may cause an increase in state and local government
contract costs assuming contractors/subcontractors are not
currently paying a prevailing wage to workers delivering
concrete. According to the California Department of
Transportation (Caltrans), on average, the hourly rate for
ready-mixed drivers would increase from $16 per hour to $34 per
hour. Actual additional costs will depend on the prevailing
wage rate in each county, any resulting increase in concrete
costs, and the portion of any contract that involves the
purchase and delivery of concrete
2)This bill will increase support costs on Caltrans contracts both
for inspection of the hauling activities and enforcement of
prevailing wage requirements under Caltrans' labor compliance
programs operations. Caltrans estimates costs of approximately
$1 million related to compliance.
3)Ongoing administrative costs of approximately $125,000 (special
funds) for the DIR Compliance Monitoring Unit to monitor and
enforce the prevailing wage requirements of this measure. To
the extent this measure leads to an increase in the number of
prevailing wage fines issued by DIR, there will an increase in
special fund revenue.
AB 219
Page 4
COMMENTS: This bill is co-sponsored by the California Public
Affairs Council and the State Building and Construction Trades
Council, and would define "public works" for purposes of state
prevailing wage law to include the delivery of ready-mix concrete.
The sponsors state that under the current material supplier
exemption to the prevailing wage law, delivery drivers hired by a
material supplier are exempted from the prevailing wage. However,
there is no physical distinction between the work performed by
ready-mix drivers employed by contractors and ready-mix drivers
employed by manufacturers, as the product and work is identical.
By expanding the prevailing wage to all ready-mix drivers serving
public works, this bill would create a more fair application of
the Labor Code that does not depend on who owns the truck
delivering the ready-mix or whether the driver is employed by an
onsite contractor or a cement manufacturer.
They conclude that this bill is about uniformity and a fair
application of the prevailing wage law to deliveries of ready-mix
and not about expanding prevailing wage to all material drivers.
Opponents contend that this bill ignores longstanding distinctions
in labor law between a driver and a construction worker. In
addition, they argue that it is inconsistent with the contract
between a supplier and a contractor. They note that ready mix
concrete is a finished product, delivered to the site in an
unfinished state pursuant to a purchase order.
Opponents also argue that this bill contravenes longstanding and
well-established legal precedent that material suppliers are not
subject to prevailing wage law. Finally, opponents argue that
this bill imposes significant new liability and administrative
burdens on prime contractors since, under California law, prime
AB 219
Page 5
contractors are jointly and severally liable for the payment of
prevailing wages by all subcontractors on a public work project.
This bill would expand that liability to include the payment of
prevailing wages by a material supplier providing ready-mixed
concrete to a public works construction jobsite.
Analysis Prepared by:
Ben Ebbink / L. & E. / (916) 319-2091 FN: 0000573