BILL ANALYSIS Ó ----------------------------------------------------------------- |SENATE RULES COMMITTEE | AB 488| |Office of Senate Floor Analyses | | |(916) 651-1520 Fax: (916) | | |327-4478 | | ----------------------------------------------------------------- THIRD READING Bill No: AB 488 Author: Gonzalez (D) Amended: 6/21/16 in Senate Vote: 21 SENATE JUDICIARY COMMITTEE: 5-2, 6/14/16 AYES: Jackson, Hertzberg, Leno, Monning, Wieckowski NOES: Moorlach, Anderson ASSEMBLY FLOOR: 69-0, 1/15/16 - See last page for vote SUBJECT: Employment discrimination SOURCE: Disability Rights California State Council on Developmental Disabilities DIGEST: This bill eliminates the current exemption for any individual employed under a special license in a nonprofit sheltered workshop or rehabilitation facility from the Fair Employment and Housing Act's (FEHA) definition of "employee," thus protecting those individuals from any form of employment discrimination on the basis of race, religious creed, physical disability, mental disability, sex, age, and sexual orientation, among other things. This bill also provides, however, that nothing under FEHA relating to discrimination on account of disability shall subject an employer to legal liability for obtaining a specified license or paying an individual with a physical or mental disability less than minimum wage pursuant to a specified license from the Industrial Welfare Commission under existing law. AB 488 Page 2 ANALYSIS: Existing law: 1)Prohibits, as a matter of federal law, under Title VII of the Civil Rights Act, discrimination and harassment of employees. 2)Provides, as a matter of federal law, Section 14(c) of the federal Fair Labor Standards Act (FLSA), for the employment of certain individuals at wage rates below the minimum wage. Under this provision, individuals whose earnings or productive capacity is impaired by physical or mental disability for the work to be performed, including those related to age or injury, may be paid less than the federal minimum wage. Certificates issued by the Department of Labor to the employer are required for the employer to pay the special minimum wage. 3)Authorizes, under Labor Code Sections 1191 and 1191.5, mentally or physically handicapped employees (and nonprofit sheltered workshops and rehabilitation facilities employing them) to be issued a license by the Industrial Welfare Commission authorizing a special subminimum wage. 4)Prohibits, under the Fair Employment and Housing Act (FEHA), as a matter of public policy, discrimination and harassment in employment on the basis of race, religious creed, color, national origin, ancestry, physical disability, mental disability, medical condition, genetic information, marital status, sex, gender, gender identity, gender expression, age, sexual orientation, or military and veteran status. 5)Provides, under FEHA, that it is an unlawful employment practice, unless based upon a bona fide occupational qualification, or, except where based upon applicable security regulations, as specified, for an employer to refuse to hire AB 488 Page 3 or employ a person or to refuse to select a person for a training program leading to employment, or to bar or to discharge a person from employment or from a training program leading to employment, or to discriminate against a person in compensation or in terms, conditions, or privileges of employment, because of any of the above-listed protected bases. 6)Provides further under FEHA, however, that such disability discrimination protections do not prohibit an employer from refusing to hire or discharging an employee with a physical or mental disability, or subject an employer to any legal liability resulting from the refusal to employ or the discharge of an employee with a physical or mental disability, where the employee, because of his or her physical or mental disability, is unable to perform his or her essential duties even with reasonable accommodations, or cannot perform those duties in a manner that would not endanger his or her health or safety or the health or safety of others even with reasonable accommodations. 7)Prohibits, under FEHA, an employer or other entity to fail to make reasonable accommodation for the known physical or mental disability of an applicant or employee; however, an employer is not required to provide accommodation that is demonstrated by the employer or other covered entity to produce undue hardship, as defined. 8)Provides, for purposes of FEHA, that the term "employee" does not include any individual employed by his or her parents, spouse, or child, or any individual employed under a special license in a nonprofit sheltered workshop or rehabilitation facility. This bill: 1)Repeals the language exempting an individual paid under a special license in a sheltered workshop or rehabilitation facility from the term "employee" under FEHA. AB 488 Page 4 2)Provides that nothing under FEHA relating to discrimination on account of disability shall subject an employer to legal liability for obtaining a specified license or paying an individual with a physical or mental disability less than minimum wage pursuant to specified laws, above. Background California law reflects a strong public policy protecting individuals against discrimination under numerous statutes, covering a variety of contexts. FEHA and the Unruh Civil Rights Act, for example, prohibit discrimination in employment, housing, public accommodation, and services provided by business establishments on the basis of specified personal characteristics, such as sex, race, color, religion, ancestry, national origin, age, disability, medical condition, genetic information, marital status, or sexual orientation. (See Gov. Code Sec. 12920 et seq. for FEHA; Civ. Code Sec. 51 for Unruh Civil Rights Act). Others still, prohibit discrimination in public schools and in other state-funded programs or activities. (See Educational Equity at Ed. Code Sec. 200 et seq. and Equity in Higher Education Act at Ed. Code Sec. 66270 et seq.; see also Gov. Code Section 11135 et seq.) Of particular import to this bill, FEHA not only protects an employee from discrimination on protected bases, but it also entitles the employee to certain accommodations under the law based on, for example, their religious creed or physical or mental disability. Further, FEHA generally protects an employee against retaliation by the employer if the employee has opposed any of the employer's discriminatory practices or because the employee has filed a complaint, testified, or assisted in a FEHA proceeding against the employer. That being said, under current law, FEHA exempts from its definition of "employee" any person who is employed under a special license in a nonprofit sheltered workshop or rehabilitation facility. Thus, such individuals employed by a nonprofit sheltered workshop or rehabilitation facility, could presumably be discriminated against on the basis of their sex, religion, race, marital status, national origin, AB 488 Page 5 and more, without any protections under the law and without any consequence to the employer who would otherwise be held in violation of FEHA with respect to any other employees. Accordingly, this bill eliminates the current exemption from the definition of employee for any "individual employed under a special license in a nonprofit sheltered workshop or rehabilitation facility." At the same time, this bill ensures that an employer who obtains a specified license or pays an individual less than minimum wage pursuant to a specified license from the California Industrial Welfare Commission is not legally liable for doing so under the anti-disability discrimination provisions of FEHA. Comments As stated by the author: The Legislature has made great strides in expanding the protections and opportunities for most Californians under the Fair Employment and Housing Act. From extending the bases of potential discrimination to include age, gender, and religious dress, to extending the definition of employee to include unpaid interns and volunteers, previous efforts have sought to ensure that all California workers are fully protected in the workplace. However, we have failed individuals with disabilities working in sheltered workshops and rehabilitation centers by not addressing the exemption of these employers from these laws. This has left individuals with disabilities working in these settings without the same recourse as others, should a case of discrimination or harassment arise in their workplace. While we recognize the need for certain nuances regarding the compensation paid to these individuals and hiring practices of the sheltered workshops and rehabilitation centers, it is simply unacceptable to leave this population of workers without these basic workplace protections. It is time to get rid of this exemption and protect all California workers as AB 488 Page 6 equally as possible. FISCAL EFFECT: Appropriation: No Fiscal Com.:NoLocal: No SUPPORT: (Verified6/22/16) Disability Rights California (co-source) State Council on Developmental Disabilities (co-source) Arc and United Cerebral Palsy California Collaboration California Foundation for Independent Living Centers California Labor Federation Disability Rights Education and Defense Fund SEIU California Special Needs Network OPPOSITION: (Verified6/22/16) The Alliance Supporting People with Intellectual and Developmental Disabilities California Disability Services Association Pleasantview Industries San Gabriel Valley Training Center VIP, Inc. Two individuals ARGUMENTS IN SUPPORT: Disability Rights California, co-sponsor of this bill, writes "[c]urrently, under state law, 'employee' does not include any individual employed by a sheltered workshop or rehabilitation facility. This leaves people with disabilities employed in these settings no recourse for discrimination by their employer. [ . . . This ] bill would change the Government Code so that individuals with disabilities who are in sheltered work are considered 'employees' and are provided the same protections as other employees under California's Federal Employment and Housing Act (FEHA). Reform is needed to strengthen rights and protections for sheltered workshop employees who work in highly-restrictive AB 488 Page 7 environments and currently are not afforded the same protections against discrimination as other employees." ARGUMENTS IN OPPOSITION: California Disability Services Association (CDSA) writes an oppose unless amended letter with respect to several issues, stating that "[b]ecause of some of the most basic requirements of FEHA, the process for placement and oversight of individuals in sheltered workshops, rehab facilities and day programs would be severely compromised" under the current version of the bill. While CDSA supports "making the law clear that ALL employees are entitled to FEHA protection from discrimination and harassment" they believe the bill imposes liability for non-discriminatory behavior that is essential to the employment arrangements for individuals covered by the bill. CDSA highlights specific areas of concern that demonstrate several "fundamental problems with the current version of the bill" as follows: FEHA prohibits employers from making any inquiry, either pre-employment or subsequent to hiring, as to whether an applicant or employee has a disability, or the nature or severity of that disability. It's impossible for a workshop, facility, or program to function if it cannot even inquire as to the disability of an employee, or to utilize that information during the course of employment to make necessary adjustments to the employment arrangements. FEHA requires employers to engage in a timely, good faith, interactive process with an employee or applicant to determine reasonable accommodations. This bill fails to allow any inquiry into an employee's disability, does not clarify which party is the "employer," and does not contemplate the process by which an individual who cannot express their needs can be accommodated. One of the most important aspects of these placements is the role of the service provider responsible for the individual serves in working with outside entities to create employment opportunities for the individuals being placed. [On] its face, FEHA's "interactive" requirements seem to prevent the service provider from serving that role. Since "day programs are not addressed in existing labor laws, their express addition to FEHA can be read to create AB 488 Page 8 an employer-employee relationship where one does not currently exist. [ . . . ] In addition, since FEHA makes individuals with various levels of disability personally liable for acts of harassment, converting the day program setting into an employment setting will inevitably promote litigation between day program participants. These program participants do have causes of action now for these types of incidents, but most are resolved by the day program providers by working with the individuals and families. [ . . . ] CDSA urges the author to consider amending the bill "to clarify that individuals in these settings are protected from discrimination and harassment, while allowing for a comprehensive review of the potential unintended consequences" (by stakeholders convened by the Director of the Department of Fair Employment and Housing). ASSEMBLY FLOOR: 69-0, 1/15/16 AYES: Achadjian, Alejo, Baker, Bigelow, Bonilla, Bonta, Brough, Brown, Burke, Calderon, Campos, Chang, Chau, Chiu, Chu, Cooley, Cooper, Dababneh, Dahle, Daly, Dodd, Eggman, Frazier, Beth Gaines, Gallagher, Cristina Garcia, Gatto, Gipson, Gonzalez, Gordon, Gray, Grove, Hadley, Harper, Roger Hernández, Irwin, Jones, Kim, Lackey, Levine, Lopez, Low, Maienschein, Mathis, Mayes, McCarty, Medina, Melendez, Mullin, Nazarian, Obernolte, O'Donnell, Olsen, Patterson, Quirk, Rendon, Rodriguez, Salas, Santiago, Steinorth, Mark Stone, Thurmond, Ting, Wagner, Waldron, Weber, Williams, Wood, Atkins NO VOTE RECORDED: Travis Allen, Bloom, Chávez, Eduardo Garcia, Gomez, Holden, Jones-Sawyer, Linder, Ridley-Thomas, Wilk Prepared by:Ronak Daylami / JUD. / (916) 651-4113 6/22/16 15:14:50 **** END **** AB 488 Page 9