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), et al. Amended: 8/2/16 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 adds a new provision to the Fair Employment and Housing Act (FEHA) to expressly authorize an individual employed under a special license under the Labor Code, as specified, in a nonprofit sheltered workshop, day program, or rehabilitation facility, to bring an action under FEHA for any form or discrimination prohibited under that act. This bill also specifies that, in any such action, the employer has an affirmative defense, as specified, if the challenged activity was permitted by statute or regulation and the challenged activity was necessary to serve employees with disabilities under the specified special license. 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 AB 488 Page 2 minimum wage pursuant to a specified license from the Industrial Welfare Commission under existing law. Senate Floor Amendments of 8/2/16 (1) authorize individuals employed under a special license under the Labor Code, as specified, in a nonprofit sheltered workshop, day program, or rehabilitation facility, to bring actions for any form or discrimination prohibited under FEHA; (2) provide employers with a specified affirmative defense in such actions; and (3) codify a legislative finding and declaration, as specified. 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, 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 FEHA, as a matter of public policy, discrimination and harassment in employment on the basis of AB 488 Page 3 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 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, AB 488 Page 4 spouse, or child, or any individual employed under a special license in a nonprofit sheltered workshop or rehabilitation facility. This bill: 1)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. 2)Creates a limited exception to the individuals exempted from the definition of "employee," under FEHA, as specified, and provides that an individual employed under a special license pursuant to the Labor Code, as specified, in a nonprofit sheltered workshop, day program, or rehabilitation facility may bring an action under FEHA for any form of harassment or discrimination prohibited by FEHA. 3)Provides that if an individual, specified above, brings an action against an employer for any form of harassment or discrimination prohibited by FEHA, the employer has an affirmative defense to the action by proving, by a preponderance of the evidence, both of the following: The challenged activity was permitted by statute or regulation. The challenged activity was necessary to serve employees with disabilities under a special license pursuant to the Labor Code, as specified. 1)States that the Legislature finds and declares that the definition of employee under FEHA, above, was not intended to permit the harassment of, or discrimination against, an individual employed under a special license pursuant to the AB 488 Page 5 Labor Code, as specified, in a nonprofit sheltered workshop, day program, or rehabilitation facility. 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, 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. AB 488 Page 6 Accordingly, this bill seeks to ensure that any individual employed under a special license in a nonprofit sheltered workshop, daycare program, or rehabilitation facility, while generally exempted from the FEHA definition of an "employee," nonetheless maintains a cause of action against an employer who harasses or discriminates against them in violation of FEHA, except as specified. At the same time, this bill also 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. [ . . . ] FISCAL EFFECT: Appropriation: No Fiscal AB 488 Page 7 Com.:NoLocal: No SUPPORT: (Verified8/2/16) 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: (Verified8/4/16) Pleasantview Industries 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. [ . . . ] Reform is needed to strengthen rights and protections for sheltered workshop employees who work in highly-restrictive environments and currently are not afforded the same protections against discrimination as other employees." ARGUMENTS IN OPPOSITION: Opponents to a prior version of this bill write that while they "fully support making the law clear that ALL employees are entitled to FEHA protection from discrimination and harassment," they "object to application of provisions that would impose liability for non-discriminatory behavior that is essential to the employment arrangements for individuals covered by the bill's provisions." ASSEMBLY FLOOR: 69-0, 1/15/16 AB 488 Page 8 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 8/4/16 10:27:16 **** END ****