BILL ANALYSIS Ó
SENATE COMMITTEE ON
BUSINESS, PROFESSIONS AND ECONOMIC DEVELOPMENT
Senator Jerry Hill, Chair
2015 - 2016 Regular
Bill No: AB 1042 Hearing Date: June 22,
2015
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|Author: |Cooper |
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|Version: |May 18, 2015 |
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|Urgency: |No |Fiscal: |No |
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|Consultant|Janelle Miyashiro |
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Subject: Proprietary security services.
SUMMARY: Expands the definition of a proprietary private security
officer (PSO) by requiring only one of the two specified
criteria to be met and includes examples of a PSO's duties that
are likely to involve interacting with the public.
Existing law:
1) Provides for the licensure and regulation of proprietary
private security officers (PSOs) and proprietary private
security employers (PPSEs) by the Bureau of Security and
Investigative Services (Bureau) in the Department of Consumer
Affairs (DCA) under the Proprietary Security Services Act
(Act). (Business and Professions Code (BPC) § 7574 et. seq.)
2) Defines a PSO as an unarmed individual who is employed
exclusively by any one employer whose; primary duty is to
provide security services for his or her employer, services
are not contracted to any other entity or person, and meets
both of the following criteria:
a) Is required to wear a distinctive uniform clearly
identifying the individual as a security officer.
b) Is likely to interact with the public while performing
his or her duties.
(BPC § 7574.01)
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3) Prohibits any who is not registered with the Bureau from
engaging in the business of a PSO. (BPC § 7574.10)
4) Requires a person registered and hired as a PSO to complete
training in security officer skills within six months of his
or her employment with a PPSE.
(BPC § 7574.18)
5) Defines a PPSE as a person who has one or more employees who
provide security services for the employer and only for the
employer. A person who employs PSOs pursuant to this chapter
at more than one location shall be considered a single
employer. (BPC § 7574.01(e))
This bill:
1) Changes the definition of a PSO to require only one of the
two specified criteria.
2) Gives examples of a PSO's duties when interacting with the
public which include, but are not limited to, acting to
prevent unapproved or unlawful entry, directing persons
causing a disturbance to leave a facility, ensuring that
persons removing property from a facility are acting within
appropriate policy requirements, observing and reporting
incidents or suspicious activity to management and other
public safety authorities as appropriate, and responding to
or reporting incidents of fire, medical emergency, hazardous
materials, and other incidents or conditions following
procedures established by the PSO's employer.
FISCAL
EFFECT: None. This bill is keyed "nonfiscal" by Legislative
Counsel. However, the Senate Appropriations Committee has
specifically requested to hear this measure.
COMMENTS:
1. Purpose. This bill is sponsored by the California
Association of Licensed Security Agencies, Guards and
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Associates (CALSAGA) . According to the Author, "AB 1042
updates the definition of Proprietary Private Security
Officer (PSO) to further professionalize the industry and
protect the general public. The bill expands the definition
of PSO to include either a person who wears a distinctive
security uniform or primarily provides a security function,
so that those who meet the definition will be required to
obtain a background check and receive some basic level of
training."
2. Background. Private security is a growing industry.
According to a report prepared for the U.S. Department of
Justice (DOJ) by the National Criminal Justice Reference
Service (NCJRS), the private security industry plays an
important role in the nation's security and safety. The
report highlights the major responsibilities of private
security today, including the protection of our nation's
institutions and critical infrastructure systems, such as
industry and manufacturing, utilities, transportation, and
health and educational facilities. According to a 2006
report by the U.S. Government Accountability Office, private
industry controls more than 85% of the nation's critical
infrastructure. That number is thought to have substantially
risen today.
However, private security services are not only employed to
protect vital infrastructure, but also in a wide range of
commercial and residential markets. The NCJRS report asserts
that both contract and proprietary security guards will
continue to be necessary to protect both people and property
in light of growing concerns about crime, vandalism, and
domestic terrorism, especially in light of reduced local
government law enforcement budgets.
3. PSO Distinction. There are two specific categories of
licensed security guards regulated by the Bureau; those who
work in-house for a specific employer (PSOs), and those who
are employed by a contract security firm to provide security
services for a third party (security guards).
Both PSOs and security guards play a role in three broad
types of security: physical, information, and
employment-related. Physical security involves physical
measures designed to safeguard people and to prevent
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unauthorized access to equipment, facilities, material, and
documents, as well as to safeguard these materials against a
security incident. Physical security may include perimeter
and interior space protection through the use of barriers,
locks, lights, sensors, and guards. Information security is
the protection of confidential information such as mailing
lists, research and development documentation, and financial
information that can be maintained in hard copy or electronic
format. Employment-related security services involve record
keeping and understanding essential information about
employees (both permanent and temporary) that might impact an
employee's job performance, possible breaches of security, or
subject the organization or company to liability. These
employment-related security services are utilized through job
applicant screening or protecting executives or other
individuals through bodyguard services. Although there may
be some overlap in the responsibilities of PSOs and security
guards in these three broad types of security services, there
is a distinctive difference in licensure and training
requirements as well as the scope of duties for each guard
category.
Security guards are employed through private patrol operators
(PPOs), who must also be registered and licensed with the
Bureau. Security guards protect persons and/or property and
prevent theft on premises owned or controlled by those
companies contracting with a PPO, the contract security firm,
or by the guard's employer. Security guards must be at least
18 years of age, undergo a criminal history background check
through the DOJ and the Federal Bureau of Investigation
(FBI), and complete a 40-hour course of required training.
The training and exam may be administered by any PPO or by a
certified training facility. Security guards may also apply
for and obtain a Bureau issued Firearms Permit after
fulfilling other specified requirements.
A PSO is defined as a generally unarmed individual who is
employed by a single employer not contracted to any other
entity or person and whose primary duty is to provide
security services for that employer. PSOs must be at least
18 years of age and undergo a criminal history background
check through the DOJ and the FBI before registering with the
Bureau. A PSO must possess a valid PSO registration
document, which can include a screen-print from the Bureau's
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website, and a valid photo identification while placed on
assignment. While PSO registration candidates do not need to
provide proof of training to the Bureau, their employers must
have proof of the PSOs completion of 16 hour of training
within the first six months of receiving the PSO registration
or six months from date of hire by the PSO employer in the
employee's file. PPSEs are prohibited from subletting PSOs
to another person, business, or entity. PSOs are prohibited
from carrying firearms or batons while on duty. California
peace officers, retired peace officers, and patrol special
police officers are exempt from PSO and PPSE registration
requirements.
According to the Bureau's 2014 Sunset Review Report, there
were approximately 594 PPSEs, 6,201 PSOs, and 2,765 PPOs (for
the fiscal year 2013/2014).
4. Unlicensed Activity. In the past, PSOs in California
received little state oversight, instead relying on standards
of conduct and duties set by their employers. California
companies that hired unlicensed PSOs incurred no penalty. To
address this issue, SB 741 (Maldonado, Chapter 361, Statutes
of 2009) was passed in order to regulate these PSOs and those
employing these security services. This new oversight
authority went into effect January 1, 2011. These regulations
included PSO and PPSE registration with the DCA and a new
required training within 6 months of registration. Licensees
could incur penalties between $250 and $1,000 for
noncompliance.
Although this somewhat recent new oversight authority by the
Bureau has greatly helped to professionalize the proprietary
security industry, there are still concerns that the current
definition of a PSO is too narrow. The Author asserts that
the definition of a PSO should include persons not wearing a
distinctive uniform, but does primarily act in a security
capacity. This new definition would bring bouncers and other
plain-clothes individuals employed for security purposes
under the umbrella of a PSO and would require their licensure
and registration with the Bureau. This issue was raised in
response to a violent incident involving an Oceanside club
bouncer and a patron in December of 2014.
Following the Oceanside club incident, a news report by NBC
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was release in February 2015, claiming that there was an
"underground industry" of unlicensed, untrained security
guards and bouncers in San Diego County, and that many of the
security officers were not licensed properly. According to a
DCA spokesman quoted in the story, "?for proprietary security
guards, the ones that work for restaurants and bars and those
sorts of things, unlicensed activity can be a vexing problem
because not every bar that springs up is aware of the
licensing requirement?It's not so much underground as they
are unaware."
The DCA spokesman also noted another issue relating to these
unlicensed security personnel, which is that the security
officer only needs to be licensed if the employee is wearing
clothing that identified him or her as security; if the
person is not wearing a uniform, but performing the same
duties, no license is required. As a result, those
individuals would not be required to register with the
Bureau, have a background check, or meet any other training
requirements for a PSO.
This bill seeks to close this loophole and change the
definition of a PSO to require only one of the two specified
criteria. This bill also gives specific examples of some of
the duties a PSO would have when interacting with the public
to ensure that those operating as a PSO are properly licensed
and regulated by the Bureau. The Author argues that these
changes will ensure greater public and consumer protection by
assisting the Bureau to curb unlicensed activity.
5. Related Legislation This Year. SB 468 (Hill, 2015) would
extend the operation of the Bureau of Security and
Investigative Services and the Alarm Company Act, Locksmith
Act, Private Investigator Act, Private Security Services Act,
Proprietary Security Services Act, and Collateral Recovery
Act until January 1, 2020; subject the Bureau to review by
the appropriate committees of the Legislature; and make
various changes to provisions in the aforementioned Acts to
improve the oversight, enforcement and regulation by the
Bureau of licensees under each Act. ( Status : This bill is in
the Assembly Business & Professions Committee.)
6. Prior Related Legislation. SB 741 (Maldonado, Chapter 361,
Statutes of 2009) revised and re-casted the existing
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regulation of proprietary private security officers to
require both proprietary private security officers and
proprietary private security employers, as defined, to
register with the Bureau of Security and Investigative
Services, and establishes training and enforcement
provisions.
SB 666 (Maldonado, Chapter 721, Statutes of 2007) required
PSOs to complete security officer skills training as they
begin employment and to undergo an annual review of this
training. SB 666 also required the Bureau to establish a
training curriculum by regulation, with the assistance of an
advisory committee.
SB 194 (Maldonado, Chapter 655, Statutes of 2005) enacted the
Act and required a PSO as defined, to meet specified
requirements and register with the DCA.
7. Arguments in Support. Writing in support of the bill, the
California Association of Licensed Security Agencies, Guards
and Associates (CALSAGA) states, "this bill would expand the
definition of a proprietary private security officer by
instead requiring only one of the two specified criteria to
be met. This change in definition would insure that certain
individuals that are hired to interact with the public while
performing his or her duties are properly trained and
certified to perform those duties?AB 1042 would provide
greater consumer protection by ensuring that certain duties,
which at times may involve dangerous situations, are carried
out by licensed and certified professionals."
8. Proposed Author Amendments. The Author indicates that in
order to address an existing problem surrounding the pay
schedule for employees of private security companies, he will
be amending the bill to redefine the work week specific to
security guards in the Labor Code (LC).
Recently, a court case in Santa Clara County determined that
private security companies are "temporary services
employers". Temporary services employers are defined in the
LC as employing units that contract with clients to supply
workers to perform services for those clients. Temporary
services employers negotiate with clients where and when
services will be provided, type of work, working conditions,
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assignments or reassignments of workers. These temporary
services employers also set the rate of pay for their workers
and pay these workers from their own accounts.
Section 201.3 of the LC requires temporary services employers
to pay their employees weekly, according to the calendar week
schedule, which is defined by the Division of Labor Standards
Enforcement (DLSE) as a week extended from Sunday to
Saturday. Section 500 of the LC defines "workweek" and
"week" as any seven consecutive days, starting with the same
calendar day each week. "Workweek" is a fixed and regularly
recurring period of 168 hours, seven consecutive 24-hour
periods.
According to the Author, most security services firms define
the workweek as Friday to Thursday. The Author states that
many companies choose to define their workweek in this
fashion due to the business needs of the company, and adds
that this is the most efficient way to process payroll from
operational, financial and information technology
perspectives. Most companies operate on a Monday to Friday
business/administrative schedule, as that enables employees
to work Monday to Friday and take weekends off. The Author
states that there are many reasons for this, including family
and religious observances. However, use of a calendar week
schedule would require administrative employees to work on
weekends in order to process payroll for a Saturday pay-day.
The Author seeks to amend the LC to redefine the work week
specific to security guards. The Author states that this
effort is not an attempt to change the weekly payroll rule
but that this new change will allow these temporary services
employers to pay their employees on a weekly, Friday to
Thursday schedule, ensuring that payment of wages to
employees follows the same timeline as the current Sunday to
Saturday schedule. The Author asserts that the Sunday to
Saturday pay schedule does not have an inherent value or
benefit to employees, as there is no legislative history as
to why the weekly pay requirement was defined in this manner
originally. The Author argues that likewise, a Friday to
Thursday pay schedule does not negatively impact employees.
In both schedules employees must wait the same period of time
in order to be paid.
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The proposed Author's amendments will redefine the work week
for security guard companies, which fall under the temporary
services employers category, to allow these companies to pay
their employees on a Friday to Thursday pay schedule.
On page 3, in line 6, add SECTION 2. Section 201.3 of the
Labor Code is amended to read:
201.3 (b) (1) (A) Except as provided in paragraphs (2) to
(5), inclusive, if an employee of a temporary services
employer is assigned to work for a client, that employee's
wages are due and payable no less frequently than weekly,
regardless of when the assignment ends, and wages for work
performed during any calendar week shall be due and payable
not later than the regular payday of the following calendar
week. A temporary services employer shall be deemed to
have timely paid wages upon completion of an assignment if
wages are paid in compliance with this subdivision.
(B) Except as provided in paragraphs (2) to (5), inclusive,
if an employee of a temporary services employer is employed
in the security services industry as a security officer who
is registered pursuant to Chapter 11.5 (commencing with
Section 7580) of Division 3 of the Business and Professions
Code, is employed by a private patrol operator registered
pursuant to that chapter, and is assigned to work for a
client, that employee's wages are due and payable no less
frequently than weekly, regardless of when the assignment
ends, and wages for work performed during any workweek, as
defined under Section 500, shall be due and payable not
later than the regular payday of the following workweek.
SUPPORT AND OPPOSITION:
Support:
California Association of Licensed Security Agencies, Guards and
Associates (Sponsor)
Opposition:
None on file as of June 16, 2015.
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