BILL ANALYSIS                                                                                                                                                                                                    Ó






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          |SENATE RULES COMMITTEE            |                       AB 1308|
          |Office of Senate Floor Analyses   |                              |
          |(916) 651-1520    Fax: (916)      |                              |
          |327-4478                          |                              |
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                                   THIRD READING 


          Bill No:  AB 1308
          Author:   Perea (D), et al.
          Amended:  6/23/15  
          Vote:     21  

           SENATE LABOR & IND. REL. COMMITTEE:  4-1, 6/10/15
           AYES:  Mendoza, Jackson, Leno, Mitchell
           NOES:  Stone

           SENATE APPROPRIATIONS COMMITTEE:  Senate Rule 28.8
            
           ASSEMBLY FLOOR:  53-23, 5/4/15 - See last page for vote

           SUBJECT:   Apprenticeship programs: approval


          SOURCE:    State Building and Construction Trades Council

          DIGEST:   This bill strengthens and expands the requirements for  
          approving new apprenticeship programs.

          Senate Floor Amendments of 6/23/15 make minor changes and add  
          coauthors.

          ANALYSIS:
               
          Existing law:

          1)Provides a framework for promoting and developing  
            apprenticeship training through the California Apprenticeship  
            Council (CAC) and the Division of Apprenticeship Standards  
            (DAS) within the Department of Industrial Relations.  DAS  
            enforces apprenticeship standards for, among other things,  








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            working conditions, classroom instruction and the specific  
            skills required for state certification as a journeyperson in  
            an apprentice occupation.

          2)Requires that all apprenticeship programs be approved by the  
            Chief of the DAS.  Existing law empowers the Chief to approve  
            apprenticeship programs in any trade anywhere in the state,  
            including cities and trade areas, if the apprentice training  
            needs justify the creation of a program.  However, in order  
            for the Chief to approve an apprenticeship program in the  
            building and construction trades, any of the following  
            "needs-based" conditions must be met (Labor Code §3075):

             a)   There is no existing apprenticeship program serving the  
               same craft or trade and geographic area;

             b)   Existing apprenticeship programs that serve the same  
               craft or trade and geographic area do not have the  
               capacity, or neglect or refuse, to dispatch sufficient  
               apprentices to qualified employers at a public works site  
               who are willing to abide by the applicable apprenticeship  
               standards;

             c)   Existing apprenticeship programs approved under this  
               chapter that serve the same trade and geographic area have  
               been identified by the CAC as deficient in meeting their  
               obligations.

          3)Requires that, for public works projects in excess of $30,000,  
            the contractor utilize apprentices for apprenticeable crafts  
            or trades. Prior to commencing work, the contractor may apply  
            to any apprenticeship program in the craft or trade that can  
            provide apprentices to the site of the public work.  The  
            apprenticeship program(s), upon approving the contractor, must  
            arrange for the dispatch of apprentices to the contractor.   
            (Labor Code §1777.5)

          4)Requires the ratio of work performed by apprentices to  
            journeymen employed in a particular craft or trade on the  
            public work may be no less than the ratio of one hour of  
            apprentice work for five hours of journeyman work, and no  
            higher than the ratio stipulated in the apprenticeship  
            standards under which the apprenticeship program operates.   
            (Labor Code §1777.5)







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          This bill:

          1)Requires that, in order to establish that apprenticeship  
            training needs justify the approval of a new program, existing  
            programs do not have the capacity, or neglect or refuse, to  
            dispatch sufficient apprentices to qualified employers who  
            "have requested apprentices", as shown by a "sustained pattern  
            of unfilled requests."

          2)Eliminates a provision of existing law that authorizes the CAC  
            to approve a new apprenticeship program if special  
            circumstances, as established by regulation, justify the  
            establishment of the program.

          3)Provides that for purposes of this requirement, an existing  
            apprenticeship program serves the "same craft or trade" as a  
            proposed apprenticeship program when there would be a  
            substantial overlap in the work processes covered by the  
            programs or when graduates of the existing program would be  
            qualified to perform a substantial portion of the work that  
            would be performed by graduates of the new program.

          Background
          
          California's apprenticeship programs represent a unique and  
          important feature of the state's workforce development system.  
          The core idea is that, by combining both high quality classroom  
          instruction and high quality on-the-job training experience,  
          apprenticeship programs train high-quality professionals in a  
          variety of different fields and professions. The building and  
          construction trades make up 79% of all of the apprentices in the  
          State of California.

          However, some stakeholders have raised concerns with certain  
          apprenticeship programs that reportedly do not provide high  
          quality instruction and training. Instead, these low-quality  
          programs provide apprentices to meet the requirements of the  
          public works law without actually giving the apprentices the  
          necessary skills to perform the trades. One of the responses to  
          this was the creation of the "needs-based" requirement for  
          approval of new apprenticeship programs in 1999. 

          In 2002, in response to the needs test, the U.S. Department of  







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          Labor (DOL) began the process of "derecognition," contending  
          that the amended apprenticeship statute did not conform to  
          federal standards.  In early 2007, the "derecognition" of  
          California's apprenticeship programs became official. The DOL  
          decision continues to stand.

          According to stakeholders, the practical consequence of the  
          "derecognition" by DOL has been that apprenticeship programs  
          approved by DAS must request separate approval from the DOL.   
          Before "derecognition," federal approval was essentially  
          automatic.  Since that action, apprenticeship programs approved  
          by California reportedly have been approved by the DOL as a  
          matter of course.

          Prior Legislation
          
          AB 921 (Keeley, Chapter 903, Statutes of 1999) included, among  
          other things, the "needs-based" conditions for the building and  
          construction trades.

          FISCAL EFFECT:   Appropriation:    No          Fiscal  
          Com.:YesLocal:   No


          SUPPORT:   (Verified6/10/15)


          State Building and Construction Trades Council (source)
          Construction Employers' Association


          OPPOSITION:   (Verified6/10/15)


          Air Conditioning Trade Association
          Plumbing-Heating-Cooling Contractors Association of California
          Western Electrical Contractors Association


          ARGUMENTS IN SUPPORT:     This bill is sponsored by the State  
          Building and Construction Trades Council.  They argue that it  
          provides much needed clarification to DAS for the purpose of  
          determining when an existing program is deficient.  Adding "have  
          requested apprentices" to Labor Code Section 3075(b)(2)  







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          clarifies that contractors must actually request apprentices  
          before existing programs may be found to lack the capacity or  
          willingness to dispatch them.   The sponsor states that during  
          Governor Schwarzenegger's administration, the DAS sought to rely  
          on Employment Development Department projections of future  
          apprentice needs to justify approval of new programs even though  
          there was no evidence contractors had sought apprentices from  
          existing programs and were unable to receive them.


          ARGUMENTS IN OPPOSITION:     Opponents write the following in  
          opposition to this bill:


            [This bill] perpetuates California's needs test for  
            apprenticeship. Economics Professor Charles Baird correctly  
            characterizes a needs test as "?a common device by which  
            regulatory bodies restrict competition from disfavored  
            interlopers." While Baird does not specifically identify who  
            the interlopers are, they are frequently trade associations  
            who see an opportunity to train young men and women for  
            careers in construction.


            ?Unfortunately, [this bill] exacerbates the damaging aspects  
            of the needs test by adding ambiguous language and deleting  
            the very modest authority of the California Apprenticeship  
            Council to approve a new apprenticeship program "justified by  
            special circumstances by regulation." While it may be  
            suggested that adding a requirement that there be a "sustained  
            pattern of unfilled requests" to justify new apprenticeship  
            opportunities, we would argue that this vague requirement of  
            'sustained' will never be satisfactory to those who prefer  
            monopoly over fair and open competition and training  
            opportunities for all.

          ASSEMBLY FLOOR:  53-23, 5/4/15
          AYES:  Alejo, Bloom, Bonilla, Bonta, Brown, Burke, Calderon,  
            Chau, Chiu, Chu, Cooley, Cooper, Dababneh, Daly, Dodd, Eggman,  
            Frazier, Cristina Garcia, Eduardo Garcia, Gatto, Gipson,  
            Gomez, Gonzalez, Gordon, Gray, Roger Hernández, Holden, Irwin,  
            Jones-Sawyer, Levine, Linder, Lopez, Low, McCarty, Medina,  
            Mullin, Nazarian, O'Donnell, Perea, Quirk, Rendon,  
            Ridley-Thomas, Rodriguez, Salas, Santiago, Steinorth, Mark  







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            Stone, Thurmond, Ting, Weber, Williams, Wood, Atkins
          NOES:  Achadjian, Travis Allen, Baker, Bigelow, Brough, Chávez,  
            Beth Gaines, Gallagher, Grove, Hadley, Harper, Jones, Kim,  
            Lackey, Maienschein, Mathis, Melendez, Obernolte, Olsen,  
            Patterson, Wagner, Waldron, Wilk
          NO VOTE RECORDED:  Campos, Chang, Dahle, Mayes

          Prepared by:Gideon Baum / L. & I.R. / (916) 651-1556
          6/23/15 16:11:47


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