Amended in Senate August 19, 2016

Amended in Senate June 22, 2016

Amended in Assembly May 31, 2016

Amended in Assembly April 13, 2016

Amended in Assembly March 15, 2016

California Legislature—2015–16 Regular Session

Assembly Bill No. 1978

Introduced by Assembly Member Gonzalez

(Coauthors: Assembly Members Campos, Chu, Cristina Garcia, Lopez, McCarty, Rodriguez, Santiago, Thurmond, and Weber)

(Coauthor: Senator Beall)

February 16, 2016

An act to begin delete amend Section 12940 of the Government Code, and to amend Section 1106 of, and to end delete add Part 4.2 (commencing with Section 1420) to Division 2 of the Labor Code, relating to employment.

LEGISLATIVE COUNSEL’S DIGEST

AB 1978, as amended, Gonzalez. Employment: property service workers.

Existing law establishes the Department of Industrial Relations in the Labor and Workforce Development Agency to foster, promote, and develop the welfare of the wage earners of California, to improve their working conditions, and to advance their opportunities for profitable employment. Existing law establishes within the department the Division of Labor Standards Enforcement, which is vested with the general duty of enforcing labor laws, including those relating to wage claims and employer retaliation. begin delete Existing law requires the Labor Commissioner, defined as the Chief of the Division of Labor Standards Enforcement, to establish and maintain a field enforcement unit in order to ensure that minimum labor standards are met. end delete

begin delete

The California Occupational Safety and Health Act of 1973 establishes certain safety and other responsibilities of employers and employees, including a requirement that every employer establish, implement, and maintain an effective injury prevention program. The act requires the program to be written, except as specified, and to include certain elements.

end delete

This bill would establish specific standards and protections for property service begin delete workers, to be known as the Property Service Workers Protection Act, end delete begin insert workers end insert and define terms for its purposes.

begin delete

The bill would require the Labor Commissioner, no later than July 1, 2018, to develop worker and supervisor materials for a prescribed 4-hour training regarding sexual violence and sexual harassment and to make those materials available to employers, covered workers, and the public through, among other means, posting on its Internet Web site. The bill would require the commissioner, beginning July 1, 2019, to update these materials annually. The bill would, on and after July 1, 2018, require employers who provide janitorial services to have a system to require that covered workers and supervisors, at least annually, receive prescribed in-person training on workplace sexual violence and sexual harassment. The bill would require the commissioner to establish standards and requirements for trainers and recordkeeping relating to training. The bill would require the Labor Commissioner to develop minimum qualifications for trainers who provide the training.

end delete begin delete

The bill would require the Occupational Safety and Health Standards Board, by January 1, 2018, to adopt standards developed by the Division of Occupational Safety and Health, in consultation with a specified advisory group, that require an employer to adopt a workplace sexual violence and sexual harassment prevention plan as a part of its injury and illness prevention plan, to protect covered workers from workplace sexual violence and sexual harassment.

end delete begin insert

The bill would require every employer subject to its provisions to keep accurate records of specific information regarding employees for 3 years. The bill would require the division to enforce its provisions and would authorize the division to adopt any regulations necessary to carry out the provisions of the bill.

end insert begin insert

The bill would require every employer, effective July 1, 2018, to register annually with the Labor Commissioner in accordance with prescribed procedures. The bill would prohibit an employer from conducting any business without registration as required by the bill and would authorize the commissioner to revoke a registration under certain circumstances. The bill would set application and renewal fees for registration.

end insert

The bill would require begin delete the registration of employers conducting janitorial business, as prescribed, and establish specific authority for the Labor Commissioner to enforce and implement that requirement. The bill would set application and renewal fees. The bill would prohibit an employer, on or after July 1, 2018, from conducting any janitorial business without a valid registration. The bill would require end delete an employer to include specific information in the registration begin delete application, subscribed and sworn to under penalty of perjury, thereby imposing a state-mandated local program by expanding the scope of the crime of perjury. end delete begin insert application. end insert The bill would prohibit the begin insert division from end insert granting begin delete of end delete registration under specific begin delete circumstances, authorize the director to deny, suspend, or void a registration in certain end delete circumstances. The bill would require the begin delete commissioner, on and after July 1, 2018, end delete begin insert commissioner end insert to maintain on the begin delete commissioner’s end delete begin insert department’s end insert Internet Web site a begin delete regularly updated, searchable database of registered employers, and, on and after July 1, 2019, a searchable end delete begin insert public end insert database begin delete regarding the compliance and enforcement activities of the department. end delete begin insert of registered property service employers. end insert

begin insert

The bill would require the division, by January 1, 2019, to establish a biennial in-person sexual violence and harassment prevention training requirement for employees and employers with the assistance of a prescribed advisory committee to be convened by the director. The bill would require employers, as of July 1, 2018, and until the division establishes that training requirement, to provide employees with a pamphlet of the Department of Fair Employment and Housing on sexual harassment.

end insert begin delete

The bill would establish various compliance and enforcement provisions, including a requirement that the director establish a Property Services Compliance Unit to enforce the act. The bill would establish civil fines and provide for labor compliance agreements, stop order authority, audits, and investigations. The bill would impose a state-mandated local program by making it a crime to conduct any janitorial business without a valid registration, or to fail to observe a stop order.

end delete

The bill would begin insert establish civil fines for specific violations of its provisions and vest in the commission the exclusive authority to enforce the civil fine provisions. The bill would end insert require the deposit of registration fees and begin delete specific end delete civil fines in the begin delete State Janitorial Contractor Registration Fund, which the bill would create, end delete begin insert Labor Enforcement and Compliance Fund end insert and begin delete make end delete begin insert would direct that end insert the moneys in the fund begin insert from those fees and fines be end insert available, upon appropriation, for the reasonable costs of administering the registration of janitorial contractors and the costs and obligations associated with the administration and enforcement of the bill by the begin delete commissioner. The bill, to provide adequate cash flow for those purposes, would authorize the Director of Finance, with the concurrence of the Secretary of the Labor and Workforce Development Agency, to approve a short-term loan each fiscal year from the Labor and Workforce Development Fund to the State Janitorial Contractor Registration Fund. end delete begin insert division. end insert

begin delete

The bill would make conforming changes regarding the definition of an employer.

end delete begin delete

The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.

end delete begin delete

This bill would provide that no reimbursement is required by this act for a specified reason.

end delete

Vote: majority. Appropriation: no. Fiscal committee: yes. State-mandated local program:  begin delete yes end delete begin insert no end insert .

The people of the State of California do enact as follows:

begin insert

begin insert SECTION 1. end insert   

Part 4.2 (commencing with Section 1420) is added
to Division 2 of the Labor Code, to read:

 

PART  begin insert 4.2. end insert   Property Service Workers Protection

 

begin insert 1420. end insert   

For purposes of this part:

(a) (1) “Covered worker” means a janitor, including any
individual predominantly working, whether as an employee,
independent contractor, or a franchisee, as a janitor, as that term
is defined in the Service Contract Act Directory of Occupations
maintained by the United State Department of Labor.

(2) “Covered worker” does not include any individual whose
work duties are predominantly final cleanup of debris, grounds,
and buildings near the completion of a construction, alteration,
demolition, installation, or repair work project, including, but not
limited to, street cleaners.

(b) “Current and valid registration” means an active
registration pursuant to this part that is not expired or revoked.

(c) “Department” means the Department of Industrial Relations.

(d) “Director” means the Director of Industrial Relations.

(e) (1) “Employer” means any person or entity that employs
at least one employee and one or more covered workers and that
enters into contracts, subcontracts, or franchise arrangements to
provide janitorial services. The term “employer” includes the term
“covered successor employer.”

(2) “Covered successor employer” means an employer who
meets one or more of the following criteria:

(A) Uses substantially the same equipment, supervisors, and
workforce to offer substantially the same services to substantially
the same clients as a predecessor employer, unless the employer
maintains the same workforce pursuant to Chapter 4.5
(commencing with Section 1060) of Part 3. In addition, an
employer who has operated with a current and valid registration
for at least the preceding three years shall not be considered a
covered successor employer for using substantially the same
equipment, supervisors, and workforce to substantially the same
clients, if all of the following apply:

(i) The individuals in the workforce were not referred or
supplied for employment by the predecessor employer to the
successor employer.

(ii) The successor employer has not had any interest in, or
connection with, the operation, ownership, management, or control
of the business of the predecessor employer within the preceding
three years.

(B) Shares in the ownership, management, control of the
workforce, or interrelations of business operations with the
predecessor employer.

(C) Is an immediate family member of any owner, partner,
officer, licensee, or director of the predecessor employer or of any
person who had a financial interest in the predecessor employer.
“Immediate family member” means a spouse, parent, sibling, son,
daughter, uncle, aunt, niece, nephew, grandparent, grandson,
granddaughter, mother-in-law, father-in-law, brother-in-law,
sister-in-law, or cousin.

(f) “Commissioner” means the Labor Commissioner of the
Division of Labor Standards Enforcement of the department.

(g) “Supervisor” has the same meaning as in subdivision (t) of
Section 12926 of the Government Code.

begin insert 1421. end insert   

Every employer shall keep accurate records for three
years, showing all of the following:

(a) The names and addresses of all employees engaged in
rendering actual services for any business of the employer.

(b) The hours worked daily by each employee, including the
times the employee begins and ends each work period.

(c) The wage and wage rate paid each payroll period.

(d) The age of all minor employees.

(e) Any other conditions of employment.

begin insert 1422. end insert   

The Division of Labor Standards Enforcement shall
enforce this part. The commissioner may adopt any regulations
necessary to carry out this part.

begin insert 1423. end insert   

Effective July 1, 2018, every employer shall register with
the commissioner annually.

begin insert 1424. end insert   

When a certificate of current and valid registration is
originally issued or renewed under this part, the Division of Labor
Standards Enforcement shall provide related and supplemental
information to the registrant regarding business administration
and applicable labor laws. As of July 1, 2018, employers covered
by this part shall provide all covered workers a copy of the
Department of Fair Employment and Housing pamphlet
DFEH-185, entitled “Sexual Harassment,” until the sexual
violence and harassment prevention training requirement is
established pursuant to Section 1429.5.

begin insert 1425. end insert   

Proof of current and valid registration shall be by an
official Division of Labor Standards Enforcement registration
form.

begin insert 1426. end insert   

At least 60 days prior to the expiration of each
registrant’s registration, the Division of Labor Standards
Enforcement shall send a renewal notice to the last known address
of the registrant. However, omission of the Division of Labor
Standards Enforcement to provide the renewal notice in
accordance with this section shall not excuse a registrant from
making timely application for renewal of registration, shall not
be a defense in any action or proceeding involving failure to renew
registration, and shall not subject the Division of Labor Standards
Enforcement to any legal liability.

begin insert 1427. end insert   

The Division of Labor Standards Enforcement shall
collect from each employer an initial nonrefundable application
fee of five hundred dollars ($500), and an annual fee of five
hundred dollars ($500) on the anniversary date of initial
application, and may periodically adjust the registration fee in an
amount sufficient to fund all direct and indirect costs to administer
and enforce this part.

begin insert 1428. end insert   

An employer shall not conduct any business without
complying with the registration requirements of this part. The
commissioner may revoke a registration if he or she finds an
employer to be out of compliance with any requirement of this part
or to have failed to satisfy any of the conditions of Section 1429.

begin insert 1429. end insert   

The Division of Labor Standards Enforcement shall not
approve the registration of any employer until all of the following
conditions are satisfied:

(a) The employer has executed a written application, in a form
prescribed by the commissioner and subscribed and sworn to by
the employer containing the following:

(1) The name of the business entity and, if applicable, its
fictitious or “doing business as” name.

(2) The form of the business entity and, if a corporation, all of
the following:

(A) The date of incorporation.

(B) The state in which incorporated.

(C) If a foreign corporation, the date the articles of
incorporation were filed with the California Secretary of State.

(D) Whether the corporation is in good standing with the
California Secretary of State.

(3) The federal employer identification number (FEIN) and the
state employer identification number (SEIN) of the business.

(4) The address of the business and the telephone number and,
if applicable, the addresses and telephone numbers of any branch
locations.

(5) Whether the application is for a new or renewal registration
and, if the application is for a renewal, the prior registration
number.

(6) The names, residential addresses, telephone numbers, and
social security numbers of the following persons:

(A) All corporate officers, if the business entity is a corporation.

(B) All persons exercising management responsibility in the
applicant’s office, regardless of form of business entity.

(C) All persons, except bona fide employees on regular salaries,
who have a financial interest of 10 percent or more in the business,
regardless of the form of business entity, and the actual percent
owned by each of those persons.

(7) The policy number, effective date, expiration date, and name
and address of the carrier of the applicant business’ current
workers’ compensation coverage.

(8) (A) Whether the employer and any persons named in
response to subparagraph (A), (B), or (C) of paragraph (6)
presently:

(i) Owe any unpaid wages.

(ii) Have unpaid judgments outstanding.

(iii) Have any liens or suits pending in court against himself or
herself.

(iv) Owe payroll taxes, or personal, partnership, or corporate
income taxes, Social Security taxes, or disability insurance.

(B) An applicant who answers affirmatively to any item
described in subparagraph (A) shall provide, as part of the
application, additional information on the unpaid amounts,
including the name and address of the party owed, the amount
owed, and any existing payment arrangements.

(9) (A) Whether the employer and any persons named in
response to subparagraph (A), (B), or (C) of paragraph (6) have
ever been cited or assessed any penalty for violating any provision
of this code.

(B) An applicant who answers affirmatively to any item
described in subparagraph (A) shall provide additional
information, as part of the application, on the date, nature of
citation, amount of penalties assessed for each citation, and the
disposition of the citation, if any. The application shall describe
any appeal filed. If the citation was not appealed, or if it was
upheld on appeal, the applicant shall state whether the penalty
assessment was paid.

(10) Effective January 1, 2020, all new applications for
registration and renewal of registration shall complete the sexual
violence and harassment prevention training requirements
prescribed by the division and developed pursuant to Section
1429.5.

(11) Such other information as the commissioner requires for
the administration and enforcement of this part.

(b) The employer has paid a registration fee to the Division of
Labor Standards Enforcement pursuant to Section 1427.

(c) Notwithstanding any other law, violation of this section shall
not be a crime.

begin insert 1429.5. end insert   

The Division of Labor Standards Enforcement shall
establish a biennial in-person sexual violence and harassment
prevention training requirement for employees and employers
covered by this part by January 1, 2019. To assist in developing
these standards, the director shall convene an advisory committee
to recommend requirements for a sexual harassment prevention
training program. The advisory committee shall be composed of
representatives of the Division of Labor Standards Enforcement,
the Division of Occupational Safety and Health, and the
Department of Fair Employment and Housing, and shall also
include representatives from a recognized or certified collective
bargaining agent that represents janitorial workers, employers,
labor-management groups in the janitorial industry, sexual assault
victims advocacy groups, and other related subject matter experts.
The director shall convene the advisory committee no later than
July 1, 2017. The advisory committee shall consider the
requirements of Section 12950.1 of the Government Code when
developing the recommended standard. The Division of Labor
Standards Enforcement shall propose the requirements for the
sexual violence and harassment prevention training requirement
no later than January 1, 2018.

begin insert 1430. end insert   

The Division of Labor Standards Enforcement shall not
register or renew the registration of an employer in any of the
following circumstances:

(a) The employer has not fully satisfied any final judgment for
unpaid wages due to an employee or former employee of a business
for which the employer is required to register under this chapter.

(b) The employer has failed to remit the proper amount of
contributions required by the Unemployment Insurance Code or
the Employment Development Department has made an assessment
for those unpaid contributions against the employer that has
become final and the employer has not fully paid the amount of
delinquency for those unpaid contributions.

(c) The employer has failed to remit the amount of Social
Security and Medicare tax contributions required by the Federal
Insurance Contributions Act (FICA) to the Internal Revenue
Service and the employer has not fully paid the amount or
delinquency for those unpaid contributions.

begin insert 1431. end insert   

The commissioner shall maintain a public database of
property service employers, on the Internet Web site of the
department, including the name, address, registration number,
and effective dates of registration.

begin insert 1432. end insert   

(a) An employer who fails to register pursuant to Section
1423 is subject to a civil fine of one hundred dollars ($100) for
each calendar day that the employer is unregistered, not to exceed
ten thousand dollars ($10,000).

(b) Any person or entity that contracts with an employer who
lacks a current and valid registration, as displayed on the online
registration database at the time the contract is executed, extended,
renewed, or modified, under this part on the date the person or
entity enters into or renews a contract or subcontract for janitorial
services with the employer is subject to a civil fine of not less than
two thousand dollars ($2,000) nor more than ten thousand dollars
($10,000) in the case of a first violation, and a civil fine of not less
than ten thousand dollars ($10,000) nor more than twenty-five
thousand dollars ($25,000) for a subsequent violation.

(c) Notwithstanding any other provision of law, the authority
to enforce this section is vested exclusively with the commissioner.
The procedures for issuing, contesting, and enforcing judgments
for citations or civil penalties issued by the commissioner shall be
the same as those set forth in Section 1197.1.

begin insert 1433. end insert   

(a) All registration fees collected pursuant to Section
1427, all civil fines collected pursuant to Section 1432, and any
other moneys as are designated by statute or order shall be
deposited in the Labor Enforcement and Compliance Fund.

(b) Moneys deposited in the fund pursuant to Section 1427 and
Section 1432 shall be used only for the following purposes:

(1) The reasonable costs of administering the registration of
janitorial contractors pursuant to this part by the Division of Labor
Standards and Enforcement.

(2) The costs and obligations associated with the administration
and enforcement of this part by the Division of Labor Standards
and Enforcement.

(c) The annual employer registration renewal fee specified in
of Section 1427, and any adjusted application renewal fee, shall
be set in amounts that are sufficient to support the direct costs and
a reasonable percentage attributable to the indirect costs of the
division for administering this part.

begin insert 1434. end insert   

A successor employer is liable for any wages and
penalties its predecessor employer owes to any of the predecessor
employer’s former employee or employees, if the successor
employer meets any of the following criteria:

(a) Uses substantially the same workforce to offer substantially
the same services as the predecessor employer. This factor does
not apply to employers who maintain the same workforce pursuant
to Chapter 4.5 (commencing with Section 1060) of Part 3.

(b) Shares in the ownership, management, control of the labor
relations, or interrelations of business operations with the
predecessor employer.

(c) Employs in a managerial capacity any person who directly
or indirectly controlled the wages, hours, or working conditions
of the affected employees of the predecessor employer.

(d) Is an immediate family member of any owner, partner,
officer, or director of the predecessor employer of any person who
had a financial interest in the predecessor employer.

end insert

All matter omitted in this version of the bill appears in the bill as amended in the Assembly, June 22, 2016. (JR11)

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CORRECTIONS:

Title-Line 1.

Digest-Pages 1 and 2.

Text-Pages 3, 4, 5, 6, 7, 8, and 9.

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