BILL ANALYSIS Ó ----------------------------------------------------------------- |SENATE RULES COMMITTEE | AB 2025| |Office of Senate Floor Analyses | | |(916) 651-1520 Fax: (916) | | |327-4478 | | ----------------------------------------------------------------- THIRD READING Bill No: AB 2025 Author: Gonzalez (D), et al. Amended: 8/19/16 in Senate Vote: 21 SENATE BUS., PROF. & ECON. DEV. COMMITTEE: 8-0, 6/13/16 AYES: Hill, Bates, Block, Gaines, Galgiani, Jackson, Mendoza, Wieckowski NO VOTE RECORDED: Hernandez SENATE LABOR & IND. REL. COMMITTEE: 5-0, 6/29/16 AYES: Mendoza, Stone, Jackson, Leno, Mitchell SENATE APPROPRIATIONS COMMITTEE: 7-0, 8/11/16 AYES: Lara, Bates, Beall, Hill, McGuire, Mendoza, Nielsen ASSEMBLY FLOOR: 69-3, 5/19/16 - See last page for vote SUBJECT: Barbering and cosmetology: labor law education requirements SOURCE: California Healthy Nail Salon Collaborative DIGEST: This bill updates the Barbering and Cosmetology Act (Act) to ensure that the Board of Barbering and Cosmetology (BBC) offers all written materials provided to licensees and applicants in English, Spanish and Vietnamese; that the BBC provides practitioner and establishment applicants with information about basic labor laws and; that the BBC includes basic labor law information in health and safety curriculum taught in BBC-approved schools. AB 2025 Page 2 Senate Floor Amendments of 8/19/16 replace an inaccurate code reference in current law to Department of Health Care Services with Department of Public Health, the intended agency for the BBC Health and Safety Advisory Committee to report its sanitary conditions regulations. Senate Floor Amendments of 8/16/16 delay implementation of the measure until July 2017, add Korean to the list of languages BBC must make written materials available in and make other technical and conforming changes. ANALYSIS: Existing law: 1)Defines "establishment" as any premises, building or part of a building where any activity licensed under the Act is practiced and sets forth requirements for licensure as an establishment by BBC. (Business and Professions Code (BPC) §§ 7346-7352) 2)Establishes the Dymally-Alatorre Bilingual Services Act (Dymally-Alatorre) which requires each state agency to conduct a survey, related to its bilingual services, of each of its statewide offices which render services to the public every two years to determine specified information. (Government Code Section 7290 et seq.) 3)Establishes the Division of Labor Standards Enforcement (DLSE) and grants the Chief of DLSE (Labor Commissioner) and his or her employee's free access to all places of labor. (Labor (LAB) Code §§ 83 and 90) 4)States the policy of this state to vigorously enforce minimum labor standards in order to ensure employees are not required AB 2025 Page 3 or permitted to work under substandard unlawful conditions or for employers that have not secured the payment of compensation, and to protect employers who comply with the law from those who attempt to gain a competitive advantage at the expense of their workers by failing to comply with minimum labor standards. Requires the Labor Commissioner to adopt an enforcement plan for the field enforcement unit which shall identify priorities for investigations to be undertaken by the unit that ensure the available resources will be concentrated in industries, occupations, and areas in which employees are relatively low paid and unskilled, and those in which there has been a history of violations and those with high rates of noncompliance with the law. (LAB § 90.5) 5)Requires, at the time of hiring, an employer to provide each employee a written notice, in the language the employer normally uses to communicate employment-related information to the employee, containing information about the rate or rates of pay. (LAB § 2810.5) This bill: 1)Requires, beginning July 1, 2017, BBC to offer and make available all written materials provided to licensees and applicants in English, Spanish, Vietnamese and Korean. 2)Expands the role of the BBC Health and Safety Advisory Committee to require recommendations be provided on issues impacting board licensees, including how to ensure licensees are aware of basic labor laws (BLLs) including, but not limited to key differences between the legal rights, benefits, and obligations of an employee and an independent contractor; wage and hour rights for hourly employees; antidiscrimination laws relating to the use of a particular language in the workplace; anti-retaliation laws relating to a worker's right to file complaints with the Department of Industrial Relations and; how to obtain more information about state and federal AB 2025 Page 4 labor law. 3)Requires every electronic application to renew a license to include a signed acknowledgment that the renewal applicant understands that establishments are responsible for compliance with any applicable labor laws of the state and that the applicant understands the informational materials BLLs. Background Concerns about nail salons and experiences of nail salon employees. Nail salons have been the focus of studies and media reports in recent years stemming from health, safety and labor concerns in these settings. In May 2015, the New York Times (NYT) published two articles stemming from interviews with more than 150 nail salon workers and owners that found that a cast majority of workers are paid below minimum wage and are sometimes not even paid. The articles found that workers "endure all manner of humiliation, including having their tips docked as punishment for minor transgressions, constant video monitoring by owners, even physical abuse." The NYT also found that employers are rarely punished for labor and other violations and that in 2014, when the New York State Labor Department conducted its first nail salon sweep, investigators inspected 29 salons and found 116 wage violations. While only about a quarter of the more than 100 workers said they were paid an amount equivalent to that state's minimum hourly wage, all but three said they had wages withheld in ways considered illegal, such as never getting overtime and many were unaware that working unpaid was against the law and their alarmingly low wages are also illegal. A February 2016 follow up report in the NYT articles found that 40 percent of the salons inspected, as part of the Labor Department's increased efforts to inspect following the original May articles, had underpaid employees, including one worker at a Manhattan salon who was paid $30 a day for 10-hour shifts, a manicurist in Queens who was paid only $200 for a 50-hour workweek, had manicurists at seven salons who were forced to work for no pay or had to pay salon owners a fee, ostensibly to learn the trade and several owners admitted to submitting fake AB 2025 Page 5 payroll records in an effort to fool investigators. The article highlighted that employers are often unfamiliar with the intricacies of state labor laws. On August 26, 2015, the Assembly Select Committee on Women in the Workplace, the Assembly Select Committee on Girls and Women of Color, and the Assembly Committees on Health, Business and Professions, and Labor held a joint informational hearing titled "Labor Practices, Health, and Safety in California Nail Salons." The purpose of the hearing was to obtain information, address concerns, and discuss policy recommendations regarding nail salon practices from state agencies, advocates, and industry. The Author notes that the most widely agreed-upon problem discussed at the hearing was lack of information about worker rights. According to the Author, this lack of information, combined with cultural and language barriers, has led to some nail salon owners using illegal practices to manage workers. These practices include employee/contractor misclassification, daily pay totaling less than minimum wage, unpaid overtime, withholding tips or deducting pay as retaliation, denying meal breaks, and language discrimination. The Author states that it is clear to many stakeholders that the use of such illegal labor practices is not always malicious, so one commonsense step is to ensure that owners are informed of existing laws, which this bill intends to do by utilizing the current establishment application process to increase awareness of basic labor laws relevant to establishments without onerous requirements on businesses. The measure would set forth requirements for all BBC establishments, including nail salons. FISCAL EFFECT: Appropriation: No Fiscal Com.:YesLocal: No According to the Senate Appropriations Committee, this bill will not result in significant costs related to the requirement to provide information to licensees in languages other than English, or to collect applicant demographic data, as BBC has AB 2025 Page 6 already translated its informational materials into the languages specified in this bill or is in the process of doing so. The analysis notes that there will be additional information technology costs, likely over $150,000 to make changes to the BreEze online application system to record a license applicant's acknowledgement of his or her responsibility to comply with BLLs. SUPPORT: (Verified8/22/16) California Healthy Nail Salon Collaborative (source) Asian Health Services Asian and Pacific Islander American Health Forum Black Women for Wellness Board of Barbering and Cosmetology California Employment Lawyers Association California Immigrant Policy Center California Labor Federation California Pan-Ethnic Health Network Center for Environmental Health Community Action Marin Immigrant Resettlement & Cultural Center, Inc. Orange County Asian and Pacific Islander Community Alliance Professional Beauty Federation of California National Employment Law Project The Greenlining Institute WorkSafe OPPOSITION: (Verified8/22/16) None received ARGUMENTS IN SUPPORT: A number of nonprofit organizations focused on improving the health of Asian Americans, serving the Asian American community in California and groups that work closely with nail salon workers and their families, as well as those with experience advocating for employment and labor AB 2025 Page 7 rights, are in support of this bill. Supporters believe the bill strikes the right balance in its focus on education and removal of language barriers while requiring owners to have a basic understanding of their obligations under California labor law. ASSEMBLY FLOOR: 69-3, 5/19/16 AYES: Achadjian, Alejo, Arambula, Atkins, Baker, Bigelow, Bloom, Bonilla, Bonta, Brown, Burke, Calderon, Campos, Chau, Chávez, Chiu, Chu, Cooley, Cooper, Dababneh, Dahle, Daly, Dodd, Eggman, Frazier, Gallagher, Cristina Garcia, Eduardo Garcia, Gatto, Gipson, Gomez, Gonzalez, Gordon, Gray, Grove, Roger Hernández, Holden, Irwin, Jones, Jones-Sawyer, Kim, Lackey, Levine, Linder, Lopez, Low, Maienschein, Medina, Melendez, Mullin, Nazarian, Obernolte, O'Donnell, Olsen, Patterson, Quirk, Ridley-Thomas, Rodriguez, Salas, Santiago, Mark Stone, Thurmond, Ting, Wagner, Waldron, Weber, Wilk, Wood, Rendon NOES: Travis Allen, Harper, Mayes NO VOTE RECORDED: Brough, Chang, Beth Gaines, Hadley, Mathis, McCarty, Steinorth, Williams Prepared by:Sarah Mason / B., P. & E.D. / (916) 651-4104 8/23/16 9:54:19 **** END ****