BILL ANALYSIS                                                                                                                                                                                                    Ó



                                                                    AB 2437


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          Date of Hearing:  May 11, 2016


                        ASSEMBLY COMMITTEE ON APPROPRIATIONS


                               Lorena Gonzalez, Chair


          AB  
          2437 (Ting) - As Amended April 25, 2016


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          Urgency:  No  State Mandated Local Program:  NoReimbursable:  No


          SUMMARY:  This bill establishes a workplace notice requirement  
          for barbering and cosmetology establishments regarding workplace  
          rights, as specified. Specifically, this bill:  


          1)Requires the Labor Commissioner, by June 1, 2017, to develop a  
            model notice pertaining to workplace rights and wage and hour  
            laws for employees of establishments licensed under the Board  
            of Barbering and Cosmetology.

          2)Requires the model notice to include, but not be limited to,  








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            information on the following:



             a)   Misclassification of an employee as an independent  
               contractor.

             b)   Wage and hour laws, including, but not limited to,  
               minimum wage, overtime compensation, meal periods, and rest  
               periods.



             c)   Tip or gratuity distribution, how to report violations  
               of the law, business expense reimbursement, and protection  
               from retaliation.



          3)Requires the model notice to contain clear and concise  
            language and be accessible on the Labor Commissioner's website  
            so that it is reasonably accessible.

          4)Authorizes the Labor Commissioner to consult with the Board of  
            Barbering and Cosmetology in providing the model notice in  
            additional languages.



          5)Beginning July 1, 2017, requires establishments licensed under  
            the Board of Barbering and Cosmetology, upon availability of  
            the model notice prepared by the Labor Commissioner, to post  
            the model notice in a conspicuous location in clear view of  
            employees, where similar notices are customarily posted.



          6)Authorizes the Board of Barbering and Cosmetology to inspect  
            establishments for compliance with the model notice posting  








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            requirement.


          FISCAL EFFECT:


          1)Minor and absorbable cost to the Division of Labor Standards  
            Enforcement within the Department of Industrial Relations.


          2)Minor and absorbable costs to the Board of Barbering and  
            Cosmetology.


          


          COMMENTS:


          1)Purpose. According to the author, the purpose of this bill is  
            to ensure that certain employers, particularly nail salon  
            establishments and their workers understand existing labor  
            laws.  Although the primary focus of the bill is nail salons,  
            the workplace posting requirement will apply to all  
            establishments licensed by the Board of Barbering and  
            Cosmetology. 

            Due to language and cultural barriers among nail salon owners  
            and employees, there remains persistent confusion about  
            workplace law.  According to the author, this community's  
            unique but pervasive problems require innovative solutions.  

          2)Background. The Board of Barbering and Cosmetology is  
            responsible for licensing and regulating barbers,  
            cosmetologists, estheticians, electrologists, manicurists,  
            apprentices and approximately 41,000 establishments, including  
            nail salons, barbershops and hair salons. According to the  
            author, there are approximately 8,000 nail salons operating in  








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            California with over 95,000 licensed nail salon workers, the  
            majority of whom are women of color.  An estimated 80% of nail  
            salon workers and owners throughout the state are Vietnamese  
            immigrant women who often have limited English proficiency.   
            According to the California Healthy Nail Salon Collaborative,  
            the annual income of many nail salon workers is less than  
            $18,200.  Nail salon workers frequently earn less than minimum  
            wage while working long hours without overtime or regular meal  
            or rest breaks. Additionally, many do not receive worker's  
            compensation, unemployment benefits, disability or social  
            security. 
            In recent years, concern has been expressed that many nail  
            salon workers are commonly misclassified as independent  
            contractors instead of employees. As discussed in the August  
            26, 2015 informational hearing convened by the Assembly Select  
            Committees on Women in the Workplace and Girls and Women of  
            Color and the Assembly Committees on Business and Professions,  
            Health and Labor and Employment, "Labor Practices Affecting  
            Nail Technicians and the Health and Safety of Nail Salons in  
            California", workers and owners, alike, are often unaware of  
            the difference in classification and other labor laws and  
            rights to which workers are entitled.  In September 2011, a  
            class action lawsuit was filed on behalf of 125 nail salon  
            workers against a nail salon chain in San Mateo County.  The  
            complaint alleged various labor violations including not  
            paying overtime, taking an employee's tips, not providing meal  
            and rest breaks and prohibiting employees from speaking  
            Vietnamese in the workplace. The case was settled and the  
            chain made improvements and adjusted their employment  
            practices. 


            Worker advocates contend that in many low-wage industries,  
            employers who disregard the law face few consequences, if any.  
             This includes nail salons that do not comply with wage and  
            hour laws, such as paying their employees overtime and  
            ensuring meal and rest breaks.  










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          3)Related Legislation. 
         
             a)   AB 2025 (Gonzalez), among other provisions, requires the  
               Board of Barbering and Cosmetology (Board), as a condition  
               of issuing an establishment license, to ensure that the  
               applicant has knowledge of basic labor laws pertaining to  
               the individuals who work in establishments.
             b)   AB 2125 (Chiu) requires the California Department of  
               Public Health (CDPH) to publish guidelines and model  
               ordinances to assist local jurisdictions to voluntarily  
               adopt local "Healthy Nail Salon" recognition programs.   
               This bill is pending on this Committee's Suspense File.


          


          Analysis Prepared by:Jennifer Swenson / APPR. / (916)  
          319-2081