BILL ANALYSIS Ó
AB 2437
Page 1
CONCURRENCE IN SENATE AMENDMENTS
AB
2437 (Ting)
As Amended August 15, 2016
Majority vote
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|ASSEMBLY: |50-27 |(May 23, 2016) |SENATE: |26-13 |(August 17, |
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Original Committee Reference: B. & P.
SUMMARY: Requires on and after July 1, 2017, an establishment
licensed by the Board of Barbering and Cosmetology (BBC) to post
a model notice pertaining to workplace rights and wage and hour
laws, developed by the Labor Commissioner (Commissioner), as
specified, and requires the BBC to inspect for compliance of the
posting requirement. Specifically, this bill:
1)Requires on and after July 1, 2017, an establishment licensed
by the BBC to post a notice, developed by the Commissioner, in
a manner that complies with specified requirements of the
Labor Code in a conspicuous location in clear view of
employees and where similar notices are customarily posted,
and further requires the BBC to inspect for compliance, as
specified.
2)Requires the notice to be posted in English, Spanish,
Vietnamese, and Korean.
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3)States that a violation of the posting requirement is
punishable by an administrative fine, and is not punishable as
a misdemeanor, as specified.
4)Requires the Commissioner to develop a model notice pertaining
to workplace rights and wage and hour laws for employees of
licensed BBC establishments, on or January 1, 2017.
5)Requires the model posting notice to be developed using plain
language in all the languages required in 2) above, and be
accessible on the Commissioner's Web site so that it is
reasonably accessible to an establishment that must comply
with the posting requirement, as specified.
6)Requires the model notice to contain the following
information:
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;
d) How to report violations of the law;
e) Business expense reimbursement; and,
f) Protection from retaliation.
7)Requires the model notice to be translated into Spanish,
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Vietnamese and Korean.
The Senate amendments delete the authorization for the
Commissioner to consult with the BBC in providing the model
notice in additional languages other than English, and instead
require the model notice to be translated into Spanish,
Vietnamese and Korean.
FISCAL EFFECT: According to the Senate Appropriations
Committee, pursuant to Senate Rule 28.8, this bill will result
in negligible state costs.
COMMENTS: Purpose. This bill requires establishments licensed
under the BBC to post a model notice, developed by the
Commissioner, pertaining to workplace rights and wage and hour
laws beginning July 1, 2017. This bill is sponsored by the
Community Health for Asian Americans and Asian Americans
Advancing Justice. According to the author,
"Due to language and cultural barriers among nail salon owners
and employees, there remains persistent confusion about
workplace law. There are approximately 8,000 nail salons
operating in California with over 95,000 licensed nail salon
technicians, the majority of whom are women of color. An
estimated 80% of nail salon owners and employees throughout the
state are Vietnamese immigrant women who often have limited
English proficiency. Employees are commonly misclassified as
independent contractors and frequently earn less than minimum
wage while working long hours without overtime pay or regular
meal or rest breaks. Additionally, due to misclassification,
many nail salon employees and owners mistakenly believe they are
not entitled to worker's compensation, unemployment, disability
or social security benefits. If poor business practices
continue to be passed on from generation to generation, failure
to address this issue will perpetuate a cycle of misinformation
and negligence.
"[This bill] supports the California nail salon industry by
requiring business owners of a nail salon to post a model notice
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- in the language its workers can understand - regarding
worker's rights surrounding wages, misclassification of an
employee as an independent contractor, overtime, tip
distribution, meal periods, rest breaks, protection from
retaliation, and where to report violations of the law. This
bill intends to educate business owners, employers, and
employees about existing labor laws given that many nail salons
appear to be in violation of these laws."
Background. The BBC is responsible for licensing and regulating
barbers, cosmetologists, estheticians, electrologists,
manicurists, apprentices and establishments. Establishment
licensees do not need to hold a separate professional license.
In order to obtain an establishment license, an individual must
submit an application to the BBC and pay the appropriate fee.
The application must contain information about the applicant,
whether it is a person, firm, or corporation that will be
operating the establishment, and specifically prohibits issuing
an establishment license if the individual, or each officer,
director, or partner has committed any acts or crimes, as
specified, which are grounds for denial. The types of
establishments that the BBC regulates, includes, but is not
limited to, nail salons, barbers, and hair salons. Currently,
the BBC licenses approximately 41,000 establishments.
The BBC is required to maintain a program of random and targeted
inspections of establishments to ensure compliance with
applicable laws relating to health and safety. While the BBC
inspects establishments for compliance with applicable health
and safety requirements, it does not have jurisdiction over the
enforcement of labor laws. However, this bill will require the
BBC to inspect for compliance with this posting requirement.
Currently, the BBC does not differentiate between the types of
establishments it licenses. An establishment licensee may
operate a business to conduct any of the professional services
for which a license is required, further establishment owners
(establishment licensees) do not need to hold a separate
professional license in order to own and operate an
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establishment; however, Business and Professions Code (BPC)
Section 7348 specifies that an establishment must at all times
be in the charge of a licensed person.
BBC Enforcement. Existing law permits the BBC to take
enforcement actions against an establishment for issues mainly
pertaining to health and safety violations. Specifically
related to nail salons, pursuant to BPC Section 7403.2 if an
inspection of an establishment finds that health and safety laws
related to manicure and pedicure equipment have been violated
and a citation is issued, the BBC may without advance hearing
temporarily suspend the license. In order to reinstate that
license, the licensee would have to comply with numerous
remediation requirements including an additional inspection and
pay all citations and fines as specified. In addition, BPC
7403.5 permits the BBC to, upon written notice, immediately
close an establishment which upon inspection, is found to have
health and safety violations of such a sever nature as to pose
immediate threat to public health and safety. BBC does not
currently have jurisdiction over labor issues or those
establishment employees that are not licensees of the BBC.
Joint Hearing on Labor Practices, Health, and Safety in
California Nail Salons. Labor concerns for nail technicians
were raised in a May 7, 2015, article from the New York Times,
"The Price of Nice Nails," in which it was reported: "The New
York Times interviewed more than 150 nail salon workers and
owners, in four languages, and found that a vast majority of
workers are paid below minimum wage; sometimes they are not even
paid. Workers endure all manner of humiliation, including
having their tips docked as punishment for minor transgressions,
constant video monitoring by owners, even physical abuse.
Employers are rarely punished for labor and other violations."
In August of 2015, the Assembly Select Committees on Women in
the Workplace, and Girls and Women of Color held a joint hearing
with the Assembly Committees on Health, Business and
Professions, and Labor and Employment, which focused on both the
health and safety of licensees regarding exposure to chemicals
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and other ingredients, and concerns about labor practices in
nail salons. The purpose of that hearing was for state
agencies, advocates, and industry to obtain and share
information, address concerns, and discuss policy
recommendations regarding nail salon practices. As noted in
background information provided by those Committees, "The
jurisdiction for labor law compliance lies with California's
Department of Industrial Relations (DIR) and Division of Labor
Standards Enforcement within DIR. Labor law violations which
occur in nail salons may not be as unique as the health concerns
for workers however outreach to workers and owners about product
safety is an avenue to improve education about employee rights
and the consequences of labor violations." This bill aims to
help address labor issues by requiring training requiring
licensed establishments to post a notice pertaining to workplace
rights and wage and hour laws in clear view of employees. The
model notice is required to provide specified information
including, but not limited to, information about tip or gratuity
distribution, misclassification of an employee as an independent
contractor, and protection from retaliation, among others.
Analysis Prepared by:
Elissa Silva / B. & P. / (916) 319-3301 FN:
0004436