BILL ANALYSIS Ó
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|SENATE RULES COMMITTEE | AB 2897|
|Office of Senate Floor Analyses | |
|(916) 651-1520 Fax: (916) | |
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THIRD READING
Bill No: AB 2897
Author: Committee on Labor and Employment
Introduced:3/1/16
Vote: 21
SENATE LABOR & IND. REL. COMMITTEE: 4-0, 6/29/16
AYES: Mendoza, Jackson, Leno, Mitchell
NO VOTE RECORDED: Stone
ASSEMBLY FLOOR: 78-0, 5/12/16 (Consent) - See last page for
vote
SUBJECT: Car washes
SOURCE: Author
DIGEST: This bill requires a car wash employer to provide
written notice to a successor employer regarding the
requirements of existing law prior to the sale or other transfer
of the business.
ANALYSIS:
Existing law:
1)Requires every employer to register annually with the Labor
Commissioner and lists the following conditions for
registration or renewal:
The employer must present proof of compliance with the
local government's business licensing or regional
regulatory requirements to the Labor Commissioner.
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Page 2
The employer has obtained a surety bond with a principal
sum no less than $150,000 and file a copy of the bond with
the Labor Commissioner. The bond shall be payable to the
people of California for the benefit of any employee
damaged by his or her employer's failure to pay wages,
interest on wages, or fringe benefits.
The employer has documented that a worker's compensation
insurance policy is in effect and has paid necessary fees.
(Labor Code §§2054 and 2055)
1)Regulates the car washing and polishing industry by requiring
specific recordkeeping requirements of car wash employers on
employee wages, hours and working conditions. (Labor Code
§2052)
2)Establishes a car wash worker fund for which penalties and
registration fees are deposited for disbursement by the Labor
Commissioner to employees of car washing or polishing
businesses found to be in violation of existing law. (Labor
Code §2065)
3)States that charitable groups, rental car agencies,
self-service or automated car wash that have no more than two
full-time employees for cashiering and/or maintenance
purposes, and licensed vehicle dealers or automotive repair
businesses are exempted. (Labor Code §2051)
4)Provides that a successor to an employer that owed wages and
penalties to the predecessor's employees is liable for those
wages and penalties under specified circumstances. (Labor Code
§2066)
This bill requires a car wash employer to provide written notice
to a successor employer regarding the above provisions, such as
owed wages and penalties, prior to the sale or other transfer of
the business.
Comments
Need for this bill? Existing law regulates the employment
practices of car washes and requires employers of car wash
employees to register with the Labor Commissioner and pay a
AB 2897
Page 3
specified registration fee or be subject to a specified civil
fine. Existing law also states that a successor car wash
employer may be liable for unpaid wages and penalties incurred
by a predecessor car wash employer if certain conditions are
met.
This bill requires a car wash employer to notify a successor in
writing of the requirement of the car wash registration law.
According to the author, this bill provides important
information about the law's requirements to a prospective
purchaser and ensures greater compliance.
Prior Legislation
AB 2750 (Hernandez, 2013) would have required a car wash
employer to provide written notice to a successor employers
regarding the requirements of existing law prior to the sale or
other transfer to the business. The bill was amended out of
Labor Code and into Business and Professions Code.
AB 1387 (Hernandez, Chapter 751, Statutes of 2013) eliminated
the sunset date on existing law regulating the car washing and
polishing industry. Also, AB 1387 increased the surety bond from
$15,000 to $150,000 and provided a specified exemption for
employers with a valid collective bargaining agreement.
AB 236 (Swanson, Chapter 224, Statutes of 2009) extended the
sunset date of the licensing and registration program for car
washes from January 1, 2010 to 2014.
SB 1468 (Alarcon, Chapter 656, Statutes of 2006) extended the
sunset date of the licensing and registration program to January
1, 2010 and required the Labor Commissioner to report on the
status of labor law violations and enforcement in the car
washing and polishing industry.
AB 1688 (Goldberg, Chapter 825, Statutes of 2003) enacted
regulations for the car wash industry including registration and
bonding requirements, as well as protections against "successor"
entities avoiding previous judgments for unpaid wages or
penalties.
SB 1097 (Hayden, 1999) would have required persons who employ
others in car washing and polishing to register with the Labor
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Page 4
Commissioner and would have required an employer who has
violated specified labor laws to obtain a surety bond and meet
other specified requirements. SB 1097 was vetoed by Governor
Davis.
FISCAL EFFECT: Appropriation: No Fiscal
Com.:NoLocal: No
SUPPORT: (Verified7/6/16)
None received
OPPOSITION: (Verified7/6/16)
None received
ARGUMENTS IN SUPPORT: According to the author's office, this
bill requires a car wash employer to notify a successor in
writing of the requirement of the car wash registration law,
including the potential for successor liability for unpaid
wages, prior to the sale or other transfer of the business.
Further, the author's office argues that requiring a person
selling their car wash business to inform a prospective
purchaser about the requirements of the law will ensure greater
awareness of and compliance with the law.
ASSEMBLY FLOOR: 78-0, 5/12/16
AYES: Achadjian, Alejo, Travis Allen, Arambula, Atkins, Baker,
Bigelow, Bloom, Bonilla, Bonta, Brough, Brown, Calderon,
Campos, Chang, Chau, Chávez, Chiu, Chu, Cooley, Cooper,
Dababneh, Dahle, Daly, Dodd, Eggman, Frazier, Beth Gaines,
Gallagher, Cristina Garcia, Eduardo Garcia, Gatto, Gipson,
Gomez, Gonzalez, Gordon, Gray, Grove, Hadley, Harper, Roger
Hernández, Holden, Irwin, Jones, Kim, Lackey, Levine, Linder,
Lopez, Low, Maienschein, Mathis, Mayes, McCarty, Medina,
Melendez, Mullin, Nazarian, Obernolte, O'Donnell, Olsen,
Patterson, Quirk, Ridley-Thomas, Rodriguez, Salas, Santiago,
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Steinorth, Mark Stone, Thurmond, Ting, Wagner, Waldron, Weber,
Wilk, Williams, Wood, Rendon
NO VOTE RECORDED: Burke, Jones-Sawyer
Prepared by:Martha Gutierrez / L. & I.R. / (916) 651-1556
7/29/16 10:48:55
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