BILL ANALYSIS Ó SB 702 Page 1 Date of Hearing: June 22, 2016 ASSEMBLY COMMITTEE ON LABOR AND EMPLOYMENT Roger Hernández, Chair SB 702 (McGuire) - As Proposed to be Amended June 22, 2016 SENATE VOTE: 38-0 SUBJECT: Employment of minors: agricultural packing plants SUMMARY: Extends the sunset date by five years on an exemption from child labor laws that allows minors to work additional hours in agricultural packing plants during peak harvest season in Lake County. Specifically, this bill: 1)Extends an exemption for specified agricultural packing plants in Lake County to employ minors that are 16 or 17 years of age to work for up to 10 hours per day and more than 48 hours (but not more than 60 hours) per week during harvest season when school is not in session to January 1, 2022. 2)Requires the Labor Commissioner (LC), on or before November 1, 2020, to issue a written report to the Legislature on the general working conditions of minors employed in the agricultural packing industry from October 1, 2016 to October 1, 2020. SB 702 Page 2 3)Makes other minor and technical changes. EXISTING LAW: 1)Prohibits any employer employing a minor 16 or 17 years of age for more than 8 hours in one day or more than 48 hours in one week. (Labor Code §1391). 2)Allows the LC to issue exemptions for agricultural packing plants to employ minors that are 16 or 17 years of age to work for up to 10 hours per day during peak harvest season when school is not in session. The LC may require inspections of agricultural packing plants prior to issuing the exemption. (Labor Code §1393). 3)Allows the LC, upon receiving written approval from the Lake County Board of Education, to issue exemptions to agricultural packing plants to employ minors enrolled in schools located in Lake County to work for up to 10 hours per day and more than 48 hours, but not more than 60 hours, per week during peak harvest season, when school is not in session. 4)Sunsets this exemption on January 1, 2017. 5)Requires the LC to inspect the affected Lake County agricultural packing plants before issuing exemptions, and also requires the affected agricultural packing plants file a written report detailing the previous year's payroll, including the age and number of minors employed, as well as the hours they worked. 6)Requires the LC, on or before November 1, 2016, to issue a SB 702 Page 3 written report to the Legislature on the general working conditions of minors employed in the agricultural packing industry from March 1, 2011 to October 1, 2016. FISCAL EFFECT: According to the Senate Appropriations Committee, the Department of Industrial Relations indicates that costs to produce the report on working conditions in the Lake County packing industry would be minor and absorbable. COMMENTS: California's child labor laws generally prohibit any employer employing a minor 16 or 17 years of age for more than 8 hours in one day or more than 48 hours in one week. However, for the past two decades California law has contained a special exemption for agricultural packing plants in Lake County. Several bills over the years have extended the sunset date on this exemption (generally by about 5 years) and required various reporting requirements of the LC. This bill proposes to extend the sunset date on the exemption by five years, or until January 1, 2022. Background on the Lake County Packing Plant Exemption The exemption for minors working in agricultural packing plants in Lake County was originally enacted in 1996. Supporters of the exemption have traditionally stated that it reflects the unique industry and labor market requirements of Lake County. This exemption has been characterized by supporters as necessary to help deal with the labor shortage in Lake County's agricultural industry during harvest time each year in August. The pear-packing season lasts only four to six weeks and SB 702 Page 4 coincides with an increase in tourism, which is considered the other large industry in Lake County. With both tourism and agriculture at peak activity, the available labor pool is severely limited. Therefore, it is argued that the employment of minors during this time is necessary and mutually beneficial for both the minors employed and growers. Supporters contend that this exemption has proved successful and the participation of youth workers has now become an economic imperative for Lake County agricultural employers. Most Recent Labor Commissioner Report As mentioned above, prior legislation to extend the sunset date on this exemption has generally required the LC to issue a report on the general working conditions of minors employed in the agricultural packing industry. The most recent report from the LC was issued on March 24, 2011. With respect to the number of minors employed in the agricultural packing industry, the report stated: "According to records of the Lake County agricultural packing plant employer operating with an approved exemption in 2010, a total of 24 minors aged 16 and 17 years old were employed during the 2010 peak packing season. Of those 24, one individual turned 18 early in the season. Two minors aged 15 years old were employed on a schedule of no more than 8 hours per day and/or 40 hours a week. The seven additional packing operations with approved exemptions statewide in 2010 were granted approval to employ SB 702 Page 5 an additional 99 minors under the provisions of these permits." With respect to the number of exemptions denied due to violations, the report stated: "At the conclusion of the 2009 season, one employer who historically held an approved exemption was found, upon inspection, to be in violation of multiple wage and hour laws, and was cited. This employer was told at the end of the 2009 season that it would not be eligible for an exemption for the 2010 season and did not apply." Existing law requires the LC to issue a report on or before November 1, 2016 that describes the general working conditions of minors employed in the agricultural packing industry during the period on March 1, 2011 to October 1, 2016. Arguments in Support According to the author, the exemption for minors working in agricultural packing plants in Lake County was originally established to help labor shortages during August's pear picking season. The sunset has been extended three times with no opposition since its original creation. Existing law allows the LC, upon approval from the Lake County Board of Education, to permit agricultural packing plants to employ minors enrolled in Lake County schools when they are not in session. SB 702 Page 6 The author states that this exemption does not affect any California overtime laws. Existing state law also requires the LC to issue a written report to the Legislature on the general working conditions of minors employed in agricultural packing plants by November 2016. The most recent legislative report has shown no systematic issues. Supporters similarly note that Lake County's late summer pear season typically coincides with peak seasons of other labor intensive industries like tourism, resulting in packing plant worker shortages. They state that the packing work exemption for minors in Lake County has relieved this shortage and provided significant economic benefits to teens and families. No known opposition on file. REGISTERED SUPPORT / OPPOSITION: Support California Farm Bureau Federation California Fresh Fruit Association California Pear Growers SB 702 Page 7 California Women for Agriculture, Lake County Chapter County of Lake Board of Supervisors-Anthony W. Farrington Kelseyville High School Lake County Farm Bureau Lake County Office of Education Opposition None on file. Analysis Prepared by:Ben Ebbink / L. & E. / (916) 319-2091