BILL ANALYSIS Ó
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|SENATE RULES COMMITTEE | SB 896|
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UNFINISHED BUSINESS
Bill No: SB 896
Author: Nguyen (R), et al.
Amended: 6/30/16
Vote: 21
SENATE BUS., PROF. & ECON. DEV. COMMITTEE: 5-2, 4/18/16
AYES: Bates, Berryhill, Galgiani, Jackson, Mendoza
NOES: Hill, Block
NO VOTE RECORDED: Hernandez, Wieckowski
SENATE APPROPRIATIONS COMMITTEE: Senate Rule 28.8
SENATE FLOOR: 27-4, 5/26/16
AYES: Anderson, Bates, Beall, Berryhill, Cannella, Fuller,
Gaines, Galgiani, Hall, Hancock, Hertzberg, Hueso, Jackson,
Lara, Liu, McGuire, Mendoza, Mitchell, Moorlach, Morrell,
Nguyen, Nielsen, Pan, Roth, Stone, Vidak, Wolk
NOES: Glazer, Hill, Leno, Leyva
NO VOTE RECORDED: Allen, Block, De León, Hernandez, Huff,
Monning, Pavley, Runner, Wieckowski
ASSEMBLY FLOOR: 61-2, 8/4/16 - See last page for vote
SUBJECT: Barbering and cosmetology: nail care
establishments: credit and debit cards
SOURCE: Author
DIGEST: This bill requires an establishment offering nail care
services that accepts a debit or credit card as payment for nail
care services to also accept a debit or credit card for payment
of a tip in accordance with labor laws.
SB 896
Page 2
Assembly Amendments add coauthors and make technical changes.
ANALYSIS:
Existing law:
1) Provides for the licensure regulation of the practice of
barbering, cosmetology, and electrolysis under the Barbering
and Cosmetology Act (Act) by the Board of Barbering and
Cosmetology (BBC).
2) Establishes nail care as a specialty branch in the practice
of cosmetology and defines nail care as the practice of
cutting, trimming, polishing, coloring, tinting, cleansing,
manicuring, or pedicuring the nails of any person or
massaging or beautifying from the elbow to the fingertips or
the knee to the toes of any person. (Business and
Professions Code (BPC) § 7316 (c) (2))
3) Provides for licensure of manicurists by BBC to practice nail
care and requires applicants to be over the age of 17,
complete 10th grade in public California school or
equivalent, not subject to a denial and have either completed
a course in nail care from a BBC approved school, or
practiced nail care in another state for a period of time
equivalent to the study and training of a BBC approved course
or completed an apprenticeship program in nail care. (BPC §
7326)
4) 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. (BPC §§ 7346-7352)
5) Requires an employer that permits patrons to pay gratuities
by credit card to pay the employees the full amount of the
gratuity that the patron indicated on the credit card slip,
without any deductions for any credit card payment processing
SB 896
Page 3
fees or costs that may be charged to the employer by the
credit card company. (Labor Code § 351)
This bill requires an establishment offering nail care services
that accepts a debit or credit card as payment for nail care
services to also accept a debit or credit card for payment of a
tip and specifies that acceptance of a tip by debit or credit
card must be done in accordance with existing labor laws.
Background
The author notes that there are over 52,000 establishments and
almost 600,000 total workers, including over 312,000
cosmetologists and approximately 129,000 nail technicians
currently licensed by BBC. According to the author, currently,
nail salon establishments in the state accept various forms of
payment for a consumer's service and tip. The author notes that
while some establishments accept paying for a service with a
credit card, they may not allow a tip to be charged on the
credit card, yet other establishments offer the service and tip
to be paid with a credit card. The author notes that many
people simply do not carry cash with them and most consumers
have a credit or debit card that they use for all their
transactions. The author states that it is more convenient for
the consumer to be able to use their card for both the service
and tip, especially if they don't have cash with them.
Nail Care in California. Nail care is a specialty branch in the
field of cosmetology. In California, a licensed cosmetologist
can practice nail care and BBC also licenses manicurists as a
separate license category. To become a licensed manicurist, an
applicant must submit proof of completion to BBC of 400 training
hours training covering all practices of a manicurist. BBC
currently licenses 126,872 manicurists, 310,041 cosmetologists
(whom can also perform nail care services) and 52,785
establishments. BBC does not include information in its
establishment license data to differentiate between an
establishment offering nail care services specifically or those
offering other personal beautification services.
Credit Card Payments and Tips. Card payments are evolving into
the most common method of customer payment, as businesses can
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Page 4
easily accept card payments and the convenience of using credit
cards generally increases the likelihood of consumer purchases,
which ultimately contributes to an increase in a business's
average sale. Businesses that accept card payments pay
processing fees for purchase transactions.
According to the Internal Revenue Service, tips are
discretionary (optional or extra) payments determined by a
customer that employees receive from customers. Tips include
cash tips received directly from customers, tips from customers
who leave a tip through electronic settlement or payment
(including a credit card, debit card, gift card, or any other
electronic payment method), the value of any noncash tips, such
as tickets, or other items of value, and tip amounts received
from other employees paid out through tip pools or tip
splitting, or other formal or informal tip sharing arrangement.
According to the United States Department of Labor, tipped
employees are those who customarily and regularly receive more
than $30 per month in tips. Tips are the property of the
employee.
FISCAL EFFECT: Appropriation: No Fiscal
Com.:YesLocal: Yes
According to the Assembly Appropriations Committee, this bill
will have negligible state fiscal impact.
SUPPORT: (Verified8/4/16)
None received
OPPOSITION: (Verified8/4/16)
Board of Barbering and Cosmetology
Professional Beauty Federation of California
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ARGUMENTS IN SUPPORT: ---
ARGUMENTS IN OPPOSITION: The Professional Beauty Federation
of California (PBFC) is opposed to this bill, noting support for
efforts to encourage tips to be given to licensees, but concerns
about the fees salon owners pay to credit companies for clients
to be able to use credit cards. PBFC believes that the decision
about using credit cards or not should be left to the salon
owner.
ASSEMBLY FLOOR: 61-2, 8/4/16
AYES: Achadjian, Alejo, Arambula, Atkins, Baker, Bloom,
Bonilla, Bonta, Brough, Brown, Burke, Calderon, Campos, Chang,
Chau, Chiu, Chu, Cooper, Dababneh, Daly, Dodd, Eggman,
Frazier, Eduardo Garcia, Gipson, Gomez, Gonzalez, Gordon,
Grove, Holden, Irwin, Jones, Jones-Sawyer, Kim, Lackey,
Levine, Lopez, Low, Maienschein, Mathis, Mayes, McCarty,
Medina, Mullin, Nazarian, O'Donnell, Quirk, Ridley-Thomas,
Rodriguez, Salas, Santiago, Mark Stone, Thurmond, Ting,
Wagner, Waldron, Weber, Wilk, Williams, Wood, Rendon
NOES: Gatto, Gray
NO VOTE RECORDED: Travis Allen, Bigelow, Chávez, Cooley, Dahle,
Beth Gaines, Gallagher, Cristina Garcia, Hadley, Harper, Roger
Hernández, Linder, Melendez, Obernolte, Olsen, Patterson,
Steinorth
Prepared by:Sarah Mason / B., P. & E.D. / (916) 651-4104
8/5/16 14:04:37
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