BILL ANALYSIS
Senate Committee on Labor and Industrial Relations
Richard Alarcon, Chair
Date of Hearing: June 9, 2004 2003-2004 Regular
Session
Consultant: Patrick W. Henning Fiscal:Yes
Urgency:No
Bill No: AB 2850
Author: Ridley-Thomas
Amended: April 27, 2004
Subject: Employment: displaced private security officers.
Purpose: To establish continued employment of private
security officers for 90 days at a job site following the
termination of a contract for private security services.
Analysis:
Existing law provides a framework for the enforcement of
labor laws relating to, among other things, the proper
payment of wages, daily overtime, working conditions, and
specific occupational registration. Also, the Displaced
Janitor Opportunity Act, permits janitors to keep their
jobs with a successor maintenance contractor up to 60 days
when their employer of 25 or more employees has lost a
janitorial contract.
This Bill would enact the Private Security Service
Assurance Act, requiring successor private security
contractors (or subcontractors), entering into contractual
agreements on or after January 1, 2005, to retain for 90
days licensed security employees of the previous employer
performing private security services who were employed for
at least 4 months. Also:
-Predecessor contractors would have to provide basic
employment data to the successor contractor within 3
working days;
- Successor contractors would not be required to pay
the same wages or benefits provided by the prior
contractor;
- Requires at the end of the 90-day transition, a
successor contractor provide a written performance
evaluation to each employee retained, and to offer
continued
employment to those whose performance is deemed
satisfactory;
- Contractors could exercise their authority to fire
for cause and, after the 90-day period, would be able
to terminate at will; and
- If economic layoffs must occur, employees would be
retained by classification seniority.
Enforcement would be by a right of private court action by
affected employees. If security officers are not offered
temporary employment, they would be able to sue for back
wages and benefit payments due. Property owners and
awarding bodies are specifically exempted from liability.
Local governmental agencies would be able to impose more
strict standards.
Comments:
1.The sponsor , the Service Employees International Union
(SEIU), argues that this measure is necessary to give
licensed private security employees a transition period
from the last contractor by demonstrating their worth to
a successor contractor. However, after 90 days an
employee can be fired for any reason.
Proponents state that there are over 160,000 private
security officers in the state with the industry growing
given the current heightened level of national security.
Individuals protected by these private security officers
are put at risk when a private building owner changes
contractors and the security officers familiar with the
building and the area are immediately replaced by new
officers who are not familiar with the area.
2. Opponents , including the California Chamber of Commerce,
argue that this measure is an unreasonable departure from
California's "at will" employment status. At-will
employment is a two-way street that provides protection
Hearing Date: June 9, 2004 AB
2850
Consultant: Patrick W. Henning
Page 2
Senate Committee on Labor and Industrial Relations
to both parties. Also, it places onerous new mandates on
California businesses:
-the successor contractor (or subcontractor) must
hire the licensed security workers of the former
contractor during that period.
-forces the new contractor to make a written offer of
employment to all of the previous contractor's
licensed security workers, ignoring the fact that the
new contractor may have their own employees' welfare
to consider and their own set of legally permissible
standards by which their company's workers are
chosen.
-forces a business to comply with intricate personnel
paperwork requirements.
Employers risk fines, penalties, and jail time for
violations of this measure's multiple mandates.
The California Manufacturers and Technology Association
states that this measure fails to consider that the
employer may have terminated the contract due to poor
performance and has no way to determine if it was the
fault of the contractor or the employees. With all of
the restrictions listed, no newly hired contractor should
have to work under these restrictive rules that would
limit its ability to hire or retain qualified employees.
3.Prior Legislation : This bill is modeled after SB 20
(Alarcon), Chapter 795, Statutes of 2001, which applies
to the janitorial industry. SB 20 requires successor
janitorial contractors to retain, for a 60-day period,
the employees of the previous employer performing
janitorial or building maintenance service duties with
four months or more service. The main difference between
this measure and SB 20 are 1) the transition period,
which is only 60 days under SB 20, and the definition of
"contractor." Under SB 20, only contractors employing 25
or more individuals are subject to its requirements.
Hearing Date: June 9, 2004 AB
2850
Consultant: Patrick W. Henning
Page 3
Senate Committee on Labor and Industrial Relations
4. Other Legislation : SB 1521 (Alarc?n), pending in the
Assembly, extends the 60-day
period under SB 20 to 90 days and subjects property
owners to the notice and retention requirements of SB 20,
as well as placing a specified restriction on the
property owner's right to terminate contracts.
5. Legislative History : This measure passed the Assembly
by a 43 to 33 vote.
Support:
Service Employees International Union (Sponsor)
Association for Los Angeles Deputy Sheriffs
California Labor Federation, AFL-CIO
California Professional Firefighters
California Teamsters Public Affairs Council
Peace Officers Research Association of California
Opposition:
Building Owners and Managers Association of California
California Business Properties Association
California Chamber of Commerce
California Manufacturers and Technology Association
Lumber Association of California and Nevada
* * *
Hearing Date: June 9, 2004 AB
2850
Consultant: Patrick W. Henning
Page 4
Senate Committee on Labor and Industrial Relations