BILL ANALYSIS
AB 236
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Date of Hearing: April 22, 2009
ASSEMBLY COMMITTEE ON LABOR AND EMPLOYMENT
William W. Monning, Chair
AB 236 (Swanson) - As Introduced: February 6, 2009
SUBJECT : Car washes.
SUMMARY : Eliminates a sunset date on a statutory enforcement
program regulating the employment practices of car washes.
EXISTING LAW
1)Contains a sunset date relating to the regulation of the car
washing and polishing industry to January 1, 2010.
2)Requires the Labor Commissioner (LC) to report to the
Legislature no later than December 31, 2008 on the status of
labor law violations and enforcement in the car washing and
polishing industry.
3)Regulates the car washing and polishing industry by requiring
specific recordkeeping requirements of car wash employers on
employee wages, hours and working conditions.
4)Requires car wash employers to register with the LC and post a
wage surety bond as specified.
5)Establishes a car wash worker fund for which penalties and
registration fees are deposited for disbursement by the LC to
employees of car washing or polishing businesses found to be
in violation of current law.
6)States 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.
FISCAL EFFECT : Unknown
COMMENTS : California leads the nation in both the number of
car washes and number of employees employed by car washes.
There are more than 1600 car washes and more than 22,000
employees respectively.
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In March 2008 the Los Angeles Times reported the results of an
investigation of the carwash industry finding that many owners
pay less than half of the required minimum wage and that
two-thirds of those inspected by the state since 2003 were out
of compliance with one or more labor laws. Some violations
included underpaying workers, hiring minors, operating without
workers' compensation insurance and denying workers their meal
and rest breaks.
BACKGROUND :
In 1999 SB 1097 (Hayden) which sought to regulate the car wash
industry, was vetoed by the Governor. In his veto message the
Governor said, in part: "I am vetoing this bill I do not believe
that the need to register car washes with the LC has been
demonstrated. I am however asking the Director of Industrial
Relations (DIR) to review the activities of the car washing
industry and make any and all appropriate recommendation to me
by June 30, 2001."
In response to the Governor's veto directive, DIR filed an
internal report about labor law violations in the industry and
possible remedies, considering limited resources and widespread
violations that affect other industries in the state.
Additionally, in early 2003, DIR conducted a coordinated
enforcement sweep of the car washing and polishing industry in
the Los Angeles area finding numerous labor law violations,
collecting back wages and penalties due, totaling over $250,000.
As a result of proven violations in this industry AB 1688
(Goldberg) "The Car Wash Worker Bill" was signed into law and
took effect on January 1, 2004. AB 1688 contained a sunset date
of January 1, 2007.
The final car wash regulations were promulgated by DIR and
finally adopted by The Office of Administrative Law December
2005.
SB 1468 (Alarcon) of 2006 extended the sunset date relating to
the regulation of the car washing and polishing industry to
January 1, 2010, and required the Labor Commissioner (LC) to
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report to the Legislature no later than December 31, 2008, on
the status of labor law violations and enforcement in the car
washing and polishing industry.
Due to the lack of enforcement of this law, combined with the
wage and hour violations that continue to plague the industry
this bill seeks to permanently extend this law.
The Division of Labor Standards Enforcement (DLSE) was required
to issue a report no later than December 31, 2008 on the
effectiveness of the enforcement program. The report has yet to
be issued.
ARGUMENTS IN SUPPORT :
The California Labor Federation, the sponsor of this bill, state
that with more than 14,000 establishments and $5 billion in
reported revenues car washing in the United States is a big
business. California leads the nation in both the number of
establishments and the number of employees. Unfortunately, many
car wash employers routinely violate basic labor laws leading to
unsafe and unhealthy workplaces for workers and communities they
serve. With the passage of the Car Wash Registry Act, the
Legislature acknowledged that existing laws did not adequately
protect some of the state's most vulnerable low-wage workers and
recognized the opportunity to level the competitive playing
field for law abiding businesses.
They also contend, this bill is still needed due to the
continued severe and widespread labor violations in the
industry. This industry clearly thrives on working outside the
law. This bill was intended to be a tool to root out the
egregious violations of labor law that occur in this industry.
As the law has been implemented, enforcement efforts in the
underground car wash economy have begun to improve and for the
first time workers have had access to justice. This bill will
enable the Car Wash Registry Act to provide strong protections
and remedies for car wash workers who are exploited by
unscrupulous employers.
The Low Wage Justice Center states their organization works
toward economic equality by reclaiming unpaid wages for low
income workers and bring exploitative employers to justice. The
currently represent some car wash workers in Los Angeles and
have seen first hand the great injustices faced by the workers.
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They also state they have seen the devastating impact the lack
of regulation and enforcement in the car wash industry. This
bill will help to ensure workers are protected and that there is
a level playing field.
Numerous other supporters agree the passage of this bill is
needed in order to clean up this largely underground industry,
and used as a crucial tool to improve the industry conditions
ensuring that carwash workers are protected as the Car Wash
Worker Law continues to be enforced. This Car Wash Worker Law
is still clearly needed since labor violations continue to be
severe and widespread in the industry.
PRIOR LEGISLATION :
SB 1468 (Alarcon) Chapter # 656, Statutes of 2006 extended the
sunset date relating to the regulation of the car washing and
polishing industry to January 1, 2010, and required the Labor
Commissioner (LC) to report to the Legislature no later than
December 31, 2008, on the status of labor law violations and
enforcement in the car washing and polishing industry.
AB 1688 (Goldberg) Chapter # 825, Statutes of 2003 established a
system to regulate the employment of workers in the car washing
and polishing industry and was scheduled to take effect on
January 1, 2004 and contained a sunset date of January 1, 2007.
SB 1097 (Hayden) of 1999 was similar to AB 1688 and SB 1468 and
was vetoed by the Governor.
REGISTERED SUPPORT / OPPOSITION :
Support
ACLU
American Federation of State, County and Municipal Employees
Asian Pacific American Legal Center of Southern California
Bet Tzedek
California Conference Board of the Amalgamated Transit Union
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California Immigrant Policy Center
California Labor Federation, AFL-CIO (sponsor)
California Rural Legal Assistance Foundation
California Teamsters Public Affairs Council
Cher Mason
Coalition for Human Immigrant Rights of Los Angeles
Colleen Flynn, Attorney at Law
Community Labor Environmental Action Network
Engineers and Scientists of California
Enlace
Garment Worker Center
Inner City Law Center
International Longshore & Warehouse Union
Ironworkers Local 416
Koreatown Immigrant Workers Alliance
La Raza Centro Legal, Inc.
LAANE
Los Angeles County Federation of Labor
Maintenance Cooperation Trust Fund
MALDEF
National Employment Law Project
National Immigration Law Center
National Lawyers Guild Labor and Employment Committee
Pride at Work
Professional & Technical Engineers, Local 21
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Professional Musicians Local 47
Progressive Jewish Alliance
Sacramento Central Labor Council
San Francisco Labor Council
San Mateo Labor Council
Southern California Coalition for Occupational Safety and Health
Strategic Committee of Public Employees, LIUNA
Strategic Concepts in Organizing & Policy Education
Teamsters 396
The Wage Justice Center
UAW Local 2865
UFCW Local 1442
UFCW Local 770
UNITE HERE!
United Food and Commercial Workers Union, Western States Council
United Steelworkers Local 675
Worksafe
Writers Guild of America, West
Opposition
None on file.
Analysis Prepared by : Lorie Erickson / L. & E. / (916)
319-2091