BILL ANALYSIS
AB 236
Page 1
CONCURRENCE IN SENATE AMENDMENTS
AB 236 (Swanson)
As Amended August 26, 2009
Majority vote
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|ASSEMBLY: |51-27|(June 2, 2009) |SENATE: |24-15|(September 3, |
| | | | | |2009) |
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Original Committee Reference: L. & E.
SUMMARY : Extends the repeal date on the regulations of the
employment practices of car washes and further defines the term
employer, as defined.
The Senate amendments extend the sunset date on the statutory
enforcement program regulating the employment practices of car
washes from January 1, 2010, to January 1, 2014, and specify that a
new motor vehicle dealer and an automotive repair dealer, as
defined, are not an employer for the purposes of the car wash
regulatory provisions.
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
AB 236
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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.
AS PASSED BY THE ASSEMBLY , this bill eliminated the sunset date on
the statutory enforcement program regulating the employment
practices of car washes.
FISCAL EFFECT : According to the Senate Appropriations Committee,
this bill generates revenue for the Car Wash Worker Fund with
registration fees and the Car Wash Worker Restitution Fund with
restitution fees.
COMMENTS : SB 1097 (Hayden) of 1999 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), Chapter 825, Statutes of 2008. "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 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.
In March 2008 the Los Angeles Times reported the results of an
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investigation of the car wash 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.
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 extend this law.
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.
Analysis Prepared by : Lorie Erickson / L. & E. / (916) 319-2091
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