BILL ANALYSIS                                                                                                                                                                                                    



                                                                  AB 1562
                                                                  Page  1

          Date of Hearing:   May 6, 2009

                        ASSEMBLY COMMITTEE ON APPROPRIATIONS
                                Kevin De Leon, Chair

            AB 1562 (Labor and Employment Committee) - As Amended:  March  
                                      11, 2009 

          Policy Committee:                              Labor and  
          Employment   Vote:                            5-2

          Urgency:     No                   State Mandated Local Program:  
          No     Reimbursable:              

           SUMMARY  

          This bill prohibits an employer from terminating an employee  
          because the employee's wages have been subjected to garnishments  
          for the payment of five or fewer judgments at any one time.

           FISCAL EFFECT
                     
          The Division of Labor Standards Enforcement (DLSE) would incur  
          minor costs, probably absorbable, to modify regulations and  
          enforce provisions of this bill. Its estimate assumes that the  
          bill will not have a pronounced effect on the number of unlawful  
          termination claims it investigates each year.  
                     
           COMMENTS
                     
           1)Background  .  Existing law states that no employer may  
            discharge an employee because the employee's wages have been  
            subjected to garnishment "for the payment of one judgment."  
            The Division of Labor Standards Enforcement has interpreted  
            the law to imply that employers are not precluded from  
            discharging an employee whose wages are garnished for payment  
            of more than one judgment.

           2)Rationale  . The bill's sponsor, the California Rural Legal  
            Assistance Foundation, states that California workers face  
            unprecedented financial pressures that have resulted in many  
            losing their homes and credit ratings. The sponsor asserts  
            that no one should lose their job merely because their wages  
            are garnished.
           








                                                                 AB 1562
                                                                  Page  2

          3)Prior legislation  . Last year, the governor vetoed AB 3062,  
            which would have prohibited an employer from discharging an  
            employ because of any number of wage garnishments. The veto  
            message stated, in part, that "this bill would require  
            California employers to coordinate the burdensome  
            administrative processes and costs of processing checks to pay  
            multiple wage garnishments for a single employee." The current  
            bill attempts to address this concern by allowing up to five  
            garnishments.


           Analysis Prepared by  :    Brad Williams / APPR. / (916) 319-2081