BILL ANALYSIS
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|SENATE RULES COMMITTEE | AB 2770|
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THIRD READING
Bill No: AB 2770
Author: Monning (D), et al
Amended: 8/18/10 in Senate
Vote: 21
SENATE LABOR & INDUST. RELATIONS COMMITTEE : 4-1, 6/23/10
AYES: DeSaulnier, Ducheny, Leno, Yee
NOES: Hollingsworth
NO VOTE RECORDED: Wyland
SENATE APPROPRIATIONS COMMITTEE : 7-4, 8/12/10
AYES: Kehoe, Alquist, Corbett, Leno, Price, Wolk, Yee
NOES: Ashburn, Emmerson, Walters, Wyland
ASSEMBLY FLOOR : 58-17, 6/1/10 - See last page for vote
SUBJECT : Employee wages and working hours: violations
SOURCE : Author
DIGEST : This bill establishes a pilot program to
investigate employment and payment practices within the
swimming pool and spa construction industries underground
economy.
ANALYSIS : Existing law establishes the Joint Enforcement
Strike Force on the Underground Economy (JESF) to combat
the underground economy. JESF is a partnership involving
the Employment Development Department (EDD), the Division
of Labor Standards Enforcement (DLSE), the Department of
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Consumer Affairs, Franchise Tax Board (FTB), the Board of
Equalization, and the United States Department of Justice.
Existing law designates the Director of EDD as the
chairperson of JESF and authorizes employees of any of the
agencies that participate in JESF to issue Labor Code
citations and penalty assessment orders to employers found
in violation of the law.
Existing law authorizes the Economic and Employment
Enforcement Coalition (EEEC), which consists of
investigators from the DLSE, the Division of Occupational
Safety and Health, the EDD, the Contractors State License
Board, and the United States Department of Labor.
This bill establishes a pilot program to investigate
employment and payment practices within the swimming pool
and spa construction industries underground economy.
The EDD, in consultation with FTB, the Department of
Justice, the Department of Insurance, the Labor and
workforce Development Agency, and industry representatives
shall develop and implement an appropriate set of criteria
that if met by will trigger a recommendation for an audit
or investigation by appropriate state tax authorities of
swimming pool and spa employer violations as specified.
The set of criteria shall take into account all relevant
factors including reported worker's compensation exemptions
ratio of building material to labor cost the severity and
number of violations committed by an employer.
This bill authorizes EDD, after July 1, 2011, to take the
following actions with respect to spa and swimming pool
employers when the set of criteria that is developed
indicates that a violation of the law has occurred:
1. Notify the appropriate state tax authorities.
2. Provide the appropriate state tax authorities with the
name of the employer and all relevant and necessary
information regarding the violations.
3. Make recommendations to the appropriate state tax
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authorities that the employer be audited or
investigated.
This bill sunsets on January 1, 2017.
Prior Legislation
AB 2879 (Leno), 2007-08 Session, is identical to this bill.
The bill was held in the Senate Appropriations Committee.
AB 875 (Koretz), 2005-06 Session, is similar, but not
identical to this bill. The bill passed the Senate (21-12)
on September 1, 2005, but was vetoed by Governor
Schwarzenegger.
FISCAL EFFECT : Appropriation: No Fiscal Com.: Yes
Local: No
SUPPORT : (Verified 8/18/10)
California Labor Federation
Spa & Pool Industry Education Council
OPPOSITION : (Verified 8/18/10) (prior version of bill)
Department of Finance
ARGUMENTS IN SUPPORT : The Spa & Pool Industry Council
(SPEC) states that employers operating in the underground
economy hurt everyone, the state loses billions of dollars
each year in tax revenues, workers are forced to go without
basic employment protections, and law-abiding businesses
are confronted with unfair competition from scofflaw
competitors. SPEC states that, as legitimate employers
working in the pool and spa industry in California, they
support the efforts of this bill to target those employers
that operate in the underground economy in flagrant
violation of the law, and not employers that commit minor
or inadvertent violations of existing law.
ASSEMBLY FLOOR :
AYES: Ammiano, Arambula, Bass, Beall, Bill Berryhill,
Blakeslee, Block, Blumenfield, Bradford, Brownley,
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Buchanan, Caballero, Charles Calderon, Carter, Chesbro,
Conway, Coto, Davis, De La Torre, De Leon, Eng, Evans,
Feuer, Fletcher, Fong, Fuentes, Furutani, Galgiani,
Gilmore, Hall, Hayashi, Hernandez, Hill, Huber, Huffman,
Jones, Lieu, Bonnie Lowenthal, Ma, Mendoza, Monning,
Nava, Nestande, Nielsen, V. Manuel Perez, Portantino,
Ruskin, Salas, Saldana, Skinner, Solorio, Swanson,
Torlakson, Torres, Torrico, Villines, Yamada, John A.
Perez
NOES: Adams, Anderson, DeVore, Fuller, Gaines, Garrick,
Hagman, Harkey, Jeffries, Knight, Logue, Miller, Niello,
Norby, Silva, Smyth, Tran
NO VOTE RECORDED: Tom Berryhill, Cook, Emmerson, Audra
Strickland, Vacancy
PQ:mw 8/18/10 Senate Floor Analyses
SUPPORT/OPPOSITION: SEE ABOVE
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