BILL ANALYSIS
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|SENATE RULES COMMITTEE | SB 657|
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UNFINISHED BUSINESS
Bill No: SB 657
Author: Steinberg (D), et al
Amended: 8/20/10
Vote: 21
SENATE JUDICIARY COMMITTEE : 3-2, 4/21/09
AYES: Corbett, Florez, Leno
NOES: Harman, Walters
SENATE FLOOR : 24-13, 1/28/10
AYES: Calderon, Cedillo, Corbett, Correa, DeSaulnier,
Ducheny, Florez, Hancock, Kehoe, Leno, Liu, Lowenthal,
Maldonado, Negrete McLeod, Oropeza, Padilla, Pavley,
Price, Romero, Simitian, Steinberg, Wiggins, Wolk, Yee
NOES: Aanestad, Ashburn, Cogdill, Cox, Denham, Dutton,
Harman, Hollingsworth, Huff, Runner, Strickland, Walters,
Wyland
NO VOTE RECORDED: Alquist, Wright, Vacancy
ASSEMBLY FLOOR : Not available
SUBJECT : Human trafficking
SOURCE : Alliance to Stop Slavery and End Trafficking
DIGEST : This bill seeks to provide consumers with new
and easily accessible information made available by
specified large retailers and manufacturers about these
businesses' voluntary efforts to try to eradicate slavery
and human trafficking that could inadvertently be in their
CONTINUED
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product supply chains. Specifically, this bill (1)
requires, beginning January 1, 2012, every retailer and
manufacturer doing business in California and having more
than $100 million in annual gross receipts to disclose its
efforts to eradicate slavery and human trafficking from its
supply chain, require the disclosure to be posted on the
company's Web site and provided to consumers in writing if
the company has no Web site, require the disclosure to
include the extent to which the company (a) uses third
party verification to evaluate and address human
trafficking and slavery risks in product supply chains, (b)
conducts independent, unannounced audits of suppliers to
ensure compliance with company standards on trafficking
slavery, (c) maintains internal accountability for
employees and contractors failing to meet company standards
on slavery and trafficking, and (d) provides company
employees and management training on mitigating risks of
slavery and trafficking in supply chains; and (2) provides
the exclusive remedy for non-compliance with the provisions
of the bill is an injunction from the Attorney General.
Assembly Amendments (1) tombstone the bill as the
California Transparency in Supply Chains Act of 2010, (2)
make the provisions inapplicable to a retail institution
having less than $100 million in annual gross receipts, (3)
require the Franchise Tax Board to make a list of specified
retail and manufacturers available to the Attorney General,
(4) add clarifying language, (5) provide new definitions
and terms, and (6) add co-authors.
ANALYSIS : Existing federal law establishes the crimes of
kidnapping in interstate or foreign commerce, peonage,
slavery and trafficking in persons, and provides for
criminal and civil penalties.
Existing federal law, the Victims of Trafficking and
Violence Protection Act of 2000, acknowledges the crime of
human trafficking, and delineates various federal actions
to combat trafficking, punish perpetrators, and provides
services to victims of trafficking.
Existing state law makes human trafficking a crime.
Existing state law, the California Trafficking Victims
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Protection Act, allows a victim of human trafficking to
bring a civil action for actual damages, compensatory
damages, punitive damages, injunctive relief, or any other
appropriate relief.
Existing state law generally regulates various business
activities and practices, including those of retail sellers
and manufacturers of products.
This bill:
1. Makes various legislative findings, including that it is
the policy of this state to ensure large retailers and
manufacturers provide consumers with information
regarding their efforts to eradicate slavery and human
trafficking from their supply chains, to educate
consumers on how to purchase goods produced by companies
that responsibly manage their supply chains, and,
thereby, to improve the lives of victims of slavery and
human trafficking.
2. Requires, after a one year "phase in" period, beginning
January 1, 2012, every retail seller and manufacturer
doing business in this state and having annual worldwide
gross receipts that exceed $100 million to disclose its
voluntary efforts to eradicate slavery and human
trafficking from its direct supply chain for tangible
goods offered for sale.
3. Requires this consumer disclosure to be posted on the
retail seller's or manufacturer's Web site with a
conspicuous and easily understood link to the required
information placed on the business' homepage. In the
event the retail seller or manufacturer does not have a
Web site, consumers must be provided the written
disclosure within 30 days that the business receives the
consumer request.
4. Requires the disclosure, at a minimum, to disclose to
what extent, that the retail seller or manufacturer,
among other things, engages in verification of product
supply chains to evaluate and address risks of human
trafficking and slavery and provides company employees
and management who have direct responsibility for supply
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chain management training on human trafficking and
slavery, particularly with respect to mitigating risks
within the supply chains of products.
5. Provides that the exclusive remedy for a violation of
this bill shall be an action brought by the Attorney
General for injunctive relief, and that nothing in the
bill shall limit remedies available for a violation of
any other state or federal law.
6. Provides that the bill's provisions shall not take
effect until January 1, 2012, to provide the designated
retail sellers and manufacturers substantial time to
comply with the bill's disclosure requirements.
7. Requires the Franchise Tax Board to make available to
the Attorney General, a list of retail sellers and
manufacturers required to disclose efforts to eradicate
slavery and human trafficking pursuant to Civil Code
Section 1714.43 based on tax returns filed for taxable
years beginning on or after January 1, 2011.
For the purposes of this bill, the following definitions
shall apply:
1. "Doing business in this state" shall have the same
meaning as set forth in Section 23101 of the Revenue and
Taxation Code.
2. "Gross receipts" shall have the same meaning as set
forth in Section 25120 of the Revenue and Taxation Code.
3. "Manufacturer" means a business entity with
manufacturing as its principal business activity code,
as reported on the entity's tax return filed under Part
10.2 (commencing with Section 18401) of Division 2 of
the Revenue and Taxation Code.
4. "Retail seller" means a business entity with retail
trade as its principal business activity code, as
reported on the entity's tax return filed under Part
10.2 (commencing with Section 18401) of Division 2 of
the Revenue and Taxation Code.
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Prior Legislation
SB 1649 (Steinberg), 2007-08 Session, was substantively
similar to this bill. The bill passed the Senate with a
vote of 23-15 on May 15, 2008, but died in the Assembly
Appropriations Committee.
SB 180 (Kuehl), Chapter 239, Statutes of 2005, established
the California Alliance to Combat Trafficking and Slavery
(California ACTS) Task Force.
AB 22 (Lieber), Chapter 240, Statutes of 2005, established
civil and criminal penalties for human trafficking and
allowed for forfeiture of assets derived from human
trafficking.
FISCAL EFFECT : Appropriation: No Fiscal Com.: Yes
Local: No
SUPPORT : (Verified 8/26/10)
Alliance to Stop Slavery and End Trafficking (source)
California Teamsters Public Affairs Council
California Labor Federation
Coalition for Humane Immigrant Rights Los Angeles
Coalition to Abolish Slavery and Trafficking
Consumer Federation of California
Free the Slaves
Polaris Project
International Justice Mission
Not for Sale Campaign
Services, Immigrants Rights, and Education Network
Vital Voices
OPPOSITION : (Verified 8/26/10)
California Chamber of Commerce
California Grocers Association
California Manufacturers and Technology Association
California Retailers Association
TechAmerica
ARGUMENTS IN SUPPORT : According to the author's office,
the primary goal of this bill is to highlight the existence
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of slave-labor and human trafficking throughout California,
and to create an opportunity for California retailers and
manufacturers to demonstrate leadership in eradicating
human trafficking from their supply chains. Additionally,
with the information required of businesses, this bill
empowers consumers to reward companies that proactively
work to eradicate slave-labor and human trafficking.
ARGUMENTS IN OPPOSITION : The California Grocers
Association writes: "While grocers do not support slavery,
human trafficking or abusive treatment of workers, the bill
poses several difficulties. SB 657 would require all
companies to develop policies with regard to its entire
supply chain, which can include entities far outside the
borders of California or the United States. Grocers do not
have the resources to monitor supplier employment
practices, nor do they have the authority to enforce state
or federal labor law with regard to suppliers. Further,
the bill requires posting of policies on a company's
internet web site but provides no details as to what
constitutes compliance with the requirement or how it
applies to retailers that do not have an internet web
site."
RJG:mw 8/26/10 Senate Floor Analyses
SUPPORT/OPPOSITION: SEE ABOVE
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