BILL ANALYSIS
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|SENATE RULES COMMITTEE | SB 903|
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THIRD READING
Bill No: SB 903
Author: Wright (D)
Amended: 04/07/10
Vote: 21
SENATE LABOR & INDUSTRIAL RELATIONS COMM : 4-2, 4/19/10
AYES: DeSaulnier, Ducheny, Leno, Yee
NOES: Wyland, Hollingsworth
SENATE APPROPRIATIONS COMMITTEE : Senate Rule 28.8
SUBJECT : Penalty collections: limitations
SOURCE : California Rural Legal Assistance Foundation
DIGEST : This bill extends the time period for collection
actions that can be brought by the Division of Labor
Standards Enforcement from one year to three years.
ANALYSIS : Under existing law, the Division of Labor
Standards Enforcement (DLSE), within the Department of
Industrial Relations, is responsible for vigorously
enforcing minimum labor standards in order to ensure
employees are not required or permitted to work under
substandard unlawful conditions, and to protect employers
who comply with the law from those who attempt to gain
competitive advantage at the expense of their workers by
failing to comply with minimum labor standards.
Existing law provides that an action by the DLSE for
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collection of a statutory penalty or fee must be commenced
within one year from the date the penalty or fee became
final.
Existing law provides that, notwithstanding Section 340 of
the Code of Civil Procedure, an action by the Division of
Occupational Safety and Health to collect any civil
penalty, fee, or penalty fee under the Occupational Safety
and Health division must be commenced within three years
from the date the penalty or fee became final.
This bill extends the period within which the DLSE may
commence an action to collect a civil penalty, fee, or
penalty fee from one year to three years from the date the
penalty or fee became final. In addition, this bill would
specify that this provision applies only to penalty
assessments or fees that became final on or after the
effective date of this bill.
Prior Legislation
AB 2016 (Conroy), Chapter 998, Statutes of 1993, requires
that an action to collect any civil penalty, fee, or
penalty fee under provision regulating safety in employment
must be commenced within three years from the date the
assessment of any penalty or fee became final. This bill
extended the time period for collection actions brought by
the Division of Occupational Safety and Health from one to
three years.
FISCAL EFFECT : Appropriation: No Fiscal Com.: Yes
Local: No
SUPPORT : (Verified 5/4/10)
California Rural Legal Assistance Foundation (source)
Asian Pacific American Legal Center of Southern California
California Conference Board of the Amalgamated Transit
Union
California Conference of Machinists
California Labor Federation
California Nurses Association/National Nurses Organizing
Committee
California Teamsters Public Affairs Council
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Engineers and Scientists of California, IFPTE Local 20
International Longshore and Warehouse Union
Jockeys' Guild
Professional and Technical Engineers, IFPTE Local 21
United Food and Commercial Workers Region 8 States Council
UNITE-HERE!
Wage Justice Center
Women's Employment Rights Clinic
ARGUMENTS IN SUPPORT : According to the author's office,
this bill would increase the statute of limitations for the
Division of Labor Standards Enforcement to bring actions to
recover penalties due from employers who violate wage and
hour laws from one year to three years. Proponents believe
that the current one year period for the commencement of
actions to recover penalties is simply too short,
especially in light of the current budget situation in
which many state employees are working less than full-time
due to furloughs.
Proponents argue that enforcement of basic rights has long
been inadequate, and unfortunately, coming forward almost
certainly results in employer retaliation so workers often
have to choose between keeping a job and speaking out for
what they deserve. In addition, proponents argue that the
likelihood of an employer getting caught is so slim and the
penalty so minor that there is no effective deterrent.
According to proponents, when employers are cited,
penalties are routinely negotiated down. In 2008, DLSE
collected approximately 20 cents on the dollar for all
civil penalties assessed for wage and hour law violations.
Proponents argue that a 20 percent recovery rate is too low
to constitute a meaningful deterrent against future
misconduct. Proponents also believe that in an era of
shrinking budgets and staff furloughs, the Legislature
should take all reasonable steps to maximize the full
collection of all debts. Proponents believe that this bill
will strengthen enforcement efforts and significantly
improve DLSE's collections of debts due to the state.
PQ:nl 5/4/10 Senate Floor Analyses
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SUPPORT/OPPOSITION: SEE ABOVE
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