BILL ANALYSIS
SB 903
Page 1
SENATE THIRD READING
SB 903 (Wright)
As Amended June 7, 2010
Majority vote
SENATE VOTE :21-10
LABOR & EMPLOYMENT 5-0 APPROPRIATIONS 12-5
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|Ayes:|Swanson, Bill Berryhill, |Ayes:|Fuentes, Bradford, |
| |Furutani, Monning, Yamada | |Charles Calderon, Coto, |
| | | |Davis, De Leon, Gatto, |
| | | |Hall, Skinner, Solorio, |
| | | |Torlakson, Torrico |
| | | | |
|-----+--------------------------+-----+--------------------------|
| | |Nays:|Conway, Harkey, Miller, |
| | | |Nielsen, Norby |
| | | | |
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SUMMARY : Extends the statute of limitation period, from one year to
three years, for collection actions brought by the Division of Labor
Standards Enforcement (DLSE).
EXISTING LAW places a one-year statute of limitation for judgments
filed on DLSE-imposed fines.
FISCAL EFFECT : According to the Assembly Appropriations Committee,
potential increase in civil penalty revenues, to the extent that the
longer period results in collection of additional penalties by DLSE.
According to DLSE, there have not been significant lapses in filing
penalties, so the additional revenues should be minor.
COMMENTS : According to a report released by the State Controller's
Office in 2008 (SCO Report), of the $71.9 million in fines issued
from 2004 to 2006, only $17.8 million was collected by the California
Department of Industrial Relations (DIR). The $54.1 million in
uncollected fines represent 75.3 percent of the total fines assessed
in that two year period. In October of 2006, DIR established a
Collection Unit (Unit) to improve its collection efforts. DIR's 2009
Annual Report on the Effectiveness of Bureau of Filed Enforcement
Report notes that the Unit has had some success since its
implementation. The Unit staff processed 3,257 judgments in 2009 and
collected $3,064,181 in penalties.
The SCO Report recommends that DIR pursue legislation to extend the
SB 903
Page 2
statute of limitation period for filing a judgment on DLSE-imposed
fines.
In its support of this measure, the California Rural Legal Assistance
Foundation (CRLAF) writes that this bill will enhance the effective
collection of civil penalties for labor law violations by DLSE.
CRLAF, the California Labor Federation and the California Nurses
Association all assert that, if enacted, this measure will conform
the statute of limitations period for DLSE penalty collection actions
to that which already exists for the Division of Occupational Safety
and Health (DOSH) civil penalty collection activity.
CRLAF notes that DLSE's collection rate has improved since the
release of the SCO Report, but states that in 2009, DLSE issues
approximately $16 million dollars less in civil penalty assessments
for labor law violations than it did in 2008. They write that DLSE
continues to be under-funded and state that cases will remain open
and collection rates will fall after the one-year deadline. CRLAF
believes that it is prudent to equip DLSE with the same collection
tools as DOSH has had since 1991.
Analysis Prepared by : Shannon McKinley / L. & E. / (916)
319-2091FN: 0005549