BILL ANALYSIS Ó
AB 514
Page A
Date of Hearing: May 4, 2011
ASSEMBLY COMMITTEE ON LABOR AND EMPLOYMENT
Sandre Swanson, Chair
AB 514 (Hernandez) - As Amended: April 27, 2011
SUBJECT : Public works: hauling refuse.
SUMMARY : Clarifies the definition of "hauling of refuse" for
purposes of prevailing wage law. Specifically, this bill:
1)Provides that "hauling of refuse" includes the hauling of
materials other than bona fide commodities sold at fair market
value from a public works site.
2)Specifies that a "bona fide commodity" is a commodity for
which there exists a publicly-traded commodity market, such as
copper, steel or aluminum.
EXISTING LAW :
1) Requires the prevailing wage rate to be paid to all workers
on "public works" projects over $1,000.
2) Defines "public work" to include, among other things,
construction, alteration, demolition, installation or repair
work done under contract and paid for in whole or in part out
of public funds.
3) Also defines "public works" to include the hauling of refuse
from a public works site to an outside disposal location,
with respect to contracts involving any state agency or any
political subdivision of the state.
FISCAL EFFECT : Unknown
COMMENTS : As discussed above, current law defines '"public
works" as "Ýc]onstruction, alteration, demolition, installation,
or repair work done under contract and paid for in whole or in
part out of public funds . . . ." (Labor Code section 1720).
Under Labor Code section 1720.3, "public works also means the
hauling of refuse from a public works site to an outside
disposal-location, with respect to contracts involving any state
agency?or any political subdivision of the state."
AB 514
Page B
The Department of Industrial Relations (DIR) has stated the
following in a recent public works coverage determination<1>:
"The off-haul of 'refuse' from a public works site to an
outside disposal location is subject to prevailing wage
requirements under section 1720.3. 'The apparent intent of
the Legislature in enacting section 1720.3 was to include
within the definition of 'public works' the hauling of any
refuse that was part of the construction project.' (83 Ops.
Cal.Atty.Gen. 166, 168-169 (2000).) Consistent with
long-standing Department interpretation, the term 'refuse'
encompasses 'anything discarded or rejected as useless or
worthless; trash.' (See American Heritage Dict. (new
college ed. 1979) p. 1095).)"
ARGUMENTS IN SUPPORT :
This measure is jointly sponsored by the California State
Building and Construction Trades Council and the California
Teamsters Public Affairs Council.
They state that current law guarantees workers employed at
public works sites are subject to a prevailing wage for
transporting refuse from the worksite to an offsite location.
Although the statutory provision exists, the sponsors contend
that many workers do not receive the wages that they are due as
a result of loopholes that circumvent this mandate.
They contend that some unscrupulous employers have rendered this
provision meaningless by selling refuse hauled from public works
sites for a nominal fee (an entire load for $1 for example) and
then refusing to pay the prevailing wage. Their rationale is
that since the material hauled away had "some value" it was no
longer refuse. Therefore, this bill would ensure that only bona
fide commodities sold at fair market value would be deemed not
to constitute "refuse."
ARGUMENTS IN OPPOSITION :
Opponents contend that this bill would expand the prevailing
wage requirement for public contracts related to the hauling of
municipal solid waste. They argue that this bill could
---------------------------
<1> Friendly Inn/Senior Center Abatement and Demolition Project,
City of Morgan Hill. DIR Public Works Case No. 2008-027 (2008).
AB 514
Page C
substantially increase the cost of services provided to schools
and other public facilities that have not been factored into
contractual agreements and would increase the costs of services
to public agencies.
REGISTERED SUPPORT / OPPOSITION :
Support
California Conference Board of the Amalgamated Transit Union
California Conference of Machinists
California Labor Federation, AFL-CIO
California Teamsters Public Affairs Council (co-sponsor)
Engineers and Scientists of California
International Longshore and Warehouse Union
Professional and Technical Engineers, Local 21
State Building and Construction Trades Council (co-sponsor)
Teamsters Local 853
UNITE HERE!
United Food and Commercial Workers Union, Western States Council
Opposition
CR & R Incorporated
Analysis Prepared by : Ben Ebbink / L. & E. / (916) 319-2091