BILL ANALYSIS �
AB 1401
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Date of Hearing: May 18, 2011
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Felipe Fuentes, Chair
AB 1401 (Arts Committee) - As Introduced: March 2, 2011
Policy Committee: Arts Vote:7-1
Labor 5-1
Urgency: No State Mandated Local Program:
No Reimbursable:
SUMMARY
This bill establishes a program enabling a minor's parent or
guardian to obtain a temporary Entertainment Work Permit (EWP).
Specifically, this bill:
1.Authorizes the Labor Commissioner (LC) to issue a one-time
temporary EWP-valid for up to 10 days-for a minor under age 16
in order to meet existing EWP requirements.
2.Stipulates that the temporary permit shall not be issued for a
minor if the minor's parent or guardian has previously applied
for, or has been issued, a permit by the LC under existing EWP
requirements, or has been issued a temporary permit pursuant
to this section for employment of the minor.
3.Requires the Division of Labor Standards Enforcement (DLSE) to
make available an online application for a temporary permit,
and requires immediate issuance of the temporary fee upon
receipt of the completed application and fee.
4.Requires the LC to establish a fee of up to $50 in order to
cover the costs of administering the temporary EWP program.
FISCAL EFFECT
The DLSE would incur one-time start-up costs of $50,000 to
$100,000 for a contract to establish the online application and
payment system for temporary permits and to implement new
procedures to integrate the temporary permit process with the
existing EWP system. These start-up costs would likely be
covered by a loan from the Labor Enforcement and Compliance
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Fund, which would be repaid by revenues from the temporary
permit fee. The bill requires that the temporary permit fee
revenues be sufficient to cover program costs. These revenues,
which would depend on the number of applicants and the fee level
established by the LC, are unknown. At the maximum fee of $50
per applicant, around 3,000 annual applications could support
the costs for two administrative staff.
The current EWP program includes processing about 60,000 permits
at an annual cost of about $800,000 for 11 positions. As part of
the 2010-11 Budget Act, General Fund support for the DLSE was
removed and replaced with funding from the newly-created Labor
Enforcement and Compliance Fund, which is financed by a
surcharge on employers.
COMMENTS
1)Purpose . According to the committee chair, Child performers
must have an EWP issued by the LC in order to be employed in
California. However, under the current system, there is no way
to obtain a same-day work permit. Instead, a paper application
must be presented to the LC's office, and a work permit is
mailed back to the applicant. This process takes up to two
weeks to complete. The delay in obtaining a permit can deny
some child performers the ability to work.
To avoid this situation, parents of child performers often
obtain an EWP prior to auditions. This results in an
inefficient and expensive work volume for the LC's office.
The LC reports issuing from 60,000-70,000 EWPs annually.
The chair states, "There is an additional important problem
with the existing permit process which subverts legislative
intent to protect the financial assets of working children.
Through a provision in law known as the Coogan Act, a blocked
trust bank account must be established for all children
working in the entertainment field. These provisions of the
Family Code are only enforced through the LC's EWPs."
"Under current law, the existing permits expire in ten days,
unless proof that a Coogan blocked trust account exists.
However, once a child begins to work, no one ever revisits the
permit to verify that a Coogan account exists. Because the
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Coogan Act is written into the Family Code, the enforcers of
the LC's office do not follow up on this important child labor
provision."
"This bill will solve both of these issues through the
creation of a same-day online permit system for EWPs for
minors.
2)Background . According to the Department of Industrial
Relations' website, except in limited circumstances, all
minors under 18 years of age employed in the state must have a
permit to work, which they obtain through their school. In
addition to the work permit, minors age 15 days to 18 years
employed in the entertainment industry must have an EWP, and
employers must have a permit to employ, both permits being
issued by the Division of Labor Standards Enforcement.
The Labor Code further provides that if the Labor Commissioner
provides written consent pursuant to Labor Code Section 1308.5
for the employment of a minor, that consent shall be void
after 10 business days, unless it is attached to a correct
copy of the trustee's statement evidencing establishment on
behalf of the minor of a Coogan Trust Account, in which case
the written consent shall be valid for a six-month period.
3)The Coogan law was passed in 1938 in response to Jackie
Coogan's plight. Even though he earned millions as a child
actor, Coogan was surprised to find out when he reached
adulthood that his entire earnings were depleted, because his
mother and stepfather spent all his money (legally) as the law
at the time considered his earnings to be his parents
property. The Coogan law was enacted to preserve a portion of
a minor's earnings under an employment contract for creative
or artistic services, for the minor's use when he or she turns
18 years of age or becomes legally emancipated.
4)Prior Legislation . AB 2032 (Davis) of 2009, which levied a fee
to fund the administration of permits for minors in the
entertainment industry, as well as to fund enforcement of
working conditions for minors in the industry, was vetoed by
Governor Schwarzenegger, who argued that such permits should
be issued by the Department of Education.
AB 402 (Davis) of 2009, which was similar to AB 2032, was also
vetoed.
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Analysis Prepared by : Chuck Nicol / APPR. / (916) 319-2081