BILL ANALYSIS �
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|SENATE RULES COMMITTEE | AB 1401|
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THIRD READING
Bill No: AB 1401
Author: Assembly Arts, Entertainment, Sports, Tourism,
and Internet
Media Committee
Amended: 8/15/11 in Senate
Vote: 21
SENATE LABOR & INDUSTRIAL RELATIONS COMM. : 4-1, 6/8/11
AYES: Lieu, DeSaulnier, Leno, Yee
NOES: Runner
NO VOTE RECORDED: Wyland, Padilla
SENATE JUDICIARY COMMITTEE : 4-0, 6/21/11
AYES: Evans, Blakeslee, Corbett, Leno
NO VOTE RECORDED: Harman
SENATE APPROPRIATIONS COMMITTEE : 6-2, 7/11/11
AYES: Kehoe, Alquist, Lieu, Pavley, Price, Steinberg
NOES: Walters, Emmerson
NO VOTE RECORDED: Runner
ASSEMBLY FLOOR : 52-24, 5/26/11 - See last page for vote
SUBJECT : Employment: minors
SOURCE : Screen Actors Guild
DIGEST : This bill establishes an Internet Web site
permit process to be administered by the Division of Labor
Standards Enforcement for the issuance of temporary work
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permits for minors working in the entertainment industry.
The temporary work permit issued under this bill would
enable a parent or guardian of a minor to establish a
Coogan Trust Account for the benefit of the minor. This
bill requires the Labor Commissioner to place fees received
for a temporary minor's entertainment work permit into an
Entertainment Work Permit Fund, which funds would pay for
the costs of administration of the Internet Web site
created under this bill.
Senate Floor Amendments of 8/15/11 (1) authorize the Labor
Commissioner to borrow up to $250,000 from the Labor
Enforcement and Compliance Fund to cover the one-time
startup costs related to the temporary permit program, and
(2) require the loan to be repaid as soon as sufficient
funds are available in the Entertainment Work Permit Fund,
provided repayment does not compromise the operations of
the temporary work permit program.
ANALYSIS : Existing law requires written consent of the
Labor Commissioner for the employment of a minor in the
entertainment industry, as specified. (Labor Code Section
1308.5)
Existing law provides that the written consent of the Labor
Commissioner expires after ten days unless a Coogan Trust
Account or similar trust account (collectively, Coogan
Trust Account) has been established for the benefit of the
minor. If a trustee's statement evidencing the
establishment of a Coogan Trust Account is attached to the
written consent, then the written consent is valid for six
months. (Labor Code Section 1308.9)
Existing law defines a "Coogan Trust Account" to mean a
trust account established for the purpose of preserving for
the benefit of a minor the portion of the minor's gross
earnings. (Family Code Section 6753)
This bill authorizes, prior to the employment of a minor
under 16 years of age, the Labor Commissioner to issue a
temporary permit to enable the parent or guardian of the
minor to apply for written consent for entertainment
industry employment of the minor and to establish a Coogan
Trust Account, or similar trust account for the benefit of
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the minor, as follows:
1. A temporary permit shall be valid for ten days from the
date of issuance;
2. The temporary permit shall not be issued for the
employment of a minor if the minor's parent or guardian
has previously applied for or been issued a permit by
the Labor Commissioner for employment of the minor;
3. The Division of Labor Standards Enforcement (DLSE) shall
prepare and make available on its Internet Web site the
application form for a temporary permit, which must be
completed by the applicant and submitted online with the
appropriate fee; and
4. Upon receipt of the completed application and fee, the
DLSE shall immediately issue a temporary permit.
This bill creates the Entertainment Work Permit Fund (Fund)
in the State Treasury and requires the Labor Commissioner
to deposit all fees received for temporary entertainment
work permits into the Fund. The funds deposited in the
Fund shall be available to the Labor Commissioner, upon
appropriation by the Legislature, to pay for the costs of
administration of the online minor's temporary
entertainment work permit program.
This bill authorizes the Labor Commissioner to set the fee,
not to exceed $50, for the minor's temporary entertainment
work permit in an amount sufficient to pay for the costs
associated with the Internet Web site.
This bill authorizes the Labor Commissioner to borrow up to
$250,000 from the Labor Enforcement and Compliance Fund to
cover the one-time startup costs related to the temporary
permit program.
This bill also requires the loan to be repaid as soon as
sufficient funds are available in the Entertainment Work
Permit Fund, provided repayment does not compromise the
operations of the temporary work permit program.
Background
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In 1938, the Coogan law was passed 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 of 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.
SB 1162 (Burton), Chapter 940, Statutes of 1999, overhauled
the Coogan law. Applicable to both court-approved and non
court-approved minors' contracts for creative or artistic
employment, SB 1162 required 15 percent of a minor's
earnings to be set aside and deposited into a "Coogan
trust" account, invested in low-risk financial vehicles,
and blocked from use until the minor is emancipated or
reaches age 18. To enforce the set-aside, SB 1162 imposed
a duty on the employer to make the deposit directly into
the minor's Coogan trust account, which a parent or
guardian is required to open at an insured financial
institution and to invest in a manner consistent with that
of a trustee. Annual accounting is required, and court
supervision of trust accounts for minors with
court-approved contracts continues until the minor turns 18
years of age or becomes legally emancipated.
To further strengthen enforcement of the Coogan law, the
Legislature adopted, and the Governor signed, SB 210
(Burton), Chapter 667, Statutes of 2004, which added the
requirement that the Labor Commissioner's written consent
for performances of a minor under Labor Code Section 1308.5
be limited to 10 days, unless a Coogan Trust Account has
been established, as discussed above.
The enforcement of this system is placed upon the studio
teachers, with whom the duty to check a child performer's
paperwork rests. A studio teacher is a certificated
teacher who holds both a valid and current California
Elementary and a California Secondary teaching credential,
which is certified by the Labor Commissioner. Studio
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teachers are paid by the employer (e.g. a production
company or studio).
A studio teacher, in addition to teaching, has the
responsibility for caring and attending to the health,
safety, and morals of minors under 16 years of age, and
shall take cognizance of such factors as: working
conditions, physical surroundings, signs of minor's mental
and physical fatigue, demands placed upon the minor in
relation to the minor's age, agility, strength, and
stamina, and may refuse to allow engagement of a minor on a
set or a location and may remove the minor there from, if
in judgment of studio teacher, conditions are such as to
present a danger to the health, safety, or morals of the
minor.
Prior Legislation
AB 2032 (Davis), 2009-10 Session, would have required
applicants for an Entertainment Work Permit for minors to
pay a fee in order to fund the administration of the
Entertainment Work Permits and the enforcement of the
working conditions of minors in the entertainment industry.
The bill was vetoed by Governor Schwarzenegger, whose veto
message stated:
"This bill would require that an application fee be
submitted at the time a minor applies for a child labor
entertainment work permit. The fee would be deposited
into the Entertainment Work Permit Fund, which would be
created by the bill. Money in the fund would be subject
to appropriation by the Legislature to the Labor
Commissioner for costs in issuing the permit, enforcing
entertainment work permit requirements, developing and
enhancing a website with informational materials, and
training studio teachers.
"This bill is essentially the same as AB 402 (Davis,
2009), which I also vetoed. Oversight of
California-certificated teachers and the issuance of
entertainment permits for mostly school-aged children are
functions that reasonably fall within the oversight of
the Department of Education, and not the Department of
Industrial Relations. As I have stressed throughout my
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Administration, government must operate more efficiently
within existing resources. This bill does not advance
that goal."
AB 402 (Davis), 2009-10 Session, was virtually identical to
AB 2032. It was vetoed by Governor Schwarzenegger.
SB 210 (Burton), Chapter 667, Statutes of 2004, which was
discussed earlier, added the requirement that the Labor
Commissioner's written consent for performances of a minor
be limited to 10 days, unless a Coogan Trust Account has
been established.
SB 1162 (Burton), Chapter 940, Statutes of 1999, which was
discussed earlier, made significant changes to the Coogan
law.
FISCAL EFFECT : Appropriation: No Fiscal Com.: Yes
Local: No
SUPPORT : (Verified 8/17/11)
Screen Actors Guild (source)
ARGUMENTS IN SUPPORT : Proponents state:
"Parents of child performers often will obtain an
entertainment work permit prior to even auditioning their
child for a job. This results in an inefficient and
expensive work volume for the Labor Commissioner's office
- who issues over 60,000 entertainment work permits for
minors annually - which is vastly larger than the pool of
actual children working in the industry in need of a
permit.
"�U]nder the current system, there is no way to obtain a
same day work permit. Instead, a paper application must
be presented to the Labor Commissioner'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.
"Under AB 1401 parents would be able to apply for their
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child's first permit online for a temporary permit that
will be granted immediately. This will allow parents to
wait to apply for a permit until their child actually has
a job - and save the Labor Commissioner many hours of
work. The temporary permit is only valid for 10 days -
time to allow the parents to submit the required
documentation with their permit renewal application,
including ? �e]stablishing a Coogan blocked trust bank
account."
ASSEMBLY FLOOR : 52-24, 5/26/11
AYES: Achadjian, Alejo, Allen, Ammiano, Atkins, Beall,
Bill Berryhill, Block, Blumenfield, Bonilla, Bradford,
Brownley, Buchanan, Butler, Charles Calderon, Campos,
Carter, Chesbro, Dickinson, Eng, Feuer, Fong, Fuentes,
Furutani, Galgiani, Gatto, Gordon, Hall, Hayashi, Roger
Hern�ndez, Hill, Huber, Hueso, Huffman, Lara, Bonnie
Lowenthal, Ma, Mendoza, Mitchell, Monning, Pan, Perea, V.
Manuel P�rez, Portantino, Skinner, Solorio, Swanson,
Torres, Wieckowski, Williams, Yamada, John A. P�rez
NOES: Conway, Cook, Donnelly, Fletcher, Beth Gaines,
Garrick, Grove, Hagman, Halderman, Harkey, Jeffries,
Knight, Logue, Mansoor, Miller, Morrell, Nestande,
Nielsen, Norby, Olsen, Silva, Smyth, Valadao, Wagner
NO VOTE RECORDED: Cedillo, Davis, Gorell, Jones
PQ:mw 8/17/11 Senate Floor Analyses
SUPPORT/OPPOSITION: SEE ABOVE
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