BILL ANALYSIS �
SENATE JUDICIARY COMMITTEE
Senator Noreen Evans, Chair
2011-2012 Regular Session
AB 1450 (Allen)
As Amended April 25, 2012
Hearing Date: July 3, 2012
Fiscal: Yes
Urgency: No
TW
SUBJECT
Employment: Discrimination: Status as Unemployed
DESCRIPTION
This bill would prohibit an employer from discriminating against
prospective job applicants on the basis of the applicant's
employment status. This bill would provide that an employer,
employment agency, or person operating an Internet job posting
Web site who discriminates against unemployed job applicants
would be subject to a civil penalty in an amount not to exceed
$1,000 for the first violation, $5,000 for the second violation,
and $10,000 for each subsequent violation, which would be
enforceable by the Labor Commissioner.
BACKGROUND
Following the recent financial crisis that began in 2007,
millions of Americans are currently unemployed. California has
an unemployment rate of 10.9 percent, compared to about 8.2
percent nationally. Recently, reports are surfacing that many
employers are requiring, as a part of the job description, that
the applicant be currently employed.
On February 16, 2011, the Equal Employment Opportunity
Commission (EEOC) held a public hearing to examine the impact of
employers considering only those currently employed for job
vacancies. According to the EEOC Press Statement on the
hearing:
(more)
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"Throughout its 45 year history, the EEOC has identified
and remedied discrimination in hiring and remains committed
to ensuring job applicants are treated fairly," said EEOC
Chair Jacqueline A. Berrien. "Today's meeting gave the
Commission an important opportunity to learn about the
emerging practice of excluding unemployed persons from
applicant pools."
According to Helen Norton, Associate Professor at the
University of Colorado School of Law, employers and staffing
agencies have publicly advertised jobs in fields ranging
from electronic engineers to restaurant and grocery managers
to mortgage underwriters with the explicit restriction that
only currently employed candidates will be considered.
"Some employers may use current employment as a signal of
quality job performance," Norton testified. "But such a
correlation is decidedly weak. A blanket reliance on
current employment serves as a poor proxy for successful job
performance."
"The use of an individual's current or recent unemployment
status as a hiring selection device is a troubling
development in the labor market," said Fatima Goss Graves,
Vice President for Education and Employment of the National
Women's Law Center. She noted that this practice "may well
act as a negative counterweight" to government efforts to
get people back to work. Women, particularly older women
and those in non-traditional occupations, are
disproportionately affected by this restriction, testified
Goss Graves.
Denying jobs to the already-unemployed can also have a
disproportionate effect on certain racial and ethnic
minority community members, Algernon Austin, Director of the
Program on Race, Ethnicity, and the Economy of the Economic
Policy Institute, explained. Unemployment rates for
African-Americans, Hispanics and Native Americans are higher
than those of whites. When comparing college-educated
workers, the unemployment rate for Asians is also higher.
Thus, restricting applications to the currently employed
could place a heavier burden on people of color, he
concluded.
The use of employment status to screen job applicants could
also seriously impact people with disabilities, according to
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Joyce Bender, an expert in the employment of people with
disabilities. "Given my experience, I can say without a
doubt that the practice of excluding persons who are
currently unemployed from applicant pools is real and can
have a negative impact on persons with disabilities," Bender
told the Commission.
Dr. William Spriggs, Assistant Secretary of Labor for
Policy, offered data supporting this testimony. Spriggs
presented current national employment statistics showing
that African-Americans and Hispanics are overrepresented
among the unemployed. He also stated that excluding the
unemployed would be more likely to limit opportunities for
older applicants as well as persons with disabilities.
(Equal Empl. Opportunity Com., Press Release, Out of Work?
Out of Luck: EEOC Examines Employers' Treatment of
Unemployed Job Applicants at Hearing (Feb. 16, 2011)
�as
of June 30, 2012].)
Following increased media attention to discrimination against
unemployed workers in hiring practices, on July 12, 2011, the
National Employment Law Project (NELP) released a study which
found that, in one month, there were more than 125 online job
postings that required candidates to be "currently employed."
According to the study, "�s]ignificantly, the fact that NELP's
relatively limited research yielded such a broad cross-section
of exclusionary ads - with postings for jobs throughout the
United States, by small, medium and large employers, for white
collar, blue collar, and service sector jobs, at virtually every
skill level - suggests that the practice of excluding unemployed
job seekers could be far more extensive than depicted in this
limited sample." (National Employment Law Project, Briefing
Paper, Hiring Discrimination Against the Unemployed (July 12,
2011) p. 2.)
Recent legislation aimed at protecting unemployed individuals
seeking work was enacted in New Jersey, which now prohibits
employers from specifying in print or Internet job
advertisements that unemployed persons will not be considered
for hire. Additionally, following the EEOC's February 16, 2011
hearing, similar federal legislation, the Fair Employment Act of
2011, the Fair Employment Opportunity Act of 2011, and the
American Jobs Act of 2011, was introduced and would make it
illegal for employers to discriminate based on employment
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status. (See H.R. No. 1113, 112th Cong., 1st Sess. (2011); H.R.
2501, 112th Cong., 1st Sess. (2011); S. 1471, 112th Cong., 1st
Sess. (2011)); S. 1549, 112th Cong., 1st Sess., Part III,
Subtitle D (2011); H.R. 12, 112th Cong., 1st Sess.(2011), Sec
D.) These bills are all currently pending in Congress.
Similarly, this bill, sponsored by the California Labor
Federation, AFL-CIO and the National Employment Law Project,
would prohibit discrimination by an employer based on a
prospective job applicant's employment status.
This bill was approved by the Senate Labor and Industrial
Relations Committee on June 27, 2012, by a vote of 5-0.
CHANGES TO EXISTING LAW
Existing law , the Fair Employment and Housing Act, prohibits
discrimination in housing and employment on the basis of race,
religious creed, color, national origin, ancestry, physical
disability, mental disability, medical condition, marital
status, sex, age, or sexual orientation. (Gov. Code Sec. 12920
et seq.)
This bill would provide that, unless based on a bona fide
occupational qualification, an employer shall not do any of the
following:
(1)exclude an applicant from the applicant pool at any stage of
the hiring process or refuse to offer employment to an
individual because of the individual's employment status;
(2)publish in print, on the Internet, or in any other medium an
advertisement or announcement for any job that includes either
a provision stating or indicating that an individual's current
employment is a requirement for a job, or a provision stating
or indicating that an employer will not consider an applicant
for employment based on that individual's employment status;
or
(3)direct or request that an employment agency take an
individual's employment status into account in screening or
referring applicants for employment.
This bill would provide that, unless based on a bona fide
occupational qualification, an employment agency shall not do
any of the following:
(1)refuse to offer employment to an individual, exclude an
individual from the applicant pool at any stage of the hiring
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process, or fail to refer an individual for employment because
of the individual's employment status;
(2)limit, segregate, or classify individuals in any manner that
may limit their access to information about jobs or referral
for consideration of jobs because of their employment status;
or
(3)publish in print, on the Internet, or in any other medium an
advertisement or announcement for any job that includes either
a provision stating or indicating that an individual's current
employment is a requirement for a job, or a provision stating
or indicating that an employer will not consider an applicant
for employment based on that individual's employment status.
This bill would provide that, unless based on a bona fide
occupational qualification, a person who operates an Internet
Web site for posting jobs in this state shall not publish on
that Internet Web site an advertisement or announcement for any
job that includes either a provision stating or indicating that
an individual's current employment is a requirement for a job,
or a provision stating or indicating that an employer will not
consider an applicant for employment based on that individual's
employment status.
This bill would not prohibit an employer, an employment agency,
or a person operating an Internet Web site for posting jobs in
this state from doing either of the following:
(1)publishing, in print, on the Internet, or in any other
medium, an advertisement or announcement for any job that sets
forth other lawful qualifications for a job, including, but
not limited to, the holding of a current and valid
professional or occupational license, certificate,
registration, permit, or other credential, or a minimum level
of education or training or professional, occupational, or
field experience; or
(2)printing or circulating or causing to be printed or
circulated a publication, advertisement, or solicitation for a
job vacancy that contains any provision stating that only
applicants who are currently employed by that employer will be
considered.
This bill would provide that an employer, an employment agency,
or a person operating an Internet Web site for posting jobs in
this state shall not do either of the following:
(1)interfere with, restrain, or deny the exercise of or the
attempt to exercise any right provided in this bill; or
(2)discriminate against any individual because the individual:
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(a) opposed any practice made unlawful by this bill; (b) has
caused to be instituted any proceeding under or related to
this bill; (c) has given, or is about to give, any information
in connection with any inquiry or proceeding relating to any
right provided under this bill; or (d) has testified, or is
about to testify, in any inquiry or proceeding relating to any
right provided under this bill.
This bill would provide that an employer, an employment agency,
or a person operating an Internet Web site for posting jobs in
this state who violates the provisions in this bill shall be
subject to a civil penalty in an amount not to exceed $1,000 for
the first violation, $5,000 for the second violation, and
$10,000 for each subsequent violation, enforceable by the Labor
Commissioner.
This bill would provide the following definitions:
(a)"contractor" means a person who is a party to a contract with
a state governmental agency, including any department,
division, subcontractor, or other unit that is responsible for
performance under the contract;
(b)"employer" means the state or any political or civil
subdivision of the state and any person who directly or
indirectly, or through an agent or any other person, employs
or exercises control over the wages, hours, or working
conditions of any person;
(c)"employment agency" has the same meaning as defined in
Section 1812.501 of the Civil Code; and
(d)"employment status" means an individual's present
unemployment, regardless of the length of time that the
individual has been unemployed.
This bill would provide that a contract entered into on or after
January 1, 2013, between a state agency and a contractor who is
an employer, shall include an express or implied requirement
that the contractor comply with the requirements of this bill.
Failure to comply with the requirements of this bill shall
constitute a breach of the contract and may be grounds for
canceling, terminating, or suspending the contract, and
debarring the contractor from eligibility for future state
agency contracts. The Labor Commissioner may enforce this
provision by directing the state agency to cancel, terminate, or
suspend the contract, or any segregable portion thereof, or
debarring the contractor from eligibility for an award of a
future state agency contract for a period not to exceed three
years.
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This bill would not preclude an employer, an employment agency,
or a person who operates an Internet Web site for posting jobs
in this state from doing any of the following:
(a)obtaining information regarding an individual's employment,
the dates of employment, or the reasons for the separation
from employment;
(b)having knowledge of a person's employment status;
(c)considering an individual's employment history or the reasons
underlying an individual's employment status;
(d)refusing to offer employment to a person because of the
reasons underlying an individual's employment status; or
(e)otherwise making employment decisions pertaining to that
individual.
COMMENT
1. Stated need for the bill
The author writes:
Nothing in state law prohibits discrimination against
individuals solely because they are out of work through no
fault of their own.
In a recent interview, the author stated, "There's been an
increasing utilization of using �unemployment status] as a crude
screening process to keep applicants from even being
interviewed. . . . It's better to be proactive rather than to
let this become a common practice." (Edwards-Levy, California
Considers Outlawing Discrimination Against Unemployed,
Huffington Post (Jan. 23, 2012)
�as of June 30, 2012].) The author, who is also a labor
attorney, also noted that "discrimination against the unemployed
could specifically harm recent military veterans, minority
groups with historically high unemployment and women who take
maternity leave." (Id.)
Co-sponsor California Labor Federation, AFL-CIO writes:
The current economic downturn presents unemployed workers with
a wide variety of unique challenges: our unemployment rate
hovers at over 10 �percent], and those without jobs have found
themselves idled for historic lengths of time. From 4 workers
fighting over every available job to the shifting demands of
today's economy, it's never been harder to find stable,
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reliable work.
In addition, this recession has given birth to a new and
particularly insidious form of discrimination. Across the
country, many employers, employment agencies, and online job
websites have begun to openly advertise warnings like "no
unemployed candidates considered at all" or "must be currently
employed." Creating a perverse catch-22, these corporations
require that you already have a job in order to get a job. . .
.
AB 1450 will ban this discrimination, whether in
advertisements or through hiring policies. Employers will
also be prohibited from refusing to hire someone because of
their employment status, while an employer's right to consider
employment history will be explicitly protected.
This common sense reform simply ends blanket policies that
exclude qualified workers, and thus the bill only affects
employers currently engaging in the practice. Meanwhile,
California's unemployed will face one less obstacle between
them and a successful return to the workforce.
2. Discrimination protection for unemployed job seekers
As discussed during the February 26, 2011 public hearing held by
the Equal Employment Opportunity Commission (EEOC), there is an
emerging practice across the country of excluding unemployed
people from applicant pools. (See Background.) This bill seeks
to address this problem by prohibiting an employer, an
employment agency, or a person operating an Internet Web site
for posting jobs in this state from discriminating against a job
applicant on the basis of the applicant's employment status.
These provisions are substantially similar to those provided in
the American Jobs Act of 2011 (S. 1549, 112th Cong., 1st Sess.,
Part III, Subtitle D (2011)), which is still pending in
Congress. Notably, the American Jobs Act of 2011 would provide
antidiscrimination protections and enforcement under Title VII
of the Civil Rights Act of 1964 (42 U.S.C. 2000e et seq.) (Title
VII) and sections 302 and 304 of the Government Employee Rights
Act of 1991 (42 U.S.C. 2000e-16b and 2000e-16c).
Under federal law, Title VII covers all public and private
employers with 15 or more employees, and prohibits employment
discrimination based on race, color, religion, sex, or national
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origin, and applies to all aspects of the employment
relationship, including hiring, compensation, training,
benefits, working conditions, discipline, promotion and
termination. California law provides more expansive
antidiscrimination protections for employees under the Fair
Employment and Housing Act (FEHA), which prohibits
discrimination in employment on the basis of race, religious
creed, color, national origin, ancestry, physical disability,
mental disability, medical condition, marital status, sex, age,
or sexual orientation. (Gov. Code Sec. 12920 et seq.)
Instead of adding employment status to the list of
antidiscrimination protections provided in FEHA, this bill would
create separate discrimination prohibitions for employment
status. By creating separate prohibitions, employees would not
have the higher level of protections and enforcement provisions
that are provided under FEHA. However, the author asserts that
care was taken "to craft the language of this bill to both
protect unemployed individuals from discrimination and uphold an
employer's right to delve into an individual's employment
history as well as the reasons for why they are unemployed."
Further, the bill was crafted in a way to avoid "multiple
meritless complaints �that] would be filed against employers via
PAGA �the Private Attorney General Act]." Further, the modest
provisions of this bill are appropriate because that author
asserts "most employers consider this type of discrimination to
be heinous and would thus continue to refrain from engaging in
such discrimination, as well as the fact that whatever
violations did occur following enactment would be properly
pursued by the office of the state labor commissioner."
The National Employment Law Project, co-sponsor, asserts:
In California, and around the nation, the Great Recession has
inflicted historic levels of pain and suffering on unemployed
families and produced the most competitive job market in
decades. Two million Californian's are officially counted as
unemployed and another 1.5 million are employed part-time but
are looking for full-time work. California's unemployment
rate now stands at 10.9 �percent], which is tied with Rhode
Island as the second highest level in the nation.
As a result of today's jobs crisis, record numbers of
hard-working Californians find themselves unemployed for
extended periods of time. In fact, nearly half of all
unemployed workers in the state . . . have been actively
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looking for work for more than six months, and over one-third
. . . have been out of work for over a year. After putting in
years of hard work, and dedication on the job, older workers
are now especially hard-hit by the unprecedented elevated
rates of long-term unemployment. . . .
This reasonable and limited measure would help put an end to
the practice of excluding qualified workers from employment
based solely on their recent job loss and eliminate the
stigmatization of those dedicated workers who have the
misfortune of being unemployed in the worst downturn since the
Great Depression.
The Consumer Attorneys of California, in support, argue that
"California currently suffers from an almost 11 �percent]
unemployment rate. Despite these staggering statistics, we have
seen a disturbing trend involving discrimination by employers
and job advertisement sites against unemployed job applicants.
Safeguards are needed to ban such blanket exclusions based on
one's employment status. AB 1450 will not prohibit an employer
from requiring certain levels of experience, education or
training, but simply would ensure hiring decisions are based on
merit, not joblessness."
3. Oppositions' concerns
A coalition of opponents assert that this bill is a job killer
because it "will essentially prohibit employers from
legitimately inquiring into an applicant's most recent
employment history, due to fear that any such inquiry will
ultimately lead to penalties and costs on the basis that the
applicant was discriminated against because of his/her status as
unemployed. It also unfairly targets state contractors by
imposing a three-year debarment from state contracts if found to
have violated the provisions of the bill, thus essentially
providing a hiring preference for the employment with state
contractors."
Staff notes that the author's stated intent of this bill is to
help get Californian's back to work by prohibiting an employer
from disqualifying the applicant because they are unemployed.
As such, the bill arguably is about filling existing jobs rather
than killing jobs that are currently available.
In response to the coalition, the author argues that "his
interest is in prohibiting blatant denials of applicants for
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jobs or blatant denials of consideration of individuals who are
out of work through no fault of their own for open job
positions, specifically because of their current employment
status. Further, the author has taken care to craft the
language of AB 1450 to both protect unemployed individuals from
discrimination and uphold an employer's right to delve into an
individual's employment history as well as the reasons for why
they are unemployed."
The coalition also asserts that this bill "does not
differentiate between those applicants, who are unemployed to
their inadequate or insufficient performance with their most
recent employer, versus those applicants who were unfortunately
a part of a lay-off. An employer should be allowed to
investigate the reasons a person is unemployed, including
whether the applicant was recently terminated for serious
misconduct, before offering that person a job and bringing
him/her into the workplace." In response, the author asserts
that stated intent of the bill is to allow job applicants to
apply for jobs, rather than turning them away without even being
interviewed or having their resume reviewed because a
pre-condition to applying for the job is that the applicant be
currently employed. As asserted by the Chair of the EEOC in the
February 2011 hearing on employment status discrimination, "the
issue of discrimination in hiring has been one of the critical
concerns of the Commission because, as we all know, part of a
successful life as an employee, and part of a successful and
productive economic life, is to get your foot in the door in the
first place. And so the things that may prevent people from
getting their foot in the door in the first place and
particularly anything that may violate the statutes that we're
charged with enforcing are of great concern to the Commission."
(Jacqueline A. Berrien, Chair, Equal Empl. Opportunity Com.,
Hearing Transcript Out of work, out of luck? Denying employment
opportunities to unemployed job seekers (Feb. 26, 2011) <
http://www.eeoc.gov/eeoc/meetings/2-16-11/transcript.cfm> �as of
June 30, 2012].) The author further argues that this bill is
about helping people get their foot in the door by removing a
pre-condition to employment that does not relate to the
substantive merits of the applicant's qualifications.
Additionally, this bill specifically does not preclude an
employer, an employment agency, or a person who operates an
Internet Web site for posting jobs in this state from doing any
of the following:
(a)obtaining information regarding an individual's employment,
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the dates of employment, or the reasons for the separation
from employment;
(b)having knowledge of a person's employment status;
(c)Considering an individual's employment history or the reasons
underlying an individual's employment status;
(d)refusing to offer employment to a person because of the
reasons underlying an individual's employment status; or
(e)otherwise making employment decisions pertaining to that
individual.
As such, this bill does not prohibit the employer from asking
about the individual's employment history, which may reveal
current unemployment, but merely prohibits the employer from
pre-conditioning job eligibility on employment status so that an
applicant who may otherwise be well-qualified for the position
has the opportunity to apply.
Support : American Federation of State, County and Municipal
Employees; California Alliance of Retired Americans; California
Conference Board of the Amalgamated Transit Union; California
Conference of Machinists; California Employment Lawyers
Association; California Immigrant Policy Center; California
Nurses Association; California Professional Firefighters;
California Rural Legal Assistance Foundation; California School
Employees Association; California State Association of
Electrical Workers; California State Pipe Trades Council;
California Teamsters Public Affairs Council; California
Workforce Association; Coalition of California Utility
Employees; Consumer Attorneys of California; Consumer Federation
of California; International Longshore and Warehouse Union;
International Union of Elevator Constructors; National
Association of Social Workers, California Chapter; Northern
California District Council of the International Longshore and
Warehouse Union; Professional & Technical Engineers, Local 21;
United Food and Commercial Workers Union, Western States
Council; UNITE HERE; Western States Council of Sheet Metal
Workers
Opposition : Air Conditioning Trade Association; Associated
Builders and Contractors of California; Associated General
Contractors; California Apartment Association; California
Association of Bed & Breakfast Inns; California Association of
Joint Powers Authorities; California Bankers Association;
California Chamber of Commerce; California Chapter of American
Fence Association; California Employment Law Council; California
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Farm Bureau Federation; California Fence Contractors'
Association; California Framing Contractors Association;
California Grocers Association; California Hotel & Lodging
Association; California Independent Grocers Association;
California Landscape Contractors Association; California League
of Food Processors; California Manufacturers & Technology
Association; California Retailers Association; City of Palm
Desert; Engineering Contractors' Association; Flasher Barricade
Association; Garden Grove Chamber of Commerce; Greater Riverside
Chamber of Commerce; Marin Builders Association; National
Federation of Independent Business; Orange County Business
Council; Plumbing-Heating-Cooling Contractors Association of
California; TechAmerica; TechNet; Western Electrical Contractors
Association, Inc.
HISTORY
Source : California Labor Federation, AFL-CIO; National
Employment Law Project
Related Pending Legislation : None Known
Prior Legislation : None Known
Prior Vote :
Senate Committee on Labor and Industrial Relations (Ayes 5, Noes
0)
Assembly Floor (Ayes 51, Noes 26)
Assembly Committee on Appropriations (Ayes 12, Noes 5)
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Assembly Committee on Judiciary (Ayes 7, Noes 3)
Assembly Committee on Labor and Employment (Ayes 5, Noes 1)
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