BILL ANALYSIS �
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|SENATE RULES COMMITTEE | AB 26|
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THIRD READING
Bill No: AB 26
Author: Bonilla (D), et al.
Amended: 8/22/14 in Senate
Vote: 21
PRIOR VOTES NOT RELEVANT
SENATE LABOR & INDUSTRIAL RELATIONS COMMITTEE : 4-1, 6/11/14
AYES: Hueso, Leno, Padilla, Mitchell
NOES: Wyland
SENATE APPROPRIATIONS COMMITTEE : Senate Rule 28.8
SUBJECT : Construction: prevailing wage
SOURCE : California State Council of Laborers
DIGEST : This bill revises the definition of construction, for
purposes of public works projects, to also include work
performed during the postconstruction phases of construction,
including, but not limited to, all cleanup work at the jobsite.
Senate Floor Amendments of 8/22/14 add double-jointing language
with AB 2272 (Gray).
ANALYSIS : Existing law defines the term "public works" 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.
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"Construction" also includes work performed during the design
and preconstruction phases of construction, including, but not
limited to, inspection and land surveying work.
Existing law also includes in the definition of a "public work,"
the hauling of refuse from a public works site to an outside
disposal location. However, "hauling of refuse" does not
include the hauling of recyclable metals such as copper, steel,
and aluminum that have been separated from other materials at
the jobsite prior to transportation and that are to be sold at
fair market value to a bona fide purchaser.
Under existing law, "paid for in whole or in part out of public
funds" means, among other things, the following:
1.Payment of money or the equivalent of money by the state or
political subdivision directly to or on behalf of the public
works contractor, subcontractor, or developer.
2.Performance of construction work in execution of a project.
3.Fees, costs, rents, insurance or bond premiums, loans, interest
rates, or other obligations normally required in the
execution of the contract, that are paid, reduced, charged at
less than fair market value, waived, or forgiven by the
state/political subdivision.
4.Money loaned by the state/political subdivision that is to be
repaid on a contingent basis.
Existing law requires all employees who work on public works
projects costing $1,000 or more to be paid the general
prevailing rate of per diem wages (the hourly wage rate being
paid to a majority of the workers in a particular craft within a
given locality) and the general prevailing rate for holiday and
overtime work for the specific location where the public work is
to be performed. The Director of the Department of Industrial
Relations is tasked with the responsibility of determining the
general prevailing rate of per diem wages in accordance with
specified standards.
This bill:
1.Revises the definition of "construction," for purposes of
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public works projects, to also include work performed during
the postconstruction phases of construction, including, but
not limited to, all cleanup work at the jobsite.
2.Contains double-jointing language with AB 2272 (Gray).
FISCAL EFFECT : Appropriation: No Fiscal Com.: Yes
Local: No
SUPPORT : (Verified 7/1/14)
California State Council of Laborers (source)
California Labor Federation, AFL-CIO
California School Employees Association
Southern California Contractors Association
State Building and Construction Trades Council, AFL-CIO
United Contractors
ARGUMENTS IN SUPPORT : According to the author's office,
prevailing wage laws were enacted to ensure skilled construction
workers on public works projects are paid at least the wages and
benefits that prevail in their local communities.
Unfortunately, proponents argue, this bill is necessary to
address a problem that has persisted on public works projects
that has allowed dishonest contractors to side-step prevailing
wage law when it comes to the final clean-up work on a public
works project. The author argues that while the general
prevailing wage determination includes "all final cleanup of
debris, grounds, and buildings near the completion of the
project," state law does not specify that this work is included
within the definition of "public works." According to the
author, the lack of clarity has resulted in some public works
employees performing cleanup work but not receiving a prevailing
wage for that work.
Further, the author contends that the discrepancy in pay
compromises the quality of projects and restricts workers'
ability to enter the middle-class. Additionally, proponents
argue that the lack of conformity makes it difficult for
contractors who pay prevailing wages to submit competitive bids
for public works projects. This bill seeks to remedy this issue
by including work performed during the postconstruction phases
of construction, including, but not limited to, all cleanup work
at a jobsite within the definition of "public works."
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PQ:k 8/25/14 Senate Floor Analyses
SUPPORT/OPPOSITION: SEE ABOVE
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