BILL ANALYSIS �
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|SENATE RULES COMMITTEE | SB 1087|
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THIRD READING
Bill No: SB 1087
Author: Monning (D), et al.
Amended: 5/5/14
Vote: 21
SENATE LABOR & INDUSTRIAL RELATIONS COMMITTEE : 4-1, 4/24/14
AYES: Hueso, Leno, Padilla, Mitchell
NOES: Wyland
SENATE APPROPRIATIONS COMMITTEE : 5-2, 5/19/14
AYES: De Le�n, Hill, Lara, Padilla, Steinberg
NOES: Walters, Gaines
SUBJECT : Farm labor contractors
SOURCE : California Rural Legal Assistance Foundation
DIGEST : This bill strengthens the farm labor contractor (FLC)
standards by, among other things, increasing bonding
requirements and raising licensure fees for FLC licensure
enforcement, as specified; prohibits the FLC who engage in
sexual harassment from being issued a FLC's license or renewing
the license, as specified; and requires a FLC to produce a
written contract or agreement between the grower and/or another
FLC in response to a subpoena or discovery request, as
specified.
ANALYSIS :
Existing law defines a "FLC" as any person who, for a fee,
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employs or recruits workers to render personal services in
connection with the production or growing of any farm products
to and who, for a fee, provides in connection therewith one or
more of the following services: furnishes board, lodging, or
transportation for those workers; supervises, times, checks,
counts, weighs, or otherwise directs or measures their work; or
disburses wage payments to these persons.
Existing law prohibits any person from acting as a FLC until a
license to do so have been issued to him by the Labor
Commissioner (Commissioner) and such license is in full effect
and is in his possession. The penalties for acting as a FLC
without a license are:
1. For any initial citation, $100 for each farmworker employed
by the unlicensed person, plus $100 for each calendar day
that a violation occurs, for a total penalty not to exceed
$10,000;
2. For a second citation, $200 for each farmworker employed by
the unlicensed person, plus $200 for each calendar day that a
violation occurs, for a total penalty not to exceed $20,000;
or
3. For a third or subsequent citation, $500 for each farmworker
employed by the unlicensed person, plus $500 for each
calendar day that a violation occurs, for a total penalty not
to exceed $50,000.
Existing law requires that the Commissioner shall not issue or
renew a FLC license, unless:
1. The applicant has executed a written application in a form
prescribed by the Commissioner, including, among other
things, a statement on the applicant's character and
operations and the names and addresses of financially
interested partners;
2. The applicant has posted a surety bond of $25,000 for
payrolls up to $500,000 or a bond of $50,000 for payrolls up
to $2 million or a bond of $75,000 for payrolls over $2
million. This bond must be payable to the State of
California in the event of violations of California Labor
Law;
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3. The applicant has paid the appropriate fees and passed an
examination that covers the agricultural labor law, including
safety regulations, collective bargaining laws, and wage and
hour requirements; and
4. The Commissioner is, after investigation, satisfied with the
character of the applicant.
These penalties are deposited into the Farmworker Remediation
Fund, which is used to pay damages due to unpaid wages that
exceed the amount of the licensee's surety bond.
Existing law sets the licensure fee at $510 and the licensure
renewal fee at $500. $150 of the licensure and renewal fees
goes to the Farmworker Remediation Fund. Existing law also sets
the examination fee at $100.
Existing law requires that FLCs receive at least eight hours of
continuing education classes each year. The classes must be
approved by the Commissioner, in consultation with other
governmental entities.
Existing law permits the Commissioner to deny, revoke, or refuse
to renew a FLC's license for a variety of different causes,
including violating health and safety laws, making
misrepresentations in the application, failing to follow
licensure requirements, and failure to pay appropriate wages.
If a FLC's license is revoked, the Commissioner must wait at
least three years before issuing another license to the
sanctioned FLC.
Existing law requires that, if a FLC leaves the state to avoid a
service of summons due to a violation of labor law, service must
instead be made on the surety.
Existing law requires FLCs to make available for inspection by
his/her employees and by the grower with whom he/she has
contracted a written statement in English and Spanish showing
the rate of compensation the FLC receives from the grower and
the rate of compensation the FLC is paying to his/her employees.
Existing law requires FLCs, upon request of the grower with whom
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the FLC has a contract, to immediately furnish the grower with a
payroll list of all the contractor's employees working for the
grower.
Existing law provides that an aggrieved employee may bring a
civil action against a FLC for injunctive relief or damages,
and, upon prevailing, recover attorney's fees.
Existing law requires that any FLC who continues to provide
FLC's services after his/her license has been suspended or
revoked is guilty of an offense punishable by a fine of not less
than $1,000, but not more than $5,000, and/or by an imprisonment
of not less than six months, but not more than one year.
This bill:
1. Requires a FLC to provide a list of all employees who
provided FLC services on behalf of the FLC, as specified.
2. Requires a double bond requirement to $50,000 for payrolls up
to $500,000 or a bond of $100,000 for payrolls up to $2
million or a bond of $150,000 for payrolls over $2 million.
3. Requires the FLC to provide documentation to the Commissioner
of the size of the contractor's payroll with either the
Employment Development Department, Franchise Tax Board,
Internal Revenue Service, or workers' compensation insurer
documentation.
4. Increases the FLC licensure fee to $600, with the additional
$100 funding the Commissioner's FLC Enforcement Unit and the
FLC Verification Unit.
5. Requires an applicant for licensure as a FLC to provide a
written statement verifying that the person's supervisorial
employees have been trained in the prevention of sexual
harassment, as specified.
6. Increases the examination fee by $100 and adds the Department
of Fair Employment and Housing to the organizations that must
be consulted by the Commissioner when creating the exam.
7. Requires that a FLC must fully remit all wage withholdings
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that are due by collective bargaining agreement or law prior
to a license being issued or renewed.
8. Expands circumstances where service to the surety is
appropriate to include if the FLC remains in the State, but
has fled the jurisdiction where the labor law violation has
occurred.
9. Requires that the FLC fully document net and gross hours
worked and wages to a grower and provides paystubs that fully
comply with California Labor Law to the contractor's
employees.
10.Requires the grower to retain contracts with FLCs for three
years.
11.Allows for the collection of expert witness fees in the event
of successfully pursuing action against a FLC.
12.Increases fees for any FLC who continues to provide FLCs
services after his/her license has been suspended or revoked
to not less than $10,000, and also extend this penalty to
FLCs who were denied a license.
13.Makes additional changes regarding compliance with federal
law and appropriate posting of a FLC's license information.
14.Expands the conditions upon which a FLC's surety bond may be
payable to include damages due to sexual harassment
specifically, or harassment generally on the basis of race,
religious creed, color, national origin, ancestry, physical
disability, mental disability, medical condition, genetic
information, marital status, sex, gender, gender identity,
gender expression, age, sexual orientation, or military and
veteran status.
15.Requires the addition of protection from sexual harassment in
the workplace as a topic for the FLC written examination.
16.Increases annual continuing education for FLCs to 12 hours
and requires it to include prevention training on sexual
harassment.
17.Prohibits the Commissioner from issuing a license to a FLC
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who, within the three preceding years, committed sexual
harassment or employed a supervisor who the FLC knew, or
should have known, had been found to have committed sexual
harassment of an employee.
18.Allows the Commissioner to revoke, suspend, or refuse to
renew the license of a FLC who, within the three preceding
years, committed sexual harassment or employed a supervisor
who the FLC knew, or should have known, had been found to
have committed sexual harassment of an employee.
19.Requires a FLC to maintain copies of any contract or
agreement for labor of services with a grower or another
labor contractor for at least three years after the
completion date of the contract.
20.Requires a FLC to make those contracts available to employees
of the Division of Labor Standards Enforcement (DLSE), and
produces the contracts in response to a discovery request or
subpoena in any civil action or claim for unpaid wages. This
includes oral agreements for labor.
21.Allows the FLC to only produce the portions of the contracts
which show the amount of the Commission or payment for the
licensee for labor or services provided under the agreement
and how that payment was calculated.
22.Requires a FLC makes the payroll list of available to
employees of the DLSE and produce the payroll list in
response to a discovery request of subpoena in any civil
action or claim for unpaid wages.
Prior Legislation
SB 168 (Monning, Chapter 715, Statutes of 2013), makes a FLC
successor to any predecessor FLC that owed wages or penalties to
a former employee of the predecessor, whether the predecessor
was a licensee or not, liable for those wages and penalties, if
the successor FLC meets specified criteria.
FISCAL EFFECT : Appropriation: Yes Fiscal Com.: Yes
Local: Yes
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According to the Senate Appropriations Committee:
The Department of Industrial Relations indicates it would
incur a one-time cost of $58,000 for rulemaking (Special
Fund).
The Department of Fair Employment Housing indicates minimal
costs from the bill.
SUPPORT : (Verified 5/20/14)
California Rural Legal Assistance Foundation (source)
American Federation of State, County and Municipal Employees,
AFL-CIO
California Applicant Attorneys Association
California Catholic Conference, Inc.
California Labor Federation, AFL-CIO
California Teamsters Public Affairs Council
Justice for Working People
National Association of Social Workers, California Chapter
United Farm Workers
OPPOSITION : (Verified 5/20/14)
Agricultural Council of California
Association of Nurseries and Garden Centers
Association of Winegrape Growers
California Chamber of Commerce
California Citrus Mutual
California Cotton Ginners Association
California Cotton Growers Association
California Farm Bureau Federation
California Grape and Tree Fruit League
Civil Justice Association of California
Family Winemakers of California
Nisei Farmers League
Western Agricultural Processors Association
Western Growers Association
Wine Institutes
ARGUMENTS IN SUPPORT : Proponents argue that this bill is an
important step in protecting the lives of farm workers in the
fields. Proponents note that this bill does not expand
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liability for FLCs, but rather ensures that FLCs are
sufficiently bonded to protect the needs of farm workers, as
well as increases funds available for the purposes of licensure
enforcement. Additionally, proponents note that sexual
harassment and assault in a serious and significant problem in
California's agricultural industry. Proponents argue that
additional training and surety bond claims will provide needed
protection to female farm workers from the current injustices
under which they currently suffer.
ARGUMENTS IN OPPOSITION : Opponents taking an 'oppose unless
amended' position, fully recognize and respect the intent of the
author to protect the safety and well-being of agricultural
workers. However, opponents have two concerns which they seek
amendments to address. The first concern is that opponents
believe that the language in this bill makes contracts between
FLCs and growers automatically discoverable, which under
existing law are treated on a case-by-case basis by courts.
Opponents believe that this violates due process and should be
removed. Secondly, opponents believe that the "known or should
have known" standard for a FLC to lose his/her license due to a
supervisor's sexual harassment of an employee should be
clarified.
PQ:d 5/21/14 Senate Floor Analyses
SUPPORT/OPPOSITION: SEE ABOVE
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