BILL ANALYSIS Ó AB 970 Page 1 Date of Hearing: April 22, 2015 ASSEMBLY COMMITTEE ON APPROPRIATIONS Jimmy Gomez, Chair AB 970 (Nazarian) - As Amended April 15, 2015 ----------------------------------------------------------------- |Policy |Labor and Employment |Vote:|5 - 2 | |Committee: | | | | | | | | | | | | | | |-------------+-------------------------------+-----+-------------| | | | | | | | | | | | | | | | |-------------+-------------------------------+-----+-------------| | | | | | | | | | | | | | | | ----------------------------------------------------------------- Urgency: No State Mandated Local Program: YesReimbursable: No SUMMARY: This bill authorizes the Labor Commissioner to enforce local laws regarding overtime hours or minimum wage provisions and to issue citations and penalties for violations, except when a local entity with jurisdiction in the matter has already issued a citation or has initiated an investigation against an employer for the same violation. Specifically, this bill: AB 970 Page 2 1)Authorizes the Labor Commissioner to issue a citation if, upon inspection or investigation, it is determined that a person has violated overtime requirements of existing law, including any applicable local overtime law. 2)Authorizes the Labor Commissioner to issue a citation if, upon inspection or investigation, it is determined a person has paid less than the minimum wage under applicable state or local law. 3)Authorizes the Labor Commissioner to issue a citation against an employer or person acting on behalf of an employer for violations of existing law related to reimbursements for expenses. 4)Prohibits the Labor Commissioner from issuing a citation for the above offenses if the local entity with jurisdiction in the matter has cited or has initiated an investigation against the employer for the same violation. FISCAL EFFECT: Ongoing costs of approximately $125,000 (special funds) to the Department of Industrial Relations (DIR) Bureau of Field Enforcement (BOFE) to cite wage violations. Although BOFE currently engages in field enforcement and has the authority to cite for violations of minimum wage, this bill will apply a local wage calculation rather than the state minimum wage. This new authorization could require more investigative work and result in increased workload. AB 970 Page 3 COMMENTS: 1)Background. Existing law requires an employer to indemnify his or her employees for "all necessary expenditures or losses" incurred by the employee in direct consequence of his or her duties. A common violation of this provision involves illegal charges for tools or equipment necessary to perform the job, but which are deducted from workers' pay notwithstanding. Workers may file a civil action to recover these illegal deductions from their pay, or may seek to recover them in a wage claim hearing (also referred to as a Berman hearing). Currently, the Labor Commissioner does not have the authority to issue a citation for this violation, even if she determines upon inspection or investigation that the charges are illegal and have not been repaid to the worker. This bill would specifically authorize the Labor Commissioner to issue citations in such situations. 2)Purpose. This bill also extends local citation authority to the Labor Commissioner with regard to enforcement of local minimum wage violations. The Labor Commissioner currently has the authority to cite for violations of state minimum wage but not for higher local minimum wage violations. The only way to address these claims currently is through the wage claim hearing process. Analysis Prepared by:Misty Feusahrens / APPR. / (916) 319-2081 AB 970 Page 4