Bill Text: CA AB3056 | 2019-2020 | Regular Session | Amended

NOTE: There are more recent revisions of this legislation. Read Latest Draft
Bill Title: Warehouse distribution centers.

Spectrum: Partisan Bill (Democrat 2-0)

Status: (Engrossed - Dead) 2020-09-01 - Died on call pursuant to Article IV, Section 10(c) of the Constitution. [AB3056 Detail]

Download: California-2019-AB3056-Amended.html

Amended  IN  Assembly  May 04, 2020

CALIFORNIA LEGISLATURE— 2019–2020 REGULAR SESSION

Assembly Bill
No. 3056


Introduced by Assembly Member Gonzalez

February 21, 2020


An act to amend Section 3352 add Part 8.6 (commencing with Section 2100) to Division 2 of the Labor Code, relating to workers’ compensation. employment.


LEGISLATIVE COUNSEL'S DIGEST


AB 3056, as amended, Gonzalez. Workers’ compensation. Warehouse distribution centers.
Existing law relating to employment regulation and supervision imposes special provisions on certain occupations and industries. Existing law charges the Labor Commissioner and the Division of Labor Standards Enforcement with the enforcement of labor laws.
This bill would enact prescribed protections for certain warehouse and distribution center employees. The bill would prohibit an employer from imposing a quota upon an employee under which reasonable amounts of time that the employee spends on any of specified activities is counted toward the time required for completing the quota, or results in the employee having less time to complete the quota. The bill would define terms for its purposes.
This bill would require an employer to allow employees who work on a quota basis to take a recovery period, determined as prescribed. Authorized recovery period time would be counted as hours worked, with no deduction from wages, and would be supplemental to other mandated meal, rest, or recovery periods. Under the bill, an employer that fails to provide an employee a recovery period would be liable to the employee for one hour of pay at the employee’s regular rate of compensation for each work day that the recovery period is not provided.
This bill, except as specified, would require the Division of Labor Standards Enforcement to enforce its provisions. The bill would authorize the commissioner to adopt regulations to implement its provisions.
This bill would establish procedures by which, upon petition and investigation, the commission, if it determines that employees perform work under a quota, would be required to establish quota baselines for an employer. The bill would require an employer subject to a baseline quota to pay each employee who works under a quota during the workday and who is assigned or required to perform work in excess of the baseline quota during that workday a wage premium of 1 ½ times the employee’s regular rate of pay for any hour during which the employee was assigned or required to perform work in excess of the baseline quota.
This bill would subject an employer who violates the quota prohibition to civil penalties and would authorize the commissioner to issue to an employee written authorization for civil action against a designated repeat offender employer.

Existing law establishes a workers’ compensation system, administered by the Administrative Director of the Division of Workers’ Compensation, within the Department of Industrial Relations, to compensate an employee for injuries sustained in the course of the employee’s employment.

Existing law defines “employee” for purposes of the laws governing workers’ compensation, but specifically excludes from that definition certain persons, such as an appointed deputy clerk or deputy sheriff who does not receive compensation and a person performing voluntary services at or for a recreational camp, hut, or lodge operated by a nonprofit organization.

This bill would make technical, nonsubstantive changes to the provision excluding certain persons as employees.

Vote: MAJORITY   Appropriation: NO   Fiscal Committee: NOYES   Local Program: NO  

The people of the State of California do enact as follows:


SECTION 1.

 The Legislature finds and declares all of the following:
(a) The rapid growth of just-in-time logistics and same-day and next-day consumer package delivery, and advances in technology used for tracking employee productivity, have led to a rise in the number of warehouse and distribution center workers who are subject to quantified performance quotas.
(b) Warehouse and distribution center employees who work under such quotas are expected to complete a quantified number of tasks within specific time periods, often measured down to the minute or second, and face adverse employment action, including suspension or termination, if they fail to do so.
(c) Warehouse and distribution center employees who work under such quotas frequently skip restroom breaks in order to keep up with their quota. Such employees also face barriers to documenting and reporting Labor Code violations because any time spent away from their station reduces the amount of time available to complete their quota.
(d) Such quotas generally do not allow for recovery during productive work time, making warehouse and distribution center employees who work under them susceptible to overwork. Affording additional, protected recovery time to such employees is therefore necessary.
(e) The quotas under which warehouse and distribution center employees regularly work also affect their compensation. California and many cities require employers to pay their employees a minimum-wage rate. Warehouse and distribution center employees who work under a quota, however, do not receive the full benefit of such minimum wages if their quota is increased to make up for the direct or indirect effect of a minimum-wage raise.
(f) California also requires that employees required to work more than a specified amount of time during a workday be paid an overtime wage premium. Existing overtime protections, however, do not adequately compensate warehouse and distribution center employees who work under a quota. Such overtime protections do not apply a wage premium for work in excess of a reasonable quota during a workday.

SEC. 2.

 Part 8.6 (commencing with Section 2100) is added to Division 2 of the Labor Code, to read:

PART 8.6. Warehouse Distribution Centers

CHAPTER  1. General Provisions

2100.
 The enactment of this part is an exercise of the police power of the State of California for the protection for the public welfare, prosperity, health, safety, and peace of its people. The civil penalties provided by this chapter are in addition to any other penalty provided by law.

2101.
 As used in this part:
(a) “Commissioner” means the Labor Commissioner.
(b) “Defined time period” means any unit of time measurement equal to or less than the duration of an employee’s shift, and includes hours, minutes, and seconds and any fraction thereof.
(c) “Employee” means a nonexempt employee, as defined in Section 2750.3, who works at a warehouse distribution center.
(d) “Employer” means a person who directly or indirectly, or through an agent or any other person, including through the services of a third-party employer, temporary service, or staffing agency or similar entity, employs or exercises control over the wages, hours, or working conditions of 100 or more employees at a single warehouse distribution center or 1,000 or more employees at one or more warehouse distribution centers in the state. For purposes of this definition, all employees of an employer’s commonly controlled group, as that term is defined in Section 25105 of the Revenue and Taxation Code, shall be counted in determining the number of employees employed at a single warehouse distribution center or at one or more warehouse distribution centers in the state.
(e) “Person” means an individual, corporation, partnership, limited partnership, limited liability partnership, limited liability company, business trust, estate, trust, association, joint venture, agency, instrumentality, or any other legal or commercial entity, whether domestic or foreign.
(f) “Quota” means a performance standard under which an employee is assigned or required to perform a quantified number of tasks, or to handle or produce a quantified amount of material, within a defined time period and under which the employee may suffer an adverse employment action if they fail to complete the performance standard.
(g) “Warehouse distribution center” means an establishment as defined by any of the following North American Industry Classification System (NAICS) Codes, however such establishment is denominated:
(1) 493110 for General Warehousing and Storage.
(2) 423 for Merchant Wholesalers, Durable Goods.
(3) 424 for Merchant Wholesalers, Nondurable Goods.

2102.
 The Division of Labor Standards Enforcement shall enforce the provisions of this part, subject to the provisions of Chapter 4 (commencing with Section 2112).

2103.
 This part does not limit the authority of the Attorney General or the district attorney of any county, either upon their own complaint or the complaint of any person acting for themselves or the general public, to prosecute actions, either civil or criminal, for violations of this part, or to enforce the provisions thereof independently and without specific direction of the director.

2104.
 The commissioner shall have authority to adopt regulations implementing this part.

2105.
 This part does not preempt any city, county, or city and county ordinances that provide equal or greater protection to employees covered by this part.

2106.
 The provisions of this part are severable. If any provision of this part or its application is held invalid, that invalidity shall not affect other provisions or applications that can be given effect without the invalid provision or application.

CHAPTER  2. Reasonable Quota Requirements

2107.
 An employer shall not impose a quota upon an employee under which reasonable amounts of time that the employee spends on any of the following activities is counted toward the time required for completing the quota, or results in the employee having less time to complete the quota:
(a) Accessing and using a restroom, or accessing adequate and sanitary hydration.
(b) Documenting or reporting to the employer or to the responsible government authority a colorable claim of a Labor Code violation.
(c) Taking any legally mandated rest, recovery, or meal period.

2108.
 (a) An employer shall authorize and permit each employee who works under a quota during any part of a workday to take a recovery period based on the total hours worked during that workday, at the rate of 10 minutes net recovery time per 4 hours or major fraction thereof, so long as the employee works at least 3 ½ hours during the workday. Authorized recovery period time shall be counted as hours worked, for which there shall be no deduction from wages. Each such recovery period shall be in addition to any other meal, rest, or recovery period mandated pursuant to an applicable statute or applicable regulation, or standard or order of the Industrial Welfare Commission, the Division of Labor Standards Enforcement, the Occupational Safety and Health Standards Board, or the Division of Occupational Safety and Health.
(b) Any employer that fails to provide an employee a recovery period in accordance with this section shall be liable to the employee for one hour of pay at the employee’s regular rate of compensation for each work day that the recovery period is not provided.

CHAPTER  3. Reasonable Compensation

2109.
 One or more employees, or their representative, or an employer may file a petition with the commissioner to establish reasonable quota baselines for an employer. Such petition shall be in a form determined by the commissioner, which shall include the address of the warehouse distribution center or warehouse distribution centers that are the subject of the petition, the classifications that are the subject of the petition, and a description or documentation of the quota in place for each classification at the time the petition is filed.

2110.
 (a) Upon receipt of a petition described in Section 2109, the commissioner shall provide notice to the employer named in the petition, in the case of a petition filed by one or more employees, and shall direct the employer to post a notice, in an approved form, at each warehouse distribution center or warehouse distribution centers that are the subject of the petition, for the purpose of providing notice of the petition to affected employees.
(b) The commissioner shall hold a noticed public hearing on the petition, at which the employer and employees that are the subject of the petition, or a representative, may present documentary evidence and witness testimony.
(c) After investigating the petition, the commissioner shall determine whether employees in the classifications that are the subject of the petition perform work under a quota. For each such classification, the commissioner shall establish baseline quotas, based on all of the following criteria:
(1) The lowest existing quota in place for the classification at the time the petition was filed.
(2) Any change in the quota for the classification since the petition was filed, and any explanation of the factors that led to such change in the quota.
(3) Any fluctuation in the quota based on seasonal demand, high-volume days, or spikes in demand.
(4) Any applicable occupational health and safety standard that applies to the work in question.
(5) Relevant evidence-based guidelines or recommendations on work pacing in the warehouse or related industries, including peer-reviewed publications and expert testimony.

2111.
 An employer that is subject to a baseline quota established pursuant to Section 2110 shall pay each employee who works under a quota during the workday and who is assigned or required to perform work in excess of the baseline quota during that workday a wage premium of 1 ½ times the employee’s regular rate of pay for any hour during which the employee was assigned or required to perform work in excess of the baseline quota.

CHAPTER  4. Enforcement

2112.
 Any employer that violates Section 2107 shall be subject to a civil penalty in the amount of two hundred fifty dollars ($250) per employee per violation in an initial citation and one thousand dollars ($1,000) per employee for each violation in a subsequent citation. The civil penalties provided for in this section are in addition to any other penalty provided by law.

2113.
 (a) Any employer that is determined by the commissioner to have violated this part more than 10 times during any rolling 365-day period shall be designated as a “repeat offender.”
(b) The commissioner, at the commissioner’s discretion, may issue written authorization for a civil action to one or more employees of a repeat offender that is the subject of a complaint alleging a violation of this part. Such letter shall be valid for a period of one year from the date of its issuance and shall permit the aggrieved employee or employees to commence a civil action pursuant to subdivision (a) of Section 2699 for the alleged violations stated in the letter.

SECTION 1.Section 3352 of the Labor Code is amended to read:
3352.

(a)“Employee,” excludes the following:

(1)A person defined in subdivision (d) of Section 3351 who is employed by that person’s parent, spouse, or child.

(2)A person performing services in return for aid or sustenance only, received from any religious, charitable, or relief organization.

(3)A person holding an appointment as deputy clerk or deputy sheriff appointed for that person’s own convenience, and who does not receive compensation from the county or municipal corporation or from the citizens of that county or municipal corporation for the person’s services as the deputy. This exclusion is operative only as to employment by the county or municipal corporation and does not deprive that person of recourse against a private person employing that person for injury occurring in the course of, and arising out of, the employment.

(4)A person performing voluntary services at or for a recreational camp, hut, or lodge operated by a nonprofit organization, exempt from federal income tax under Section 501(c)(3) of the Internal Revenue Code, of which the person or a member of that person’s family is a member and who does not receive compensation for those services, other than meals, lodging, or transportation.

(5)A person performing voluntary service as a ski patrolman who does not receive compensation for those services, other than meals or lodging or the use of ski tow or ski lift facilities.

(6)A person employed by a ski lift operator to work at a snow ski area who is relieved of, and is not performing any, prescribed duties, while participating in recreational activities on the person’s own initiative.

(7)A person, other than a regular employee, participating in sports or athletics who does not receive compensation for the participation other than the use of athletic equipment, uniforms, transportation, travel, meals, lodgings, or other expenses incidental thereto.

(8)A person described in subdivision (d) of Section 3351 whose employment by the employer to be held liable, during the 90 calendar days immediately preceding the date of injury, for injuries as described in Section 5411, or during the 90 calendar days immediately preceding the date of the last employment in an occupation exposing the employee to the hazards of the disease or injury, for diseases or injuries as described in Section 5412, comes within either of the following descriptions:

(A)The employment was, or was contracted to be, for less than 52 hours.

(B)The employment was, or was contracted to be, for wages of not more than one hundred dollars ($100).

(9)A person performing voluntary service for a public agency or a private, nonprofit organization who does not receive remuneration for the services, other than meals, transportation, lodging, or reimbursement for incidental expenses.

(10)A person, other than a regular employee, performing officiating services relating to amateur sporting events sponsored by a public agency or private, nonprofit organization, who does not receive remuneration for these services, other than a stipend for each day of service no greater than the amount established by the Department of Human Resources as a per diem expense for employees or officers of the state. The stipend shall be presumed to cover incidental expenses involved in officiating, including meals, transportation, lodging, rule books and courses, uniforms, and appropriate equipment.

(11)A student participating as an athlete in amateur sporting events sponsored by a public agency or public or private nonprofit college, university, or school, who does not receive remuneration for the participation, other than the use of athletic equipment, uniforms, transportation, travel, meals, lodgings, scholarships, grants-in-aid, or other expenses incidental thereto.

(12)A law enforcement officer who is regularly employed by a local or state law enforcement agency in an adjoining state and who is deputized to work under the supervision of a California peace officer pursuant to paragraph (4) of subdivision (a) of Section 832.6 of the Penal Code.

(13)A law enforcement officer who is regularly employed by the Oregon State Police, the State of Nevada’s Department of Public Safety, or the Arizona Department of Public Safety and who is acting as a peace officer in this state pursuant to subdivision (a) of Section 830.39 of the Penal Code.

(14)A person, other than a regular employee, performing services as a sports official for an entity sponsoring an intercollegiate or interscholastic sports event, or a person performing services as a sports official for a public agency, public entity, or a private nonprofit organization, which public agency, public entity, or private nonprofit organization sponsors an amateur sports event. For purposes of this subdivision, “sports official” includes an umpire, referee, judge, scorekeeper, timekeeper, or other person who is a neutral participant in a sports event.

(15)A person who is an owner-builder, as defined in subdivision (a) of Section 50692 of the Health and Safety Code, who is participating in a mutual self-help housing program, as defined in Section 50087 of the Health and Safety Code, sponsored by a nonprofit corporation.

(16)(A)(i)An officer or member of the board of directors, as described in subdivision (c) of Section 3351, if the officer or member owns at least 10 percent of the issued and outstanding stock of the corporation, or at least 1 percent of the issued and outstanding stock of the corporation if that officer’s or member’s parent, grandparent, sibling, spouse, or child owns at least 10 percent of the issued and outstanding stock of the corporation and that officer or member is covered by a health insurance policy or a healthcare service plan, and executes a written waiver of the officer’s or member’s rights under this chapter stating under penalty of perjury that the person is a qualifying officer or director. The waiver shall be effective upon the date of receipt and acceptance by the corporation’s insurance carrier. The insurance carrier, with the consent of the individual executing the waiver, may elect to backdate the acceptance of the waiver up to 15 days prior to the date of receipt of the waiver. The insurance carrier, insurance agent, or insurance broker is not required to investigate, verify, or confirm the accuracy of the facts contained in the waiver. There is a conclusive presumption that a person who executes a waiver pursuant to this subdivision is not covered by workers’ compensation benefits.

(ii)A written waiver that is executed pursuant to this subparagraph, including a written waiver that was executed prior to January 1, 2017, and is accepted by the insurance carrier on or before December 31, 2017, may be deemed to be accepted by the insurance carrier as of January 1, 2017. The written waiver shall remain in effect until the officer or member of the board of directors provides the corporation’s insurance carrier with a written withdrawal of the waiver.

(B)Notwithstanding subparagraph (A), an officer or director of a private corporation who is the sole shareholder of the private corporation, unless the officer, director, or private corporation has elected to be subject to liability for workers’ compensation pursuant to subdivision (a) of Section 4151.

(17)(A)An individual who is a general partner of a partnership or a managing member of a limited liability company who executes a written waiver of the partner’s rights under this chapter stating under penalty of perjury that the person is a qualifying general partner or managing member. The waiver shall be effective upon the date of receipt and acceptance by the partnership’s or limited liability company’s insurance carrier. The insurance carrier, with the consent of the individual executing the waiver, may elect to backdate the acceptance of the waiver up to 15 days prior to the date of receipt of the waiver. The insurance carrier, insurance agent, or insurance broker is not required to investigate, verify, or confirm the accuracy of the facts contained in the waiver. There is a conclusive presumption that a person who executes a waiver pursuant to this subdivision is not covered by workers’ compensation benefits.

(B)A written waiver that is executed pursuant to this paragraph, including, but not limited to, a written waiver that was executed prior to January 1, 2017, and is accepted by the insurance carrier on or before December 31, 2017, may be deemed to be accepted by the insurance carrier as of January 1, 2017. The written waiver shall remain in effect until the general partner provides the partnership’s insurance carrier or the managing member provides the limited liability company’s insurance carrier with a written withdrawal of the waiver.

(18)(A)(i)An owner of a professional corporation, as defined in Section 13401 of the Corporations Code, who is a practitioner rendering the professional services for which the professional corporation is organized and who executes a document, in writing and under penalty of perjury, both waiving the owner’s rights under this chapter and stating that the owner is covered by a health insurance policy or a healthcare service plan. The owner shall provide a copy of the waiver to all other owners of the professional corporation and the professional corporation shall keep a copy of the waiver on file. The waiver is effective upon the date of receipt and acceptance by the professional corporation’s insurance carrier. The insurance carrier, with the consent of the individual executing the waiver, may elect to backdate the acceptance of the waiver up to 15 days prior to the date of receipt of the waiver. The insurance carrier, insurance agent, or insurance broker is not required to investigate, verify, or confirm the accuracy of the facts contained in the waiver. There is a conclusive presumption that a person who executes a waiver pursuant to this subdivision is not covered by workers’ compensation benefits.

(ii)A written waiver that is executed pursuant to this subparagraph and is accepted by the insurance carrier on or before December 31, 2017, may be deemed to be accepted by the insurance carrier as of January 1, 2017. The written waiver shall remain in effect until the owner provides the professional corporation’s insurance carrier with a written withdrawal of the waiver.

(B)Notwithstanding subparagraph (A), an owner of a private professional corporation who is the sole shareholder of the private professional corporation, unless the owner or private professional corporation has elected to be subject to liability for workers’ compensation pursuant to subdivision (a) of Section 4151.

(19)(A)(i)An officer or member of the board of directors of a cooperative corporation organized pursuant to the Cooperative Corporation Law, as set forth in Part 2 (commencing with Section 12200) of Division 3 of Title 1 of the Corporations Code, who executes a document, in writing and under penalty of perjury, both waiving the officer’s or member’s rights under this chapter and stating that the officer or member is covered by both a healthcare service plan or health insurance policy, and a disability insurance policy that is comparable in scope and coverage, as determined by the Insurance Commissioner, to a workers’ compensation policy. The officer or member of the board of directors shall provide a copy of the waiver to all other officers and members of the board of directors of the cooperative corporation, and the cooperative corporation shall keep a copy of the waiver on file. The waiver is effective upon the date of receipt and acceptance by the cooperative corporation’s insurance carrier. The insurance carrier, with the consent of the individual executing the waiver, may elect to backdate the acceptance of the waiver up to 15 days prior to the date of receipt of the waiver. The insurance carrier, insurance agent, or insurance broker is not required to investigate, verify, or confirm the accuracy of the facts contained in the waiver. There is a conclusive presumption that a person who executes a waiver pursuant to this subdivision is not covered by workers’ compensation benefits.

(ii)A written waiver that is executed pursuant to this subparagraph and is accepted by the insurance carrier on or before December 31, 2017, may be deemed to be accepted by the insurance carrier as of January 1, 2017. The written waiver shall remain in effect until the officer or member of the board provides the cooperative corporation’s insurance carrier with a written withdrawal of the waiver.

(B)Notwithstanding subparagraph (A), an officer or director of a private cooperative corporation who is the sole shareholder of the private cooperative corporation, unless the officer, director, or private cooperative corporation has elected to be subject to liability for workers’ compensation pursuant to subdivision (a) of Section 4151.

(b)(1)This section shall become operative on July 1, 2018.

(2)A policy or contract that is entered into or renewed in compliance with this section is subject to this section as it read on the date that the policy or contract was entered into or renewed.

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