Legislation to Fear – AB 1897

There have been numerous veiled attempts to place workplace state compliance issues and labor law violations at the feet of the clients of Farm Labor Contractors. Various state legislators (usually from Los Angeles for some reason) have been chipping away at the protections provided farmers who decide to utilize farm labor contractors instead of employing seasonal workers themselves.

AB 1897 (Roger Hernandez D – West Covina) brings this issue to a head and a copy of it is sitting on Governor Browns desk right now either awaiting veto, signature, or being ignored all together, thus making it law. The text of the bill is to the point:

“Existing law regulates the terms and conditions of employment and establishes specified obligations of employers to employees. Existing law prohibits a person or entity from entering into a contract for labor or services with a construction, farm labor, garment, janitorial, security guard, or warehouse contractor, if the person or entity knows or should know that the contract or agreement does not include sufficient funds for the contractor to comply with laws or regulations governing the labor or services to be provided.
This bill would require a client employer to share with a labor contractor all civil legal responsibility and civil liability for all workers supplied by that labor contractor for the payment of wages and the failure to obtain valid workers’ compensation coverage. The bill would prohibit a client employer from shifting to the labor contractor legal duties or liabilities under workplace safety provisions with respect to workers provided by the labor contractor. The bill would define a client employer as a business entity that obtains or is provided workers to perform labor within the usual course of business from a labor contractor, except as specified. The bill would define a labor contractor as an individual or entity that supplies workers, either with or without a contract, to a client employer to perform labor within the client employer’s usual course of business. The bill would except from the definition of labor contractor specified nonprofit, labor, and motion picture payroll services organizations and 3rd parties engaged in an employee leasing arrangement, as specified. The bill would specify that it does not prohibit client employers and labor contractors from mutually contracting for otherwise lawful remedies for violations of its provisions by the other party. The bill would require a client employer or labor contractor to provide to a requesting enforcement agency or department, and make available for copying, information within its possession, custody, or control required to verify compliance with applicable state laws. The bill would authorize the Labor Commissioner, the Division of Occupational Safety and Health, and the Employment Development Department to adopt necessary regulations and rules to administer and enforce the bill’s provisions. The bill would provide that waiver of its provisions is contrary to public policy, void, and unenforceable. The bill would prohibit its provisions from being interpreted to impose liability in specified circumstances.”
So in a nutshell, the Grower, Packer, or Shipper that utilizes contracted labor could be held dually, and possibly solely liable for any Labor Law, Cal-Osha violation, or payroll issue that any labor contractor that he is contracted with might have. This may allow Cal-Osha to “double up” when handing out citations by providing one to the FLC and one to the FLC’s client.
If it is signed or not remains to be seen, but the bill should shine a light on a couple of really good questions for Agricultural Concerns:
1) Are you sure that your contractor is compliant?
2) Are you sure your contractor is insured correctly?
3) Will this “reach through” apply to possible insurance fraud indictments that the contractor used to be solely responsible for, as the payroll in question was received through contract with the FLC’s client?
4) Does the FLC’s Client have contingent workers compensation to cover any uncovered claims that might arise through the FLC, when these injuries are determined to have happened within the scope of the contractor and on the land of the Client?
There are many more, but those top the list.
There are also many ways to verify compliance, verify coverage, and verify Cal-Osha history of your FLC. If you would like to discuss the ways in which to verify these items and protect your self, whether or not the legislation becomes law, please feel free to contact me.

 

Guy Teafatiller

guyt@vanbeurden.com

Vice President | Kingsburg