California Governor Jerry Brown has signed Assembly Bill 1897 which has redefined project management responsibility and who is accountable when laws are being broken. For your convenience we have broken down the Bill into the 5 things you need to know:
1) The Bill defines a “Client Employer” as an individual or entity that obtains or is provided workers to perform labor or services within the usual course of business of the individual or entity from a labor contractor but does not include:
- Entities with a workforce less than 25 workers including those provided by any labor contractor
- Entities with five or fewer workers supplied by a labor contractors
- State or any political subdivision of the state including cities, counties and special districts.
2) The Bill Defines “Labor Contractor” as an individual or entity that supplies, either with or without a contract, a client employer with workers to perform labor within the client employer’s usual course of business but does not include:
- Community based organizations that provide worker services
- Labor Organizations or apprenticeship programs
- A third party who is a party to an employee leasing arrangement
3) The Bill Defines “Worker” to exclude any employee who is exempt from overtime wages under existing exemptions for executives, admins and professional employees.
4) A Client Employer shall share with a labor contractor all civil legal responsibility and civil liability as follows:
- Payment of proper wages
- Failure to report and pay all required employer contributions and personal income tax withholdings
- Failure to secure valid workers’ compensation coverage
5) AB 1897 prohibits a Client Employer from shifting legal duties and responsibilities related to workplace health and safety to the Labor Contractor.
As with any facet of life who or what an organization associates with reflects the values and beliefs of that organization. If a Client Employer chooses to do business with a Labor Contractor that does not comply with laws regarding prevailing wage and other labor compliance regulations the entity is effectively saying that they do not believe in workers rights. AB 1897 has now taken away the option for turning a blind eye and passing down responsibility to Labor Contractors. This bill has made staying informed and aware of subcontractor actions even more important. LCPtracker provides easy recognition of violations to allow for swift and accurate corrections so Client Employers can rest assured all bases are covered. Remember:
“With great power comes great responsibility” -Uncle Ben
To read the full text of AB 1897 click Here
For more information on LCPtracker and how our software can help you stay in compliance click Here