Bill Text: CA AB647 | 2023-2024 | Regular Session | Amended

NOTE: There are more recent revisions of this legislation. Read Latest Draft

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Bill Title: Grocery workers.

Spectrum: Partisan Bill (Democrat 1-0)

Status: (Passed) 2023-10-08 - Chaptered by Secretary of State - Chapter 452, Statutes of 2023. [AB647 Detail]

Download: California-2023-AB647-Amended.html

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Amended  IN  Assembly  March 09, 2023

CALIFORNIA LEGISLATURE— 2023–2024 REGULAR SESSION

Assembly Bill

No. 647

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Introduced by Assembly Member Holden

February 09, 2023

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An act to amend Sections 2504 and 2506 2502, 2504, 2506, and 2512 of, and to add Section Sections 2505, 2509, 2510, 2511, and 2516.1 to, the Labor Code, relating to private employment.

LEGISLATIVE COUNSEL'S DIGEST

AB 647, as amended, Holden. Grocery workers.

Existing law, upon change in control of a grocery establishment, as defined, requires an incumbent grocery employer, within 15 days after the execution of the transfer document, to provide to the successor grocery employer a list of eligible grocery workers, as specified, and requires the successor grocery employer to maintain a preferential hiring list of eligible grocery workers, to hire from that list for 90 days after the grocery establishment is fully operational and open to the public under the successor grocery employer, and to retain each eligible grocery worker hired for at least 90 days after their commencement date, except as specified. Existing law exempts from those provisions grocery establishments that are located in geographic areas designated by the United States Department of Agriculture as a food desert if specified conditions apply.

This bill would instead require a successor grocery employer to provide the list of eligible grocery workers within 25 days after the execution of the transfer document. The bill would require the successor grocery employer to hire from the list for 100 120 days after the grocery establishment is fully operational and open to the public and retain each eligible grocery worker for at least 90 120 days after their commencement date, except as specified. The bill would require an incumbent grocery employer to also provide the list of eligible grocery workers to any collective bargaining representatives, and would revise the employee information an incumbent grocery employer is required to provide to the successor grocery employer. The bill would authorize a successor grocery store employer to obtain the list of eligible grocery workers from a collective bargaining representative if the incumbent grocery employer does not provide the information within 15 days. The bill would make the above-specified provisions providing for a transition employment period applicable to separated employees, as defined. The bill would grant a separated employee who is offered a position that is more than 15 miles from their place of residence the right to refuse an offer of employment that is more than 15 miles from the employee’s residence without a loss of seniority, and would grant a separated employee a right to recall based on seniority before hiring any new employees for one year. The bill would prohibit a successor grocery store employer to cause a grocery establishment that is located in a geographic area designated as a food desert to cease being fully operational and open to the public until the establishment provides notice to the city council, city attorney, board of supervisors, county counsel, State Department of Public Health, and Attorney General 180 days before the establishment ceases to be fully operational and open to the public. The bill would require the notice to include, among other things, a written analysis and explanation, including data, on how residents living in the geographic area will be able, at a comparable cost, including transportation cost and time off work and childcare costs, to purchase food. The bill would prohibit an employer from taking adverse action against a person for seeking to enforce their rights. The bill would authorize an employee, collective bargaining representative, or nonprofit corporation to bring an action in the superior court and would specify remedies in that regard, including punitive damages and the recovery of reasonable attorney’s fees and costs to the collective bargaining representative or employee. The bill would also authorize an employer who prevails to recover attorney’s fees upon obtaining a court determination that the worker’s lawsuit was frivolous. The bill would require the Division of Labor Standards Enforcement to enforce the provisions, would establish remedies in that regard, and would authorize the division to promulgate and enforce rules and regulations and issue determinations and interpretations that would have the force and effect of law. The bill would make an employer, agent of any employer, or other person who violates or causes to be violated the provisions, subject to specified monetary penalties, would require the funds to be deposited into the Labor and Workforce Development Fund and paid to the employee as compensatory damages. The bill would require the Labor Commissioner to enforce the provisions. The bill would make a controlling private fund, as defined, and any holder of an active interest of a controlling private fund jointly and severally liable for specified liabilities.

Existing law specifies parties may, by collective bargaining agreement, provide that the agreement supersedes the provisions described above providing for employment protections for grocery workers.

This bill would require the waiver to be explicitly set forth in the collective bargaining agreement. The bill would also add and revise various definitions, including revising the definition of “grocery establishment” by including specified distribution centers and revising an exclusion for retail stores that have ceased operations.

Digest Key

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

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Bill Text

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

SECTION 1.

 Section 2502 of the Labor Code is amended to read:

2502.

 For purposes of this part, the following definitions shall apply:

(a) “Change in control” means any sale, purchase, assignment, acquisition, transfer, contribution, or other disposition of all or substantially all of the assets assets, cash on hand, or a controlling interest, including by consolidation, merger, or reorganization, of the incumbent grocery employer or any person who controls the incumbent grocery employer or any grocery establishment under the operation or control of either the incumbent grocery employer or any person who controls the incumbent grocery employer.

(b) “Controlling person” means a person who directly or indirectly owns, controls, or holds with power to vote, including through coordination with other persons, 20 percent or more of the outstanding voting interests of a corporation.

(c) “Controlling private fund” means a private fund that directly or through an affiliate becomes a control person with respect to a grocery establishment.

(b)

(d) “Eligible grocery worker” means any individual whose primary place of employment is at the grocery establishment subject to a change in control, and who has worked for the incumbent grocery employer for at least six months prior to the execution of the transfer document. “Eligible grocery worker” includes a separated employee. “Eligible grocery worker” does not include a managerial, supervisory, or confidential employee.

(c)

(e) “Employment commencement date” means the date on which an eligible grocery worker retained by the successor grocery employer pursuant to this part commences work for the successor grocery employer in exchange for benefits and compensation under the terms and conditions established by the successor grocery employer and as required by law.

(d)

(f) “Grocery establishment” means a retail store in this state that is over 15,000 square feet in size and that sells primarily household foodstuffs for offsite consumption, including the sale of fresh produce, meats, poultry, fish, deli products, dairy products, canned foods, dry foods, beverages, baked foods, or prepared foods. Other household supplies or other products shall be secondary to the primary purpose of food sales. A distribution center owned and operated by a grocery establishment that is used primarily to distribute goods to or from its owned stores is a “grocery establishment” regardless of its square footage. A grocery establishment does not include a retail store that has ceased operations for six ____ months or more.

(e)

(g) “Incumbent grocery employer” means the person that owns, controls, or operates the grocery establishment at the time of the change in control.

(f)

(h) “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.

(i) “Separated employee” means an employee who was employed by the incumbent grocery employer for 6 months or more in the 12 months preceding the change in control and whose most recent separation from active service was due to change in control, lack of business, reduction in force, a transfer of more than 15 miles from the employee’s residence, or another economic nondisciplinary reason. There is a rebuttable presumption that any termination occurring within a year of a change in control was due to a nondisciplinary reason. A separated employee is an eligible grocery worker.

(g)

(j) “Successor grocery employer” means the person that owns, controls, or operates the grocery establishment after the change in control.

(h)

(k) “Transfer document” means the purchase agreement or other document effecting the change in control.

SECTION 1.SEC. 2.

 Section 2504 of the Labor Code is amended to read:

2504.

 (a) (1) The incumbent grocery employer shall, within 25 15 days after the execution of the transfer document, provide to the successor grocery employer and any collective bargaining representative the name, address, date of hire, and employment occupation classification classification, and, if known, the cellular telephone number and email address of each eligible grocery worker.

(2) If the incumbent grocery employer does not provide the information specified in paragraph (1) within 15 days, the successor grocery employer may obtain the information from a collective bargaining representative.

(b) The successor grocery employer shall maintain a preferential hiring list of eligible grocery workers identified by the incumbent grocery employer or collective bargaining representative pursuant to subdivision (a) and shall hire from that list for a period beginning upon the execution of the transfer document and continuing for 100 120 days after the grocery establishment is fully operational and open to the public under the successor grocery employer.

(c) If the successor grocery employer extends an offer of employment to an eligible grocery worker pursuant to this part, the successor grocery employer shall retain written verification of that offer for at least three years after the date of the offer. The verification shall include the name, address, date of hire, and employment occupation classification of each eligible grocery worker.

SEC. 3.

 Section 2505 is added to the Labor Code, to read:

2505.

 Any separated employee who is offered a position that is more than 15 miles from their place of residence shall have the right to refuse such recall without a loss of seniority and shall still retain a right to recall based on seniority prior to hiring of any new employees for one year after the separation from employment.

SEC. 2.SEC. 4.

 Section 2506 of the Labor Code is amended to read:

2506.

 (a) A successor grocery employer shall retain each eligible grocery worker hired pursuant to this part for at least 100 120 days after the eligible grocery worker’s employment commencement date. During this 100-day 120-day transition employment period, eligible grocery workers shall be employed under the terms and conditions established by the successor grocery employer and pursuant to the terms of a relevant collective bargaining agreement, if any.

(b) If, within the period established in subdivision (b) of Section 2504, the successor grocery employer determines that it requires fewer eligible grocery workers than were required by the incumbent grocery employer, the successor grocery employer shall retain eligible grocery workers by seniority within each job classification to the extent that comparable job classifications exist or pursuant to the terms of a relevant collective bargaining agreement, if any. Nonclassified eligible grocery workers shall be retained by seniority and according to experience or pursuant to the terms of a relevant collective bargaining agreement, if any.

(c) During the 100-day 120-day transition employment period, the successor grocery employer shall not discharge without cause an eligible grocery worker retained pursuant to this part.

(d) At the end of the 100-day 120-day transition employment period, the successor grocery employer shall make a written performance evaluation for each eligible grocery worker retained pursuant to this part. If the eligible grocery worker’s performance during the 100-day 120-day transition employment period is satisfactory, the successor grocery employer shall consider offering the eligible grocery worker continued employment under the terms and conditions established by the successor grocery employer and as required by law. The successor grocery employer shall retain a record of the written performance evaluation for at least three years.

SEC. 5.

 Section 2509 is added to the Labor Code, to read:

2509.

 An employer shall not refuse to employ, terminate, reduce the compensation of, or otherwise take adverse action against any laid-off employee for seeking to enforce their rights under this part, including participating in proceedings, opposing any practice prescribed by this part, or otherwise asserting rights under this part. This section applies to an employee who mistakenly, but in good faith, alleges noncompliance with this part.

SEC. 6.

 Section 2510 is added to the Labor Code, to read:

2510.

 (a) An aggrieved employee or an employee representative, such as a collective bargaining representative or nonprofit corporation, may bring an action in the superior court of the State of California for violations of this part and may be awarded the following:

(1) Hiring and reinstatement rights pursuant to this part. For violations of the retention provision, whereupon the 120-day transition employment period shall not commence until the eligible grocery worker’s employment commencement date with the successor grocery employer.

(2) Front pay or back pay for each day during which the violation continues, which shall be calculated at a rate of compensation not less than the highest of any of the following rates:

(A) The average regular rate of pay received by the employee during the last three years of the employee’s employment in the same job classification.

(B) The most recent regular rate received by the employee while employed by the employer.

(C) The regular rate of pay received by the employee during the last three years of that employee’s employment in the same job classification.

(3) The value of the benefits the employee would have received under any benefit plans.

(4) Punitive damages pursuant to Section 3294 of the Civil Code.

(5) The court shall award reasonable attorney’s fees and costs to any employee or employee representative who prevails in an enforcement action and to an employer who prevails and obtains a court determination that the employee’s lawsuit was frivolous.

(b) The Division of Labor Standards Enforcement shall enforce this section as follows:

(1) An aggrieved employee or employee representative may file a complaint with the division for a violation of this section and may be awarded any of the following:

(A) Hiring and reinstatement rights pursuant to this chapter. For violations of the retention provision, whereupon the 120-day transition employment period shall not commence until the eligible grocery worker’s employment commencement date with the successor grocery employer.

(B) Front pay or back pay for each day during which the violation continues, which shall be calculated at a rate of compensation not less than the highest of any of the following rates:

(i) The average regular rate of pay received by the employee during the last three years of the employee’s employment in the same job classification.

(ii) The most recent regular rate received by the employee while employed by the employer.

(iii) The regular rate of pay received by the employee during the last three years of that employee’s employment in the same job classification.

(C) The value of the benefits the employee would have received under any benefit plans.

(2) An employer, agent of an employer, or other person who violates this part or causes a violation of this part shall be subject to a civil penalty of one hundred dollars ($100) for each employee whose rights under these provisions are violated. An additional amount payable as liquidated damages in the amount of five hundred dollars ($500) per employee, for each day the rights of an employee under this part are violated and continuing until the violation is cured, which shall be recovered by the Labor Commissioner, deposited into the Labor and Workforce Development Fund, and paid to the employee as compensatory damages.

(3) The Labor Commissioner shall enforce this section, including investigating an alleged violation and ordering appropriate temporary relief to mitigate the violation and pending the completion of a full investigation or hearing, through the procedures set forth in Section 98.3, 98.7, 98.74, or 1197.1, including by issuing a citation against an employer who violates this section and by filing a civil action. If a citation is issued, the procedures for issuing, contesting, and enforcing judgments for citations and civil penalties issued by the Labor Commissioner shall be the same as those set out in Section 98.74 or 1197.1, as appropriate.

(4) In an action brought by the Labor Commissioner for enforcement of this section, the court may issue preliminary and permanent injunctive relief to vindicate the rights of employees.

(5) In an administrative or civil action brought under this section, the Labor Commissioner or court shall award interest on all amounts due and unpaid at the rate of interest specified in subdivision (b) of Section 3289 of the Civil Code.

(6) The remedies, penalties, and procedures provided under this section are cumulative.

(c) The Division of Labor Standards Enforcement may promulgate and enforce rules and regulations and issue determinations and interpretations consistent with and necessary for the implementation of this section. Those rules and regulations, determinations, and interpretations shall have the force of law and may be relied upon by employers, employees, and other persons to determine their rights and responsibilities under this section.

SEC. 7.

 Section 2511 is added to the Labor Code, to read:

2511.

 Notwithstanding any other law, contract, or agreement, a controlling private fund and any holder of an active interest in a controlling private fund shall be jointly and severally liable for all liabilities created by this part of each grocery establishment for which the controlling private fund is a controlling person, and for all liabilities of any affiliate of each grocery establishment.

SEC. 8.

 Section 2512 of the Labor Code is amended to read:

2512.

 Parties subject to this part may, by collective bargaining agreement, provide that the agreement supersedes the requirements of this part. part, in whole or in part, if the waiver is explicitly set forth in the agreement in clear and unambiguous terms.

SEC. 3.SEC. 9.

 Section 2516.1 is added to the Labor Code, to read:

2516.1.

 (a) In the case of a change of control from a merger, a successor grocery employer shall not cause a grocery establishment that is located in a geographic area designated by United States Department of Agriculture as a food desert to cease being fully operational and open to the public until the establishment provides a written notice to the city council, city attorney, board of supervisors, county counsel, State Department of Public Health, and Attorney General 180 days before the establishment ceases to be fully operational and open to the public.

(b) The notice required by subdivision (a) shall include both of the following:

(1) A written analysis and explanation, including data, of how residents living in the geographic area designated by United States Department of Agriculture as a food desert will be able, at comparable cost, including transportation cost and time off work and childcare costs, to purchase food after the establishment ceases being fully operational and open to the public.

(2) A profit and loss statement for the establishment consistent with generally accepted accounting principles for the two years prior to the merger attested to by a responsible officer of the successor employer.