BILL NUMBER: AB 842 INTRODUCED
BILL TEXT
INTRODUCED BY Assembly Member Swanson
FEBRUARY 26, 2009
An act to amend Sections 1400, 1401, 1402, 1402.5, and 1403 of,
and to add Sections 1400.5, 1401.5, and 1401.6 to, the Labor Code,
relating to employment.
LEGISLATIVE COUNSEL'S DIGEST
AB 842, as introduced, Swanson. Employment.
Existing law provides that an employer, with certain exceptions,
may not order a mass layoff, relocation, or termination, as defined,
at a covered establishment without giving 60 days' prior written
notice to employees and the Employment Development Department and
other local agencies, as well as complying with specified federal
guidelines.
This bill would increase the layoff notice period from 60 to 90
days. This bill would require employers, when notice is given, to
provide employees with information regarding benefits and services
available to them once the notice of layoff is given. This bill would
also require employers that give notice of a mass layoff,
relocation, or termination to provide sufficient meeting space for
the provision of rapid response activity, as defined, and to allow
providers of rapid response activity services and affected employees
to meet for not less than one hour for such services to be provided.
Existing law provides that an employer who fails to comply with
the layoff notice requirements may be subject to civil penalties,
including backpay, and liability under civil actions brought by
employees unless the employer can demonstrate specified exemptions.
This bill would require the Labor and Workforce Development Agency
to maintain a guide of benefits and services that may be available
to employees who are the subject of a layoff, including unemployment
assistance and COBRA information, and to transmit the guide to an
employer who gives notice of an impending layoff, and to post the
guide on the agency's Internet Web site.
This bill would also require the Labor and Workforce Development
Agency to maintain a guide for employers containing development
benefits and services, including trade adjustment assistance and tax
credits, that could be used to avert mass layoffs or relocations of
workforce employees and to transmit the guide to an employer who
gives notice of an impending layoff, and to post the guide on the
agency's Internet Web site.
This bill would provide that up to 10% of the civil penalties for
employers who violate these provisions be used by the Labor and
Workforce Development Agency to fund the their new duties under this
bill.
Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: no.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Section 1400 of the Labor Code is amended to read:
1400. The definitions set forth in this section shall govern the
construction and meaning of the terms used in this chapter:
(a) "Covered establishment" means any industrial or commercial
facility or part thereof that employs, or has employed within the
preceding 12 months, 75 or more persons.
(b) "Employee" means a person employed by an employer for at least
6 months of the 12 months preceding the date on which notice is
required.
(b)
(c) "Employer" means any person, as defined by Section
18, who directly or indirectly owns and operates a covered
establishment. A parent corporation is an employer as to any covered
establishment directly owned and operated by its corporate
subsidiary.
(c)
(d) "Layoff" means a separation from a position for
lack of funds or lack of work.
(d)
(e) "Mass layoff" means a layoff during any 30-day
period of 50 or more employees at a covered establishment.
(e)
(f) "Relocation" means the removal of all or
substantially all of the industrial or commercial operations in a
covered establishment to a different location 100 miles or more away.
(f)
(g) "Termination" means the cessation or substantial
cessation of industrial or commercial operations in a covered
establishment.
(g) (1) This chapter does not apply where the closing or layoff is
the result of the completion of a particular project or undertaking
of an employer subject to Wage Order 11, regulating the Broadcasting
Industry, Wage Order 12, regulating the Motion Picture Industry, or
Wage Order 16, regulating Certain On-Site Occupations in the
Construction, Drilling, Logging and Mining Industries, of the
Industrial Welfare Commission, and the employees were hired with the
understanding that their employment was limited to the duration of
that project or undertaking.
(2) This chapter does not apply to employees who are employed in
seasonal employment where the employees were hired with the
understanding that their employment was seasonal and temporary.
(h) "Employee" means a person employed by an employer for at least
6 months of the 12 months preceding the date on which notice is
required.
SEC. 2. Section 1400.5 is added to the Labor Code, to read:
1400.5. (a) This chapter does not apply if the closing or layoff
is the result of the completion of a particular project or
undertaking of an employer subject to Wage Order 11, regulating the
Broadcasting Industry, Wage Order 12, regulating the Motion Picture
Industry, or Wage Order 16, regulating Certain On-Site Occupations in
the Construction, Drilling, Logging and Mining Industries, of the
Industrial Welfare Commission, and the employees were hired with the
understanding that their employment was limited to the duration of
that project or undertaking.
(b) This chapter does not apply to employees who are employed in
seasonal employment if the employees were hired with the
understanding that their employment was seasonal and temporary.
SEC. 3. Section 1401 of the Labor Code is amended to read:
1401. (a) An employer may not order a mass layoff, relocation, or
termination at a covered establishment unless, 60
90 days before the order takes effect, the employer gives
written notice of the order to the following:
(1) The employees of the covered establishment affected by the
order and their representative or union .
(2) The Labor and Workforce Development Agency, the
Department of Industrial Relations, the Employment Development
Department, the local workforce investment board, and the chief
elected official of each city and county government within which the
termination, relocation, or mass layoff occurs.
(b) An employer required to give notice of any mass layoff,
relocation, or termination under this chapter shall include in its
notice the elements required by the federal Worker Adjustment and
Retraining Notification Act (29 U.S.C. Sec. 2101 et seq.).
(c) Concurrent with or immediately after providing the notice
required under subdivision (a), an employer shall provide the
employees of the covered establishment with information regarding the
benefits and services available to the employees, as described in
the guide compiled by the Labor and Workforce Development Agency
pursuant to Section 1401.5.
(c)
(d) Notwithstanding the requirements of subdivision
(a), an employer is not required to provide notice if a mass layoff,
relocation, or termination is necessitated by a physical calamity or
an act of war.
SEC. 4. Section 1401.5 is added to the Labor Code, to read:
1401.5. The Labor and Workforce Development Agency shall prepare
the following:
(a) A guide of benefits and services that may be available to
employees of covered establishments, including unemployment
compensation, trade adjustment assistance, COBRA benefits, and early
access to training and other services, including counseling services,
available under the federal Workforce Investment Act of 1998 (29
U.S.C. Sec. 2801 et seq.). This guide shall be available on the
Internet Web site of the Labor and Workforce Development Agency and
shall include a description of the benefits and services, the
eligibility requirements, and the means of obtaining those benefits
and services.
(b) A guide of economic development benefits and services,
including workforce services, that may be available to employers of
covered establishments to avert mass layoff, relocation, or
termination; feasibility studies; data and statistics; trade
adjustment assistance; and available tax credits, financial
assistance, and other incentives provided through the departments and
agencies of the California state government. The guide shall focus
particularly on resources for retooling to achieve greater energy
efficiency. This guide shall be available on the Internet Web site of
the Labor and Workforce Development Agency and shall include a
description of benefits and services, their eligibility requirements,
and the means of obtaining the benefits and services.
SEC. 5. Section 1401.6 is added to the Labor Code, to read:
1401.6. (a) An employer that provides the notice required by
paragraph (1) of subdivision (a) of Section 1401 shall make
sufficient meeting space available at the covered establishment for
the provision of rapid response activity, as defined by paragraph
(38) of Section 2801 of Title 29 of the United States Code. The
employer shall allow a provider of rapid response activity services
and an affected employee and his or her representative to meet for
not less than one hour for the provision of rapid response activity
services.
(b) An employee shall be compensated at his or her regular rate of
pay and benefits for the meeting described in subdivision (a).
(c) The employer shall provide notice of the meeting described in
subdivision (a) to the affected employee and his or her
representative not less than 24 hours prior to the meeting.
SEC. 6. Section 1402 of the Labor Code is amended to read:
1402. (a) An employer who fails to give notice as required by
paragraph (1) of subdivision (a) of Section 1401 before ordering a
mass layoff, relocation, or termination is liable to each
an employee entitled to notice who lost his or
her employment for the following :
(1) Back pay Backpay at
the average regular rate of compensation received by the employee
during the last three years of his or her employment, or the employee'
s final rate of compensation, whichever is higher.
(2) The value of the cost of any benefits to which the employee
would have been entitled had his or her employment not been lost,
including the cost of any medical expenses incurred by the employee
that would have been covered under an employee benefit plan.
(b) Liability under this section is calculated for the period of
the employer's violation, up to a maximum of 60
90 days, or one-half the number of days that the employee
was employed by the employer, whichever period is smaller.
(c) The amount of an employer's liability under subdivision (a) is
reduced by the following:
(1) Any wages, except vacation moneys accrued prior to the period
of the employer's violation, paid by the employer to the employee
during the period of the employer's violation.
(2) Any voluntary and unconditional payments made by the employer
to the employee that were not required to satisfy any legal
obligation.
(3) Any payments by the employer to a third party or trustee, such
as premiums for health benefits or payments to a defined
contribution pension plan, on behalf of and attributable to the
employee for the period of the violation.
SEC. 7. Section 1402.5 of the Labor Code is amended to read:
1402.5. (a) An employer is not required to comply with the notice
requirement contained in subdivision (a) of Section 1401 if the
department determines that all of the following conditions exist:
(1) As of the time that notice would have been required, the
employer was actively seeking capital or business in
consultation with the state or local government, local economic
development agency, or Workforce Investment Board. Information
provided to the state, local government, local economic development
agency, or Workforce Investment Board shall be kept confidential
.
(2) The capital or business sought, if obtained, would have
enabled the employer to avoid or postpone the mass layoff,
relocation , or termination.
(3) The employer reasonably and in good faith believed that giving
the notice required by subdivision (a) of Section 1401 would have
precluded the employer from obtaining the needed capital or business.
(b) The department may not determine that the employer was
actively seeking capital or business under subdivision (a) unless the
employer provides the department with both of the following:
(1) A written record consisting of all documents relevant to the
determination of whether the employer was actively seeking capital or
business, as specified by the department.
(2) An affidavit verifying the contents of the documents contained
in the record.
(c) The affidavit provided to the department pursuant to paragraph
(2) of subdivision (b) shall contain a declaration signed under
penalty of perjury stating that the affidavit and the contents of the
documents contained in the record submitted pursuant to paragraph
(1) of subdivision (b) are true and correct.
(d) This section does not apply to notice of a mass layoff as
defined by subdivision (d) (e) of
Section 1400.
SEC. 8. Section 1403 of the Labor Code is amended to read:
1403. (a) An employer who fails to give
notice as required by paragraph (2) of subdivision (a) of Section
1401 is subject to a civil penalty of not more than five hundred
dollars ($500) for each day of the employer's violation. The employer
is not subject to a civil penalty under this section, however, if
the employer pays to all applicable employees the amounts for which
the employer is liable under Section 1402 within three weeks from the
date the employer orders the mass layoff, relocation, or
termination.
(b) Up to 10 percent of the civil penalties levied on employers
pursuant to subdivision (a) shall be utilized, upon appropriation, by
the Labor and Workforce Development Agency to fund the activities
specified under Section 1401.5.