Here's a look at two legal developments in California that might show up in your backyard soon.
First, according to our friends over at Construction Dive, The California State Assembly last week passed a bill requiring general contractors, or direct contractors, to pay the wages of their subcontractors’ employees if the subcontractors do not pay them. The bill, if signed by Governor Jerry Brown, would go into effect in January 2018. The bill is in response to the continued misclassification of workers as Independent Contractors or 1099 workers.
The article in the Sacramento Bee states that, “The Assembly on Wednesday sent to the governor’s desk Assembly Bill 1701, which would allow construction workers who have not been paid for a job to seek their back wages and benefits, with interest, from the general contractor, even if they did not work directly for that company on the project.”
Heavily lobbied by the construction unions and workers' rights groups, if signed by the Governor, you can expect that groups and unions will begin to test the waters in other states to see whether and how this one might be implemented.
As you might expect, the folks in favor of this bill are saying “At last,” while the folks against it are saying that this bill would raise project costs from residential construction to commercial construction and would force developers and builders out of the state.
We will keep an eye on this one.
The second major legislative move signed in California in the last week is a bill that makes California a “Sanctuary State.” According to an article in the LA Times over the weekend, the bill has been “officially dubbed the 'California Values Act.'" The signing of this bill will escalate the battle between the Trump Administration and the state. Legislators in favor of the passage of the law lauded the move saying that, “This move further sends a signal to the Trump Administration that California is a state that honors its immigrant population.” Those against the passage said that it would attract more illegals to the state and accuses the Democrats of pushing the issue in order to attract more voters to the state.
Just two of the latest developments on the misclassification issue.
