Amended  IN  Assembly  May 11, 2020
Amended  IN  Assembly  May 04, 2020

CALIFORNIA LEGISLATURE— 2019–2020 REGULAR SESSION

Assembly Bill
No. 3056

Introduced by Assembly Member Gonzalez

February 21, 2020

An act to add Part 8.6 (commencing with Section 2100) to Division 2 of the Labor Code, relating to employment.


LEGISLATIVE COUNSEL'S DIGEST


AB 3056, as amended, Gonzalez. Warehouse distribution centers.
Existing law relating to employment regulation and supervision imposes special provisions on certain occupations and industries. Existing law charges the Labor Commissioner and the Division of Labor Standards Enforcement with the enforcement of labor laws.
This bill would enact prescribed protections for certain warehouse and distribution center employees. The bill would prohibit an employer from imposing a quota upon an employee under which reasonable amounts of time that the employee spends on any of specified activities is counted toward the time required for completing the quota, or results in the employee having less time to complete the quota. The bill would define terms for its purposes.

This bill would require an employer to allow employees who work on a quota basis to take a recovery period, determined as prescribed. Authorized recovery period time would be counted as hours worked, with no deduction from wages, and would be supplemental to other mandated meal, rest, or recovery periods. Under the bill, an employer that fails to provide an employee a recovery period would be liable to the employee for one hour of pay at the employee’s regular rate of compensation for each work day that the recovery period is not provided.

This bill, except as specified, would require the Division of Labor Standards Enforcement to enforce its provisions. The bill would authorize the commissioner to adopt regulations to implement its provisions.

This bill would establish procedures by which, upon petition and investigation, the commission, if it determines that employees perform work under a quota, would be required to establish quota baselines for an employer. The

This bill would require an employer subject to a baseline quota to pay each employee who works under a quota during the workday and who is assigned or required to perform work in excess of the baseline quota during that workday a wage premium of 1 ½ times the employee’s regular rate of pay for any hour during which the employee was assigned or required to perform work in excess of the baseline quota.
This bill would subject an employer who violates the quota prohibition to civil penalties and would authorize the commissioner to issue to an employee written authorization for civil action against a designated repeat offender employer.
Vote: MAJORITY   Appropriation: NO   Fiscal Committee: YES   Local Program: NO  

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


SECTION 1.

 The Legislature finds and declares all of the following:
(a) The rapid growth of just-in-time logistics and same-day and next-day consumer package delivery, and advances in technology used for tracking employee productivity, have led to a rise in the number of warehouse and distribution center workers who are subject to quantified performance quotas.
(b) Warehouse and distribution center employees who work under such quotas are expected to complete a quantified number of tasks within specific time periods, often measured down to the minute or second, and face adverse employment action, including suspension or termination, if they fail to do so.
(c) Warehouse and distribution center employees who work under such quotas frequently skip restroom breaks in order to keep up with their quota. Such employees also face barriers to documenting and reporting Labor Code violations because any time spent away from their station reduces the amount of time available to complete their quota.

(d)Such quotas generally do not allow for recovery during productive work time, making warehouse and distribution center employees who work under them susceptible to overwork. Affording additional, protected recovery time to such employees is therefore necessary.

(e)

(d) The quotas under which warehouse and distribution center employees regularly work also affect their compensation. California and many cities require employers to pay their employees a minimum-wage rate. Warehouse and distribution center employees who work under a quota, however, do not receive the full benefit of such minimum wages if their quota is increased to make up for the direct or indirect effect of a minimum-wage raise.

(f)

(e) California also requires that employees required to work more than a specified amount of time during a workday be paid an overtime wage premium. Existing overtime protections, however, do not adequately compensate warehouse and distribution center employees who work under a quota. Such overtime protections do not apply a wage premium for work in excess of a reasonable quota during a workday.

SEC. 2.

 Part 8.6 (commencing with Section 2100) is added to Division 2 of the Labor Code, to read:

PART 8.6. Warehouse Distribution Centers

CHAPTER  1. General Provisions

2100.
 The enactment of this part is an exercise of the police power of the State of California for the protection for the public welfare, prosperity, health, safety, and peace of its people. The civil penalties provided by this chapter are in addition to any other penalty provided by law.

2101.
 As used in this part:
(a) “Commissioner” means the Labor Commissioner.
(b) “Defined time period” means any unit of time measurement equal to or less than the duration of an employee’s shift, and includes hours, minutes, and seconds and any fraction thereof.
(c) “Employee” means a nonexempt employee, as defined in Section 2750.3, who works at a warehouse distribution center.
(d) “Employer” means a person who directly or indirectly, or through an agent or any other person, including through the services of a third-party employer, temporary service, or staffing agency or similar entity, employs or exercises control over the wages, hours, or working conditions of 100 or more employees at a single warehouse distribution center or 1,000 or more employees at one or more warehouse distribution centers in the state. For purposes of this definition, all employees of an employer’s commonly controlled group, as that term is defined in Section 25105 of the Revenue and Taxation Code, shall be counted in determining the number of employees employed at a single warehouse distribution center or at one or more warehouse distribution centers in the state.
(e) “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.
(f) “Quota” means a performance standard under which an employee is assigned or required to perform a quantified number of tasks, or to handle or produce a quantified amount of material, within a defined time period and under which the employee may suffer an adverse employment action if they fail to complete the performance standard.
(g) “Warehouse distribution center” means an establishment as defined by any of the following North American Industry Classification System (NAICS) Codes, however such establishment is denominated:
(1) 493110 for General Warehousing and Storage.
(2) 423 for Merchant Wholesalers, Durable Goods.
(3) 424 for Merchant Wholesalers, Nondurable Goods.

2102.
 The Division of Labor Standards Enforcement shall enforce the provisions of this part, subject to the provisions of Chapter 4 (commencing with Section 2112).

2103.
 This part does not limit the authority of the Attorney General or the district attorney of any county, either upon their own complaint or the complaint of any person acting for themselves or the general public, to prosecute actions, either civil or criminal, for violations of this part, or to enforce the provisions thereof independently and without specific direction of the director.

2104.
 The commissioner shall have authority to adopt regulations implementing this part.

2105.
 This part does not preempt any city, county, or city and county ordinances that provide equal or greater protection to employees covered by this part.

2106.
 The provisions of this part are severable. If any provision of this part or its application is held invalid, that invalidity shall not affect other provisions or applications that can be given effect without the invalid provision or application.

CHAPTER  2. Reasonable Quota Requirements

2107.
 An employer shall not impose a quota upon an employee under which reasonable amounts of time that the employee spends on any of the following activities is counted toward the time required for completing the quota, or results in the employee having less time to complete the quota:
(a) Accessing and using a restroom, restroom or handwashing station or accessing adequate and sanitary hydration.
(b) Documenting or reporting to the employer or to the responsible government authority a colorable claim of a Labor Code violation.
(c) Taking any legally mandated rest, recovery, or meal period.

2108.

(a)An employer shall authorize and permit each employee who works under a quota during any part of a workday to take a recovery period based on the total hours worked during that workday, at the rate of 10 minutes net recovery time per 4 hours or major fraction thereof, so long as the employee works at least 3 ½ hours during the workday. Authorized recovery period time shall be counted as hours worked, for which there shall be no deduction from wages. Each such recovery period shall be in addition to any other meal, rest, or recovery period mandated pursuant to an applicable statute or applicable regulation, or standard or order of the Industrial Welfare Commission, the Division of Labor Standards Enforcement, the Occupational Safety and Health Standards Board, or the Division of Occupational Safety and Health.

(b)Any employer that fails to provide an employee a recovery period in accordance with this section shall be liable to the employee for one hour of pay at the employee’s regular rate of compensation for each work day that the recovery period is not provided.

3.Reasonable Compensation
2109.

One or more employees, or their representative, or an employer may file a petition with the commissioner to establish reasonable quota baselines for an employer. Such petition shall be in a form determined by the commissioner, which shall include the address of the warehouse distribution center or warehouse distribution centers that are the subject of the petition, the classifications that are the subject of the petition, and a description or documentation of the quota in place for each classification at the time the petition is filed.

2110.

(a)Upon receipt of a petition described in Section 2109, the commissioner shall provide notice to the employer named in the petition, in the case of a petition filed by one or more employees, and shall direct the employer to post a notice, in an approved form, at each warehouse distribution center or warehouse distribution centers that are the subject of the petition, for the purpose of providing notice of the petition to affected employees.

(b)The commissioner shall hold a noticed public hearing on the petition, at which the employer and employees that are the subject of the petition, or a representative, may present documentary evidence and witness testimony.

(c)After investigating the petition, the commissioner shall determine whether employees in the classifications that are the subject of the petition perform work under a quota. For each such classification, the commissioner shall establish baseline quotas, based on all of the following criteria:

(1)The lowest existing quota in place for the classification at the time the petition was filed.

(2)Any change in the quota for the classification since the petition was filed, and any explanation of the factors that led to such change in the quota.

(3)Any fluctuation in the quota based on seasonal demand, high-volume days, or spikes in demand.

(4)Any applicable occupational health and safety standard that applies to the work in question.

(5)Relevant evidence-based guidelines or recommendations on work pacing in the warehouse or related industries, including peer-reviewed publications and expert testimony.

2111.

An employer that is subject to a baseline quota established pursuant to Section 2110 shall pay each employee who works under a quota during the workday and who is assigned or required to perform work in excess of the baseline quota during that workday a wage premium of 1 ½ times the employee’s regular rate of pay for any hour during which the employee was assigned or required to perform work in excess of the baseline quota.

CHAPTER  3. Reasonable Compensation

2109.
 An employer shall pay each employee who works under a quota during the workday and who is assigned or required to perform work in excess of the baseline quota during that workday a wage premium of 1½ times the employee’s regular rate of pay for any hour during which the employee was assigned or required to perform work in excess of the baseline quota.

CHAPTER  4. Enforcement

2112.
 Any employer that violates Section 2107 shall be subject to a civil penalty in the amount of two hundred fifty dollars ($250) per employee per violation in an initial citation and one thousand dollars ($1,000) per employee for each violation in a subsequent citation. The civil penalties provided for in this section are in addition to any other penalty provided by law.

2113.
 (a) Any employer that is determined by the commissioner to have violated this part more than 10 times during any rolling 365-day period shall be designated as a “repeat offender.”
(b) The commissioner, at the commissioner’s discretion, may issue written authorization for a civil action to one or more employees of a repeat offender that is the subject of a complaint alleging a violation of this part. Such letter shall be valid for a period of one year from the date of its issuance and shall permit the aggrieved employee or employees to commence a civil action pursuant to subdivision (a) of Section 2699 for the alleged violations stated in the letter.