California state Assembly passes wage theft legislation

Last Wednesday, the California State Assembly passed Bill 1701, a piece of legislation tackling wage theft in the state’s construction industry. This victory followed closely behind the Senate passage of the bill the previous week. The bill is now being sent to Governor Jerry Brown.

If signed into law, this important piece of legislation will empower the state Labor Commissioner along with joint labor-management committees to pursue legal action against general contractors if it is found that their subcontractors are failing to pay workers. The law previously protected general contractors from responsibility, leading to a massive wage theft epidemic affecting thousands of works and also costing the state approximately $8.5 billion to $10 billion annually in tax revenues.

In response to news of the bill’s passage, Robbie Hunter, president of the State Building and Construction Trades Council stated, “Many developers and general contractors, through the CBIA, spent millions to preserve their chosen method of doing business, gaining lucrative profits by insulating themselves through a maze of subcontractors that they knew didn’t pay their workers and were operating in the underground economy,” going on to say, “With AB 1701, we have brought that system to its knees and have created an even playing field where fair contractors have the ability to win bids in the residential and commercial construction market.”

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