CA Labor Law Requires Surety Bond to Curb Abuse of Foreign Workers

CA Labor Law Requires Surety Bond to Curb Abuse of Foreign Workers

ILO Arab States / Flickr / CC BY-NC

Date Enacted:  September 20, 2014

Date Effective: January 1, 2015

California’s bill SB 477 addresses exploitation of non-American workers. The law will require foreign labor contractors who recruit foreign laborers to California-based positions to register with the Labor Commission. It’s already necessary for many contractors to get bonded and insured, and a new bond will now be required of any contractor dealing with foreign labor and foreign labor recruitment.

Read more about this and other updates to the law below.

Contractor Bond Amounts Based On Income

The California bill requires all foreign labor contractors to register by July 1st, 2016 and obtain a bond, whose amount is based on the annual gross income receipts . The contracting bond required for receipts valued at greater than two million dollars is in the amount of $150,000. For receipts of $500,000 to two million dollars, the bill mandates a bond of $100,000. Lastly, for receipts of up to $500,000, a bond of $50,000 is dictated by the rule.

Final Judgements

When a contractor has had a final judgement in one year equal to that of the bond required, the contractor has 60 days to deposit an additional bond to fulfil the obligation set forth by the state of California. The bond may be used to pay for legal violations as well as for interest on wages and damages or monetary assistance to foreign workers affected by violations.

Other Notable Changes

Banned Behaviors

SB 477 prohibits discrimination, intimidation, restraint, coercion and discharge of a foreign worker or the family of a foreign worker in retaliation for exercising the rights given by the bills. The penalty for violation of these rights can be any amount up to $25,000, but no less than $1,000. Additionally, the foreign worker who has been exploited may bring action against the labor contractor.

Fee Assessment

The law stipulates that foreign labor recruiters can’t charge foreign laborers any fees for visas, processing, placement, transportation or otherwise. The labor recruiter may choose to pay these fees, but cannot pass these fees on to the worker. The only fees that may be charged are ones that are customarily paid by any United States citizen employed in the United States.

Check out the full California Foreign Labor Recruitment Bill for more details.
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