HOUSE BILL REPORT

                      HB 1472

                     As Reported By House Committee on:

                              Commerce & Labor

Title:  An act relating to employment.

Brief Description:  Revising provisions regulating employment.

Sponsor(s):  Representatives Cole, Heavey, Prentice, Jacobsen, Wood, Zellinsky, R. Johnson, Jones, Winsley, Phillips, Braddock, R. King, Nelson, Leonard, Franklin, Valle, Rust, Roland, Haugen, Riley, Fraser, Belcher, Scott, Dorn, R. Fisher, Cooper, Pruitt, Ebersole, Appelwick, Brekke, Sheldon, Wang, Dellwo, Peery, Orr, Spanel, O'Brien, Hargrove and Wineberry.

Brief History:

   Reported by House Committee on:

Commerce & Labor, February 14, 1991, DPS.

HOUSE COMMITTEE ON

COMMERCE & LABOR

Majority Report: That Substitute House Bill No. 1472 be substituted therefor, and the substitute bill do pass.  Signed by 7 members:  Representatives Heavey, Chair; Cole, Vice Chair; Franklin; Jones; R. King; O'Brien; and Prentice. 

Minority Report: Do not pass.  Signed by 4 members:  Representatives Fuhrman, Ranking Minority Member; Lisk, Assistant Ranking Minority Member; Vance; and Wilson. 

Staff:  Chris Cordes  (786-7117).

Background:  The industrial welfare law authorizes the Department of Labor and  Industries to establish employment standards for Washington workers, except agricultural workers. The department's rules for the employment of minors include minor work permit requirements, maximum hours of work, and age limitations.  Minors may not be employed in certain hazardous occupations. 

An  employer who violates an industrial welfare standard is guilty of a misdemeanor and is subject to a fine of not less than $25 or more than $1,000.  The department does not have authority to impose civil penalties or issue orders to restrain violations.

If an employer pays wages at a rate less than the state minimum wage, fails to keep required records, hinders an investigation for enforcing the state minimum wage, or otherwise violates the state minimum wage law, the employer is guilty, upon conviction, of a gross misdemeanor.  It is a misdemeanor if the employer fails to pay wages due upon termination of the employee's job, takes unlawful deductions from an employee's wages, or violates wage bond requirements.  An employer is subject to a 10 percent penalty if the employer fails to pay a wage claim.

Summary of Substitute Bill:

Child labor - hours of work

Permissible hours of work for minors are established.

   General requirements are:

!  Minors required to attend school may not work during     school hours, except with permission of school officials.

!  No minor may work more than eight hours per day, 40 hours      per week, or five days per week.

   During the school year:

!  Minors, under the age of 16, may work up to 3 hours per     day on school days, and up to 18 hours per week during      weeks when school is in session.

!  Minors, age 16 and 17, may work up to 4 hours per day on       school days, and up to 28 hours per week during weeks      when school is in session.

Enforcement of Child Labor Standards

Civil penalties.  The director of the Department of Labor and Industries is  authorized to issue citations to employers for violations of the standards for employment of minors under the industrial welfare law.  If the violation is not abated within the abatement period, the employer is subject to a civil penalty of not more than $1,000. 

Violations of posting requirements are subject to a penalty of not more than $100.  For repeated or serious violations, the employer is subject to a penalty of not more than $1,000 for each day of the violation.  Penalties will be deposited in the state general fund.

Restraining orders.  The director is authorized to issue an order restraining any workplace practice in violation of employment standards for minors if the practice is creating a substantial probability that death or serious physical or emotional harm could result to a minor employee.

Appeal procedures.  Any person aggrieved by an action of the department in enforcing the standards for the employment of minors may appeal to the director.  After a hearing, the director must issue a final order, which may be appealed to superior court in accordance with the Administrative Procedure Act.

Criminal penalties.  An employer who knowingly or recklessly violates the standards for the employment of minors is guilty of a gross misdemeanor.  If an employer's practices violate the standards and result in death or permanent disability of a minor, the employer is guilty of a class C felony.

Enforcement of Wage Laws

Penalties for violations of the minimum wage law.  An employer that hinders or delays the department in enforcing the minimum wage laws, or fails to keep or furnish required wage records, is subject to a civil penalty for each violation of not more than $1,000 depending on the size of the business and the gravity of the violation.

If an employer pays wages at a rate less than the state minimum wage, the employer is subject to a civil penalty equal to 20 percent of the wage violation.  For willful or repeated violations, the employer is subject to conviction for a gross misdemeanor.

The director of the Department of Labor and Industries is authorized to order reinstatement with back pay and interest of up to 1 percent per month if the director finds that an employer discharged or discriminated against an employee because of a minimum wage claim.

Penalties for wage claim violations.  If, after notification of a wage claim, the employer fails to pay the claim or make satisfactory explanation, the employer is subject to a penalty of 20 percent of the claim found to be due.  The director is also authorized to order payment of interest when back wages are owed to an employee.  Any action on the claim must begin within three years of the violation.

The director may require a bond from any employer that has repeatedly violated the state wage laws.

Substitute Bill Compared to Original Bill:  Language is added to: (1) clarify that the civil penalty for wage law violations may be assessed for each violation of the wage laws; (2) provide that the civil penalties will be deposited in the state general fund; and (3) appropriate $500,000 from the state general fund for enforcement activities.  Technical corrections are made to conform the bill with the repealed section.

Fiscal Note:  Requested January 26, 1991.

Appropriation:  Yes.

Effective Date:  The bill contains an emergency clause and sections 1 through 7 (the child labor provisions) take effect July 1, 1991.

Testimony For:  (Child labor enforcement) Under current law, the only penalties for violations of the child labor laws are criminal penalties.  The Department of Labor and Industries could improve its enforcement of these laws if civil penalties were available as a tool.  A department study of industrial insurance claims filed by minors indicated that a large number of claims occurred in situations where the minor's employment was in violation of the law.

(Wage law enforcement)  The department also needs better methods to enforce claims for wages.  Civil penalties would provide a needed deterrence to get voluntary compliance.

Testimony Against:  (Child labor)  While better enforcement is needed, the law should first be clarified.  Employers cannot comply when there are conflicts between state and federal law.  An advisory committee should be formed to review the law and recommend changes, and then enforcement could be strengthened after employers are fully advised of the law's requirements.

Witnesses:  (in favor) Mark McDermott, Department of Labor and Industries; and Jeff Johnson, Washington State Labor Council.  (opposed)  Linda Matson, National Federation of Independent Business; Jan Gee, Washington Retail Association; Gary Smith, Independent Business Association; and Kent Meyers.