Employment: contracts or agreements for labor or services.

Existing law prohibits a person or entity from entering into a contract or agreement for labor or services with a construction, farm labor, garment, janitorial, or security guard contractor where the person or entity knows or should know that the contract or agreement does not include funds sufficient to allow the contractor to comply with all applicable local, state, and federal laws or regulations governing the labor or services to be provided. The Division of Labor Standards Enforcement, within the Department of Industrial Relations, is charged with the responsibility of enforcing minimum labor standards under state law. The division's Bureau of Field Enforcement is responsible for investigating and enforcing statutes relating to the above targeted areas. The Economic and Employment Enforcement Coalition, composed of the division and other state and federal agencies, combines and coordinates investigative and enforcement efforts of the various agencies targeting the underground economy. This bill would provide that in an investigation by the Economic and Employment Enforcement Coalition or the Bureau of Field Enforcement involving a labor contractor employing 15 or more workers in any of these 5 targeted areas, if the Division of Labor Standards Enforcement has a reasonable suspicion that a violation of potential financial significance, as defined, has been committed or cited by the division, the division must obtain the relevant terms of the contract from the contractor and make a written record thereof, as well as a record of whether there is a likelihood that the applicable contract violates those provisions requiring adequate funding. The bill also would require the division to make a record of its reasons supporting its decision to either file or not file a legal action.