Governor signs Assemblymember Frazier’s bill to create certainty for small businesses

Sacramento, CA On Wednesday, September 14, Governor Brown signed into law AB 326 by Assemblymember Jim Frazier (D – Oakley), which sets a 30-day deadline that the Department of Industrial Relations (DIR) must reimburse a collateral deposit by an employer in a Division of Labor Standards Enforcement prevailing wage dispute.

“I applaud the Governor for signing AB 326 to bring fairness to the prevailing wage dispute process,” said Frazier. “As a former general contractor, I know first-hand that tying up cash can place innocent employers in jeopardy of losing their business or creating financial hardship.”

Current law requires that in cases where a contractor has been accused of prevailing wage violations, the contractor must post a cash deposit with the DIR equivalent to the full amount of the assessment plus penalties. AB 326 would ensure that the contractor is reimbursed in a timely manner.

“We cannot thank Assemblymember Frazier enough for stepping up on this issue,” said Tom Holsman, CEO of the Associated General Contractors of California. “There have been instances when contractors have not received their cash deposits back for months, even though a settlement had been arrived at, or the contractor had been fully exonerated.”

AB 326 had the support of the Associated General Contractors of California and San Diego, Associated Builders & Contractors of California, Construction Employers’ Association, Southern California Contractors Association, and California Association of Specialty Contractors. This bill passed through the Legislature with widespread bipartisan support and will become effective on January 1, 2017.

Assemblymember Frazier represents the 11th Assembly District, which includes the communities of Antioch, Bethel Island, Birds Landing, Brentwood, Byron, Collinsville, Discovery Bay, Fairfield, Isleton, Knightsen, Locke, Oakley, Pittsburg (partial), Rio Vista, Suisun City, Travis AFB, Vacaville and Walnut Grove.

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