BILL NUMBER: AB 2557INTRODUCED BILL TEXT INTRODUCED BY Assembly Members Santiago and Bloom FEBRUARY 19, 2016 An act to amend Section 12990 of the Government Code, relating to public contracting. LEGISLATIVE COUNSEL'S DIGEST AB 2557, as introduced, Santiago. State contracts: nondiscrimination clause. Existing law, the California Fair Employment and Housing Act (FEHA), prohibits an employer or labor organization, among others, from discriminating against a person in specified contexts on the basis of the person's race, religious creed, color, national origin, ancestry, physical disability, mental disability, medical condition, genetic information, marital status, sex, gender, gender identity, gender expression, age, sexual orientation, or military and veteran status. FEHA makes an employer who is, or wishes to become, a contractor with the state for public works or for goods or services subject to the provisions of FEHA relating to discrimination, and requires every state contract and subcontract for public works or for goods or services to contain a nondiscrimination clause prohibiting discrimination on the bases enumerated in FEHA by contractors or subcontractors. This bill would specify that those provisions apply to subcontractors, and would require each state agency with an active contract or subcontract that contains the nondiscrimination clause to negotiate amendments to the nondiscrimination clause as necessary to ensure that the wording of the clause is consistent with the current statutory nondiscrimination provisions. Vote: majority. Appropriation: no. Fiscal committee: yes. State-mandated local program: no. THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS: SECTION 1. Section 12990 of the Government Code is amended to read: 12990. (a) Any employer who is, or wishes to become, a contractor or subcontractor with the state for public works or for goods or services is subject to the provisions of this part relating to discrimination in employment and to the nondiscrimination requirements of this section and any rules and regulations that implement it. (b) Prior to becoming a contractor or subcontractor with the state, an employer may be required to submit a nondiscrimination program to the department for approval and certification and may be required to submit periodic reports of its compliance with that program. (c) (1) Every state contract and subcontract for public works or for goods or services shall contain a nondiscrimination clause prohibiting discrimination on the bases enumerated in this part by contractors or subcontractors. The nondiscrimination clause shall contain a provision requiring contractors and subcontractors to give written notice of their obligations under that clause to labor organizations with which they have a collective bargaining or other agreement. These contractual provisions shall be fully and effectively enforced. This subdivision does not apply to a credit card purchase of goods of two thousand five hundred dollars ($2,500) or less. The total amount of exemption authorized herein shall not exceed seven thousand five hundred dollars ($7,500) per year for each company from which a state agency is purchasing goods by credit card. It shall be the responsibility of each state agency to monitor the use of this exemption and adhere to these restrictions on these purchases. (2) (A) Each state agency with an active contract or subcontract that contains a nondiscrimination clause pursuant to this subdivision shall negotiate amendments to the nondiscrimination clause or necessary to ensure that the wording of the clause is consistent with the current statutory nondiscrimination provisions of this part. (B) This paragraph applies to all active contracts or subcontracts, regardless of the date the contract or subcontract was entered into. (d) The department shall periodically develop rules and regulations for the application and implementation of this section, and submit them to the council for consideration and adoption in accordance with the provisions of Chapter 3.5 (commencing with Section 11340) of Part 1. Those rules and regulations shall describe and include, but not be limited to, all of the following: (1) Procedures for the investigation, approval, certification, decertification, monitoring, and enforcement of nondiscrimination programs. (2) The size of contracts or subcontracts below which any particular provision of this section shall not apply. (3) The circumstances, if any, under which a contractor or subcontractor is not subject to this section. (4) Criteria for determining the appropriate plant, region, division, or other unit of a contractor's or subcontractor's operation for which a nondiscrimination program is required. (5) Procedures for coordinating the nondiscrimination requirements of this section and its implementing rules and regulations with the California Plan for Equal Opportunity in Apprenticeship, with the provisions and implementing regulations of Article 9.5 (commencing with Section 11135) of Chapter 1 of Part 1, and with comparable federal laws and regulations concerning nondiscrimination, equal employment opportunity, and affirmative action by those who contract with the United States. (6) The basic principles and standards to guide the department in administering and implementing this section. (e) Where a contractor or subcontractor is required to prepare an affirmative action, equal employment, or nondiscrimination program subject to review and approval by a federal compliance agency, that program may be filed with the department, instead of any nondiscrimination program regularly required by this section or its implementing rules and regulations. Such a program shall constitute a prima facie demonstration of compliance with this section. Where the department or a federal compliance agency has required the preparation of an affirmative action, equal employment, or nondiscrimination program subject to review and approval by the department or a federal compliance agency, evidence of such a program shall also constitute prima facie compliance with an ordinance or regulation of any city, city and county, or county that requires an employer to submit such a program to a local awarding agency for its approval prior to becoming a contractor or subcontractor with that agency. (f) Where the department determines and certifies that the provisions of this section or its implementing rules and regulations are violated or determines a contractor or subcontractor is engaging in practices made unlawful under this part, the department may recommend appropriate sanctions to the awarding agency. Any such recommendation shall take into account the severity of the violation or violations and any other penalties, sanctions, or remedies previously imposed.