California 2023-2024 Regular Session

California Assembly Bill AB1204

Introduced
2/16/23  
Introduced
2/16/23  
Refer
3/2/23  
Refer
3/2/23  
Report Pass
4/26/23  
Report Pass
4/26/23  
Refer
5/1/23  
Refer
5/1/23  
Report Pass
5/10/23  
Report Pass
5/10/23  
Engrossed
5/22/23  
Engrossed
5/22/23  
Refer
5/23/23  
Refer
5/23/23  
Refer
5/31/23  
Refer
5/31/23  
Report Pass
6/19/23  
Report Pass
6/19/23  
Refer
6/19/23  
Refer
6/19/23  
Report Pass
7/12/23  
Report Pass
7/12/23  
Refer
7/12/23  
Refer
7/12/23  
Enrolled
9/5/23  
Enrolled
9/5/23  
Chaptered
10/8/23  
Chaptered
10/8/23  
Passed
10/8/23  

Caption

Contractors: contracts: restrictions.

Impact

The impact of AB 1204 on state laws is significant, particularly within the realm of contractors' operations. By implementing stricter controls on subcontractor arrangements, the bill seeks to reduce instances of potential misclassification of workers and reinforce labor protections. This is aligned with broader efforts in California to address labor rights and secure fair working conditions within the contracting industry. The California Contractors State License Board is expected to have enhanced authority to enforce these regulations, thereby potentially transforming how contractors manage their subcontractor relationships.

Summary

Assembly Bill 1204 establishes new restrictions on specialty contractors in California by prohibiting them from entering into contracts with more than one subcontractor of the same license classification for any single project, unless specific conditions are met. This legislative change aims to regulate subcontracting practices to enhance accountability and ensure that workers are classified correctly as employees rather than independent contractors. It emphasizes the need for specialty contractors either to employ classified workers outright or to enter into bona fide collective bargaining agreements with the subcontractors involved.

Sentiment

The sentiment surrounding AB 1204 appears to be mixed among industry stakeholders. Proponents argue that the bill will lead to a more transparent and equitable contracting environment, benefiting workers who might otherwise be exploited under loose subcontracting practices. Conversely, some critics, particularly those in the contracting industry, express concerns that these new restrictions may hinder operational flexibility and increase costs, ultimately impacting project timelines and competitiveness in the market.

Contention

Notable points of contention include the balance between enhancing labor protections and preserving the business interests of contractors. Disagreement exists over the feasibility and consequences of regulating subcontractor relationships so tightly, with some asserting that such measures could lead to fewer job opportunities if contractors limit their engagement with subcontractors. The bill's definition of what constitutes a 'bona fide' collective bargaining agreement also leaves room for interpretation, stirring debate over compliance and regulatory clarity.

Companion Bills

No companion bills found.

Previously Filed As

CA SB1455

Contractors: licensing.

CA AB2614

Workers’ compensation: labor contractors.

CA AB2705

Contractors: violations.

CA SB610

Contractors: licensing and regulation.

CA AB3087

Contractors’ State License Law.

CA SB291

Contractors: workers’ compensation insurance.

CA SB806

Worker status: employees: independent contractors.

CA SB304

Contractors: exemptions.

CA SB601

Professions and vocations: contractors: home improvement contracts: prohibited business practices: limitation of actions.

CA AB3281

Worker status: independent contractors: business-to-business contracting relationship.

Similar Bills

SC H4518

Residential home builders

LA SB122

Provides relative to the Louisiana State Licensing Board for Contractors. (8/1/25)

CA AB1545

Satellite wagering facilities: employees.

CA SB1455

Contractors: licensing.

AZ HB2634

Department of revenue; reuse zone

AZ HB2807

TPT; prime contracting; exemption; alterations

AZ HB2594

TPT; prime contracting; exemption; alterations

AZ HB2749

TPT; prime contracting; exemption; alterations