Existing law establishes within the Department of Industrial Relations the Division of Labor Standards Enforcement, headed by the Labor Commissioner, for the purposes of enforcing labor laws.

This bill would establish within the division the Labor Trafficking Unit, which would be required to coordinate with the Labor Enforcement Task Force, the Criminal Investigation Unit, the Department of Justice, and the Civil Rights Department to combat labor trafficking. The bill would require the unit to receive and investigate complaints alleging labor trafficking and take steps to prevent labor trafficking. The bill would require the unit to coordinate with or refer cases to the Labor Enforcement Task Force or the Civil Rights Department for potential civil actions, and to coordinate with or refer cases to the Department of Justice for potential criminal actions. The bill would require the unit to follow protocols to ensure survivors of labor trafficking are not victimized by the process of prosecuting traffickers and are informed of the services available to them. The bill would authorize the unit to coordinate with state and local agencies for specified purposes relating to the investigation and prosecution of labor trafficking. The bill would require the Division of Occupational Safety and Health to notify the unit when, upon investigating businesses under their purview, there is evidence of labor trafficking. The bill would require the unit, beginning January 1, 2026, until January 1, 2036, to annually submit a report to the Legislature with specified information relating to labor trafficking complaints, including the number, types, and outcomes of complaints.

Existing law establishes within the Department of Industrial Relations the Division of Labor Standards Enforcement, headed by the Labor Commissioner, for the purposes of enforcing labor laws.

This bill would establish within the division the Labor Trafficking Unit, which would be required to coordinate with the Labor Enforcement Task Force, the Criminal Investigation Unit, the Department of Justice, and the Civil Rights Department to combat labor trafficking. The bill would require the unit to receive and investigate complaints alleging labor trafficking and take steps to prevent labor trafficking. The bill would require the unit to coordinate with or refer cases to the Labor Enforcement Task Force or the Civil Rights Department for potential civil actions, and to coordinate with or refer cases to the Department of Justice for potential criminal actions. The bill would require the unit to follow protocols to ensure survivors of labor trafficking are not victimized by the process of prosecuting traffickers and are informed of the services available to them. The bill would authorize the unit to coordinate with state and local agencies for specified purposes relating to the investigation and prosecution of labor trafficking. The bill would require the Division of Occupational Safety and Health to notify the unit when, upon investigating businesses under their purview, there is evidence of labor trafficking. The bill would require the unit, beginning January 1, 2026, until January 1, 2036, to annually submit a report to the Legislature with specified information relating to labor trafficking complaints, including the number, types, and outcomes of complaints.

SENATE COMMITTEE ON

Senator Anthony Portantino, Chair

2023 - 2024 Regular Session

AB 380 (Arambula) - Division of Labor Standards Enforcement: Labor Trafficking Unit

Bill Summary:

AB 380 would establish the Labor Trafficking Unit (LTU) within the Department of Industrial Relations’ Division of Labor Standards Enforcement (DLSE).

Fiscal Impact:

• The Department of Industrial Relations (DIR) indicates that it would incur first-year costs of $4.3 million, and $4 million annually thereafter, to implement the provisions of the bill (Labor Enforcement and Compliance Fund). DLSE anticipates significant costs to staff and set up the LTU to (1) receive, investigate, and refer complaints, (2) provide support to survivors, and (3) compile the annual report. DIR’s Division of Occupational Safety and Health (Cal/OSHA) would incur minor and absorbable costs to implement written procedures to identify labor trafficking and share evidence with the LTU. Additionally, the bill would result in minor and absorbable costs to DIR’s Labor Enforcement Task Force (LETF) to coordinate with the LTU. DIR notes LETF does not have the authority or capacity to pursue civil actions related to labor trafficking and would continue to refer any potential cases to the appropriate authority.
• The bill would result in General Fund administrative costs to the Department of Justice (DOJ) of $1.6 million in 2023-24, and $2.7 million annually thereafter. The Criminal Law Division’s Special Prosecutions Section currently receives five to 12 labor trafficking allegation referral per year from DIR and anticipates this number to increase upon establishment of the LTU, necessitating an additional 15 positions.
• The Civil Rights Department (CRD) would incur annual General Fund costs of $3.4 million beginning in 2024-25 for an additional 18 positions. Included in CRD’s estimate is funding for operational expenses, including translation and interpretation services, a pay differential for certified bilingual employees, and travel expenses to visit worksites and other locations statewide to support human trafficking survivors.

Background:

The United States remains one of the widely regarded destination countries for human trafficking; federal reports estimate that 14,500 to 17,500 victims are trafficked into the country annually. This does not include trafficking victims within the United States itself and, due to the clandestine nature of the underground economy, the figures are almost certainly an underestimate. Human trafficking can take a number of forms, but generally involves compelling or coercing a person to provide labor or services, or to engage in commercial sex acts. As highlighted by the Attorney General’s website on human trafficking, “the coercion can be subtle or overt, physical or psychological, and may involve the use of violence, threats, lies, or debt bondage.”

In California specifically, there were 1,656 cases of human trafficking reported in 2018. Of these cases, 1,226 cases were sex trafficking cases, 151 cases were labor trafficking and 110 involved both labor and sex trafficking.

Clearly, there is a notable amount of overlap between labor and sex trafficking, but a slight distinction does exist. Labor trafficking involves the recruitment, harboring, or transportation of a person for labor services, through the use of force, fraud, or coercion. Labor trafficking also takes many forms, including domestic servitude, restaurant work, janitorial work, factory work, migrant agricultural work, and construction. It is often distinguished by unsanitary and overcrowded living and working conditions, nominal or no pay for work that is done, debt bondage, and document servitude.

Proposed Law:

This bill would, among other things, do the following:

• Establish LTU, within DIR’s DLSE, and require it to coordinate with LETF, the Criminal Investigation Unit within DOJ, and the Civil Rights Department (CRD) to combat labor trafficking.
• Authorize LTU to receive and investigate complaints alleging labor trafficking and take steps to prevent labor trafficking.
• Require LTU to coordinate with or refer cases to LETF or CRD for potential civil actions relating to labor trafficking violations.
• Require LTU to coordinate with or refer cases to DOJ for potential criminal actions relating to labor trafficking violations.
• Permit LTU to coordinate with local law enforcement agencies or district attorney’s offices when investigating criminal actions relating to labor trafficking.
• Require LTU to follow protocols to ensure survivors are not victimized by the process of prosecuting traffickers and are informed of the services available to them.
• Permit LTU to coordinate with both state and local agencies to connect survivors of labor trafficking with available services.
• Require Cal/OSHA to notify LTU when, upon investigating businesses under their purview, there is evidence of labor trafficking.
• Require LTU, on or before January 1, 2026, and annually thereafter until January 1, 2036, to submit a report to the Legislature that includes specified information.

Related Legislation:

• AB 1820 (Arambula, 2022) was nearly identical to this bill, and was vetoed by the Governor.
• AB 1684 (Stone, Chapter 63, Statutes of 2016) authorized the Department of Fair Employment and Housing (now the California Civil Rights Department) to receive, investigate, mediate, and prosecute civil complaints on behalf of a victim of human trafficking. The bill also required any damages awarded in a civil action brought by the CRD to be awarded to the victim of human trafficking.

Staff Comments:

In 2020, the Little Hoover Commission released three reports reviewing the state’s response to labor trafficking. The Commission noted that in California and elsewhere, much of the focus of law enforcement has appropriately been on combatting sex trafficking, particularly among minors; however, the Commission concludes that the state should bolster its response to labor trafficking. In one of the reports, the Commission found that while several state agencies play a role in combatting human trafficking, there is no coordinated strategy to target the crime statewide. No state agency has a mandate to look for labor trafficking and government agencies are siloed. The Commission noted that while issues related to labor exploitation in California fall under the jurisdiction of DIR, the agency does not proactively look for labor trafficking cases, in part because it does not have the authority to investigate labor trafficking cases. However, members of LETF – a multi-agency effort led by DIR to combat the underground economy – have observed signs of potential trafficking during inspections or received labor trafficking complaints and made 11 referrals of potential cases to DOJ to investigate.

-- END --

SENATE COMMITTEE ON PUBLIC SAFETY

Senator Aisha Wahab, Chair

2023 - 2024 Regular

Bill No: AB 380 Hearing Date: July 11, 2023

Subject: Division of Labor Standards Enforcement: Labor Trafficking Unit

HISTORY

Source: Western Center on Law & Poverty

Prior Legislation: AB 1820 (Arambula) vetoed 2022

Support: American Federation of State, County and Municipal Employees (AFSCME), AFL-CIO; California Labor Federation; California State Council of Service Employees International Union (SEIU California); Los Angeles County District Attorney’s Office; National Association of Social Workers, California Chapter; Peace Officers Research Association of California; San Diego County District Attorney's Office; UDW/AFSCME Local 3930

Opposition: None known

Assembly Floor Vote: 80 - 0

PURPOSE

The purpose of this bill is to establish the Labor Trafficking Unit (LTU) within the Division of Labor Standards Enforcement (DLSE) and requires the LTU to coordinate with the Labor Enforcement Task Force (LETF), the Department of Justice (DOJ), and the Civil Rights Department (CRD).

Existing law provides that any person who deprives or violates the personal liberty of another with the intent to obtain forced labor or services is guilty of human trafficking and shall be punished in the state prison for 5, 8, or 12 years and a fine of not more than $500,000. (Penal Code, § 236.1 (a).)

Existing law provides that a victim of human trafficking may bring a civil action for damages, compensatory damages, punitive damages, injunctive relief, and combination thereof, or any other appropriate relief. (Civil Code § 52.5.)

Existing law provides that when the Attorney General deems it advisable or necessary in the public interest, or when directed to do so by the Governor, the Attorney General shall assist any district attorney in the discharge of the district attorney’s duties, and may, if deemed necessary, take full charge of any investigation or prosecution of violations of law of which the superior court has jurisdiction. In this respect, the Attorney General has all the powers of a district attorney. (Government Code § 12550.)

Existing law authorizes the CRD to receive, investigate, conciliate, mediate, and prosecute complaints alleging, and to bring civil actions for, a violation of the crime of human trafficking, as specified. (Government Code § 12930 (f)(3).)

Existing law establishes the LETF under the direction of Department of Industrial Relations (DIR) to enforce activities regarding labor, tax, and licensing law violators operating in the underground economy. (Unemp. Ins. Code §329.)

This bill establishes the LTU and directs it to coordinate with the LETF, the Criminal Investigation Unit, DOJ, and the CRD to combat labor trafficking.

This bill requires the LTU to receive and investigate complaints alleging labor trafficking, as well as take steps to prevent it.

This bill requires the LTU to coordinate with, or refer cases to, LETF or CRD for potential civil actions relating to labor trafficking violations.

This bill requires the LTU to coordinate with, or refer cases to, DOJ for potential criminal prosecution related to labor trafficking violations.

This bill permits the LTU to coordinate with local law enforcement agencies or district attorney’s offices when investigating criminal actions relating to labor trafficking.

This bill requires the LTU to follow protocols to ensure survivors are not victimized by the process of prosecuting traffickers and are informed of services available to them.

This bill requires the Division of Occupational Safety and Health to notify the LTU when they find evidence of labor trafficking in the course of investigating businesses.

This bill requires, beginning January 1, 2026, and annually thereafter, LTU to submit a report to the Legislature that contains the following:

1. The number of complaints or referrals received;
   
2. The number and type of complaints or referrals investigated;
   
3. The number of complaints referred to CRD and to DOJ respectively;
   
4. The number of referrals and coordinations with local law enforcement agencies and district attorney’s offices;
   
5. The outcomes for each complaint; and,
   
6. A discussion of the major challenges to address labor trafficking complaints and the ongoing efforts to address those challenges.
   

This bill sunsets the reporting requirement on January 1, 2036.

COMMENTS

1. Need for This Bill

According to the author;

AB 380 will protect California’s most vulnerable workers from being taken advantage of by unscrupulous individuals and businesses who force them to work under duress with little to no pay. Trafficked employees face threats from their employers relating to documentation status, harm to their families, and loss of wages that prevent them from trying to escape and seek help. California first enacted anti-trafficking laws fifteen years ago, yet no state agency currently has a requirement to look for labor trafficking. This bill will create a Labor Trafficking Unit with the authority to receive, investigate, and coordinate claims of labor trafficking. By establishing a Labor Trafficking Unit within the Department of Industrial Relations (DIR), the state agency best suited to enforce labor laws, our state can take the necessary steps to stop the abuses of workers. Subject matter experts agree that the Department of Industrial Relations is the most suitable location for this authority as its work focuses on wage theft, labor rights, and laws. According to a 2020 Little Hoover Report, Labor Trafficking: Strategies to Uncover this Hidden Crime, DIR ‘“does not proactively look for labor trafficking cases because [it] does not have the authority to investigate or prosecute these cases”’ (p.9). Most importantly, DIR is already skilled in working closely with victims of trafficking. The department directly works to ensure survivors are informed about the services available to them and are not further victimized by the process of prosecuting traffickers

2. Labor Trafficking

According to the Attorney General’s Website: “Labor trafficking involves the recruitment, harboring, or transportation of a person for labor services, through the use of force, fraud, or coercion. It is modern day slavery. Labor trafficking arises in many situations, including domestic servitude, restaurant work, janitorial work, factory work, migrant agricultural work, and construction. It is often marked by unsanitary and overcrowded living and working conditions, nominal or no pay for work that is done, debt bondage, and document servitude. It occurs in homes and workplaces, and is often perpetrated by traffickers who are the same cultural origin and ethnicity as the victims, which allows the traffickers to use class hierarchy and cultural power to ensure the compliance of their victims. Labor traffickers often tell their victims that they will not be believed if they go to the authorities, that they will be deported from the United States, and that they have nowhere to run. Traffickers teach their victims to trust no one but the traffickers, so victims are often suspicious of genuine offers to help; they often expect that they will have to give something in return.” (What is Human Trafficking?, California Attorney General. Available at: https://oag.ca.gov/human-trafficking/what-is. [As of March 29, 2023])

3. Little Hoover Commission Reports

In 2020 the Little Hoover Commission released three reports reviewing the state’s response to labor trafficking. The Commission noted that state efforts to combat human trafficking have focused mainly on sex trafficking. In the second report, Labor Trafficking: Strategies to Uncover this Hidden Crime, the Commission found that while several state agencies play a role in combatting human trafficking, there is no coordinated strategy to target the crime statewide. No state agency has a mandate to look for labor trafficking and government agencies are siloed. The Commission noted that while issues related to labor exploitation in California fall under the jurisdiction of the DIR, the agency does not proactively look for labor trafficking cases, in part because it does not have the authority to investigate labor trafficking cases. However, members of the Labor Enforcement Task Force – a multi-agency effort led by DIR to combat the underground economy – have observed signs of potential trafficking during inspections or received labor trafficking complaints and made nearly close to one dozen referrals of potential cases to the Department of Justice to investigate. (Labor Trafficking: Strategies to Uncover this Hidden Crime, Little Hoover Commission (Sept. 2020), at pp. 6-9. Available at: https://lhc.ca.gov/sites/lhc.ca.gov/files/Reports/251/Report251.pdf. [As of March 29, 2023])

Consistent with these recommendations, this bill would establish LTU to receive and investigate complaints alleging labor trafficking and subsequently refer them for criminal prosecution by the DOJ or for civil action by the DEFH.

4. Governor’s Veto Message

AB 1820 (Arambula), of 2021-2022 Legislative Session, proposed nearly identical to this bill and was vetoed. The Governor’s veto message stated:

While I am strongly supportive of efforts to combat labor trafficking, the California Civil Rights Department (CCRD) (formerly DFEH) is the appropriate state entity to take the lead in this effort per the amendments offered by my office. DLSE does not have authority to criminally or civilly prosecute these types of cases nor have the tools and resources necessary to assist labor trafficking survivors. CCRD is already active in this space and could seamlessly expand its efforts to more aggressively combat labor trafficking provided it is given new resources in the budget.

This bill does not address the governor’s concerns.

5. Argument in Support

American Federation of State, County and Municipal Employees (AFSCME) supports this bill stating:

Human trafficking is reported to be the world’s fastest growing criminal activity, worth multiple billions of dollars in the U.S. alone. Although no accurate data for the United States exists, it is estimated that the number of sex and labor trafficking victims to be in the hundreds of thousands. According to the UC Berkeley Labor Centers, California specifically is reported to have one of the highest incidents of human trafficking in the U.S., with Alameda and Los Angeles Counties being central hubs. At the same time, however, California has been at the forefront of developing innovative anti-trafficking programs and policies such the Los Angeles Sheriff’s Human Trafficking Bureau, the SafetyNet program in Alameda, and the specialized courts for vulnerable girls in Alameda and Los Angeles. However, there are no statewide agencies with dedicated authority to investigate and prosecute individuals and businesses that violate human trafficking laws.

With the creation of the Labor Trafficking Unit under the Division of Labor Standards Enforcement, AB 380 would take a necessary step to properly investigate and coordinate state efforts to prevent and prosecute labor trafficking.

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SENATE COMMITTEE ON LABOR, PUBLIC EMPLOYMENT AND RETIREMENT

Senator Dave Cortese, Chair

2023 - 2024 Regular

Bill No: AB 380 Hearing Date: June 28, 2023

SUBJECT: Division of Labor Standards Enforcement: Labor Trafficking Unit

KEY ISSUE

Should the Legislature establish the Labor Trafficking Unit within the Department of Industrial Relations’ Division of Labor Standards Enforcement to receive and investigate complaints alleging labor trafficking and take steps to prevent labor trafficking?

ANALYSIS

Existing law:

1. Establishes the Division of Occupational Safety and Health (Cal/OSHA) within the Department of Industrial Relations (DIR), and gives Cal/OSHA the power, jurisdiction, and supervision over every place of employment in this state which is necessary to enforce and administer all laws requiring places of employment to be safe, and requiring the protection of the life, safety, and health of every employee. (Labor Code §175-176)
2. Establishes Division of Labor Standards Enforcement (DLSE) under the direction of the Labor Commissioner (LC) and authorizes the LC to investigate employee complaints and enforce labor laws, as specified. (Lab. Code, §79 et seq.)
3. Establishes the Labor Enforcement Task Force (LETF) under the direction of DIR to combat the underground economy in order to ensure safe working conditions and proper payment of wages for workers; to create an environment in which legitimate businesses can thrive; and to support the collection of all California taxes, fees, and penalties due from employers. (Budget Act of 2012, AB 1464, Chapter 21, Statutes of 2012)
4. Establishes the Joint Enforcement Strike Force on the Underground Economy (JESF), under the direction of the Employment Development Department (EDD), to combat the underground economy by combining resources and sharing information among the state agencies that enforce tax, labor, and licensing laws. (Unemployment Insurance Code §329)
5. Requires the Department of Justice (DOJ) to maintain, at a minimum, two multiagency Tax Recovery in the Underground Economy (TRUE) Criminal Enforcement Program investigative teams to combat underground economic activities through a multiagency collaboration and recover state revenue lost to the underground economy. (Government Code §15926)
6. Establishes and authorizes the Civil Rights Department (CRD) to receive, investigate, conciliate, mediate, and prosecute complaints alleging, and to bring civil actions for a violation of the crime of human trafficking, as specified. (Government Code §12930)
7. Provides that any person who deprives or violates the personal liberty of another with the intent to obtain forced labor or services is guilty of human trafficking and shall be punished in the state prison for 5, 8, or 12 years and a fine of not more than $500,000. (Pen. Code, §236.1(a))
8. Provides that a victim of human trafficking may bring a civil action for damages, compensatory damages, punitive damages, injunctive relief, and combination thereof, or any other appropriate relief. (Civil Code §52.5)

This bill:

1. Establishes the Labor Trafficking Unit (LTU), within the Division of Labor Standards Enforcement (DLSE), and requires the LTU to coordinate with the Labor Enforcement Task Force (LETF), the Criminal Investigation Unit, the Department of Justice (DOJ), and the Civil Rights Department (CRD) to combat labor trafficking.
2. Authorizes the LTU to receive and investigate complaints alleging labor trafficking and take steps to prevent labor trafficking.
3. Requires the LTU to coordinate with or refer cases to the LETF or the CRD for potential civil actions relating to labor trafficking violations.
4. Requires the LTU to coordinate with or refer cases to the DOJ for potential criminal actions relating to labor trafficking violations.
5. Permits the LTU to coordinate with local law enforcement agencies or district attorney’s offices when investigating criminal actions relating to labor trafficking.
6. Requires the LTU to follow protocols to ensure survivors are not victimized by the process of prosecuting traffickers and are informed of the services available to them.
7. Permits the LTU to coordinate with both state and local agencies to connect survivors of labor trafficking with available services.
8. Requires the Division of Occupational Safety and Health (Cal/OSHA) to notify the LTU when, upon investigating businesses under their purview, there is evidence of labor trafficking.
9. Requires the LTU, on or before January 1, 2026, and annually thereafter, to submit a report to the Legislature that includes the following information:
   1. The number of complaints or referrals received.
   2. The number and type of complaints or referrals investigated.
   3. The number of complaints referred to CRD and to DOJ.
   4. The number of referrals and coordinations with local law enforcement agencies and district attorney’s offices.
   5. The outcome of each complaint.
   6. A discussion of the major challenges to address labor trafficking complaints and ongoing efforts to address them as well as options to improve the state’s claim process.
10. Requires the report to the Legislature to be submitted pursuant to existing reporting provisions and sunsets the reporting requirements on January 1, 2036.

COMMENTS

1. Background on Labor Trafficking:

Human trafficking involves the use of force, fraud or coercion to deprive a victim of their liberty for purposes of obtaining labor or services. The United States remains one of the widely regarded destination countries for human trafficking; federal reports estimate that 14,500 to 17,500 victims are trafficked into the US annually. This does not include trafficking victims within the United States itself and, due to the clandestine nature of the underground economy, is almost certainly an underestimate. Human trafficking can take a number of forms, but generally involves compelling or coercing a person to provide labor or services, or to engage in commercial sex acts. As highlighted by the Attorney General’s website on human trafficking, “the coercion can be subtle or overt, physical or psychological, and may involve the use of violence, threats, lies, or debt bondage.”^[1]

The Attorney General’s website additionally notes, “Labor trafficking involves the recruitment, harboring, or transportation of a person for labor services, through the use of force, fraud, or coercion. It is modern day slavery. Labor trafficking arises in many situations, including domestic servitude, restaurant work, janitorial work, factory work, migrant agricultural work, and construction. It is often marked by unsanitary and overcrowded living and working conditions, nominal or no pay for work that is done, debt bondage, and document servitude. It occurs in homes and workplaces, and is often perpetrated by traffickers who are the same cultural origin and ethnicity as the victims, which allows the traffickers to use class hierarchy and cultural power to ensure the compliance of their victims. Labor traffickers often tell their victims that they will not be believed if they go to the authorities, that they will be deported from the United States, and that they have nowhere to run. Traffickers teach their victims to trust no one but the traffickers, so victims are often suspicious of genuine offers to help; they often expect that they will have to give something in return.”^[2]

Though existing law provides for training, workplace postings advising employees of their rights, and harsh penalties for human trafficking, the incentives to coerce people into servitude still exist.

2. Little Hoover Commission Reports:

In 2020, the Little Hoover Commission released three reports reviewing the state’s response to labor trafficking. The Commission noted that in California and elsewhere, much of the focus of law enforcement has appropriately been on combatting sex trafficking, particularly among minors, but believes that the state can and must do more to respond to labor trafficking. In one of the reports, Labor Trafficking: Strategies to Uncover this Hidden Crime, the Commission found that while several state agencies play a role in combatting human trafficking, there is no coordinated strategy to target the crime statewide. No state agency has a mandate to look for labor trafficking and government agencies are siloed.^[3] The Commission noted that while issues related to labor exploitation in California fall under the jurisdiction of the DIR, the agency does not proactively look for labor trafficking cases, in part because it does not have the authority to investigate labor trafficking cases. However, members of the Labor Enforcement Task Force – a multi-agency effort led by DIR to combat the underground economy – have observed signs of potential trafficking during inspections or received labor trafficking complaints and made 11 referrals of potential cases to the Department of Justice to investigate.^[4]

While California enacted anti-trafficking laws to support victims and increase penalties, more than fifteen years since the first antihuman trafficking landmark legislation was enacted, no state agency currently has a mandate to combat, prevent and address labor trafficking. Two state agencies that do have jurisdiction to prosecute trafficking crimes are the Department of Justice (DOJ) and the Civil Rights Department (CRD). Both DOJ and CRD coordinate with DIR when encountering labor trafficking cases on an as needed basis.

Consistent with the Little Hoover Commission recommendations, this bill would establish the Labor Trafficking Unit, within the Department of Industrial Relations, to receive and investigate complaints alleging labor trafficking and subsequently refer them for criminal prosecution by the DOJ or for civil action by the CRD.

3. AB 1820 (Arambula, 2022):

AB 1820 (Arambula) of 2022 was nearly identical to this bill [AB 380] and was vetoed. In his veto message, the Governor stated the following:

While I am strongly supportive of efforts to combat labor trafficking, the California Civil Rights Department (CCRD) (formerly DFEH) is the appropriate state entity to take the lead in this effort per the amendments offered by my office. DLSE does not have authority to criminally or civilly prosecute these types of cases nor have the tools and resources necessary to assist labor trafficking survivors. CCRD is already active in this space and could seamlessly expand its efforts to more aggressively combat labor trafficking provided it is given new resources in the budget.

AB 1684 (Stone, Chapter 63, Statutes of 2016) authorized the Department of Fair Employment and Housing (now the California Civil Rights Department) to receive, investigate, mediate, and prosecute civil complaints on behalf of a victim of human trafficking. AB 1684 also required any damages awarded in a civil action brought by the CRD to be awarded to the victim of human trafficking.

4. Need for this bill?

According to the author, “AB 380 will protect California’s most vulnerable workers from being taken advantage of by unscrupulous individuals and businesses who force them to work under duress with little to no pay. Trafficked employees face threats from their employers relating to documentation status, harm to their families, and loss of wages that prevent them from trying to escape and seek help. California first enacted anti-trafficking laws fifteen years ago, yet no state agency currently has a requirement to look for labor trafficking. This bill will create a Labor Trafficking Unit with the authority to investigate and receive claims of labor trafficking. By establishing a Labor Trafficking Unit in a state agency with the best expertise to enforce labor laws our state can take necessary steps to properly prevent, investigate, and coordinate state efforts to put a stop to the abuses of workers. Subject matter experts have emphasized that the Department of Industrial Relations is the most valuable and more suitable location. Survivors are more likely to feel safer and receive better resources from DIR as its work focuses on wage theft, labor rights and laws. Most importantly, we want to ensure survivors are informed about the services available to them and are not further victimized by the process of prosecuting traffickers.”

5. Proponent Arguments:

According to the sponsors of the measure, the Western Center on Law & Poverty and the Sunita Jain Anti-Trafficking Initiative, “California has the highest number of human trafficking cases in the nation reported to the National Human Trafficking Hotline. Despite its prevalence victims who toil in our fields, our restaurants and care for our family members are a “hidden crime.” Many victims do not self- identify or self-report, and many do not even recognize they are being trafficked. A report published by the Little Hoover Commission concluded that California’s efforts to prevent labor trafficking are fragmented and a major issue is a lack of a directive to current state agencies to lead efforts to prevent labor trafficking and coordinate with other agencies such as California Department of Justice (DOJ) and Department of Fair Employment and Housing (DFEH) to stop trafficking before it starts.

AB 380 (Arambula) - the California Labor Trafficking Prevention Act - seeks to protect California’s most vulnerable workers from being taken advantage of by unscrupulous individuals and businesses who force them to work under duress with little to no pay. This bill will provide the Department of Industrial Relations (DIR) with statutory authority to investigate and prosecute claims of human labor trafficking and create a Labor Trafficking Unit to take necessary steps to properly prevent, investigate, and coordinate state efforts to put a stop to the abuses of workers.”

6. Opponent Arguments:

None received.

7. Double Referral:

This bill has been double referred and if approved by this Committee today, will be sent to Senate Public Safety Committee for a hearing.

8. Prior and Related Legislation:

AB 235 (B. Rubio, 2023) is substantially similar to this bill. AB 235 would establish a Labor Trafficking Unit within the Civil Rights Department and require the unit to coordinate with the LETF, DOJ, and DLSE to take steps to prevent labor trafficking, receive and investigate complaints alleging labor trafficking, and report specified data. AB 235 was held on the Assembly Appropriations Committee suspense file.

AB 1149 (Grayson, 2023) would establish, until July 1, 2026, the California Multidisciplinary Alliance to Stop Trafficking Act (California MAST) to review collaborative models between governmental and nongovernmental organizations for protecting victims and survivors of trafficking, among other related duties. AB 1149 was held on the Assembly Appropriations Committee suspense file.

AB 1820 (Arambula, 2022, Vetoed), described above, was nearly identical to this bill.

AB 2553 (Grayson, 2022) would have established the California Multidisciplinary Alliance to Stop Trafficking Act (California MAST) to examine collaborative models between governmental and nongovernmental organizations for protecting victims and survivors of trafficking. AB 2553 was held on the Senate Committee on Appropriations suspense file.

AB 1296 (Gonzalez, Chapter 626, Statutes of 2019) established the Tax Recovery in the Underground Economy Criminal Enforcement Program (TRUE) in the Department of Justice to combat underground economic activities through a multiagency collaboration.

AB 2034 (Kalra, Chapter 812, Statutes of 2018) required businesses and establishments that operate in transportation or handle high volumes of traffic to train their employees in recognizing the signs of human trafficking and reporting suspected human trafficking.

SB 970 (Atkins, Chapter 842, Statutes of 2018) required that hotels and motels provide human trafficking education to employees who interact with the public.

AB 1684 (Stone, Chapter 63, Statutes of 2016) authorized the Department of Fair Employment and Housing (now the Civil Rights Department) to receive, investigate, mediate, and prosecute civil complaints on behalf of a victim of human trafficking.

AB 1464 (Blumenfield, Budget) Chapter 12, Statutes of 2012 established the Labor Enforcement Task Force within the DIR.

SUPPORT

Sunita Jain Anti-Trafficking Initiative, Loyola Law School (Co-Sponsor)

Western Center on Law & Poverty (Co-Sponsor)

3Strands Global Foundation
American Federation of State, County and Municipal Employees (AFSCME)

California Labor Federation, AFL-CIO
California Partnership for The San Joaquin Valley
California Police Chiefs Association
California Rural Legal Assistance Foundation, INC.
Central Valley Immigrant Integration Collaborative
Centro Binacional Para El Desarrollo Indígena Oaxaqueno
Centro LA Familia Advocacy Services
Dolores Street Community Services
Freedom Network USA
Fresno State Office of Community and Economic Development
Immigrant Defense Advocates
Legal Aid At Work
Little Hoover Commission
Los Angeles Center for Law and Justice
National Association of Social Workers, California Chapter
National Council of Jewish Women CA
Pilipino Workers Center
Precision Nails
San Diego County District Attorney's Office
Santa Barbara Women's Political Committee

Service Employees International Union (SEIU California)
State Building and Construction Trades Council of California
Thai Community Development Center
Tradeswomen INC.
Treasures Ministries
UDW/AFSCME Local 3930

OPPOSITION

None received

-- END --

1. “What is Human Trafficking?” Office of the Attorney General of California, https://oag.ca.gov/human-trafficking/what-is. ↑

2. Office of the Attorney General of California, https://oag.ca.gov/human-trafficking/what-is. ↑

3. Little Hoover Commission (September 2020, pages 3-4). Labor Trafficking: Strategies to Uncover this Hidden Crime. ↑

4. Little Hoover Commission (September 2020, pages 6-9). Labor Trafficking: Strategies to Uncover this Hidden Crime. ↑

ASSEMBLY THIRD READING

ATR Bill Id:AB 380

Author:(Arambula)

As Introduced Ver:February 2, 2023

Majority vote

SUMMARY

Establishes the Labor Trafficking Unit (LTU) within the Division of Labor Standards Enforcement (DLSE) and requires the LTU to coordinate with the Labor Enforcement Task Force (LETF), the Department of Justice (DOJ), and the Civil Rights Department (CRD) to take steps to prevent labor trafficking, investigate complaints alleging labor trafficking, and report specified data.

Major Provisions

1. Requires the LTU to coordinate with or refer cases to the LETF or the CRD for potential civil actions relating to labor trafficking violations.
2. Requires the LTU to coordinate with or refer cases to DOJ for potential criminal actions relating to labor trafficking violations.
3. Permits the LTU to coordinate with local law enforcement agencies or district attorney's offices when investigating criminal actions relating to labor trafficking.
4. Requires the LTU to follow protocols to ensure survivors are not victimized by the process of prosecuting traffickers and are informed of the services available to them.
5. Permits the LTU to coordinate with both state and local agencies to connect survivors of labor trafficking with available services.
6. Requires the Division of Occupational Safety and Health (Cal/OSHA) to notify the LTU when, upon investigating businesses under their purview, there is evidence of labor trafficking.
7. Requires, beginning January 1, 2026, and annually thereafter, the LTU to submit a report, as specified, to the Legislature that contains the following information:
   1. The number of complaints or referrals received.
   2. The number and type of complaints or referrals investigated.
   3. The number of complaints referred to CRD and to DOJ respectively.
   4. The number of referrals and coordinations with local law enforcement agencies and district attorney's offices.
   5. The outcomes for each complaint.
   6. A discussion of the major challenges to address labor trafficking complaints and the ongoing efforts to address those challenges.
8. Sunsets the reporting requirement on January 1, 2036.

COMMENTS

Labor trafficking involves an action such as recruiting, harboring, transporting or providing a person for the purpose of providing labor or services.^[1] Unlike sex trafficking victims, labor trafficking victims are almost exclusively foreign nationals. Some are in the U.S. without authorization, while others are lured to the U.S. with promises of legitimate work on valid visas.^[2]

Labor trafficking takes several forms, including debt bondage, involuntary servitude, domestic servitude, and forced child labor.^[3] Victims may be held against their will, may not be allowed to leave the premises, or may be housed in a closed or remote location. They may be forced to work in poor conditions for little or no pay, in urban or rural settings, alongside or within legitimate businesses, behind locked doors or hidden in plain sight.^[4] Specific data is not available to precisely determine the total fiscal impact of forced labor in California, but estimates of unpaid wages alone suggest the costs are significant. The International Labour Organization estimates approximately $19.6 billion in unpaid wages to people forced into labor globally.^[5]

According to the Author

"[This bill] will protect California's most vulnerable workers from being taken advantage of by unscrupulous individuals and businesses who force them to work under duress with little to no pay. There are many different situations that trafficked workers face—threats from employers relating to documentation status, harm to their families, and loss of wages—that prevent victims from trying to escape and seek services available. California first enacted anti-trafficking laws fifteen years ago, yet no state agency currently has a requirement to look for labor trafficking. This bill will create a Labor Trafficking Unit with the authority to investigate and prosecute claims of human labor trafficking. By establishing a Labor Trafficking Unit in a state agency with the best expertise to enforce labor laws our state can take necessary steps to properly prevent, investigate, and coordinate state efforts to put a stop to the abuses of workers. Subject matter experts have emphasized that the Department of Industrial Relations is the most valuable and more suitable location. Victims are more likely to feel safer and receive better resources from DIR as its work focuses on wages, labor rights and laws. Most importantly, we want to ensure survivors are informed about the services available to them and are not further victimized by the process of prosecuting traffickers."

In addition, the author points out that [this bill] will promote equity solutions and maximize benefits for underserved and marginalized communities by positioning the state to implement "more effective investigations of labor trafficking and prosecution and supporting victims of labor trafficking through legal action and resources in order to ensure justice."

Arguments in Support

According to The Sunita Jain Anti-Trafficking Initiative, cosponsor of the bill, "California has the highest number of human trafficking cases in the nation reported to the National Human Trafficking Hotline. Despite its prevalence victims who toil in our fields, our restaurants and care for our family members are a "hidden crime." Many victims do not self- identify or self-report, and many do not even recognize they are being trafficked. [This bill] seeks to protect California's most vulnerable workers from being taken advantage of by unscrupulous individuals and businesses who force them to work under duress with little to no pay. This bill will provide the Department of Industrial Relations (DIR) with statutory authority to investigate and prosecute claims of human labor trafficking and create a Labor Trafficking Unit to take necessary steps to properly prevent, investigate, and coordinate state efforts to put a stop to the abuses of workers."

Arguments in Opposition

None on file.

FISCAL COMMENTS

According to the Assembly Appropriations Committee:

1. Costs of approximately $4.3 million in the first year across the Department of Industrial Relations (DIR), which includes DLSE, LETF, and Cal/OSHA, and $4.0 million ongoing to DLSE (Labor Enforcement and Compliance Fund). Although this bill does not functionally expand DLSE's powers to combat labor trafficking, this bill signals a requirement to significantly enhance such efforts. DLSE will incur significant costs to staff and set up the LTU to receive, investigate, and refer complaints; provide support to survivors; and compile the annual report.

Cal/OSHA will incur minor and absorbable costs to implement written procedures to identify labor trafficking and share evidence with the LTU. Additionally, minor and absorbable costs to LETF to coordinate with the LTU. DIR notes LETF does not have the authority or capacity to pursue civil actions related to labor trafficking and would continue to refer any potential cases to the appropriate authority.

1. Costs of approximately $1.6 million in fiscal year 2023-24 and costs of approximately $3.9 million annually thereafter to DOJ (General Fund (GF)). The Criminal Law Division's Special Prosecutions Section currently receives five to 12 labor trafficking allegations per year from DIR and anticipates this number to increase upon establishment of the LTU, necessitating an additional 15 positions, including one supervising deputy, two deputy attorneys general, four investigators, and three legal secretaries.
2. Annual GF costs of approximately $3.4 million, beginning fiscal year 2024-25, to CRD for an additional 18 positions, including senior and junior attorneys to litigate civil actions and coordinate with other agencies, investigators, an experienced mediator, bilingual outreach workers, and administrative and information technology support staff. The cost estimate also includes $125,000 for operational expenses, such as expert consultants for civil actions, translation and interpretation services, the bilingual pay differential for certified bilingual employees, and travel expenses to visit worksites and other locations statewide to support human trafficking survivors.

VOTES

ASM LABOR AND EMPLOYMENT: 7-0-0

YES: Kalra, Flora, Chen, Haney, Ortega, Reyes, Ward

ASM PUBLIC SAFETY: 8-0-0

YES: Jones-Sawyer, Alanis, Bonta, Bryan, Lackey, Ortega, Santiago, Zbur

ASM APPROPRIATIONS: 15-0-1

YES: Holden, Megan Dahle, Bryan, Calderon, Wendy Carrillo, Dixon, Mike Fong, Hart, Lowenthal, Mathis, Papan, Pellerin, Sanchez, Weber, Ortega

ABS, ABST OR NV: Robert Rivas

UPDATED

VERSION: February 2, 2023

CONSULTANT: Martin Vindiola / L. & E. / (916) 319-2091 FN: 0000487

1. Little Hoover Commission. Human Trafficking: Coordinating a California Response, June 2020. ↑

2. Davis, Kristina. Horrors of labor trafficking remain hidden with spotlight on sex trafficking, The San Diego Tribune, December 2019. ↑

3. U.S. Department of Health & Human Services: Office on Trafficking in Persons. Fact Sheet: Labor Trafficking. ↑

4. Little Hoover Commission. Human Trafficking: Coordinating a California Response, June 2020. ↑

5. International Labour Office. The Cost of Coercion, 2009. ↑

Date of Hearing: May 3, 2023

ASSEMBLY COMMITTEE ON APPROPRIATIONS

Chris Holden, Chair

ABPCA Bill Id:AB 380

Author:(Arambula) – As Introduced Ver:February 2, 2023

Urgency: No State Mandated Local Program: No Reimbursable: No

SUMMARY:

This bill establishes the Labor Trafficking Unit (LTU) within the Division of Labor Standards Enforcement (DLSE).

Specifically, this bill:

1. Requires the DLSE to establish the LTU to coordinate with the Labor Enforcement Task Force (LETF), Criminal Investigation Unit, Department of Justice (DOJ), and Civil Rights Department (CRD) to combat labor trafficking.
2. Requires the LTU to receive and investigate complaints alleging labor trafficking. The LTU must coordinate with or refer cases to LETF or CRD for potential civil actions, as well as DOJ for potential criminal actions, and may coordinate with local law enforcement agencies investigating criminal actions related to labor trafficking.
3. Requires the LTU to follow specified protocols to support survivors and authorizes the LTU to coordinate with state and local agencies to connect survivors with services.
4. Requires the Division of Occupational Safety and Health (Cal/OSHA) to notify the LTU when Cal/OSHA discovers evidence of labor trafficking during regular investigations under Cal/OSHA’s existing purview.
5. Requires, beginning January 1, 2026, the LTU to submit an annual report to the Legislature regarding labor trafficking complaints received and ongoing efforts to resolve the challenges of addressing complaints.

FISCAL EFFECT:

1. Costs of approximately $4.3 million in the first year across the Department of Industrial Relations (DIR), which includes DLSE, LETF, and Cal/OSHA, and $4.0 million ongoing to DLSE (Labor Enforcement and Compliance Fund). Although this bill does not functionally expand DLSE’s powers to combat labor trafficking, this bill signals a requirement to significantly enhance such efforts. DLSE will incur significant costs to staff and set up the LTU to receive, investigate, and refer complaints; provide support to survivors; and compile the annual report.

Cal/OSHA will incur minor and absorbable costs to implement written procedures to identify labor trafficking and share evidence with the LTU. Additionally, minor and absorbable costs to LETF to coordinate with the LTU. DIR notes LETF does not have the authority or capacity to pursue civil actions related to labor trafficking and would continue to refer any potential cases to the appropriate authority.

1. Costs of approximately $1.6 million in fiscal year 2023-24 and costs of approximately $3.9 million annually thereafter to DOJ (General Fund (GF)). The Criminal Law Division’s Special Prosecutions Section currently receives five to 12 labor trafficking allegations per year from DIR and anticipates this number to increase upon establishment of the LTU, necessitating an additional 15 positions, including one supervising deputy, two deputy attorneys general, four investigators, and three legal secretaries.
2. Annual GF costs of approximately $3.4 million, beginning fiscal year 2024-25, to CRD for an additional 18 positions, including senior and junior attorneys to litigate civil actions and coordinate with other agencies, investigators, an experienced mediator, bilingual outreach workers, and administrative and information technology support staff. The cost estimate also includes $125,000 for operational expenses, such as expert consultants for civil actions, translation and interpretation services, the bilingual pay differential for certified bilingual employees, and travel expenses to visit worksites and other locations statewide to support human trafficking survivors.

COMMENTS:

1. Purpose. According to the author:

California first enacted anti-trafficking laws fifteen years ago, yet no state agency currently has a requirement to look for labor trafficking. This bill will create a [LTU] with the authority to investigate and prosecute claims of human labor trafficking. By establishing a [LTU] in a state agency with the best expertise to enforce labor laws our state can take necessary steps to properly prevent, investigate, and coordinate state efforts to put a stop to the abuses of workers. Subject matter experts have emphasized that the [DIR] is the most valuable and more suitable location. Victims are more likely to feel safer and receive better resources from DIR as its work focuses on wages, labor rights and laws. Most importantly, we want to ensure survivors are informed about the services available to them and are not further victimized by the process of prosecuting traffickers.

This bill is co-sponsored by the Sunita Jain Anti-Trafficking Initiative, a project at Loyola Law School, and Western Center on Law and Poverty. This bill is also supported by various labor organizations and legal aid groups, as well as the Little Hoover Commission (LHC).

1. Background.

LHC Reports. In 2020, the LHC released three reports reviewing the state’s response to labor trafficking, noting that the state’s efforts thus far have focused mainly on sex trafficking. LHC found that, while several state agencies play a role in combatting human trafficking, there is no coordinated strategy to target the crime statewide – no state agency has a mandate to look for labor trafficking and existing agency efforts are siloed. LHC noted, while issues related to labor exploitation fall under DIR jurisdiction, DIR does not proactively look for labor trafficking cases, in part because DIR does not have the authority to investigate cases.

LETF. DIR primarily works to combat the underground economy through its LETF, additionally comprised of the Labor and Workforce Development Agency, Employment Development Department, Contractor’s State Licensing Board, Department of Insurance, State Board of Equalization, Bureau of Automotive Repair, and DOJ. LETF shares information and resources to ensure workers receive proper payment of wages and have safe working environments, while ensuring the state receives all employment taxes, fees, and penalties due from employers.

The LHC found LETF members have observed signs of potential trafficking during inspections or received labor trafficking complaints, referring nearly one dozen potential cases to DOJ for investigation. This bill augments existing LETF efforts by establishing the LTU, under the central authority of DLSE, to receive and investigate labor trafficking complaints. This bill requires the LTU to refer criminal cases to DOJ for prosecution and civil cases to LETF or CRD for action, and it requires CalOSHA to notify the LTU when evidence of labor trafficking is discovered.

Competing Approaches. This bill is virtually identical to AB 1820 (Arambula), of the 2021-22 Legislative Session. AB 1820 was vetoed by Governor Newsom, who stated:

While I am strongly supportive of efforts to combat labor trafficking, the [CRD] is the appropriate state entity to take the lead in this effort per the amendments offered by my office. DLSE does not have authority to criminally or civilly prosecute these types of cases nor have the tools and resources necessary to assist labor trafficking survivors. [CRD] is already active in this space and could seamlessly expand its efforts to more aggressively combat labor trafficking provided it is given new resources in the budget.

This bill keeps the LTU at DLSE. However, AB 235 (Rubio), of this legislative session, proposes to establish the LTU at CRD. The two bills are virtually identical otherwise, except AB 235 requires the LTU to coordinate with state and local agencies to connect survivors with available services, whereas this bill authorizes such coordination. AB 235 also requires the LTU to communicate additional resources available to survivors. AB 235 is pending hearing in this committee.

Analysis Prepared by: Irene Ho / APPR. / (916) 319-2081

Date of Hearing: April 18, 2023

Consultant: Elizabeth Potter

ASSEMBLY COMMITTEE ON

Reginald Byron Jones-Sawyer, Sr., Chair

ABPCA Bill Id:

Author:() – As Ver:

SUMMARY: : Establishes the Labor Trafficking Unit (LTU) within the Division of Labor Standards Enforcement (DLSE) and requires the LTU to coordinate with the Labor Enforcement Task Force (LETF), the Department of Justice (DOJ), and the Civil Rights Department (CRD). Specifically, this bill:

1. Establishes the LTU and directs it to coordinate with the LETF, the Criminal Investigation Unit, DOJ, and the CRD to combat labor trafficking.
   
2. Requires the LTU to receive and investigate complaints alleging labor trafficking, as well as take steps to prevent it.
   
3. Requires the LTU to coordinate with, or refer cases to, LETF or CRD for potential civil actions relating to labor trafficking violations.
   
4. Requires the LTU to coordinate with, or refer cases to, DOJ for potential criminal prosecution related to labor trafficking violations.
   
5. Permits the LTU to coordinate with local law enforcement agencies or district attorney’s offices when investigating criminal actions relating to labor trafficking.
   
6. Requires the LTU to follow protocols to ensure survivors are not victimized by the process of prosecuting traffickers and are informed of services available to them.
   
7. Requires the Division of Occupational Safety and Health to notify the LTU when they find evidence of labor trafficking in the course of investigating businesses.
   
8. Requires, beginning January 1, 2026, and annually thereafter, LTU to submit a report to the Legislature that contains the following:
   
   1. The number of complaints or referrals received;
      
   2. The number and type of complaints or referrals investigated;
      
   3. The number of complaints referred to CRD and to DOJ respectively;
      
   4. The number of referrals and coordinations with local law enforcement agencies and district attorney’s offices;
      
   5. The outcomes for each complaint; and,
      
   6. A discussion of the major challenges to address labor trafficking complaints and the ongoing efforts to address those challenges.
      
9. Sunsets the reporting requirement on January 1, 2036.

EXISTING LAW:

1. Provides that any person who deprives or violates the personal liberty of another with the intent to obtain forced labor or services is guilty of human trafficking and shall be punished in the state prison for 5, 8, or 12 years and a fine of not more than $500,000. (Pen. Code, § 236.1., subd. (a).)
   
2. Provides that a victim of human trafficking may bring a civil action for damages, compensatory damages, punitive damages, injunctive relief, and combination thereof, or any other appropriate relief. (Civ. Code, § 52.5.)
   
3. Provides that when the Attorney General deems it advisable or necessary in the public interest, or when directed to do so by the Governor, the Attorney General shall assist any district attorney in the discharge of the district attorney’s duties, and may, if deemed necessary, take full charge of any investigation or prosecution of violations of law of which the superior court has jurisdiction. In this respect, the Attorney General has all the powers of a district attorney. (Gov. Code, § 12550.)
   
4. Authorizes the CRD to receive, investigate, conciliate, mediate, and prosecute complaints alleging, and to bring civil actions for, a violation of the crime of human trafficking, as specified. (Gov. Code, 12930, § subd. (f)(3).)
   
5. Establishes the LETF under the direction of Department of Industrial Relations (DIR) to enforce activities regarding labor, tax, and licensing law violators operating in the underground economy. (Unemp. Ins. Code, §329.)

FISCAL EFFECT: Unknown

COMMENTS:

1. Author's Statement: According to the author, “AB 380 will protect California’s most vulnerable workers from being taken advantage of by unscrupulous individuals and businesses who force them to work under duress with little to no pay. There are many different situations that trafficked workers face—threats from employers relating to documentation status, harm to their families, and loss of wages—that prevent victims from trying to escape and seek services available. California first enacted anti-trafficking laws fifteen years ago, yet no state agency currently has a requirement to look for labor trafficking. This bill will create a Labor Trafficking Unit with the authority to investigate and prosecute claims of human labor trafficking. By establishing a Labor Trafficking Unit in a state agency with the best expertise to enforce labor laws our state can take necessary steps to properly prevent, investigate, and coordinate state efforts to put a stop to the abuses of workers. Subject matter experts have emphasized that the Department of Industrial Relations is the most valuable and more suitable location. Victims are more likely to feel safer and receive better resources from DIR as its work focuses on wages, labor rights and laws. Most importantly, we want to ensure survivors are informed about the services available to them and are not further victimized by the process of prosecuting traffickers.”
   
2. Labor Trafficking: According to the Attorney General’s Website: “Labor trafficking involves the recruitment, harboring, or transportation of a person for labor services, through the use of force, fraud, or coercion. It is modern day slavery. Labor trafficking arises in many situations, including domestic servitude, restaurant work, janitorial work, factory work, migrant agricultural work, and construction. It is often marked by unsanitary and overcrowded living and working conditions, nominal or no pay for work that is done, debt bondage, and document servitude. It occurs in homes and workplaces, and is often perpetrated by traffickers who are the same cultural origin and ethnicity as the victims, which allows the traffickers to use class hierarchy and cultural power to ensure the compliance of their victims. Labor traffickers often tell their victims that they will not be believed if they go to the authorities, that they will be deported from the United States, and that they have nowhere to run. Traffickers teach their victims to trust no one but the traffickers, so victims are often suspicious of genuine offers to help; they often expect that they will have to give something in return.” (What is Human Trafficking?, California Attorney General. Available at: https://oag.ca.gov/human-trafficking/what-is. [As of March 29, 2023])
   
3. Little Hoover Commission Reports: In 2020 the Little Hoover Commission released three reports reviewing the state’s response to labor trafficking. The Commission noted that state efforts to combat human trafficking have focused mainly on sex trafficking. In the second report, Labor Trafficking: Strategies to Uncover this Hidden Crime, the Commission found that while several state agencies play a role in combatting human trafficking, there is no coordinated strategy to target the crime statewide. No state agency has a mandate to look for labor trafficking and government agencies are siloed. The Commission noted that while issues related to labor exploitation in California fall under the jurisdiction of the DIR, the agency does not proactively look for labor trafficking cases, in part because it does not have the authority to investigate labor trafficking cases. However, members of the Labor Enforcement Task Force – a multi-agency effort led by DIR to combat the underground economy – have observed signs of potential trafficking during inspections or received labor trafficking complaints and made nearly close to one dozen referrals of potential cases to the Department of Justice to investigate. (Labor Trafficking: Strategies to Uncover this Hidden Crime, Little Hoover Commission (Sept. 2020), at pp. 6-9. Available at: https://lhc.ca.gov/sites/lhc.ca.gov/files/Reports/251/Report251.pdf. [As of March 29, 2023])
   
   Consistent with these recommendations, this bill would establish LTU to receive and investigate complaints alleging labor trafficking and subsequently refer them for criminal prosecution by the DOJ or for civil action by the DEFH.
   
4. Governor’s Veto Message: AB 1820 (Arambula), of 2021-2022 Legislative Session, proposed nearly identical to this bill and was vetoed. The Governor’s veto message stated:
   
   “While I am strongly supportive of efforts to combat labor trafficking, the California Civil Rights Department (CCRD) (formerly DFEH) is the appropriate state entity to take the lead in this effort per the amendments offered by my office. DLSE does not have authority to criminally or civilly prosecute these types of cases nor have the tools and resources necessary to assist labor trafficking survivors. CCRD is already active in this space and could seamlessly expand its efforts to more aggressively combat labor trafficking provided it is given new resources in the budget.
   
   This bill does not address the governor’s concerns.
   
5. Argument in Support: According to Sunita Jain Anti-Trafficking Initiative (SJI) a project at Loyola Law School and Western Center on Law & Poverty, “Human trafficking is the world's fastest-growing criminal enterprise and is an estimated to be a $150 billion- annual global industry. On a global scale, the International Labour Organization estimates that of the 20.9 million forced laborers worldwide, 68 percent are victims of forced labor exploitation. Unfortunately, COVID- 19 has worsened the current status quo. A State Department report underscored that COVID 19 increased the number of people at risk of human trafficking and highlighted "monumental" challenges laid bare by the pandemic, which "may be long lasting, requiring sustained collaboration among governments, civil society organizations, private sector leaders, survivor leaders, and other anti-trafficking actors to adjust and respond aptly to overcome these challenges.”
   
   “The passing of this bill is crucial to safeguarding the rights of all workers, including victims of labor trafficking. Now is the time for action as we are seeing numerous cases of labor trafficking coming to light in California across a wide range of industries. The LA Times recently highlighted that many farm workers in the cannabis industry are being forced to work and not being paid for their labor, which is labor trafficking.^[1] In 2018, a decades long scheme of labor trafficking was discovered at numerous elder and child care facilities named Rainbow Bright that were operated by the Gamos Family. The Gamos family would require their workers, mostly Filipino immigrants, to live and work in the care homes and would confiscate their passports and threatened to turn them over to U.S. immigration officials.^[2]
   
   “California has the highest number of human trafficking cases in the nation reported to the National Human Trafficking Hotline. Despite its prevalence victims who toil in our fields, our restaurants and care for our family members are a “hidden crime.” Many victims do not self- identify or self-report, and many do not even recognize they are being trafficked. A report published by the Little Hoover Commission concluded that California’s efforts to prevent labor trafficking are fragmented and a major issue is a lack of a directive to current state agencies to lead efforts to prevent labor trafficking and coordinate with other agencies such as California Department of Justice (DOJ) and Department of Fair Employment and Housing (DFEH) to stop trafficking before it starts.
   
   “AB 380 (Arambula) - the California Labor Trafficking Prevention Act - seeks to protect California’s most vulnerable workers from being taken advantage of by unscrupulous individuals and businesses who force them to work under duress with little to no pay. This bill will provide the Department of Industrial Relations (DIR) with statutory authority to investigate and prosecute claims of human labor trafficking and create a Labor Trafficking Unit to take necessary steps to properly prevent, investigate, and coordinate state efforts to put a stop to the abuses of workers.”
   
6. Related Legislation:
   
   1. AB 235 (B. Rubio), is substantially similar to this bill. AB 235 would establish a LTU within the CRD and require the LTU to coordinate with the LETF, DOJ, and DLSE to take steps to prevent labor trafficking, receive and investigate complaints alleging labor trafficking, and report specified data. AB 235 is pending hearing in this committee today.
      
   2. AB 1149 (Grayson), would establish, until July 1, 2026, the California Multidisciplinary Alliance to Stop Trafficking Act (California MAST) to review collaborative models between governmental and nongovernmental organizations for protecting victims and survivors of trafficking, among other related duties. AB 1149 bill is currently pending a hearing in the Assembly Committee on Appropriations.
      
7. Prior Legislation:
   
   1. AB 1820 (Arambula), of the 2021-2022 Legislative Session, was nearly identical to this bill. AB 1820 was vetoed by the Governor.
      
   2. AB 2553 (Grayson), of 2021-2022 Legislative Session, would have established the California Multidisciplinary Alliance to Stop Trafficking Act (California MAST) to examine collaborative models between governmental and nongovernmental organizations for protecting victims and survivors of trafficking. AB 2553 was held on the Senate Committee on Appropriations suspense file.
      
   3. AB 1684 (Stone), Chapter 63, Statutes of 2016, authorized the DEFH to receive, investigate, mediate, and prosecute civil complaints on behalf of a victim of human trafficking.
      

REGISTERED SUPPORT / OPPOSITION:

Support

3strands Global Foundation
Afscme
American Federation of State, County and Municipal Employees - Afl-cio
California Labor Federation, Afl-cio
California Rural Legal Assistance Foundation, INC.
Dolores Street Community Services
Freedom Network USA
Immigrant Defense Advocates
Legal Aid At Work
Little Hoover Commission
Los Angeles Center for Law and Justice
Loyola Law School, the Sunita Jain Anti-trafficking Initiative
National Association of Social Workers, California Chapter
National Council of Jewish Women CA
Pilipino Workers Center
San Diego County District Attorney's Office
Santa Barbara Women's Political Committee
State Building and Construction Trades Council of Ca
Thai Community Development Center
Tradeswomen INC.
Udw/afscme Local 3930
Western Center on Law & Poverty

Opposition

None on file.

Analysis Prepared by:

1. L.A. Times Article: “Lawmakers want investigation, hearings into ‘Wild West’ of California cannabis and farm work’ ↑

2. https://oag.ca.gov/news/press-releases/attorney-general-bonta-announces-sentences-rainbow-bright-defendants-bay-area ↑

Date of Hearing: March 22, 2023

ASSEMBLY COMMITTEE ON LABOR AND EMPLOYMENT

Ash Kalra, Chair

ABPCA Bill Id:AB 380 (

Author:Arambula) – As Introduced Ver:February 2, 2023

SUBJECT: Division of Labor Standards Enforcement: Labor Trafficking Unit

SUMMARY: Establishes the Labor Trafficking Unit (LTU) within the Division of Labor Standards Enforcement (DLSE) and requires the LTU to coordinate with the Labor Enforcement Task Force (LETF), the Department of Justice (DOJ), and the Civil Rights Department (CRD) to take steps to prevent labor trafficking, investigate complaints alleging labor trafficking, and report specified data.

Specifically, this bill:

1. Requires the LTU to coordinate with or refer cases to the LETF or the CRD for potential civil actions relating to labor trafficking violations.
2. Requires the LTU to coordinate with or refer cases to DOJ for potential criminal actions relating to labor trafficking violations.
3. Permits the LTU to coordinate with local law enforcement agencies or district attorney’s offices when investigating criminal actions relating to labor trafficking.
4. Requires the LTU to follow protocols to ensure survivors are not victimized by the process of prosecuting traffickers and are informed of the services available to them.
5. Permits the LTU to coordinate with both state and local agencies to connect survivors of labor trafficking with available services.
6. Requires the Division of Occupational Safety and Health (Cal/OSHA) to notify the LTU when, upon investigating businesses under their purview, there is evidence of labor trafficking.
7. Requires, beginning January 1, 2026, and annually thereafter, the LTU to submit a report, as specified, to the Legislature that contains the following information:
   1. The number of complaints or referrals received.
   2. The number and type of complaints or referrals investigated.
   3. The number of complaints referred to CRD and to DOJ respectively.
   4. The number of referrals and coordinations with local law enforcement agencies and district attorney’s offices.
   5. The outcomes for each complaint.
   6. A discussion of the major challenges to address labor trafficking complaints and the ongoing efforts to address those challenges.
8. Sunsets the reporting requirement on January 1, 2036.

EXISTING LAW:

1. Establishes DLSE under the direction of the Labor Commissioner (LC) and authorizes the LC to investigate employee complaints and enforce labor laws, as specified.
   (Lab. Code, § 79 et seq.)
2. Establishes LETF under the direction of DIR to combat the underground economy in order to ensure safe working conditions and proper payment of wages for workers; to create an environment in which legitimate businesses can thrive; and to support the collection of all California taxes, fees, and penalties due from employers. (Budget Act of 2012)
   
3. Establishes the Joint Enforcement Strike Force (JESF) to combat the underground economy by combining resources and sharing information among the state agencies that enforce tax, labor, and licensing laws. (Unemp. Ins. Code, § 329.)
4. Requires the DOJ to maintain, at a minimum, two multiagency Tax Recovery in the Underground Economy (TRUE) Criminal Enforcement Program investigative teams to combat underground economic activities through a multiagency collaboration and recover state revenue lost to the underground economy. (Gov. Code, § 15926.)
5. Authorizes CRD to receive, investigate, conciliate, mediate, and prosecute complaints alleging, and to bring civil actions for a violation of the crime of human trafficking, as specified. (Gov. Code, § 12930 (f)(3).)
6. Provides that a victim of human trafficking may bring a civil action for damages, compensatory damages, punitive damages, injunctive relief, and combination thereof, or any other appropriate relief. (Civ. Code, § 52.5.)
7. Provides that any person who deprives or violates the personal liberty of another with the intent to effect or maintain specified felony prostitution-related offenses or obtain forced labor or services is guilty of human trafficking. (Pen. Code, § 236.1.)

FISCAL EFFECT: Unknown

COMMENTS: Note: This bill is double referred to the Assembly Public Safety Committee upon passage out of this Committee.

Labor trafficking involves an action such as recruiting, harboring, transporting or providing a person for the purpose of providing labor or services.^[1] Unlike sex trafficking victims, labor trafficking victims are almost exclusively foreign nationals. Some are in the U.S. without authorization, while others are lured to the U.S. with promises of legitimate work on valid visas.^[2]

Labor trafficking takes several forms, including debt bondage, involuntary servitude, domestic servitude, and forced child labor.^[3] Victims may be held against their will, may not be allowed to leave the premises, or may be housed in a closed or remote location. They may be forced to work in poor conditions for little or no pay, in urban or rural settings, alongside or within legitimate businesses, behind locked doors or hidden in plain sight.^[4] Specific data is not available to precisely determine the total fiscal impact of forced labor in California, but estimates of unpaid wages alone suggest the costs are significant. The International Labour Organization estimates approximately $19.6 billion in unpaid wages to people forced into labor globally.^[5]

According to the author, “[This bill] will protect California’s most vulnerable workers from being taken advantage of by unscrupulous individuals and businesses who force them to work under duress with little to no pay. There are many different situations that trafficked workers face—threats from employers relating to documentation status, harm to their families, and loss of wages—that prevent victims from trying to escape and seek services available. California first enacted anti-trafficking laws fifteen years ago, yet no state agency currently has a requirement to look for labor trafficking. This bill will create a Labor Trafficking Unit with the authority to investigate and prosecute claims of human labor trafficking. By establishing a Labor Trafficking Unit in a state agency with the best expertise to enforce labor laws our state can take necessary steps to properly prevent, investigate, and coordinate state efforts to put a stop to the abuses of workers. Subject matter experts have emphasized that the Department of Industrial Relations is the most valuable and more suitable location. Victims are more likely to feel safer and receive better resources from DIR as its work focuses on wages, labor rights and laws. Most importantly, we want to ensure survivors are informed about the services available to them and are not further victimized by the process of prosecuting traffickers.”

In addition, the author points out that [this bill] will promote equity solutions and maximize benefits for underserved and marginalized communities by positioning the state to implement “more effective investigations of labor trafficking and prosecution and supporting victims of labor trafficking through legal action and resources in order to ensure justice.”

The Underground Economy

The underground economy is comprised of individuals and businesses that use various schemes to conceal their activities and evade their tax liabilities by avoiding licensing, regulatory, labor, and tax agencies. Businesses in the underground economy may deliberately fail to report work to appropriate government agencies, obtain proper permits, secure the appropriate insurance, provide sufficient safety and skills training to workers, or pay fees, taxes, or minimum wages. Other evasive practices include paying workers a lower wage than stated on payroll reports, misclassifying workers as independent contractors to avoid paying employee-level fees and taxes, and misreporting profits and material costs to avoid taxes.^[6]

The UCLA Labor Center notes it is difficult to calculate the size of the underground economy because underground businesses are not participating in systems that would allow for data collection. The UCLA Labor Center acknowledges that the statistics on the extent of the informal economy are unreliable and vary widely. The data that does exist on the size of the underground economy is largely based on national estimates. The Employment Development Department (EDD), based on their analysis of Internal Revenue Service data, estimates California’s underground economy at $60 - $140 billion annually.^[7]

Governor’s Veto Message

AB 1820 (Arambula) of 2022 proposed language identical to this bill and was vetoed. The Governor’s veto message stated:

“While I am strongly supportive of efforts to combat labor trafficking, the California Civil Rights Department (CCRD) (formerly DFEH) is the appropriate state entity to take the lead in this effort per the amendments offered by my office. DLSE does not have authority to criminally or civilly prosecute these types of cases nor have the tools and resources necessary to assist labor trafficking survivors. CCRD is already active in this space and could seamlessly expand its efforts to more aggressively combat labor trafficking provided it is given new resources in the budget.”

In response to the Governor’s veto, the author states, “In 2022, Governor Newsom vetoed AB 1820, a bill that addressed the inhumane brutalities that victims of human trafficking endure by predatory labor traffickers across the state’s various industries. The author still believes that establishing the Labor Trafficking Unit in the Division of Labor Standards Enforcement within the Department of Industrial Relations (DIR) provides the necessary authority to prevent and combat human trafficking. Given DIR’s expertise in working with vulnerable communities and its authority in investigating and prosecuting labor crimes, it remains the most suitable department to take the lead in providing justice to workers most impacted by labor trafficking. The author acknowledges the Governor’s request that the Unit be placed in the Department of Civil Rights, but this agency since 2016 has had the statutory authority that DIR has lacked. It is only with the leadership of both of these departments that California will be best positioned to lead the nation in combating labor trafficking, a crime which has only worsened in the aftermath of the COVID-19 crisis.”

Arguments in Support

According to The Sunita Jain Anti-Trafficking Initiative, cosponsor of the bill, “California has the highest number of human trafficking cases in the nation reported to the National Human Trafficking Hotline. Despite its prevalence victims who toil in our fields, our restaurants and care for our family members are a “hidden crime.” Many victims do not self- identify or self-report, and many do not even recognize they are being trafficked. [This bill] seeks to protect California’s most vulnerable workers from being taken advantage of by unscrupulous individuals and businesses who force them to work under duress with little to no pay. This bill will provide the Department of Industrial Relations (DIR) with statutory authority to investigate and prosecute claims of human labor trafficking and create a Labor Trafficking Unit to take necessary steps to properly prevent, investigate, and coordinate state efforts to put a stop to the abuses of workers.”

Committee Comments

The committee notes that this bill is substantially similar to Assembly Bill 235 (Rubio) that would also establish a Labor Trafficking Unit with an identical mandate to investigate complaints alleging labor trafficking and take steps to prevent labor trafficking by coordinating with relevant agencies. The one significant difference between this bill and AB 235 (Rubio) is that this bill establishes the Labor Trafficking Unit within DLSE and AB 235 (Rubio) establishes the Labor Trafficking Unit within CRD. Committee staff notes that establishing two labor trafficking units with substantially similar mandates and reporting requirements in two separate departments appears duplicative.

Related & Prior Legislation

AB 253 (Rubio) of 2023 is nearly identical to this bill and would establish a LTU within the CRD and require the LTU to coordinate with the LETF, DOJ, and DLSE to take steps to prevent labor trafficking, receive and investigate complaints alleging labor trafficking, and report specified data. This bill is currently pending a hearing in this Committee.

AB 1149 (Grayson) of 2023 would establish, until July 1, 2026, the California Multidisciplinary Alliance to Stop Trafficking Act (California MAST) to review collaborative models between governmental and nongovernmental organizations for protecting victims and survivors of trafficking, among other related duties. This bill is currently pending a hearing in the Assembly Public Safety Committee.

AB 1820 (Arambula) of 2022 would have established the LTU within DLSE to coordinate with LETF, DOJ, and CRD to investigate and prosecute complaints alleging labor trafficking, and report specified data. This bill was vetoed by Governor Newsom.

AB 2553 (Grayson) of 2022 would have established the California Multidisciplinary Alliance to Stop Trafficking Act (California MAST) to examine collaborative models between governmental and nongovernmental organizations for protecting victims and survivors of trafficking. This bill was held under submission in the Senate Appropriations Committee.

AB 1296 (Gonzalez) Chapter 626, Statutes of 2019 established the Tax Recovery in the Underground Economy Criminal Enforcement Program (TRUE) in the Department of Justice (DOJ) to combat underground economic activities through a multiagency collaboration.

AB 2034 (Kalra) Chapter 812, Statutes of 2018 required businesses and establishments that operate in transportation or handle high volumes of traffic to train their employees in recognizing the signs of human trafficking and reporting suspected human trafficking.

SB 970 (Atkins) Chapter 842, Statutes of 2018 required that hotels and motels provide human trafficking education to employees who interact with the public.

AB 1684 (Stone) Chapter 63, Statutes of 2016 authorized the Department of Fair Employment and Housing to receive, investigate, conciliate, mediate, and prosecute complaints alleging, and bring civil actions for, a victim of human trafficking.

AB 1464 (Blumenfield, Budget) Chapter 12, Statutes of 2012 established the LETF within the DIR.

AB 576 (V. Manuel Pérez) Chapter 614, Statutes of 2013 created the “Centralized Intelligence Partnership” pilot program consisting of specified agencies to collaborate in combating those engaged in the underground economy.

SB 1490 (Johnston) Chapter 1117, Statutes of 1994, codified the Joint Enforcement Strike Force on the Underground Economy under the EDD.

REGISTERED SUPPORT / OPPOSITION:

Support

Loyola Law School, the Sunita Jain Anti-trafficking Initiative (Co-Sponsor)
Western Center on Law and Poverty (Co-Sponsor)
1 Individual
California Rural Legal Assistance Foundation, INC.
Dolores Street Community Services
Freedom Network USA
Legal Aid At Work
Little Hoover Commission
Santa Barbara Women's Political Committee
Thai Community Development Center
Tradeswomen INC.
Western Center on Law & Poverty

Opposition

None on file.

Analysis Prepared by: Martin Vindiola / L. & E. /

1. Little Hoover Commission. Human Trafficking: Coordinating a California Response, June 2020. ↑

2. Davis, Kristina. Horrors of labor trafficking remain hidden with spotlight on sex trafficking, The San Diego Tribune, December 2019. ↑

3. U.S. Department of Health & Human Services: Office on Trafficking in Persons. Fact Sheet: Labor Trafficking. ↑

4. Little Hoover Commission. Human Trafficking: Coordinating a California Response, June 2020. ↑

5. International Labour Office. The Cost of Coercion, 2009. ↑

6. UCLA Labor Center. California and the Underground Economy, April 2013. ↑

7. Ibid. ↑