Section 1777.7 Of Article 2. Wages From California Labor Code >> Division 2. >> Part 7. >> Chapter 1. >> Article 2.
1777.7
. (a) (1) If the Labor Commissioner or his or her designee
determines after an investigation that a contractor or subcontractor
knowingly violated Section 1777.5, the contractor and any
subcontractor responsible for the violation shall forfeit, as a civil
penalty to the state or political subdivision on whose behalf the
contract is made or awarded, not more than one hundred dollars ($100)
for each full calendar day of noncompliance. The amount of this
penalty may be reduced by the Labor Commissioner if the amount of the
penalty would be disproportionate to the severity of the violation.
A contractor or subcontractor that knowingly commits a second or
subsequent violation within a three-year period, if the noncompliance
results in apprenticeship training not being provided as required by
this chapter, shall forfeit as a civil penalty the sum of not more
than three hundred dollars ($300) for each full calendar day of
noncompliance.
(2) In lieu of the penalty provided for in this subdivision, the
Labor Commissioner may, for a first-time violation and with the
concurrence of an apprenticeship program described in subdivision (d)
of Section 1777.5, order the contractor or subcontractor to provide
apprentice employment equivalent to the work hours that would have
been provided for apprentices during the period of noncompliance.
(b) The Labor Commissioner shall consider, in setting the amount
of a monetary penalty, all of the following circumstances:
(1) Whether the violation was intentional.
(2) Whether the party has committed other violations of Section
1777.5.
(3) Whether, upon notice of the violation, the party took steps to
voluntarily remedy the violation.
(4) Whether, and to what extent, the violation resulted in lost
training opportunities for apprentices.
(5) Whether, and to what extent, the violation otherwise harmed
apprentices or apprenticeship programs.
(c) (1) The Labor Commissioner or his or her designee shall issue
a civil wage and penalty assessment, in accordance with the
provisions of Section 1741, upon determination of penalties assessed
under subdivisions (a) and (b). Review of a civil wage and penalty
assessment issued under this subdivision may be requested in
accordance with the provisions of Section 1742. The regulations of
the Director of Industrial Relations, which govern proceedings for
review of civil wage and penalty assessments and the withholding of
contract payments under Article 1 (commencing with Section 1720) and
Article 2 (commencing with Section 1770), shall apply.
(2) For purposes of this section, a determination issued pursuant
to subdivision (a) or (b) includes a determination that has been
approved by the Labor Commissioner and issued by an awarding body
that has been authorized to assist the director in the enforcement of
Section 1777.5 pursuant to subdivision (p) of that section. The
Labor Commissioner may intervene in any proceeding for review of a
determination issued by an awarding body. If the involvement of the
Labor Commissioner in a labor compliance program enforcement action
is limited to a review of the determination and the matter is
resolved without litigation by or against the Labor Commissioner or
the department, the awarding body shall enforce any applicable
penalties, as specified in this section, and shall deposit any
penalties and forfeitures collected in the General Fund.
(d) The determination of the Labor Commissioner as to the amount
of the penalty imposed under subdivisions (a) and (b) shall be
reviewable only for an abuse of discretion.
(e) If a subcontractor is found to have violated Section 1777.5,
the prime contractor of the project is not liable for any penalties
under subdivision (a) unless the prime contractor had knowledge of
the subcontractor's failure to comply with the provisions of Section
1777.5 or unless the prime contractor fails to comply with any of the
following requirements:
(1) The contract executed between the contractor and the
subcontractor for the performance of work on the public works project
shall include a copy of the provisions of Sections 1771, 1775, 1776,
1777.5, 1813, and 1815.
(2) The contractor shall continually monitor a subcontractor's use
of apprentices required to be employed on the public works project
pursuant to subdivision (d) of Section 1777.5, including, but not
limited to, periodic review of the certified payroll of the
subcontractor.
(3) Upon becoming aware of a failure of the subcontractor to
employ the required number of apprentices, the contractor shall take
corrective action, including, but not limited to, retaining funds due
to the subcontractor for work performed on the public works project
until the failure is corrected.
(4) Prior to making the final payment to the subcontractor for
work performed on the public works project, the contractor shall
obtain a declaration signed under penalty of perjury from the
subcontractor that the subcontractor has employed the required number
of apprentices on the public works project.
(f) The Division of Labor Standards Enforcement shall notify the
contractor on a public works project within 15 days of the receipt by
the division of a complaint that a subcontractor on that public
works project knowingly violated Section 1777.5.
(g) The interpretation of Section 1777.5 and the substantive
requirements of this section applicable to contractors or
subcontractors shall be in accordance with the regulations of the
California Apprenticeship Council.
(h) The Director of Industrial Relations may adopt regulations to
establish guidelines for the imposition of monetary penalties.