Cal. LAB § 1771.8 — California Code / Code lab / Division 2 / Part 7 / Chapter 1 / Article 2 / Section 1771.8
Section 1771.8
Status: in_force

(a) For the purposes of this section, the following terms have the following meanings:

(1) A “private labor compliance entity” is defined as a third-party company that is hired by an awarding body to perform labor compliance and enforcement activities on public works projects on its behalf.

(2) A “conflict of interest” is a situation in which a private labor compliance entity performs labor compliance work under contract for both an awarding body, and a contractor who is bidding a public works project for the same awarding body.

(b) (1) A private labor compliance entity shall be prohibited from providing labor compliance and enforcement activities on behalf of an awarding body if it has a conflict of interest.

(2) Prior to an awarding body entering a contract for a public works project, a private labor compliance entity shall disclose a potential conflict of interest to the awarding body. If no conflict exists, a private labor compliance entity shall submit to the awarding body a signed declaration under penalty of perjury verifying that it has no conflicts of interest.

(c) A private labor compliance entity, prior to withholding funds from a public works contractor for an alleged violation, including, but not limited to, worker classification, scope of work, travel and subsistence apprenticeship standards, shall do the following:

(1) Confer with the negotiating parties of the applicable agreements to review relevant public works law.

(2) Not withhold an amount that exceeds the alleged underpayments and penalty assessments.

(d) A private labor compliance entity seeking to withhold funds from a public works contractor or subcontractor on behalf of an awarding body pursuant to Sections 1726 and 1771.6 shall, within 20 days of a written request for review by the contractor or subcontractor, provide a venue for a public works contractor or subcontractor to review and respond to evidence of alleged violations.

(e) A violation of this section shall make a contract between a private labor compliance entity and an awarding body null and void, and the private labor compliance entity would be subject to a penalty by the awarding body of not less than one thousand dollars ($1,000), including reasonable attorney’s fees, subject matter expert costs, and expenses.

(f) In the event of a violation of this section, an aggrieved party, including a joint labor-management committee established pursuant to the federal Labor Management Cooperation Act of 1978 (29 U.S.C. Sec. 175(a)), shall have the right to initiate a private right of action. The private right of action may only be filed against a private labor compliance entity as defined in subdivision (a), an awarding body, or an awarding body’s agent. The court shall award reasonable attorney’s fees and costs incurred in maintaining the action, including expert witness fees to a prevailing plaintiff.

(g) In addition, the provisions of this section may be enforced by a public prosecutor as defined in Section 180.

(h) This section does not apply to the following awarding bodies operating labor compliance programs approved and monitored by the Department of Industrial Relations pursuant to Section 1771.5:

(1) The Department of Transportation.

(2) The City of Los Angeles.

(3) The Los Angeles Unified School District.

(4) The County of Sacramento.