Call it the “Who’s the Boss” phenomenon: The business models of many major U.S. companies depend on workers who are legally employed by someone else. Labor groups argue that such sprawling supply chains make it harder to hold companies accountable for abuse, let alone organize the workers involved. Now they’re pushing back: A California bill would put companies on the hook when employees get cheated by their contractors.
The proposed legislation, which passed the state Assembly on May 29 and heads today to the state Senate Judicial Committee, would make many companies share “all civil legal responsibility and civil liability” when contractors they hire run afoul of rules on paying wages and workers compensation. The California Chamber of Commerce calls it a “job killer.” Jennifer Barrera, a policy advocate for the Chamber, argues that it represents a “significant expansion of liability—and unfair because the business may or may not be able to control or prevent these violations from occurring.”