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SB-419 Oil and gas: regulation: skilled and trained workforce.(2021-2022)

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Date Published: 04/15/2021 09:00 PM
SB419:v97#DOCUMENT

Amended  IN  Senate  April 15, 2021
Amended  IN  Senate  March 10, 2021

CALIFORNIA LEGISLATURE— 2021–2022 REGULAR SESSION

Senate Bill
No. 419


Introduced by Senator Stern

February 12, 2021


An act to add Article 4.6 (commencing with Section 3280) to Chapter 1 of Division 3 of the Public Resources Code, relating to oil and gas.


LEGISLATIVE COUNSEL'S DIGEST


SB 419, as amended, Stern. Oil and gas: regulation: skilled and trained workforce.
Under existing law, the Geologic Energy Management Division in the Department of Conservation regulates the drilling, operation, maintenance, and abandonment of oil and gas wells and production facilities in the state. Existing law requires the State Oil and Gas Supervisor to supervise the drilling, operation, maintenance, and abandonment of wells and the operation, maintenance, and removal or abandonment of tanks and facilities related to oil and gas production within an oil and gas field, so as to prevent damage to life, health, property, and natural resources, as provided.
This bill would, except as provided, for work that must be performed by a licensed contractor, require that the owner or operator of a well or production facility, when contracting for the performance of construction, alteration, demolition, installation, repair, or maintenance work, as defined, to be performed at the well or production facility, to require that its contractors and any subcontractors use a skilled and trained workforce, as defined, to perform all onsite work within an apprenticeable occupation, as defined, in the building and construction trades, as defined.
Existing law provides for apprenticeship programs within the Division of Apprenticeship Standards within the Department of Industrial Relations, sponsored by specific entities and employers, and requires the Chief of the Division of Apprenticeship Standards to perform various functions with respect to apprenticeship programs and the welfare of apprentices.
This bill would require the chief to consider specified matter in determining whether to approve a new apprenticeship program for workers performing construction, alteration, demolition, installation, repair, or maintenance work at oil and gas wells or production facilities. The bill would authorize an apprenticeship program approved by the chief to enroll, with advanced standing, applicants with relevant prior work experience performing work at wells or production facilities, in accordance with the approved apprenticeship standards of the program.
Under existing law, a person who fails to comply with requirements relating to the regulation of oil or gas operations is guilty of a misdemeanor.
Because a violation of this bill’s skilled and trained workforce requirements would be a misdemeanor, the bill would impose a state-mandated local program by creating a new crime.
The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.
This bill would provide that no reimbursement is required by this act for a specified reason.
Vote: MAJORITY   Appropriation: NO   Fiscal Committee: YES   Local Program: YES  

The people of the State of California do enact as follows:


SECTION 1.

 The Legislature finds and declares all of the following:
(a) The use of a skilled and trained workforce to perform construction and maintenance work at oil and gas wells and production facilities is necessary to avoid risks to public health and safety and to the environment, and those risks are particularly high when workers are employed by outside contractors because they generally will be less familiar with the operations of the facility and its emergency plans and the owner or operator of the facility will have less incentive to invest in their training.
(b) Requiring that workers employed by outside contractors at these facilities to perform work within an apprenticeable occupation in the building and construction trades be paid at least at a rate equivalent to the prevailing journeyperson wage for the occupation, or be registered in an approved apprenticeship program, is necessary to provide an economic incentive for employers to use only the most skilled workers to perform work that poses a risk to public health and safety and to the environment.
(c) Requiring that apprentices be registered in programs approved by the Chief of the Division of Apprenticeship Standards within the Department of Industrial Relations is necessary to ensure that these workers are receiving the proper training and on-the-job supervision and that the programs are subject to proper oversight.
(d) The requirement that at least 60 percent of the journeypersons working for a contractor be graduates of an approved apprenticeship program is necessary to ensure that the majority of the journeypersons will have had appropriate classroom and laboratory instruction for their occupations. A phase-in for this requirement will avoid disruption of the industry.

SEC. 2.

 Article 4.6 (commencing with Section 3280) is added to Chapter 1 of Division 3 of the Public Resources Code, to read:
Article  4.6. Skilled and Trained Workforce Requirements

3280.
 As used in this article, the following terms have the following meanings:
(a) “Apprenticeable occupation” means an occupation for which the chief has approved an apprenticeship program pursuant to Section 3075 of the Labor Code.
(b) “Building and construction trades” has the same meaning as used in Section 3075.5 of the Labor Code.
(c) “Chief” means the Chief of the Division of Apprenticeship Standards of the Department of Industrial Relations.
(d) “Construction,” “alteration,” “demolition,” “installation,” “repair,” and “maintenance” have the same meanings as used in Sections 1720 and 1771 of the Labor Code.
(e) “Graduate of an apprenticeship program” means either of the following:
(1) An individual that has been issued a certificate of completion under the authority of the California Apprenticeship Council or the chief for completing an apprenticeship program approved by the chief pursuant to Section 3075 of the Labor Code.
(2) An individual that has completed an apprenticeship program located outside California and approved for federal purposes pursuant to the apprenticeship regulations adopted by the United States Secretary of Labor.
(f) “Licensed contractor” means a contractor licensed by the Contractors’ Contractors State License Board.
(g) “Onsite work” shall not include work that was not within the scope of a prevailing wage determination issued by the Director of Industrial Relations as of January 1, 2021.
(h) “Prevailing hourly wage rate” means the general prevailing rate of per diem wages, as determined by the Director of Industrial Relations pursuant to Sections 1773 and 1773.9 of the Labor Code, but does not include shift differentials, travel, and subsistence, or holiday pay. Notwithstanding subdivision (c) of Section 1773.1 of the Labor Code, the requirement that employer payments not reduce the obligation to pay the hourly straight time or overtime wages found to be prevailing does not apply if otherwise provided in a bona fide collective bargaining agreement covering the worker.
(i) “Registered apprentice” means an apprentice registered in an apprenticeship program approved by the chief pursuant to Section 3075 of the Labor Code who is performing work covered by the standards of that apprenticeship program and receiving the supervision required by the standards of that apprenticeship program.
(j) “Skilled journeyperson” means a worker who meets both of the following criteria:
(1) The worker either graduated from an apprenticeship program for the applicable occupation that was approved by the chief, or has at least as many hours of on-the-job experience in the applicable occupation that would be required to graduate from an apprenticeship program for the applicable occupation that is approved by the chief.
(2) The worker is being paid at least a rate equivalent to the prevailing hourly wage rate for a journeyperson in the applicable occupation and geographic area.
(k) “Skilled and trained workforce” means a workforce that meets both of the following criteria:
(1) All the workers are either registered apprentices or skilled journeypersons.
(2) (A) As of January 1, 2022, at least 30 percent of the skilled journeypersons are graduates of an apprenticeship program for the applicable occupation.
(B) As of January 1, 2023, at least 45 percent of the skilled journeypersons are graduates of an apprenticeship program for the applicable occupation.
(C) As of January 1, 2024, at least 60 percent of the skilled journeypersons are graduates of an apprenticeship program for the applicable occupation.

3281.
 (a) (1) This section shall apply to contracts awarded, extended, or renewed on or after January 1, 2022.
(2) This section shall apply only to work that must be performed by a licensed contractor.
(3) This section shall not apply to well drilling, well testing, or well repair activities. activities, or to other downhole-related activities, including, but not limited to, pumping unit installation, hookup, commissioning and startup, and the plugging of wells at active oil fields.
(b) (1) The owner or operator of a well or production facility, when contracting for the performance of construction, alteration, demolition, installation, repair, or maintenance work, including the plugging, capping, and abandonment of wells, surface plugging of wells pursuant to the orphan well program in an inactive field and the retirement of wells on active fields, but excluding subsurface plugging of wells at active oil fields, to be performed at the well or production facility, shall require that its contractors and any subcontractors use a skilled and trained workforce to perform all onsite work within an apprenticeable occupation in the building and construction trades.
(2) This section is satisfied if all contractors and subcontractors are required to become bound to a multicraft project labor agreement that expressly requires each contractor and subcontractor performing the work to use a skilled and trained workforce within the meaning of Section 3280. For purposes of this paragraph, “project labor agreement” has the same meaning as set forth in paragraph (1) of subdivision (b) of Section 2500 of the Public Contract Code.

(2)

(3) For purposes of paragraph (2) of subdivision (b) of Section 3075 of the Labor Code, work subject to the requirements of this section shall be considered in determining whether existing apprenticeship programs do not have the capacity, or have neglected or refused, to dispatch sufficient apprentices to qualified employers who are willing to abide by the applicable apprenticeship standards.

(3)

(4) (A) This section does not apply to the employees of the owner or operator of the well or production facility or prevent the owner or operator from using its own employees to perform any work that has not been assigned to contractors while the employees of the contractor are present and working.
(B) An apprenticeship program approved by the chief may enroll, with advanced standing, applicants with relevant prior work experience performing work at wells or production facilities subject to this section, in accordance with the approved apprenticeship standards of the program.

(4)

(5) The criteria of paragraph (1) of subdivision (j) of, and paragraph (2) of subdivision (k) of, Section 3280 shall not apply to either of the following:
(A) To the extent that the contractor has requested qualified workers from the local hiring halls that dispatch workers in the apprenticeable occupation and, due to workforce shortages, the contractor is unable to obtain sufficient qualified workers within 48 hours of the request, Saturdays, Sundays, and holidays excepted. This section does not prevent contractors from obtaining workers from any source.
(B) To the extent that compliance is impracticable because an emergency requires immediate action to prevent harm to public health or safety or to the environment, but the criteria applies apply as soon as the emergency is over or as soon as it becomes practicable for contractors to obtain a qualified workforce.

(5)

(6) The requirement of paragraph (1) for a skilled and trained workforce applies to each individual contractor’s and subcontractor’s onsite workforce.

(6)

(7) This section does not make the construction, alteration, demolition, installation, repair, or maintenance work at a well or production facility that is subject to this section a public work, within the meaning of Chapter 1 (commencing with Section 1720) of Part 7 of Division 2 of the Labor Code.

(7)

(8) This section does not preclude the use of an alternative workweek schedule adopted pursuant to Section 511 or 514 of the Labor Code.

SEC. 3.

 No reimbursement is required by this act pursuant to Section 6 of Article XIII B of the California Constitution because the only costs that may be incurred by a local agency or school district will be incurred because this act creates a new crime or infraction, eliminates a crime or infraction, or changes the penalty for a crime or infraction, within the meaning of Section 17556 of the Government Code, or changes the definition of a crime within the meaning of Section 6 of Article XIII B of the California Constitution.