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Legislative / Regulatory Alerts

Contact: Brad Barnum / Executive Vice President - 858-731-8158

AGCSD Legislative / Regulatory Alerts

December 19, 2019

Skilled & Trained Workforce Requirements Move up to 60% on January 1, 2020 for Certain Trades

Brad Barnum, Executive Vice President

It's been three years since legislation was enacted that requires contractors and subcontractors on designated projects to have a percentage of their journeymen be graduates of an approved apprenticeship program . It’s been one year since the California Labor Commissioner can enforce these requirements, with fines starting at $5,000 and quickly ratcheting up to debarment.

The last of three percentage increases will take effect on January 1, 2020, when the requirement moves to 60% on certain crafts. Click here for the specific delivery methods, affected agencies, percentage requirements, and apprentice trades.

It should be noted that although these skilled and trained workforce requirements are legislatively mandated for various delivery methods or public owners, any public agency can choose to implement these requirements on any project.

A Refresher on Skilled and Trained Workforce

Under the skilled and trained workforce requirements, the entire workforce on a specific project must be "skilled," which means they must be graduates of state-approved apprenticeship program, be enrolled in the program, or have equivalent hours of on the job experience that would be necessary to graduate from that apprenticeship program. A certain percentage the workforce must be “trained,” or have graduated from a state-approved apprenticeship program. Here’s an example for a contractor that has Laborers on the job, which now have a 60% requirement:

  • A contractor on a skilled and trained workforce job has 10 Laborer journeymen on the project.
    • On a monthly basis, at least six of those journeypersons (60%) on that project must have graduated from a state-approved Laborer apprenticeship program.
    • The remaining four journeypersons, or 40% in this example, must have at least 3,000 hours of documented on-the-job training in the Laborer trade.
    • Any remaining persons on that project must be apprentices currently enrolled in a state-approved apprenticeship program. Other than apprentices, no persons can be working on these jobs that do not meet the requirements in the first two bullet points, even if they are paid the journeyman pay rate.

Of particular importance to contractors and public agencies are the reporting documents. While a project is being performed, these documents must be completed monthly by the prime contractor and all sub-tier contractors, and provided to the awarding body.

AGC has prepared specific reporting documents that we believe should help demonstrate that the prime contractor and its sub-contractors have a "skilled and trained" workforce:

The importance of completing these reporting documents is clear, because without them (or a contractor plan to achieve compliance), the awarding bodies will be obligated to withhold further payments, or withhold 150% of the value of the monthly billing. If the Monthly Report does not demonstrate compliance, the awarding body will forward it to the Labor Commissioner's Office, where significant financial penalties or debarment await non-compliant contractors.

AGC is an advocate for a skilled and trained workforce, and we hope contractors utilize this guidance to achieve compliance. A consistent approach will allow our local public agencies to effectively monitor and enforce. Our strong recommendation is to contact your local apprenticeship program to inquire about strategies to address these rapidly spreading requirements.

If you have any questions about the skilled and trained workforce requirements, please contact:

Brad Barnum, AGC Executive Vice President, (858) 731-8158
Pete Saucedo, AGC Apprenticeship Executive Director, (858) 558-0739
Chad T. Wishchuk, Esq. of Finch, Thornton & Baird, LLP, (858) 737-3100