AB1245 - State contracts: certification process: forced labor and human trafficking.

Amended IN Senate June 09, 2026 Amended IN Assembly January 22, 2026 Amended IN Assembly January 05, 2026 CALIFORNIA LEGISLATURE— 2025–2026 REGULAR SESSION Assembly Bill No. 1245 Introduced by Assembly Member Stefani (Coauthors: Assembly Members Ahrens, Gipson, Ortega, and Ward) (Coauthors: Senators Cortese and Wahab) February 21, 2025 An act to amend Section 6108 of the Public Contract Code, relating to public contracts. LEGISLATIVE COUNSEL'S DIGEST AB 1245, as amended, Stefani. State contracts: certification process: forced labor and human trafficking. Existing law requires a contract entered into by any state agency for the procurement or laundering of apparel, garments, or corresponding accessories, or the procurement of equipment, materials, or supplies, other than procurement related to a public works contract, to require that a contractor certify that nothing furnished to the state pursuant to the contract has been laundered or produced by certain types of labor, including forced labor, as defined. Existing law makes any person who falsely certifies pursuant to these provisions guilty of a misdemeanor. This bill would, for a contract entered into or renewed on or after January 1, 2027, with an estimated value that exceeds $550,000, revise the above contracting requirements to also require a contractor to certify that the contract complies with specified requirements relating to human trafficking, including certain prohibitions on contractors, contractor employees, subcontractors, subcontractor employees, and their agents. The bill would revise the definition of forced labor to mean knowingly providing or obtaining labor or services of a person by, among other things, threats of serious harm to, or physical restraint against, that person or another person. This bill would require contractors and subcontractors to notify employees of specified prohibited activities and the actions that may be taken against them for violations. The bill would provide that a contractor is ineligible for, and shall not bid on, or submit a proposal for, a contract under these provisions if the contractor has failed to certify its compliance. The bill would also require a contractor to exercise due diligence in ensuring that its subcontractors comply with those requirements, including requiring each subcontractor to sign a certification. By expanding the scope of a crime, the bill would impose a state-mandated local program. This bill would, for a contract that has an estimated value that exceeds $550,000, require, before a contract or subcontract is awarded, a proposed contractor or proposed subcontractor to provide a certification to the contracting officer or contractor, as applicable, that states the contractor or subcontractor has implemented a compliance plan, as specified, and has conducted due diligence that either (1) to the best of the contractor’s or subcontractor’s knowledge and belief, certain parties have not engaged in any specified prohibited activities or (2) if the contractor or subcontractor is aware of abuses relating to the specified prohibited activities, then certain parties have taken the appropriate remedial and referral actions. This bill would require a contractor or subcontractor to take specified actions to ensure compliance with the above-described provisions, including requiring the contractor or subcontractor to disclose to the contracting officer and the state agency with oversight information sufficient to identify the nature and extent of a violation of a prohibited activity. The bill would specify certain actions a contractor would be required to take if a contractor, contractor employee, subcontractor, subcontractor employee, or agent violates these provisions or specified provisions, including, among others, notifying its employees of the actions that will be taken against the employee or agent for violations. Existing law authorizes certain sanctions to be imposed if a contractor knew or should have known that the apparel, garments, corresponding accessories, equipment, materials, or supplies furnished to the state were laundered or produced in violation of specified conditions, including, among others, voiding the contract under which the prohibited apparel, garments, or corresponding accessories, equipment, materials, or supplies were laundered or provided at the option of the state agency and removing the contractor from the bidder’s list for a period not to exceed 360 days. This bill would, for a contract entered into or renewed on or after January 1, 2027, with an estimated value that exceeds $550,000, authorize additional sanctions, including, among others, requiring a contractor to remove a contractor employee from the performance of the contract, requiring the contractor to terminate a subcontractor, and suspending contract payments until the contractor has taken appropriate remedial action. The bill would also specify that these requirements govern contracts and subcontracts entered into by a state agency, regardless of place of performance. Existing law authorizes a contractor to request a hearing before an administrative law judge when sanctions are imposed. Existing law requires the administrative law judge to consider any measures the contractor has taken to ensure compliance with the above-described provisions and authorizes the administrative law judge to waive any or all sanctions if it is determined that the contractor has acted in good faith. This bill would, for a contract entered into or renewed on or after January 1, 2027, with an estimated value that exceeds $550,000, authorize the administrative law judge to additionally consider mitigating factors and aggravating factors, as specified. Existing law authorizes a state agency that investigates a complaint against a contractor for violation of the above-described provisions to limit its investigation to evaluating the information provided by the person or entity submitting the complaint and information provided by the contractor. This bill would, for a contract entered into or renewed on or after January 1, 2027, with an estimated value that exceeds $550,000, authorize the state agency to limit its investigation to credible information. The bill would require the contracting officer, upon receipt of credible information regarding a violation of specified provisions, to promptly notify the state agency with oversight, the agency debarring and suspending official, and law enforcement officials with jurisdiction over the alleged offense, as specified. The bill would authorize the contracting officer to direct the contractor to take specific steps to abate the alleged violation or enforcement of the requirements of its compliance plan. 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. Digest Key Vote: MAJORITY Appropriation: NO Fiscal Committee: YES Local Program: YES Bill Text The people of the State of California do enact as follows: SECTION 1. Section 6108 of the Public Contract Code, as amended by Section 63 of Chapter 241 of the Statutes of 2025, is amended to read: 6108. (a) (1) (A) Every contract entered into by any state agency for the procurement or laundering of apparel, garments, or corresponding accessories, or the procurement of equipment, materials, or supplies, other than procurement related to a public works contract, shall require that a contractor certify to both of the following: (i) That no apparel, garments, corresponding accessories, equipment, materials, or supplies furnished to the state pursuant to the contract have been laundered or produced in whole or in part by sweatshop labor, forced labor, convict labor, indentured labor under penal sanction, abusive forms of child labor, or exploitation of children in sweatshop labor, or with the benefit of sweatshop labor, forced labor, convict labor, indentured labor under penal sanction, abusive forms of child labor, or exploitation of children in sweatshop labor. The contractor shall agree to comply with this provision of the contract. (ii) The contract complies with the requirements provided in subparagraph (B). (B) Contractors, contractor employees, subcontractors, subcontractor employees, and their agents are prohibited from all of the following: (i) Engaging in severe forms of trafficking in persons during the performance period of the contract. (ii) Using forced labor in the performance of the contract. (iii) Destroying, concealing, confiscating, or otherwise denying access by an employee to the employee’s identity or immigration documents, including passports or driver’s licenses, regardless of the issuing authority. (iv) Using misleading or fraudulent practices during the recruitment of employees or offering of employment, including failing to disclose, in a format and language understood by the employee or potential employee, basic information or making material misrepresentations during the recruitment of employees regarding the key terms and conditions of employment, including all of the following: (I) Wages and fringe benefits. (II) The location of work. (III) The living conditions, housing, and associated costs, if provided or arranged by the employer or agent. (IV) Any significant costs to be charged to the employee or potential employee. (V) The hazardous nature of the work, if applicable. (v) Using recruiters that do not comply with state labor laws and the laws of the country that the recruiting takes place. (vi) Charging employees or potential employees recruitment fees. (vii) (I) Failing to provide or pay for the cost of return transportation upon the end of employment, for either of the following: (ia) An employee who is not a national of the country where the work is taking place and who was brought into that country for the purpose of working on a state contract or subcontract. (ib) An employee who is not a United States national and who was brought into the United States for the purpose of working on a state contract or subcontract, if the payment of the cost is required under existing temporary worker programs or pursuant to a written agreement with the employee. (II) The requirements of subclause (I) do not apply to an employee who meets one of the following criteria: (ia) The employee is legally permitted to remain in the country where the work is performed and chooses to remain in the country where the work is performed. (ib) The employee is exempted by an authorized official of the contracting agency, designated by a chief official of a state agency in accordance with agency procedures. (III) For a victim of trafficking in persons who is seeking victim services or legal redress in the country or for a witness in an enforcement action related to trafficking in persons in which the work is performed, or a portion of the work is performed, the contractor shall provide or pay the cost of return transportation as specified in subclause (I) in a way that does not obstruct the victim services, legal redress, or witness activity, including offering return transportation to a witness at a time that supports the witness’s need to testify. (viii) Providing or arranging housing that fails to meet the housing and safety standards of the county where the work is performed. (ix) If required by law or contract, failing to provide an employment contract, recruitment agreement, or other required work document in writing. (I) The written document shall be in a language the employee understands. (II) If the employee must relocate to perform the work, the written document shall be provided to the employee at least five days prior to the employee relocating. (III) The written document shall include, but is not limited to, a work description, wages, the prohibition on charging recruitment fees as specified in clause (vi), the work location, the living accommodations and associated costs, the amount of time off, the round-trip transportation arrangements, a grievance process, and the content of applicable laws and regulations that prohibit trafficking in persons. (IV) The contracting officer shall consider the risk that the contract or subcontract will involve services or supplies susceptible to trafficking in persons, and the number of non-United States citizens expected to be employed, when deciding whether to require work documents in the contract. (C) Contractors and subcontractors are required to notify employees of the prohibited activities described in subparagraph (B) and the actions that may be taken against them for violations. (D) The contractor is ineligible for, and shall not bid on, or submit a proposal for, a contract under this section if that contractor has failed to certify compliance with subparagraph (A). (E) The contractor shall also exercise due diligence in ensuring that its subcontractors comply with subparagraph (A), including requiring each subcontractor to sign a certification. (2) Before a contract is awarded, a proposed contractor shall provide a certification to the contracting officer that states both of the following: (A) The contractor has implemented a compliance plan that includes both of the following: (i) Procedures to prevent any prohibited activities described in subparagraph (B) of paragraph (1). (ii) Procedures to monitor, detect, and terminate a contract with a subcontractor or agent engaging in any prohibited activities described in subparagraph (B) of paragraph (1). (B) The contractor has conducted due diligence and one of the following applies: (i) To the best of the contractor’s knowledge and belief, the contractor, its agents, proposed subcontractors, or their agents, have not engaged in any prohibited activities described in subparagraph (B) of paragraph (1). (ii) If the contractor is aware of abuses relating to the prohibited activities described in subparagraph (B) of paragraph (1), the contractor or proposed subcontractors have taken the appropriate remedial and referral actions. (3) Before a subcontract is awarded, the contractor shall obtain a certification from the proposed subcontractor that states both of the following: (A) The subcontractor has implemented a compliance plan that includes both of the following: (i) Procedures to prevent any prohibited activities described in subparagraph (B) of paragraph (1). (ii) Procedures to monitor, detect, and terminate a contract with a subcontractor or agent engaging in any prohibited activities described in subparagraph (B) of paragraph (1). (B) The subcontractor has conducted due diligence and one of the following applies: (i) To the best of the subcontractor’s knowledge and belief, the subcontractor, its agents, proposed subcontractors, or their agents, have not engaged in any prohibited activities descr [Text truncated for display. Full text available on Congress.gov.]