AB1362 - Foreign labor contractor registration: agricultural workers.

Assembly Bill No. 1362 CHAPTER 190 An act to amend Sections 9998.1, 9998.1.5, 9998.8, and 9998.10 of, to add and repeal Section 9998.12 of, and to repeal and add Section 9998 of, the Business and Professions Code, relating to foreign labor contractors. [ Approved by Governor October 01, 2025. Filed with Secretary of State October 01, 2025. ] LEGISLATIVE COUNSEL'S DIGEST AB 1362, Kalra. Foreign labor contractor registration: agricultural workers. (1) Existing law establishes the Department of Industrial Relations within the Labor and Workforce Development Agency and sets forth the functions of the department, which include, among others, fostering, promoting, and developing the welfare of the wage earners of California and improving their working conditions. Existing law establishes within the department the Division of Labor Standards Enforcement, headed by the Labor Commissioner, for the purposes of enforcing labor laws. Existing law requires the Labor Commissioner to enforce and administer a program to register and supervise foreign labor contractors who perform foreign labor contracting activities to recruit or solicit foreign workers. Existing law defines foreign workers for purposes of these provisions to mean any person seeking employment who is not a United States citizen or permanent resident but who is authorized by the federal government to work in the United States, including a person who engages in temporary nonagricultural labor, as specified. Existing law requires foreign labor contractors to register under the program, as prescribed. Existing law requires an applicant for registration as a foreign labor contractor to execute a written application in a form prescribed by the commissioner, as specified, that includes, among other things, the names and addresses of all persons financially interested in the proposed operation as a foreign labor contractor, as provided. Existing law imposes specific requirements on foreign labor contractors relating to recruitment or solicitation for employment and relating to work contracts. Existing law authorizes the commissioner to adopt regulations or policies and procedures to implement these provisions. Existing law authorizes the commissioner, or a person aggrieved by a violation of these provisions, to bring certain actions against the violator, including an action for injunctive relief, as provided. A violation of these provisions is a crime. Existing law makes these provisions applicable only to nonagricultural workers, and exempts persons licensed as farm labor contractors, specified persons exempt from farm labor contractor licensing requirements, and employers of agricultural workers. This bill would, beginning July 1, 2027, expand the above-described provisions to agricultural workers under the federal H-2A visa program. The bill would make related conforming changes and findings and declarations. The bill would additionally require, beginning July 1, 2027, the above-described application to contain a listing of each federal visa program under which the person will be performing foreign labor contracting activities. The bill would authorize the commissioner to enforce the above-described foreign labor contractor registration provisions through specified procedures, including the issuance of a citation or filing of a civil action against a person who violates those provisions. (2) Existing law requires farm labor contractors to be licensed by the commissioner and to comply with specified employment laws applicable to farm labor contractors. Existing law prohibits the commissioner from issuing to any person, or renewing, a license to act as a farm labor contractor unless certain conditions are satisfied, including a requirement that the person has executed a written application in a form prescribed by the commissioner as a foreign labor contractor, as prescribed. This bill would require, beginning July 1, 2027, a person who is licensed or acting as a farm labor contractor and who performs foreign labor contracting activities to register with the commissioner as a foreign labor contractor, as prescribed. The bill would authorize the commissioner to eliminate duplicative application information requirements for information previously obtained from the farm labor contractor’s license application, as specified. By expanding the application of the foreign labor contractor registration provisions, the bill would expand an existing crime, thereby imposing a state-mandated local program. This bill would require the Department of Industrial Relations to submit to the Legislature, by January 1, 2028, a study on how to extend foreign labor contractor registration requirements to certain foreign labor contractors, as specified. (3) 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. The Legislature finds and declares all of the following: (a) It is well documented that foreign labor recruiters charge illegal and exorbitant recruitment fees and misrepresent the terms and conditions of work and visas to foreign workers seeking to work in California on temporary visas legally. These fraudulent activities lead to human trafficking and labor exploitation, harming both workers and ethical businesses. (b) In 2014, the Legislature passed Senate Bill 477, authored by Senator Darrell Steinberg, to protect the 130,000 foreign workers on temporary work visas who came to California annually. However, due to a drafting error, only 3 percent of California’s temporary foreign workers currently receive the comprehensive protection intended by Senate Bill 477. Since 2014, the number of foreign workers coming legally to California on temporary work visas has increased by almost 169 percent, resulting in 345,000 temporary workers entering California annually who remain unprotected. (c) The goals of Senate Bill 477, as enacted, were to expand the regulation of foreign labor recruiters by: (1) Creating a universal standard prohibiting recruitment fees for all workers coming to California. (2) Requiring the registration of foreign labor recruiters (FLRs) for recruitment activities conducted outside of the United States. (3) Mandating California employers to use registered FLRs. (4) Ensuring comprehensive disclosure of working terms and conditions to foreign workers through written contracts during the recruitment process. (5) Imposing bonds and penalties for noncompliance with the law’s requirements. (d) Although the Legislature intended to protect all visa holders through Senate Bill 477, implementation of the law has left foreign workers unprotected, including visa holders on A-3, B-1, H-1B, H-1C, H-2A, H-2B, L-1, O-1, P-3, and TN temporary work visas. Senate Bill 477 intended to protect these workers from fraudulent “foreign labor contracting activity,” defined as recruiting or soliciting for compensation a foreign worker residing outside of the United States. Senate Bill 477 focused on activities at the time of recruitment and does not apply to employers who directly recruit their own foreign workers or workers already inside the United States. (e) From 2014 to 2024, the National Human Trafficking Hotline has documented that the H-2A visa, used to bring foreign workers for seasonal agriculture work, has been involved in the most reports for human trafficking cases among temporary visa holders. H-2A visa holders constitute approximately 14 percent of the foreign workers who come annually to California on temporary work visas. Current law, including California’s farm labor contractor requirements, does not protect these workers and other visa holders from illegal activities at the time of recruitment in their home country, which was the intent of Senate Bill 477. SEC. 2. Section 9998 of the Business and Professions Code is repealed. SEC. 3. Section 9998 is added to the Business and Professions Code, to read: 9998. This chapter shall apply only to the following: (a) Nonagricultural workers under the federal H-2B visa program established pursuant to Section 101(a)(15)(H)(ii)(b) of the federal Immigration and Nationality Act (8 U.S.C. Sec. 1101(a)(15)(H)(ii)(b)). (b) On and after July 1, 2027, agricultural workers under the federal H-2A visa program established pursuant to Section 101(a)(15)(H)(ii)(a) of the federal Immigration and Nationality Act (8 U.S.C. Sec. 1101(a)(15)(H)(ii)(a)). SEC. 4. Section 9998.1 of the Business and Professions Code is amended to read: 9998.1. The following definitions are applicable to this chapter: (a) “Person” includes any natural person, company, firm, partnership or joint venture, association, corporation, limited liability company, or sole proprietorship. (b) “Foreign labor contracting activity” means recruiting or soliciting for compensation a foreign worker who resides outside of the United States in furtherance of that worker’s employment in California, including when that activity occurs wholly outside the United States. “Foreign labor contracting activity” does not include the services of an employer, or employee of an employer, if those services are provided directly to foreign workers solely to find workers for the employer’s own use. (c) “Foreign worker” means any person seeking employment who is not a United States citizen or permanent resident but who is authorized by the federal government to work in the United States, including a person who engages in temporary nonagricultural labor pursuant to Section 101(a)(15)(H)(ii)(b) of the federal Immigration and Nationality Act (8 U.S.C. Sec. 1101(a)(15)(H)(ii)(b)). “Foreign worker” shall also include any worker described in Section 9998. (d) “Foreign labor contractor” means any person who performs foreign labor contracting activity, including any person who performs foreign labor contracting activity wholly outside the United States, except that the term does not include any entity of federal, state, or local government. “Foreign labor contractor” does not include a person licensed by the Labor Commissioner as a talent agency under Chapter 4 (commencing with Section 1700) of Part 6 of Division 2 of the Labor Code, or a person who obtained and maintains full written designation from the United States Department of State under Part 62 of Title 22 of the Code of Federal Regulations. SEC. 5. Section 9998.1.5 of the Business and Professions Code is amended to read: 9998.1.5. (a) (1) On and after July 1, 2016, a person acting as a foreign labor contractor shall register with the Labor Commissioner in accordance with the terms and procedures for registration established by the commissioner by January 1, 2016. (2) On and after July 1, 2027, a person who is licensed or acting as a farm labor contractor pursuant to Chapter 3 (commencing with Section 1682) of Part 6 of Division 2 of the Labor Code and who performs foreign labor contracting activities shall register with the Labor Commissioner pursuant to the terms and procedures for registration described in paragraph (1). (3) In registering a person already licensed as a farm labor contractor pursuant to Chapter 3 (commencing with Section 1682) of Part 6 of Division 2 of the Labor Code as a foreign labor contractor pursuant to paragraph (2), the Labor Commissioner has discretion, to the extent feasible for the efficient administration of the program, to eliminate duplicative application information requirements for information previously obtained from the farm labor contractor’s license application if both of the following conditions are met: (A) The applicant provides their farm labor contractor license number. (B) The applicant attests that there are no changes to the information previously provided to the Labor Commissioner. (4) The commissioner shall post on its internet website the names and contact information for all registered foreign labor contractors and a list of the names and contact information for any foreign labor contractors denied renewal or registration. (b) The Labor Commissioner may not register a person to act as a foreign labor contractor, and may not renew a registration, until all of the following conditions are satisfied: (1) The person has executed a written application in a form prescribed by the commissioner, subscribed and sworn to by the person, and containing all of the following: (A) A statement by the person of all facts required by the commissioner concerning the applicant’s character, competency, responsibility, and the manner and means by which the person proposes to conduct operations as a foreign labor contractor if registered. (B) The names and addresses of all persons, except bona fide employees on stated salaries, financially interested, either as partners, associates, or profit sharers, in the proposed operation as a foreign labor contractor, together with the amount of their respective interests. (C) A declaration consenting to the designation by a court or the commissioner as an agent available to accept service of summons in any action against the registrant, if the registrant has left the jurisdiction in which the action is commenced or otherwise has become unavailable to accept service. (D) On and after July 1, 2027, a listing of each federal visa program under which the person will be performing foreign labor contractor activities. (2) The commissioner, after investigation, is satisfied as to the character, competency, and responsibility of the person. (3) (A) The person has deposited with the commissioner a surety bond in an amount based on the size of the person’s annual gross receipts from operations as a foreign labor contractor, as follows: (i) For gross receipts up to five hundred thousand dollars ($500,000), a fifty-thousand-dollar ($50,000) bond. (ii) For gross receipts of five hundred thousand dollars ($500,000) to two million dollars ($2,000,000), a one-hundred-thousand-dollar ($100,000) bond. (iii) For gross receipts greater than two million dollars ($2,000,000), a one-hundred-fifty-thousand-dollar ($150,000) bond. (B) If the foreign labor contractor has been the subject of a final judgment in a year in an amount equal to that of the bond required, that contractor shall be required to deposit an additional bond within 60 days. The bond shall be payable to the people of the State of California and shall be conditioned on the foreign labor contractor complying with all the terms and provisions of this chapter and paying all damages occasioned to any person by failure to do so, or by any violation of this chapter, or false statements or misrepresentations made in the registration process. The bond [Text truncated for display. Full text available on Congress.gov.]