Updated Guidance for Construction Projects in Los Angeles County

By and on May 8, 2020
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In the two months since Governor Gavin Newsom’s Stay at Home Order was enacted across the state, construction has largely continued in Los Angeles County despite guidelines and protocols enacted by local officials seeking to make job sites safe during the ongoing pandemic. We previously covered impacts and developments from the Coronavirus in Los Angeles County on April 8, 2020.

The City of Los Angeles has been led by Mayor Eric Garcetti in focusing efforts to enable essential business, including many construction projects, to continue with safety precautions. Mayor Garcetti established a Stage 2 process to begin on May 8, 2020, to allow additional businesses to operate on a careful and phased basis. According to telehandler professionals the Los Angeles Department of Building and Safety has produced Guidelines for Inspections by City Personnel, as well as Safety Guidelines that all construction projects must comply with, get a Plant Hire for your bigger constructions.

To obtain the City of Los Angeles’s COVID-19 Safety Guidelines for Construction Sites, please click here. To obtain the City of Los Angeles’s City Inspections COVID-19 Guidelines, please click here. The City of Los Angeles also requires the completion of a Social Distancing Protocol, which must be posted near worksite entrances and distributed to all employees. A copy of the blank protocol form can be obtained here.

In addition to the City, the County of Los Angeles Department of Public Works developed its own Guidelines for Construction Sites during the COVID-19 Pandemic. The County of Los Angeles’s recommendations are based on the recent guidelines published by the CDC and Cal/OSHA. To obtain the County of Los Angeles’s COVID-19 Construction Guidelines, please click here. The County has also developed modified procedures for submittal and pick-up of Construction Plans that can be viewed here.

While construction has largely continued in and around Los Angeles, recent media reports have raised issues with worksite contamination, non-compliance issues, and delays resulting from social distancing and other mandated policies. If these or other issues are affecting your construction project or worksite in and around Los Angeles, please contact a construction attorney who can assist you with your specific issues.

Visit our COVID-19 Hub for ongoing updates.

Filed under Coronavirus, COVID-19

Essential Construction Projects In California: Can You Keep Working And How?

By , and on April 8, 2020
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Despite the COVID-19 pandemic and its severe impact on the construction industry, work on Essential Projects is permitted in certain instances, depending on the location and the type of the project. The question of what work is “essential” is key. Not surprisingly, the designation of Essential Construction is evolving and different requirements now exist at the state and local level which has led to confusion.

The following provides an overview of the current orders and local regulations affecting major metropolitan areas of California as well as the trends as a result of these orders. Those with additional questions beyond the information presented in this article are recommended to consult with a licensed attorney with construction law experience to achieve your compliance and workplace safety goals.

The Federal Guideline

The Department of Homeland Security for the Federal Government produced Guidelines identifying 16 sectors deemed “Essential” Businesses. These Guidelines are only recommendations – it is up to the individual local jurisdictions to draft their own ordinances.

Under the Guidelines, several areas are clearly covered as “essential” including infrastructure construction and restoration (fiber optic cables, wireless facilities, and other communications-related areas); work supporting the manufacture, distribution and provision and construction of computing-related services); business infrastructure; financial transactions/services; web-based services; and critical manufacturing. Make your irrigation water secure with this Layflat Hose Coupler.

For more information on the federal guidelines, please visit our prior article on this issue.

California State Guideline

On March 19, 2020, Governor Newsom’s Office issued Executive Order N-33-20 ordering all residents to “Stay at Home,” except as needed to maintain continuity of essential critical infrastructure sectors, including those designed by the State Public Health Officer. On March 22, 2020, the State Public Health Officer designated a list of “Essential Critical Infrastructure Workers” to help state, local, tribal, and industry partners as they work to protect communities, while ensuring continuity of functions critical to public health and safety, as well as economic and national security. The State Public Health Officer’s list of designated “essential” workers includes but is not limited to:

  • Construction workers who support the construction, operation, inspection, and maintenance of construction sites and construction projects (including housing construction)
  • Workers such as plumbers, electricians, exterminators, and other service providers who provide services that are necessary to maintaining the safety, sanitation, construction material sources, and essential operation of construction sites and construction projects (including those that support such projects to ensure the availability of needed facilities, transportation, energy and communications; and support to ensure the effective removal, storage, and disposal of solid waste and hazardous waste)

San Francisco County and Bay Area (Marin, Alameda, Santa Clara, Contra Costa)

The San Francisco County and City ordinance is instructive as the counties in the Bay Area have worked together and been on the forefront of developing the definitions of Essential Projects. The same standards apply to Marin, Alameda, Contra Costa, and Santa Clara Counties.

The Order provides that only certain, limited types of construction are permitted to continue, including the following:

  • healthcare projects directly related to addressing the COVID-19 pandemic
  • housing and mixed use projects that includes at least 10% affordable housing
  • projects that provide services to vulnerable populations projects required to maintain safety, sanitation, and habitability of residences and commercial buildings
  • construction necessary to secure an existing construction site that must shut down

The Health Officer may issue guidance requiring construction site-specific health and safety plans. The Order also provides for San Francisco to limit public works construction to essential public works projects as determined by the City Administrator in consultation with the Health Officer.

All other construction is prohibited. Essential projects are further defined as:

  • Projects immediately necessary to the maintenance, operation, or repair of Essential Infrastructure;
  • Projects associated with Healthcare Operations, including creating or expanding Healthcare Operations, provided that such construction is directly related to the COVID-19 response;
  • Affordable housing that is or will be income-restricted, including multi-unit or mixed-use developments containing at least 10% income-restricted units;
  • Public works projects if specifically designated as an Essential Governmental Function by the City Administrator in consultation with the Health Officer;
  • Shelters and temporary housing, but not including hotels or motels;
  • Projects immediately necessary to provide critical noncommercial services to individuals experiencing homelessness, elderly persons, persons who are economically disadvantaged, and persons with special needs;
  • Construction necessary to ensure that existing construction sites that must be shut down under this Order are left in a safe and secure manner, but only to the extent necessary to do so;
  • and Construction or repair necessary to ensure that residences and building containing Essential Businesses are safe, sanitary, or habitable to the extent such construction or repair cannot reasonably be delayed.

San Francisco also recently developed guidance for construction “Best Practices” and “Field Safety Guidelines” for COVID-19 job site safety, including submission of Site-Specific Health and Safety Plans that conform to the guidelines. These guidelines are likely to be adopted by the Bay Area counties and beyond. Contractors and construction professionals should consult with an attorney on how to comply and submit the necessary plans to safely resume operations.

Los Angeles County

While the County of Los Angeles has not provided specific construction-related guidance, the City of Los Angeles has developed protocols for COVID-19 Safety for Construction Sites. The City’s plan requires a comprehensive COVID-19 exposure control plan, which includes control measures such as social distancing; symptom checking; hygiene; decontamination procedures, and training. Failure to comply with this guidance shall be deemed as creating unsafe conditions and may result in withheld inspections or shutting down the construction site until corrected.

Unlike the San Francisco ordinance, the City of Los Angeles’s guidance does not distinguish between different types of essential construction and instead relies upon the state and federal guidance principles. However, the protocols for construction sites includes directives to maintain a minimum 6-foot distance from other workers at all times, provide personal protective equipment (PPE) such as gloves, goggles, face shields and face masks, and stagger the trades as necessary to reduce density and maintain minimum 6-foot separation. Make sure as well that they have the high-quality construction equipment or they used heavy equipment as these will be crucial in the construction process. These types of workplace conditions and equipment will continue to affect job sites throughout Los Angeles. Notably, some cities in Los Angeles County are looking at their own, more stringent regulations on construction projects.

San Diego, Orange, Riverside County

San Diego, Riverside, and Orange Counties presently do not have independent guidance or reporting requirements beyond those provided by the State and Federal Guidelines. We continue to monitor for additional updates, but expect these Counties to adopt some standard protocols, reporting requirements, and construction site and job guidance like those from San Francisco or Los Angeles.

Sacramento County

San Diego, Riverside, and Orange Counties presently do not have independent guidance or reporting requirements beyond those provided by the State and Federal Guidelines. We continue to monitor for additional updates, but expect these Counties to adopt some standard protocols, reporting requirements, and construction site and job guidance like those from San Francisco or Los Angeles.

Key Take Away: Keep Up To Date And Monitor Your Projects

Clearly, a high premium has been placed on housing. Originally San Francisco was in line with the Federal Guidelines and was allowing all housing construction to go forward. However, as it has begun tightening up on permissible activities, San Francisco now requires an affordable component to allow the construction to go forward. It will be interesting to watch as other areas make decisions on this issue whether the trend will be towards being more restrictive in allowing residential construction and how “affordable” is defined.

The Federal Guidelines are more developed with respect to Public Works and Infrastructure work. However, the document is meant to give guidance to the local agencies who may choose to follow San Francisco’s lead and specifically designate what projects can go forward rather than leave it open for interpretation.

It is important for the Construction Industry to pay close attention to what work is permissible during this crisis and what work must be delayed. Unfortunately, we anticipate that the trend will continue to be more restrictive until a better comfort level is achieved with the future of the virus. This means close attention should be paid to each project and to carefully evaluate if notices of potential delays should be issued and to evaluate if the contractor can obtain any relief for affirmative extended general conditions, efficiency claims, or other additional compensation or remedies.

Los Angeles Construction Site Safety Guidance, (March 31, 2020)
Orange County Amended Health Order and Guidance, (March 18, 2020)
Sacramento County Stay At Home and Essential Services Order, (March 19, 2020)
Santa Clara County Order of the Health Officer, (March 31, 2020)
Alameda County Order of the Health Officer, (March 31, 2020)
Contra Costa County Order of the Health Officer, (March 31, 2020)
Marin County Order of the Health Officer, (March 31, 2020)
Riverside Essential and Criticial Services Guidance, (March 22, 2020)
San Diego Social Distancing and Sanitation Protocol, (April 2, 2020)
San Francisco Guidance for Construction Related Essential Business, (March 31, 2020)

Filed under Coronavirus, COVID-19

California’s Skilled and Trained Workforce Requirements: Public Works and AB 3018, What You Need to Know

By and on December 2, 2019
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Do you have the proper skilled and trained workforce for your construction projects? If you take on public works projects in California, you may not be in compliance with the new changes in the law. To avoid civil penalties or nonpayment and potentially being precluded from future bids on public works contracts, you must critically review your team and proposal prior to accepting an award. Once awarded a public contact requiring a skilled and trained workforce, diligent reporting practices and oversight are required to maintain compliance.

Compliance with California’s skilled and trained workforce requirements for contractors, engineers, architects, design professionals, and suppliers competing for public works construction projects in California is mandated through enforcement with the enactment of AB 3018. Signed by Governor Brown in his last legislative session, AB 3018 dramatically increased the penalties for non-compliance with the existing skilled and trained workforce requirements in California. The new penalties include civil fines by the Labor Commissioner up to $10,000 per month per non-compliant contractor, disqualification from bidding on future public works contract, and withholding of payment for delinquent contractors. This update provides information on California’s skilled and trained workforce requirements, identifies key issues on compliance to avoid penalties, and discusses the impact of enforcement on construction professionals’ business practices.

Who Needs to Comply with California’s Skilled and Trained Workforce Requirements?

Fast Facts

  • Not every public works contract in California is required to have skilled and trained workforce requirements.
  • If you are required to be listed as a contractor in the proposal or bid, you likely need to comply. If you are not listed as a contractor in the proposal or bid and your contract price does not exceed 0.5% of the prime contract, then you are not required to comply.

Existing California law (Public Contracts Code section 2600, et seq.) authorizes a public entity to require a bidder, contractor, or other entity to use a skilled and trained workforce to complete a contract or project, and requires that the commitment to use a skilled and trained workforce be made in an enforceable agreement that meets specified requirements discussed below.

Existing law requires all public works contracts “relating to school facilities” and “design-build contracts” to comply with the aforementioned trained and skilled workforce requirements.

For other types of public works contracts requiring skilled and trained workforce requirements, if a public works contracting party is not listed on the bid as a contractor or subcontractor and its total contract price is less than or equal to 0.5% of the prime contract, then it is not required to comply with the skilled workforce percentages.

If the contract price exceeds 0.5% of the prime contract, and the contracting party is not required to be listed on the bid or proposal, Labor Code section 1722.1 defines who is treated as a “contractor” and “subcontractor” as “a contractor, subcontractor, licensee, officer, agent, or representative thereof, acting in that capacity, when working on public works pursuant to this article and Article 2.” Article 2 generally requires certain subcontractors who work on public works projects to register with the Labor Commissioner.

Finally, if the contract price exceeds 0.5% of the prime contract and is required to be listed on the bid or proposal, then existing law generally requires these entities to comply with the skilled and trained workforce requirements above. In addition, the contractor or subcontractor need not meet the requirements if, during the calendar month, the contractor or subcontractor employs skilled journeypersons to perform fewer than 10 hours of work on the contract or project. There is not likely to be further clarification on which entities will be treated as “contractors” and “subcontractors” for the skilled and trained workforce requirements until the Labor Commissioner provides additional clarification.

What are the Criteria to Determine whether a Skilled or Trained Workforce Requirement is Met?

Fast Facts

  • Contracts that require skilled and trained workforces can be satisfied by either: (1) employing the requisite percentage of apprenticeship graduates on a qualifying project; or (2) staffing apprenticeship graduates to meet the requisite percentage of hours on a qualifying project.
  • If a contractor is required to be listed on the proposal or bid for a public works contract requiring a skilled and trained workforce, then the contractor must comply with the skilled and trained workforce requirements.

California law defines a “skilled and trained workforce” to mean a project workforce that meets certain qualifications, specifically “graduates of an apprenticeship program for the applicable occupation.” The following table provides a breakdown of the increasing apprenticeship graduation requirements for a public works workforce under existing law:

Year Percentage Graduates Required
2017 30%
2018 40%
20191 50%
2020 60%

Alternatively, for the hours of work performed by skilled journeypersons employed by the contractor or subcontractor on the contract or project, the percentage of hours performed by skilled journeypersons who met the graduation requirement is at least equal to the required graduation percentage.

California Labor Code section 3075 provides details on the required apprenticeship programs to satisfy the graduation requirements for a public works workforce. The apprenticeship graduation requirements can be satisfied by a union or merit shop program including those provided by the Associated General Contractors and Associated Builders & Contractors. These programs can be used by journeyman who have not graduated from an approved apprenticeship program in order to test up or out of a traditional apprenticeship program, but still require the journeyman to participate in, at minimum, a six-month apprenticeship program in order to receive certification for the trade. An apprenticeship program can be administered by a joint apprenticeship committee, unilateral management or labor apprenticeship committee, or an individual employer. A new apprenticeship program can be approved for circumstances where any of the following conditions are met:

(1) There is no existing apprenticeship program approved under this chapter serving the same craft or trade and geographic area;

(2) Existing apprenticeship programs approved under this chapter that serve the same craft or trade and geographic area do not have the capacity, or neglect or refuse, to dispatch sufficient apprentices to qualified employers at a public works site who have requested apprentices and are willing to abide by the applicable apprenticeship standards, as shown by a sustained pattern of unfilled requests; or

(3) Existing apprenticeship programs approved under this chapter that serve the same trade and geographic area have been identified by the California Apprenticeship Council as deficient in meeting their obligations under this chapter.

How do you Demonstrate Compliance with California’s Skilled or Trained Workforce Requirements?

Fast Facts

  • Contractors subject to the skilled and trained workforce requirements are required to submit monthly reports demonstrating compliance with the graduation requirements that are subject to audit and investigation by the Labor Commissioner.

Existing California law requires a successful bidder subject to the skilled and trained workforce requirements to provide monthly reports demonstrating compliance with the aforementioned skilled and trained workforce requirements to the public agency or other awarding body.

Effective January 1, 2019, AB 3018 provides that the public agency or other awarding body must forward a copy of the monthly report to the Labor Commissioner for issuance of a civil wage and penalty assessment and a copy of the plan, if any, to achieve substantial compliance with skilled and trained workforce requirements and the response to that plan, as prescribed, if the monthly report does not demonstrate compliance with skilled and trained workforce requirements.

AB 3018 also amended Public Contract Code sections 2601 and 2602, and added new section 2603, shifting some responsibility for skilled and trained workforce compliance to subcontractors. If the prime contractor fails to comply with the monthly reporting requirements as a result of one noncompliant subcontractor, the public entity or awarding body is required withhold 150% of the value of the monthly billing for that subcontractor until that subcontractor demonstrates a plan to achieve substantial compliance, or until the subcontractor is substituted out in accordance with applicable law. The prime contractor is permitted (but not required) to withhold payment from the subcontractor. The public entity will be permitted to pay the prime contractor for the other work on the project performed by the prime contractor or by other compliant subcontractors.

What are the Penalties for Non-Compliance with California’s Skilled or Trained Workforce Requirements?

Fast Facts

  • Non-compliant contractors can be hit with up to $10,000 in fines per month, disqualification for future public works contracts, withholding of payment for non-compliant service rendered, and subject to additional reporting requirements.

AB 3018 empowers the Labor Commissioner with authority to investigate suspected violations of the skilled and trained workforce requirements and impose civil penalties up to $10,000 per month per non-compliant contractor. In situations where the Labor Commissioner finds that violations of the skilled and trained workforce requirements are willful, the contractor or subcontractor may be temporarily disqualified from bidding on public works projects. Prior to AB 3018, enforcement of the skilled and trained workforce requirements was left to the awarding bodies with no specified penalties.

AB 3018 also empowers the public agency or awarding body and prime contractor to withhold up to 150% of the value of the monthly billing for a non-compliant subcontractor who fails to timely submit the required information or does not demonstrate compliance. Non-compliant prime contractors and subcontractors are subject to additional and onerous reporting requirements to the Labor Commissioner, including declarations as to the accuracy of the information provided under penalty of perjury.

The Labor Commissioner shall publish on its website a list of contractors who are ineligible to bid on or be awarded public works contract, or to perform work as a subcontractor on a public works project pursuant to this section.

What can California Contractors, Engineers, Architects, Design Professionals, and Suppliers Competing for Public Works Projects do to Comply with AB 3018?

Fast Facts

  • Maintaining compliance with the skilled and trained workforce requirements will likely result in increased labor costs for contractors bidding on public works contracts.
  • Increased penalties and enforcement for non-compliance will require additional investment into reporting and compliance work.
  • Staffing and hiring decisions for public works contracts requiring skilled and trained workforces should be made at the time bids and proposals are submitted.

The increased penalties and investigation provided for under AB 3018 turned California’s skilled and trained workforce requirements from an aspirational goal to a present-day reality for contractors working on public works contracts. Given the limited number of apprenticeship graduates in the journeyman workforce, competition for those candidates with the required experience is expected to increase, putting additional upward pressure on labor costs. This is in addition to the already-limited number of qualified workers in the construction industry.

Indeed, in certain locales with public contracts requiring a skilled and trained workforce, apprenticeship graduates may need to be sourced from other locations in order to meet the skilled and trained workforce requirements. In the alternative, employers may need to start their own apprenticeship program.

In addition to increased labor costs, the severity of the penalties for non-compliance will also result in additional compliance-related expenses to ensure that the required information is accurately reported and supported with the Labor Commissioner. This includes costs associated with retaining an attorney familiar with California’s skilled and trained workforce requirements prior to an investigation or enforcement action by the Labor Commissioner to ensure compliance. Thus, contractors bidding for public works contracts subject to trained and skilled workforce requirements will likely be forced to pass these additional costs along to public agencies seeking affected Requests for Proposals which may further winnow out the contractors who are able to earn awarded bids.

Contractors submitting bids and proposals on public works contracts in California requiring skilled and trained workforce requirements should invest additional resources into staffing and hiring decisions before bids or proposals are submitted after California’s passage of AB 3018. Additional preparation well prior to submission of bids, including retaining qualified legal counsel in advance of preparing the bid, should ensure that contractors can maintain compliance throughout the life of a project without being subject to the penalties and fines discussed above.

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Gordon & Rees’ Construction Group consists of more than 150 lawyers across the United States who focus their practice on the comprehensive range of legal service required by all participants in the construction industry.

Brenda Radmacher is an experienced Partner at Gordon & Rees, and noted expert in construction law in California. She is called on as a counselor, litigator, and noted speaker in regard to issues involving land owners, general contractors, developers, and builders, including public works contracts. She has a varied practice with significant experience in representing companies to address risk management issues, handling their litigation, and drafting critical documents and procedures. Nicholas Krebs is an associate in the Los Angeles office and member of the Construction Group. Please contact Ms. Radmacher for all inquiries regarding California’s AB 3018.

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1 AB 3018’s penalties and enforcement become effective January 1, 2019.
The materials presented in this article are intended for informational purposes only. These materials should not be used as legal advice applicable to the reader’s specific situation. In addition, the provision of this information to the reader in does not constitute nor form an attorney-client relationship. No action should be taken on information provided within this website without retaining counsel from a professional attorney. The request or receipt of any information from this website or resulting communications does not constitute an acceptance to represent the recipient of this information. This information is subject to change without notice and should not be relied upon for accuracy and pertinence to the reader’s specific circumstances. This article may constitute attorney advertising.

Filed under AB 3018, Public Works Project Bids