By Kevin Barry, Marcy Koukhab and Chloe Osmer

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most poorly-treated workers in California. According to worker advocates, media reports and academic studies, labor law violations-including minimum wage, overtime, and break period violations-are endemic to the carwash industry. In 2003, the California legislature passed Assembly Bill 1688, the "Car Wash Worker Law," to address many of these problems through a system of registration and enforcement ¹. The purpose of this report is to provide our client, the CLEAN Carwash Campaign, with an assessment of how well the law has furthered efforts to improve conditions for workers in the industry, and to provide a set of policy recommendations that would enable the law to do so more effectively. Our analysis is based on findings in three areas: the implementation and enforcement of the law, the law's impact on workers and their advocates, and the perspectives of carwash operators.

In each year since the implementation of AB 1688 began, the number of carwashes applying and successfully registering has grown significantly. This represents noteworthy industry progress towards compliance with the law's registration requirement. However, as of February 2009, close to 40% of the applicable carwashes in California were not in compliance with the law. Enforcement of AB 1688's registration requirement and other labor laws by the state's Division of Labor Standards Enforcement (DLSE) has increased in the carwash industry during the past two years; state labor investigators visited approximately a third of carwashes covered by the law in both 2007 and 2008, assessing more than $8.5 million in fines and penalties for labor violations and failure to register in accordance with the law. Nonetheless, many carwash operators continue to violate state labor laws.

Carwash worker advocates have found several key provisions of AB 1688 to be useful to their advocacy efforts, and believe that the law has had a positive overall impact on workers and the industry. However, they have also identified a number of limitations to the law, including the lack of information needed for workers to recover wages through the law's surety bond and restitution fund provisions, insufficient penalties, and ineffective enforcement. Although carwash operators are predictably less supportive of AB 1688 than worker advocates, the concerns they voiced about the law echo, to some degree, what we heard from worker advocates: that the law's provisions are not strong enough to compel compliance, that more widespread and effective enforcement is needed, and that many employers continue to violate labor laws.

Based on our findings, we developed a number of policy options to address AB 1688's key deficiencies, and we evaluated these policies according to their effectiveness in improving the law's outcomes, their political feasibility, and their administrative feasibility. As a result of our analysis, we recommend that our client first advocate for changes to internal DLSE policy that would make the surety bond and restitution fund wage recovery mechanisms better known and more easily accessible to workers and their advocates. Our client should also consider, though as more of a future priority, petitioning the Labor Commissioner to make enforcement more effective and transparent by assigning specialized investigators to the carwash industry and posting enforcement data to its website. Additionally, if the Car Wash Worker Law is successfully reauthorized in 2009, we recommend that our client attempt to strengthen the law through statutory amendments in 2011 when a new, perhaps more labor-friendly governor is in office.

¹For the remainder of this report, we use "AB 1688" and "Car Wash Worker Law" interchangeably.