PLF and ACTA challenge state restrictions on job-creating apprentice programs

Sacramento, CA; January 26, 2012: The State of California is imposing unconstitutional restrictions on the opening of new apprentice programs for crafts and trades.

ACTA Students

So argues a lawsuit filed by attorneys with Pacific Legal Foundation, representing the Air Conditioning Trade Association (ACTA). PLF attorneys served the suit on state officials last night.

The lawsuit targets California Labor Code section 3075, which sets up a vague and unjustified bureaucratic obstacle course for proposed new apprenticeship programs. It prohibits an apprenticeship program from opening up, or expanding into a new part of the state, unless the state Division of Apprenticeship Standards (DAS) and the California Apprenticeship Council (CAC) determine that the “training needs [of the geographical area] justify the establishment [of additional programs].” The DAS and CAC can rule that there is no “need” for a new program if one already exists.

Undercutting consumers and marketplace competition

Timothy Sandefur Principal Attorney

“This law basically says that if you want to run an apprenticeship program, you first have to get permission from the state’s existing apprenticeship programs,” explained Timothy Sandefur, a PLF principal attorney, who is representing ACTA in the case. “Existing apprenticeship programs are given a special privilege of blocking any new company from opening or expanding and competing against them. Imagine if Target could legally prohibit any new Wal-Marts from opening up. That’s what this law does for apprenticeship programs.”

PLF’s lawsuit argues that these restrictions violate constitutional Due Process and Equal Protection principles by prohibiting the opening or expansion of businesses for no legitimate regulatory purpose. Rather than promoting public health and safety — the accepted reasons for government regulation — the restrictions on new apprenticeship programs actually serve the private interests of established programs, and undermine the interests of consumers, job-seekers, and employers, by limiting marketplace competition and consumer choice.

ACTA was founded in 1972, to represent the interests of businesses that install air conditioning and heating systems. In 1993, ACTA began an apprenticeship program to train people in working with sheet metal. Over the years, ACTA has trained thousands of students, but it has only been allowed to recruit students who live in Mariposa, Merced, Stanislaus, and Tuolumne Counties.

In 2008, ACTA applied for permission to expand its operations to the rest of the state’s counties, but in response to complaints filed by existing apprenticeship programs, the CAC refused ACTA’s request. Regulators declared there was no “public need” for ACTA to expand. “It’s truly a sad day when all you want to do is train tomorrow’s workforce and you are told you cannot because they want to limit contractors’ options,” said Jill Mojica, executive director of ACTA. “Contractors should have a choice of what apprenticeship training program they would like to use. It is ACTA’s hope that this lawsuit will provide California contractors with more apprenticeship opportunities.”

Feds: No need for state’s standards-free “public need” test

In 2007, the U.S. Department of Labor declared that the California “public need” law conflicted with federal law, and revoked the state’s authority to qualify apprentices for work on federal projects. But the state still imposes the “need” test on new apprentice programs that would train workers for state and local (as well as private) projects in California.

“As long as California enforces this ‘needs’ test, the federal government will not give any recognition to the state’s apprenticeship programs,” explained Sandefur. “In other words, the California Department of Labor is so insistent on enforcing this anti-competitive ‘needs’ test that it will ignore the best interests of the state’s blue-collar workers.”

A roadblock to economic recovery

“Apprenticeship is a vital component of the state’s economy,” Sandefur continued. “For many people, it’s the path to getting a better job to provide for themselves and their families. California’s unemployment is among the nation’s highest. But rather than encourage new apprenticeship programs and opportunities, the state is stifling them in order to prevent legitimate competition between different training programs. That’s not just unfair — it’s also unconstitutional.”

About Pacific Legal Foundation
Donor-supported Pacific Legal Foundation (www.pacificlegal.org) is the leading legal watchdog organization that litigates for limited government, property rights, free enterprise, and a balanced approach to environmental regulations, in courts nationwide.

PLF attorneys are currently before the U.S. Supreme Court in a high-profile challenge to overreaching govern­ment regulations, Sackett v. EPA. Oral argument was held in that case on January 9, 2012, and a decision is expected in spring or early summer.