California Regulates Use of Production Quotas in Warehouse Distribution Centers

Allen Smith, J.D. By Allen Smith, J.D. September 27, 2021

​On Sept. 22, Gov. Gavin Newsom signed into law a bill, AB 701, regulating production quotas for warehouse distribution center employees, such as the quotas used by Amazon to speed employees' work. We've gathered articles on the news from SHRM Online and other outlets.

First Law of its Kind

AB 701 is the nation's first legislation to make companies disclose the productivity requirements and work-speed metrics they set for employees. AB 701 doesn't specifically name Amazon, but supporters and opponents of the bill said the e-commerce giant was clearly the target for the regulations.

(San Gabriel Valley Tribune via The Press Enterprise)

Protections for Warehouse Workers

The measure requires companies to disclose production quota descriptions to their workers and prohibits the use of algorithms that disrupt basic worker rights such as rest periods, bathroom breaks, or compliance with health and safety laws. The legislation ensures workers cannot be fired or retaliated against for failing to meet an unsafe quota.

(Office of Gov. Gavin Newsom)

Former Labor Leader Authored Bill

Democratic Assemblywoman Lorena Gonzalez, a former labor leader, authored the law. She accused Amazon of disciplining warehouse workers at the direction of an algorithm that tracks employees' activities and can determine that anything not directly related to moving packages is off-task. "Amazon is pushing workers to risk their bodies for next-day delivery, while they can't so much as use the restroom without fearing retaliation," Gonzalez said. Amazon did not respond for requests for comment on her legislation or statement.


Employers Nudged to Move Out of State?

Opponents of AB 701 maintained that even before the legislation was enacted, an employer that implemented a quota that forced employees to flout existing health and safety laws violated California law. They also expressed concern that the legislation could harm California's warehouse employers by nudging business owners to move out of state.


Quota Transparency

AB 701 requires that a covered business provide to each employee, within 30 days of hire or 30 days of the effective date of the new law (Jan. 1, 2022), a written description of each quota to which the employee is subject. Quota is defined broadly as, "A work standard under which an employee is assigned or required to perform at a specified productivity speed, or perform a quantified number of tasks, or to handle or produce a quantified amount of material, within a defined time period and under which the employee may suffer an adverse employment action if they fail to complete the performance standard." An employer may not take an adverse employment action against an employee for failing to meet a quota that has not been disclosed in writing to the employee.

(Littler via JD Supra)

Governor Vetoes 'Card-Check' Union Recognition for Farmworkers

On Sept. 22, Newsom also vetoed AB 616, which would have allowed for "card-check" union recognition for farmworkers under the Agricultural Labor Relations Act. Under the card-check method, employees can approve union representation when the majority of employees in the bargaining unit sign authorization forms.

(SHRM Online



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