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 Bill Text - SB-400 Labor: elective compensation under the Inflation Reduction Act of 2022.

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 |Add To My Favorites |Track Bill | Version: 10/01/25 - Chaptered
 09/17/25 - Enrolled
 09/03/25 - Amended Assembly
 08/21/25 - Amended Assembly
 06/30/25 - Amended Assembly
 06/23/25 - Amended Assembly
 04/07/25 - Amended Senate
 03/27/25 - Amended Senate
 02/14/25 - Introduced

 SB-400 Labor: elective compensation under the Inflation Reduction Act of 2022.(2025-2026)

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 Date Published: 10/02/2025 09:00 PM

SB400:v91#DOCUMENTBill Start

 Senate Bill

 No. 400

 CHAPTER 220

An act to add and repeal Article 4 (commencing with Section 280) of Chapter 1 of Part 1 of Division 2 of the Labor Code, relating to labor, and declaring the urgency thereof, to take effect immediately.

 [
 Approved by

 Governor
 October 01, 2025.

 Filed with

 Secretary of State
 October 01, 2025.
 ]

LEGISLATIVE COUNSEL'S DIGEST

SB 400, Cortese.
 Labor: elective compensation under the Inflation Reduction Act of 2022.

Existing law, with certain exceptions, establishes 8 hours as a day’s work and a 40-hour workweek, and requires payment of prescribed overtime compensation for additional hours worked. Existing law requires a person who unlawfully withholds wages due an employee, as provided, to be subject to specified civil penalties. Existing law charges the Labor Commissioner with enforcement of these provisions.

Existing law makes every person who fails to pay the wages of each employee subject to a specified penalty. Existing law requires the penalty to either be recovered by an employee as a statutory penalty or by the Labor Commissioner as a civil penalty, as prescribed.

Existing law defines “public works,” for purposes of regulating public works contracts, as, among other things, construction, alteration,
 demolition, installation, or repair work done under contract and paid for, in whole or in part, out of public funds. Existing law further requires that, except as specified, not less than the general prevailing rate of per diem wages be paid to workers employed on public works and imposes misdemeanor penalties for a violation of this requirement. Existing law provides that for the purposes of provisions of law relating to the payment of prevailing wages, “public works” includes specified types of construction, alteration, demolition, installation, and repair work.

Existing law, the Labor Code Private Attorneys General Act of 2004, authorizes an aggrieved employee to recover through a civil action a civil penalty that may be assessed and collected by the Labor and Workforce Development Agency, as specified.

This bill would, until January 1, 2029, authorize a taxpayer, employer, contractor, or subcontractor to make an
 elective retroactive wage payment, as defined, to workers who performed work on a qualified renewable clean energy facility pursuant to the Inflation Reduction Act of 2022 (Public Law 117-169) if certain requirements are met, including, among others, that the facility is not a public works project, as defined, and would not otherwise be subject to the Davis-Bacon Act, as specified. The bill would specify that those provisions do not apply to, among others, violations of any other provision of law unrelated to the payment of retroactive prevailing wage correction payments in connection with the application for federal tax benefits pursuant to the Inflation Reduction Act of 2022. The bill would limit that authorization to renewable energy facility construction or repairs commenced on or after January 1, 2023, that were completed on or before December 31, 2024.

The bill would make related findings and declarations.

This bill would declare that it is to take effect immediately as an urgency statute.

Digest Key

 Vote:
 2/3 
 Appropriation:
 NO 
 Fiscal Committee:
 YES 
 Local Program:
 NO 

Bill Text

The people of the State of California do enact as follows:

SECTION 1.

 Article 4 (commencing with Section 280) is added to Chapter 1 of Part 1 of Division 2 of the Labor Code, to read:

 Article
 4. Elective Compensation Under The Inflation Reduction Act

280.

 It is the intent of the Legislature to do all of the following:

(a) Facilitate the construction, rebuild, repowering, and repair of facilities that advance the state’s goals for the use of renewable energy in retail electricity sales including the use of tax incentives available to qualif