AB 381 expands California’s state-contract labor compliance rules for contracts involving apparel, garments, accessories, equipment, materials, and supplies. For contracts entered into or renewed on or after January 1, 2026, it requires contractors to certify not only that goods were not produced with sweatshop labor or forced labor, but also that the contract complies with a broader set of anti-trafficking requirements. Those requirements cover contractors, subcontractors, employees, and agents, and prohibit severe forms of trafficking in persons, forced labor, document confiscation, deceptive recruitment, recruitment fees, unsafe housing, and certain failures to provide written work documents or return transportation.
The bill also requires contractors and subcontractors to adopt and certify compliance plans, conduct due diligence on subcontractors, notify workers of prohibited conduct and potential discipline, and disclose credible allegations and violations to the contracting officer and oversight agencies. It adds enforcement tools, including ineligibility to bid if certification is not made, possible removal of employees or subcontractors from the contract, suspension of payments pending remediation, and potential suspension or debarment. The bill further directs contracting officers to notify oversight officials, debarring and suspending officials, and law enforcement when credible information of a violation is received, and allows agencies to limit investigations to credible information.
AB 381 would amend Public Contract Code Section 6108 and thereby broaden the state’s existing “sweatfree” procurement framework. It also revises definitions of forced labor, coercion, recruitment fees, severe forms of trafficking in persons, and related terms, and applies the new requirements to contracts and subcontracts regardless of where performance occurs. The bill preserves the existing misdemeanor penalty for false certification and states that no reimbursement is required for local agencies or school districts because any costs arise from changes to crimes or penalties.
The bill’s overall sentiment appears strongly supportive in policy committees and on the floor, with unanimous or near-unanimous “do pass” votes at each recorded stage. That pattern suggests broad agreement with the bill’s anti-trafficking and labor-protection goals. However, the measure was later held under submission and placed on the suspense file, indicating that fiscal or implementation concerns likely became more significant even though no recorded vote opposition appears in the available history.
The main points of contention are likely administrative burden, enforcement scope, and potential cost impacts on state procurement and contractors. The bill imposes detailed compliance-plan, disclosure, monitoring, and subcontractor-certification obligations, and it expands sanctions and reporting duties, which may raise concerns among procurement officials and contractors about compliance complexity and liability. At the same time, the bill’s supporters appear to view those requirements as necessary to strengthen protections against forced labor and human trafficking in state supply chains.
AB 381 would amend Public Contract Code Section 6108 to impose expanded anti-trafficking certification, compliance-plan, reporting, and enforcement requirements on state contracts for apparel, garments, accessories, equipment, materials, and supplies, effective for contracts entered into or renewed on or after January 1, 2026. It would also broaden the definition of forced labor and add new sanctions and investigative procedures, while preserving the existing misdemeanor for false certification and maintaining the current credit-card purchase exemption. The bill would create a state-mandated local program by expanding the scope of a crime, but it states that no reimbursement is required.
The recorded vote history shows consistently unanimous support at every committee and floor stage, with no recorded nays, which indicates strong bipartisan or at least broad institutional support for the bill’s anti-human-trafficking and labor-compliance objectives. There is no committee transcript available to show detailed debate, but the measure’s progression suggests general approval of the policy direction. Its later placement on the suspense file and being held under submission suggests that fiscal or implementation concerns, rather than policy opposition, may have slowed advancement.
The likely areas of contention are the bill’s breadth and administrative demands. Contractors and procurement agencies would face new certification, due-diligence, posting, disclosure, and subcontractor-monitoring obligations, along with expanded sanctions such as payment suspension, removal of workers or subcontractors, and possible debarment. Another possible concern is the bill’s extraterritorial reach, since it applies to contracts and subcontracts regardless of place of performance and requires compliance with foreign labor and housing standards in some cases. Supporters, by contrast, appear focused on strengthening protections against forced labor, deceptive recruitment, and trafficking in state supply chains.