At a Glance

• Beginning January 1, 2027, a public works contractor or subcontractor may be barred from defending itself with payroll, time, or employment records that it did not timely produce in response to a duly served written request from the labor commissioner.
• The new law effectively moves a critical part of hearing preparation into the investigation stage. A contractor’s initial response to a records request may determine what evidence it later has available to challenge a civil wage and penalty assessment.

On August 27, 2026, California Governor Gavin Newsom signed Senate Bill 1316 (SB 1316), adding section 1742.05 to the California Labor Code. Effective January 1, 2027, the new section creates a potentially case-dispositive consequence for public works contractors and subcontractors that do not timely produce requested payroll, time, and employment records: They may be unable to introduce, use, rely on, or use the withheld records to dispute penalties or for impeachment at the administrative hearing or a later writ proceeding.

The statute is short, but its practical effect is significant. Contractors have historically faced penalties, withholding, and subpoena enforcement for record-production failures. SB 1316 adds a separate evidentiary consequence. Records omitted during the investigation may be unavailable after issuance of an assessment, when the contractor needs them to contest the labor commissioner’s calculations, to support worker classifications, or to...

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