LEGAL PARAMETERS OF THE CALIFORNIA SMOKE-FREE

WORKPLACE LAW (LABOR CODE 6404.5)

by

Barbara Solomon, Deputy City Attorney - San Francisco

Evan A. Braude, Special Assistant City Attorney - Los Angeles

Brian Doyle, Senior Assistant City Attorney - San Jose

1. DOES THE EXEMPTION FOR WORKPLACES WITH FIVE OR FEWER EMPLOYEES APPLY TO BARS TAVERNS AND GAMING CLUBS?

The language of Labor Code 6404.5 (AB 13) expressly states that the “five or fewer employees” exemption does not apply to indoor workplaces in “specific types of business establishments” which are addressed by a “paragraph of this subdivision that has become inoperative” (see Section 6404.5(d)(14) of the California Labor Code). Gaming clubs are addressed in Section 6404.5 (d)(7) and bars and taverns are addressed in Section 6404.5(d)(8). Section 6404.5(f) says that the exemption for gaming clubs and bars and taverns will become inoperable on January 1, 1998. Therefore, the AB 13 exemption for indoor workplaces with five or fewer employees clearly does not apply to bar/restaurant combinations, bars, taverns, and gaming clubs. This conclusion is supported by an interpretation written by a staff attorney of the California Department of Health Services on August 15, 1997 and a State of California Legislative Counsel’s Opinion dated December 20, 1997.

2. MAY BARS ALLOW CUSTOMERS TO SMOKE IN EMPLOYEE BREAKROOMS?

Strictly interpreted, the Labor Code 6404.5 (d) (13) exception for breakrooms for smoking applies only to breakrooms used by employees. The exception refers to a workplace breakroom which implies that only workers will use it. Patrons, guests, or other customers present in the business establishment may not use it as a smoking room. Specifically, the law allows employers to establish breakrooms for employees who smoke as long as: 1) air from the smoker’s breakroom is “exhausted directly to the outside by an exhaust fan” and the air is not recirculated to other parts of the building; 2) any operative ventilation standard adopted by CAL/EPA or Federal OSHA is observed; 3) the smokers’ breakroom is a “nonwork area” and “no one, as part of his or her work responsibilities, is required to enter” it; and 4) “there are sufficient nonsmoking breakrooms to accommodate nonsmokers.”

3. HOW DOES LABOR CODE 6404.5 APPLY TO OWNER-OPERATED BUSINESSES?

It has been suggested that a business operated solely by the owners, without the compensated services of any employees, is technically not a “workplace” under the California Labor Code and is therefore exempt from Labor Code 6404.5. It appears that an owner-operated bar may be exempt, although a determination may depend on such factors as how the business is structured, whether the owner-operators pay themselves a salary out of gross or net revenues, and other legal subtleties. Payment out of gross revenues looks more like a salary, whereas payment out of net revenues looks more like a dividend or “share” of the business. In any case, to be considered an owner-operated establishment, the establishment would have to meet the following conditions:

1) No one is paid to assist, on a temporary (during busy times or to cover owner vacations, etc.) or regular basis, in the in-house operation of the business, whether serving customers or performing other duties or services, such as cleaning the premises.

2) No salaried service or contract employee – such as an employee of a cleaning service, a bookkeeper, a musician, caterer, etc. – may work in the bar.

3) If volunteers help in the operation of the business, they cannot be compensated in any way for their service. Tips are a form of compensation and anyone receiving tips would be considered an employee of the business. It would appear that few, if any, bar-restaurants, bars, or gaming clubs can meet these conditions. State law charges the city and county governments with the responsibility to enforce Labor Code 6404.5. Owners of a business who think they may have grounds for this or any other exemption should contact their local government enforcement agency to determine their actual status. Each of the 61 local health departments in the state of California has a tobacco control coordinator who can help individuals reach the appropriate enforcement agency in their area.

4. MAY AN OTHERWISE EXEMPT ESTABLISHMENT, THAT IS ONE WITHOUT EMPLOYEES, ALLOW A NON-EMPLOYEE CLEANING SERVICE TO CLEAN THE BAR AFTER HOURS? IN OTHER WORDS, DOES THE PRESENCE OF INDEPENDENT CONTRACTORS MAKE AN ESTABLISHMENT A WORKPLACE?

The statute addresses smoking in the workplace or place of employment. To carry out the intent of the law and to avoid abuses, the Legislature must have intended to allow smoking in bars only where they are completely run and operated by the owners or partners. The presence of any employee or worker on the premises, whether full-time, part-time, wage earning, salaried or independent contractor, seasonal or intermittent, during business or non-business hours, would bring the establishment within the definition of a workplace or place of employment, where smoking is not allowed indoors. However, for many jurisdictions, the occasional presence of delivery people or postal carriers on the premises would not convert the owner-run bar into a workplace.

5. MAY A BAR OR A PRIVATE CLUB BE EXEMPT FROM THE LAW WHEN THE BAR OR CLUB HAS NO EMPLOYEES BUT USES UNPAID VOLUNTEERS?

There are two main lines of thought on this, the narrowest approach defining anyone who does not receive money in exchange for their work as a volunteer. A second approach would suggest that a person who receives any benefit in exchange for work is no longer a volunteer, particularly if that benefit is to accrue monetary credit toward a family member’s school tuition or toward fees for membership in an organization. Further, this line of reasoning would hold that if money “earned” from “volunteer” work is directed to an organization or cause of the volunteer’s choice, this control over the funds is sufficient benefit to make them other than a true volunteer.

The California Legislative Counsel has concluded that a worker is an employee if he is paid “consideration” for his services and if the employer has the right to direct and control the

6. WHEN ENFORCING SECTION 6404.5, MAY LOCAL ENFORCEMENT AGENCIES CITE SMOKING PATRONS AS WELL AS BAR OWNERS?

Local agencies have the authority to cite smoking patrons under section 6404.5, subdivisions (b) and (j). Subdivision (b) states that “No employer shall knowingly or intentionally permit, and no person shall engage in, the smoking of tobacco products in an enclosed space at a place of employment.” (Emphasis added.) Subdivision (j) states that “Any violation of the prohibition set forth in subdivision (b) is an infraction subject to subdivision (d) of Section 17 of the Penal Code….” Thus, both employers and persons may be cited for violations.

Nonetheless, as a policy matter, local agencies may decide to refrain from citing customers until a serious problem develops, such as an organized pro-smoking protest or a particularly recalcitrant bar patron surfaces. The phrase “no person shall engage in” was probably inserted to allow for some enforcement where the bar owner has taken all “reasonable steps” to prevent smoking by a non-employee under subdivision (c), including positing signs and asking the non-employee to stop smoking, yet the non-employee persists in smoking.

Although it is not required in the law, some jurisdictions would consider a bar owner’s decision to refuse service of alcoholic beverages to a non-cooperative customer to be convincing evidence that the owner is sincerely attempting to comply with the law.

Each jurisdiction may determine the procedure for citing patrons. For instance in San Francisco, the health inspectors would be responsible for citing bar owners and the police department would be responsible for citing customers.

7. HOW OPEN DO PATIOS, DECKS AND OTHER AREAS OUTSIDE BARS AND RESTAUANTS HAVE TO BE TO FALL OUTSIDE THE DEFINITION OF “AN ENCLOSED SPACE AT A PLACE OF EMPLOYMENT?”

The State of California has not yet put forth a definition of “enclosed space” but one is being developed by the Attorney General’s office. Until the state defines “enclosed space” the local jurisdictions could do so. Such a definition would probably rely to a great extent on the policy decisions of local planners.

Section 6404.5 does not define “enclosed space” and there little contextual language in the statute from which to draw inferences. At present, the best definition we have is an informal one set forth in a memorandum dated December 1, 1997 sent to the San Francisco City Attorney’s office by the CAL/OSHA Legal Office. This memorandum states:

“the term is generally understood to mean a space surrounded by four walls, a floor and a ceiling. Thus, bars, taverns or gaming clubs with patio areas which lack a roof or walls would not be an “enclosed space.” Thus, relying on CAL/OSHA’s definition until another is put forth by the state, if a patio or deck has one entire side open, or is missing a complete wall or a roof, it will not be considered an enclosed space, and smoking will be allowed. On the other hand, if a patio or porch simply has a few windows or doors that open, but no missing wall or roof, that area would be considered enclosed, and smoking is prohibited.

This issue may be revisited where for instance, an open-ended patio is so deep that smoke gets trapped inside the area, and for all practical purposes, the area is “enclosed.” We must bear in mind the overall purpose of the statute, which is to reduce employee exposure to environmental tobacco smoke.

8. HOW DOES THE LAW APPLY TO HOTEL LOBBIES AND OPEN BARS

LOCATED WITHIN HOTEL LOBBIES?

The exception in section 6404.5, subdivision (d)(2), allows a hotel or motel to designate up to twenty-five percent of the lobby area for smoking. The “lobby” is defined as “the common public area of such an establishment in which registration and other similar or related transactions, or both, are conducted and in which the establishment’s guests and members of the public typically congregate.” (Id.) A bar area, whether open or enclosed, that is located within a hotel or motel lobby would not be considered a lobby area. Section 6404.5, subdivision (d)(8), defines a “bar” y primarily devoted to the serving of alcoholic beverages for consumption by guests on the premises, in which the serving of food is incidental.” Thus, if a hotel or motel sets up a bar within a lobby, the lobby exception would not apply and smoking would be prohibited.

There are large hotels with unenclosed or open-air bar areas located right next to lobby areas and where the seating areas for these bars overlap with the seating areas for the lobby/registration area and customer waiting areas. Such hotels are often licensed to allow customers to consume alcoholic beverages anywhere on the premises. In such cases, a fair reading of the statute would seem to prohibit smoking within the bar itself, but allow smoking within a designated smoking area of the lobby, regardless of whether customers are consuming drinks in that area. The resolution of this issue, however, may depend on the limitations set forth in the alcohol license granted the hotel.

9. TO WHAT EXTENT MAY TOBACCO RETAIL SHOPS BE LOCATED WITHIN BARS, AND MUST THEY HAVE SEPARATELY ENCLOSED AREAS, A SEPARATE VENTILATION SYSTEM, A SEPARATE ENTRANCE, AND/OR A SEPARATE BUSINESS LICENSE?

Bar owners may not simply construct a wall or two within a bar and call it a tobacco retail shop.

Section 6404.5, subdivision (d) (4) excepts from places of employment, “Retail or wholesale tobacco shops and private smoker’s lounges.” The statute goes on to define these two terms for purposes of this paragraph:

(A) “Private smoker’s lounge” means any enclosed area in or attached to a retail or wholesale tobacco shop that is dedicated to the use of tobacco products, including, but not limited to, cigars and pipes.

(B) “Retail or wholesale tobacco shop” means any business establishment the main purpose of which is the sale of tobacco products, including, but not limited to, cigars, pipe tobacco, and smoking accessories. (Emphasis added.)

The underscored language indicates a legislative intent to except only true tobacco shops, that is, those shops whose main purpose is to sell tobacco products. A bar whose main purpose is to sell alcoholic beverages may not convert a corner of the bar to a tobacco shop and thereby allow smoking in the so-called tobacco shop. We believe that such a shop would require a separate business license, separate entrance and separate enclosure. Conceivably, that shop could be attached to or next door to a bar; however, we also understand that the ABC would prohibit bar customers from carrying their drinks outside the licensed premises of the bar area and into the tobacco shop. We believe that obtaining a license to sell and consume alcohol on the premises carries great weight in determining that a business is a bar and not dedicated to the sale of tobacco products as its main purpose. The holding of such a license would arguably carry a presumption that this establishment is a bar rather than a true tobacco shop and therefore, smoking indoors would be prohibited.