(a) For purposes of this section, the term “employment agency” means an employment agency, as defined in paragraph (3) of subdivision (a) of Section 1812.501, or a domestic agency, as defined in subdivision (h) of Section 1812.501.

(b) An employment agency is not the employer of a domestic worker for whom it procures, offers, refers, provides, or attempts to provide work, if all of the following factors characterize the nature of the relationship between the employment agency and the domestic worker for whom the agency procures, offers, refers, provides, or attempts to provide domestic work:

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(1) There is a signed contract or agreement between the employment agency and the domestic worker that contains, at a minimum, provisions that specify all of the following:

(A) That the employment agency shall assist the domestic worker in securing work.

(B) How the employment agency’s referral fee shall be paid.

(C) That the domestic worker is free to sign an agreement with other employment agencies and to perform domestic work for persons not referred by the employment agency.

(2) The domestic worker informs the employment agency of any restrictions on hours, location, conditions, or type of work he or she will accept and the domestic worker is free to select or reject any work opportunity procured, offered, referred, or provided by the employment agency.

(3) The domestic worker is free to renegotiate with the person hiring him or her the amount proposed to be paid for the work.

(4) The domestic worker does not receive any training from the employment agency with respect to the performance of domestic work. However, an employment agency may provide a voluntary orientation session in which the relationship between the employment agency and the domestic worker, including the employment agency’s administrative and operating procedures, and the provisions of the contract or agreement between the employment agency and the domestic worker are explained.

(5) The domestic worker performs domestic work without any direction, control, or supervision exercised by the employment agency with respect to the manner and means of performing the domestic work. An employment agency shall not be deemed to be exercising direction, control, or supervision when it takes any of the following actions:

(A) Informs the domestic worker about the services to be provided and the conditions of work specified by the person seeking to hire a domestic worker.

(B) Contacts the person who has hired the domestic worker to determine whether that person is satisfied with the agency’s referral service.

(C) Informs the domestic worker of the time during which new referrals are available.

(D) Requests the domestic worker to inform the employment agency if the domestic worker is unable to perform the work accepted.

(6) The employment agency does not provide tools, supplies, or equipment necessary to perform the domestic work.

(7) The domestic worker is not obligated to pay the employment agency’s referral fee, and the employment agency is not obligated to pay the domestic worker if the person for whom the services were performed fails or refuses to pay for the domestic work.

(8) Payments for domestic services are made directly to either the domestic worker or to the employment agency. Payments made directly to the employment agency shall be deposited into a trust account until payment can be made to the domestic worker.

(9) The relationship between a domestic worker and the person for whom the domestic worker performs services may only be terminated by either of those parties and not by the employment agency that referred the domestic worker. However, an employment agency may decline to make additional referrals to a particular domestic worker, and the domestic worker may decline to accept a particular referral.

(c) The fee charged by an employment agency for its services shall be reasonable, negotiable, and based on a fixed percentage of the job cost.

(d) An employment agency referring a domestic worker to a job shall inform that domestic worker, in writing, on or before the signing of the contract pursuant to paragraph (1) of subdivision (b), that the domestic worker may be obligated to obtain business permits or licenses, where required by any state or local law, ordinance, or regulation, and that he or she is not eligible for unemployment insurance, state disability insurance, social security, or workers’ compensation benefits through an employment agency complying with subdivision (b). The employment agency referring a domestic worker shall also inform that domestic worker, if the domestic worker is self-employed, that he or she is required to pay self-employment tax, state tax, and federal income taxes.

(e) An employment agency referring a domestic worker to a job shall verify the worker’s legal status or authorization to work prior to providing referral services in accordance with procedures established under federal law.

(f) An employment agency referring a domestic worker to a job shall orally communicate to the person seeking domestic services the disclosure set forth below prior to the referral of the domestic worker the following disclosure statement:

“(Name of agency) is not the employer of the domestic worker it referred to you. Depending on your arrangement with the domestic worker, you may have employer responsibilities.”

Within three business days after the employment agency refers a domestic worker to the person seeking domestic services, the following statement printed in not less than 10-point type shall be mailed to the person seeking domestic services:

“(Name of agency) is not the employer of the domestic worker it referred to you. The domestic worker may be your employee or an independent contractor depending on the relationship you have with him or her. If you direct and control the manner and means by which the domestic worker performs his or her work you may have employer responsibilities, including employment taxes and workers’ compensation, under state and federal law. For additional information contact your local Employment Development Department and the Internal Revenue Service.”

(g) An employment agency referring a domestic worker to a job shall not specify that a worker is self-employed or an independent contractor in any notice, advertisement, or brochure provided to either the worker or the customer.

(h) Every employment agency referring a domestic worker to a job and who is not the employer of the domestic worker being referred, shall in any paid telephone directory advertisement or any other promotional literature or advertising distributed or placed by such an employment agency, on or after January 1, 1995, insert the following statement, in no less than 6-point type which shall be in print which contrasts with the background of the advertisement so as to be easily legible:

“(Name of agency) is a referral agency.”

(i) An employment agency may not refer, in its advertising, soliciting, or other presentments to the public, to any bond required to be filed pursuant to this chapter.

(j) An employment agency may not refer, in its advertising, soliciting, or other presentments to the public, to any licensure acquired by the agency.

(k) Any violation of this section with the intent to directly or indirectly mislead the public on the nature of services provided by an employment agency shall constitute unfair competition which includes any unlawful, unfair, or fraudulent business acts or practices and unfair, deceptive, untrue, or misleading advertising. Any person or entity that engages in unfair competition shall be liable for a civil penalty not to exceed two thousand five hundred dollars ($2,500) for each violation.

(Amended by Stats. 1994, Ch. 1081, Sec. 1. Effective January 1, 1995.)