Store Research
SENATE BILL 816 (CUSANOVICH – 1973)
CHAPTER 1116, STATUTES OF 1973, SB 816
Some bill research does not include the Governor's file because at the time we researched the bill, the sitting Governor had not released his chaptered bill file. If the Governor's file is not included with this particular research, please contact our office (1-530-666-1917 or quote@legintent.com) and we will be happy to provide this file at no charge if it is available. Please Note: Governor files did not exist prior to 1943.
As enacted, Senate Bill 816 was a single-section bill adding only Business and Professions Code section 16607, relating to restraint of trade. (See Exhibit #1d) Senator Lou Cusanovich introduced the bill on April 23, 1973 at the request of W. J. LaPerch, President of the Business and Professional Agency. (See Exhibits #1a; #4, document SP-4; and #8, documents A 6, A-7, and A-8)
While before the Legislature, the measure was considered by the Senate Committee on Business and Professions and the Assembly Committee on Commerce and Public Utilities. (See Exhibits #3 and #5) Senate Bill 816 was amended twice, once in each House, before receiving unanimous legislative approval. (See Exhibits #1b, #1c, and #2) Senate Bill 816 was signed by Governor Ronald Reagan and was recorded by the Secretary of State as Chapter 1116 of the Statutes of 1973. (See Exhibits #1d and #2)
The Senate Committee on Business and Professions analysis of the bill indicated that Senate Bill 816 was introduced in response to industry competition problems. (See Exhibit #3) Apparently, it was not unusual for an employment agency’s former employee to take the customer and applicant lists of the agency with them as they went to work for themselves or a competitor. (See Exhibits #3 and #8, document A 6)
A March 28, 1973 letter from W. J. LaPerch, President of the Association of Professional Personnel Agencies, to Senator Cusanovich further explained this problem:
An employment agency deals in information that is both portable and transferrable. [sic] The name of a current employer along with a job listing can be worth several hundreds or thousands of dollars.
Two unfortunate situations arise frequently over which we have little or no control. An employee who has access to our employer client listings and our applicant listings leaves our employ and either goes witha [sic] competitor, or opens his own business. Neither of these acts are damaging in themselves, and in a sense represent a healthy spirit of competition.
It is only when the employee takes proprietary information with him and compromises it, that it costs the agency that spent time and money generating it the fee involved.
Therefore, what we would like to do is have legislation which is essentially identical to that enacted for the telephone answering services . [sic] It would not restrain trade or restrict counselors from changing employers. It would only prevent the improper transfer of information.
(See Exhibit #6, document AP-2; see also #8, document A-6)