SB 459 became law on January 1, 2012. The bill added two new Labor Code sections 226.8 and 2753. Labor Code section 226.8(a) prohibits employers from charging a worker a fee or making any deductions from the worker's compensation where such fee or deduction would have been prohibited if the worker was classified as a regular W-2 employee. Labor Code section 226.8(b) imposes penalties of between $5,000 and $15,000 for each violation of the law.

The bill does not limit other legal remedies available to employees including existing statutory actions and attorney's fees if the employee prevails.

The term "per violation" has not been defined by the courts yet, but it is likely that it means a penalty for each  fee or deduction for renting equipment, renting facilities and other employer-provided equipment and other charge that the employee would need to pay to perform the job's duties.  It is possible that this new law may result in hundreds of thousands of dollars in penalties per misclassification in situations where the employer regularly charged the employee for equipment use, facilities us, or some other fee or charge to use something necessary to the employment.

While it was at first unclear if Governor Brown would sign the bill, the justification was that employers that misclassify contractors are estimated to evade several billion dollars in payroll and other state taxes each year.  Governor Schwarzenegger had vetoed a smiliar bill while in office.