San Leandro Municipal Code Art. 6 Living Wage

(Legislative History: Ordinance No. 2007-018, 6/30/07 (Sections 1-6-600—1-6-660))

The purpose of this Article is to assure that City employees, employees of City service contractors, subcontractors, and employees and contractors of City financial assistance earn an hourly wage that is sufficient to live with dignity and to achieve economic self-sufficiency. The City contracts with many businesses and organizations to provide services to the public, and provides financial assistance to developers and businesses for the purpose of promoting economic development and job growth. Such public expenditures should also be spent to set a community economic standard that permits workers to live out of poverty. The City Council finds that the use of City funds to provide living wage jobs will decrease poverty, increase consumer income, invigorate neighborhood businesses and reduce the need for taxpayer funded social service programs.

This Article shall be known and may be cited as the "Living Wage Ordinance." The purpose of this Article is to protect the public health, safety and welfare. It does this by requiring that public funds be expended in such a manner as to facilitate individual self-reliance by employees of City contractors, lessees, recipients of City financial aid and their respective subcontractors.

(a) The City of San Leandro awards contracts to private firms and other businesses to provide services to the public and to City government; and

(b) The City of San Leandro has a limited amount of taxpayer resources to expend; and

(c) The use of taxpayer dollars to promote sustenance and creation of living wage jobs will increase consumer income, decrease levels of poverty and reduce the need for taxpayer-funded social programs in other areas; and

(d) When City funds are used to contract for services, such contracts should demonstrate an effort to promote an employment environment that enhances the general quality of life within the community and maximizes the productive effect of the City's limited resources; and

(e) The City's use of contractors that do not provide health insurance to their employees can result in imposing the costs of their medical care on the County, State and Federal governments; and

(f) That employees are far likelier to be healthy if their employer provides reasonable health insurance to them and their dependents; and

(g) The payment of a minimum level of compensation as required by this Article benefits these interests.

The following words and phrases whenever used in this Article shall be construed as defined in this section:

"City"

means the City of San Leandro and all City agencies.

"City financial aid recipients"

mean all persons or entities that receive from the City, direct assistance in the form of grants, loans, or loan guarantees, in-kind services, waivers of City fees, real property or other valuable consideration in the amount of more than One hundred thousand dollars within the City's fiscal year (July 1 through June 30). This term shall not include those who enjoy an economic benefit as an incidental effect of City policies, regulations or ordinances.

"Contractor"

means any person or entity that enters into a service contract as hereafter defined with the City in an amount equal to or greater than Twenty-five thousand dollars within the City's fiscal year. (Contractor includes subcontractors whose employees are engaged in City funded services.)

"Employee"

means any individual employed by an employer who performs at least 25% of the work arising from City financial aid, or a City lease, or who performs work arising from a service contract. No work may be reassigned in order to evade coverage under this Article.

"Health benefits"

mean an employer's monetary contribution toward the cost of health and medical care insurance for covered employees and their dependents. Health benefits may include the following types of insurance: medical health, including mental health, dental and vision care. The hourly cost of providing health benefits shall be credited as compensation along with wages under this Chapter. Retirement benefits, accidental death and dismemberment insurance, life insurance, disability insurance and other benefits that do not provide medical or health-related coverage shall not be credited as compensation.

"Nonprofit"

shall mean a nonprofit organization described in Section 501(c) of the Internal Revenue Code of 1954 which is exempt from taxation under Section 501(c) of that code, or any nonprofit educational organization qualified under Section 23701(d) of the Revenue and Taxation Code.

"Person"

means any individual, proprietorship, partnership, joint venture, corporation, limited liability company, trust, association, or other entity that may employ individuals or enter into contracts.

"Service contract"

means a contract given a contractor by the City for Twenty-five thousand dollars or more for the furnishing of services to or for the City, except those contracts where services are incidental to delivery of products, equipment or commodities. Service contracts include, but are not limited to, security guard services, janitorial services, waste management, landscaping, parking attendant services, and towing. "Service contract" does not include: (1) a contract between the City and another governmental entity or public utility; and (2) a contract subject to Federal or State laws or regulations that would preclude application of the living wage requirement otherwise applicable pursuant to this Article.

The persons and entities described below shall comply with the minimum compensation standards established by this Article if they employ more than six employees:

(a) The City of San Leandro, including all its agencies, departments and offices, for all regular and permanent part-time employees.

(b) For-profit service contractors which employ six or more employees and receive contract(s) from the City for Twenty-five thousand dollars or more within the City's fiscal year. Compliance shall be required during the term of the contract for all employees who perform, and while engaged in work arising from the service contract.

(c) Nonprofit service contractors which employ six or more employees and receive contracts from the City of One hundred thousand dollars or more within the City's fiscal year. Compliance shall be required during the term of the contract for all employees who perform at least 25% of the work arising from the service contract.

(d) Lessees of public property, licensees, concessionaires and franchises which employ six or more employees and have Three hundred fifty thousand dollars or more in annual gross receipts. Compliance shall be required during the lease term for any employees who spend 25% or more of their compensated time on the leased property or engage in work directly related to the license, concession or franchise.

(e) City financial aid recipients which employ six or more employees and receive more than One hundred thousand dollars in grants, loans or other cash and/or non-cash assistance within the City's fiscal year. Compliance shall be required for a duration of one year for each One hundred thousand dollars of assistance, up to a maximum duration of five years, following receipt of the aid for all employees who spend 25% or more of their compensated time engaged in work directly related to the purposes for which the City provided the aid.

(f) Subcontractors and sub lessees of any of the entities or persons described in subsections (a) through (e) of this section.

All persons and entities subject to this chapter shall pay covered employees a wage of no less than the living wage set forth in this Article:

(a) Living wage means no less than Twelve dollars and forty cents per hour including wages and health benefits. For health benefits to be counted as a part of the living wage, the benefit must be at least One Dollar and Fifty Cents ($1.50) per hour. If employer contributions for health benefits are not paid on an hourly basis, the employer must demonstrate to the City the hourly value of such benefits in order to receive credit for such payments to covered employees.

(b) Time-off: Employees shall be entitled to at least 22 days off per year for sick leave, vacation, or personal necessity. At least 12 of the required days off shall be compensated at the same rate as regular compensation for a normal working day. Ten of the required 22 days may be uncompensated days off. Employees who work part-time shall be entitled to accrue compensated days off in increments proportional to that accrued by full-time employees. Employees shall be eligible to use accrued days off after the first six months of satisfactory employment or consistent with employer policy, whichever is sooner. Paid holidays, consistent with established employer policy, may be counted toward provision of the required 12 compensated days off.

(c) Additional Compensation Permissible: Nothing in this Article shall be construed to limit an employer's discretion to provide greater wages to its employees.

(d) The initial rates set forth in subsection (a) of this section shall increase annually on July 1, beginning July 1, 2008, to reflect the 12 month average in the Consumer Price Index for all urban consumers in the San Francisco-Oakland-San Jose Metropolitan Statistical Areas for the preceding year from May through April.

(e) If the prevailing wage for services occupations are posted by the State Department of Industrial Relations (or any successor agency) and exceeds the compensation required by the living wage, then the contractor is required to pay its employees the posted prevailing wage.

(f) The City Council may periodically adjust the living wage rate up or down to reflect average living wage rates in effect in other Alameda County cities.

Following a review and recommendation by the City Manager, the City Council may approve waivers with or without conditions to any of the requirements and regulations set forth in this Article, or in any implementing policies, upon a finding that such action is in the best interest of the City.

Every City contract, lease, license agreement, concession agreement, franchise agreement or agreement for financial aid with an employer or amendment thereto affecting financial aid or extending the term shall require compliance with the requirements of this Article. Such contract provisions shall address the employer's duty to promptly provide to the City, documents and information verifying compliance with the requirements of this chapter, and sanctions for noncompliance. Such contract provisions shall also require the employer to give written notification to each current employee, and to each new employee at time of hire, of his or her rights under this Article. The notification shall be in the form provided by the City in English and Spanish, and translated by the employer to other languages spoken by a significant number of the employees, and shall also be posted prominently in areas at the work site where it will be seen by all employees.

The requirements of this Article shall not be applicable to the following employees:

(a) Employees of another government agency, including without limitation, cities, counties, state agencies, joint power authorities, and public utilities.

(b) An employee participating in a temporary job training program approved by the City in which a significant component of the employee's training consists of acquiring specialized knowledge, abilities, skills or job readiness (e.g., the importance of proper work attire, punctuality and workplace demeanor).

(c) Any disabled employee who; (1) is covered by a current sub-minimum wage certificate issued to the employee by the U.S. Department of Labor; or (2) would be covered by such a certificate but for the fact that the employer is paying a wage equal to or higher than the minimum wage.

(d) An employee who is in an internship or other job training program for which the employee is also receiving academic credit.

(e) An employee who is under 18 years of age.

(f) A temporary employee of the City of San Leandro who is employed for a limited term to a regular or nonregular position including casual, seasonal and emergency appointments with no guarantee of continued employment beyond the initial hire season.

(g) Volunteers.

(h) Employees who are standing by or on-call according to the criteria established by the Fair Labor Standards Act, 29 U.S.C. Section 201. This exemption shall apply only during the time when the employee is actually standing by or on-call.

(i) Employees of contractors and subcontractors subject to the requirements of Division 2, Part 7, of the California Labor Code, for payment of prevailing wage when prevailing wage requires compensation greater than that required by this Article.

(j) An employee for whom application of the requirements of this Article is prohibited by State or Federal law.

(k) An employee subject to a bona fide collective bargaining agreement where the waiver of the provisions of this Article are set forth in clear and unambiguous terms in such an agreement.

(a) It shall be unlawful to retaliate or discriminate against any person on account of having inquired into or having claimed a violation of this Article.

(b) Each entity which is to replace a prior entity, subject to the requirements of this Article, and described in Section 6, shall offer employment to the employees of the prior entity. Such employees may be not be terminated by the new entity during the first 90 days except for just cause. The new entity may operate at lower staffing levels than its predecessor but in such event, shall place its predecessor's employees on a preferential reinstatement list based on seniority. For purposes of this section, an entity "replaces" another if it (1) assumes all or part of the lease, contract, subcontract or City aid of a prior employer, and (2) offers employment which employees of the prior entity can perform. Nothing herein shall be construed to require that supervisory, managerial or confidential employees retained by the new contractor be kept in a supervisory, managerial or confidential position.

(a) An employee who alleges violation of any provision of the requirements of this Article may report such acts to the City. The City Manager may establish a procedure for receiving and investigating such complaints and take appropriate enforcement action.

(b) Any complaints received shall be treated as confidential matters to the extent permitted by law. Any complaints received and all investigation documents related thereto shall be deemed exempt from disclosure pursuant to California Government Code Sections 6254 and 6255.

(a) A person claiming violation of this Article may bring an action in the Superior Court of the State of California against an employer and obtain the following remedies:

(1) Back pay for each day during which the employer failed to pay the compensation required by this Article.

(2) Reinstatement and compensatory damages.

(3) For a willful violation of this Article, a court may award as a penalty up to treble the amount of monies to be paid as damages.

(4) Reasonable attorneys' fees and costs.

(b) Notwithstanding any provision of this Article or any ordinances to the contrary, no criminal penalties shall attach for any violation of this chapter.

(c) No remedy set forth in this Article is intended to be exclusive or a prerequisite for asserting a claim for relief to enforce any rights hereunder in a court of law.

(d) No liability of City: Claims or lawsuits against the City arising under this Article are not authorized, nor shall the remedies provided in subsection (a) be awarded against the City. The City shall not be liable to any person or entity because of the City's failure to notify an employer of the applicability of this Article, the City's failure to investigate or enforce violations of this Article, or based upon another employer's failure to comply with this Article.

(e) The City may terminate a service contract, financial assistance, or lease or facility agreement and pursue any other legal remedies available to the City, including debarment, for noncompliance with this Article.

This Article shall apply to every City contract, lease, license, concession agreement, franchise agreement or agreement for financial aid with an employer entered into or amended on or after September 1, 2007.