HomeMy WebLinkAboutAgenda Bill 7.A 09/20/2004CITY OF PETALUMA, CALIFORNIA
7.
AGENDA ILL Septomber 2 , 2004
Abend'a Title: Presentation and Discussion Regarding Possible Meeting: Dater September 20, 2004
Wage Ordinance.
Meeting. Time: ❑ 3:00 PM
7:00 PM
Category (check_ one):.. 0 :Consent Calendar ❑ Public'Hearing E New Business
❑ Unfinished Business, ❑' Presenta_ t_ ion
Department: Director:` Contact Person:._ Phone.Number:
City Manager M, ichael' Bierman Michael Bierman, 778-4345
Cost of Proposal: Account Number:
Amount Budgeted- Name of Fund:
Attachments to Agenda Packet I;tem:'
1. Recently passed living wage: ordinance for the City of Sonoma
.2. City of Petaluma Service. -Contracts Summary (as prepared by U.S. Berkeley Institute for Labor and
Employment)
3. A Living Wage for,- Santa Rosd and Petaluma, a publication of ,the UC Berkeley Center for Labor
Research and Education
4., Living Wage Laws "& Communities;.,a publication of the Brennan Center for Justice,
1 5. California Labor & Employinent,publication, Spring,2002
'6. UC Berkeley Labor Center brochure
Summary Statement: The Living Wage Coalition of Sonoma 'County will give a presentation to the
Council regarding a living wage ordinance' for Petaluma. The City of Sonoma_ recently passed a living
wage ordinance (attached); and the Coalition proposes to craft a similar ; ordinance for Petaluma.
Researchers from the UC Berkeley ,Center for Labor Research and Education and the Institute for Labor
and Employment would prepare a.fiscal:impact report; using, the Sonorria.ordinance as a baseline, with the
thresholds and exemptions remaining.more, or less the same.
The Living Wage Coalition of `Sonorna County proposes . to split the cost of the fiscal impact report,
estimated to, cost approximately $5,000.
Recommended'City Council;Action%Sueaested.Motion:
Discussion and Direction regarding the -proposed living wage ordinance.
Reviewed bv.l+inance Director: Reviewed by City Attorney: Approved> -)by iCit'v'Manager:
Date: Dater Date:
odav's Date: Revision # and Date Revised: File Code:
31 May 2004 PROPOSED' LIVING WAGE -"CITY "OF SONOMA Page 1 of 9
Impacts of.the,-proposed' Living Wage Ordinance for the City..of Sonoma:
Cit,Employees,'Contracts, Leases, Franchises,'Agreerrients and Grants
'Revised Report: 331'M�ay 2004
Marcee Harris,. M.P.P.
Goldman School of Public Policy
'University of California.at Berkeley
Dr Peter V. Hall'
;Faculty of Environmental Studies,
University of Waterloo, .
1. Introduction and Summary
The purpose of the proposed Living Wage Ordinance: for`the City of Sonoma (including the
City's Community Development Agency) is to ensure that employees of the City, those
working on contracts With the City, and ;those working. for `f rms and non -profits receiving
substantial grants,'aloaris; financial assistance, leases, concessions, franchises and other forms
of support from 'th.e .Gity,..eamia living wage' with benefits. The purpose of this report is to
present estimates of the 1`ikely'impact of the proposed Living Wage Ordinance for the City of
Sonorria.as applied to city�eiriployees, service contractors, lessees, franchisees, and recipients
of financial assistance.
This report updates the esti_rnates-contained in our February2'004 report. It is based on further
discussion and,. information, about- the impact of the proposed ordinance., The key revisions are
as follows:
• The impact on direct city employees as estimated,by city staff is accepted. Seven
employees will receive additional pay, leave and.health:benefrts costing $12,300 per
year:
• The employment status of Sonoma Valley Visitors.Bureau employees has:been
confirmed. Ten employees will receivel ad'ditioiial pay, leave and health benefits
costing '$24,500"per -year.
® The Proposed Ordinance has been revised to exempt volunteers; including. part-time
'f refrghters ,and firefighters Wiih EMT. certification. It is estimated that approximately
40 Emergency Medicate Technicians and Paramedi„cs willreceive additional pay, leave
and health benefits costing up to $104;700 per "year.
The estimates, indicate that 57 low. -Wage workerswill receive wage, leave and/or health
benefit increases worth an,average of up to $2,270,per worker per year under the proposed
policy. This,will' cost employers a total of up to $141,400.per year. It is likely that most of
this cost will ,be borne by the„City. This represents up to 0.9% of the 2002/3City Budget, or
up to $15.49 per resident per year.
1 Research -Associate ofthe Institutefor. Labor and Employment, University`of California,at Berkeley.
2 &this report the term `city' means the City of Sonoma and all:City.agencies. '
31 May20.04 PROPOSED LIVINGWAGE- CITY OF SONOMA Page 2 of-9
i
A significant proportion of the estimated benefits - and costs accrue because part4ime EMTs
and Paramedics working for the .City are covered'by the proposed policy. If 'these groups.
were not covered under the policy, the cost to employers would be reduced.to $3.6,800per
year, and only T7 workers would benefit.
In,summary; the proposed Living Wage Ordinance will generate modest but: verytangible
direct benefits for loW-wage workers; while the (indirect effect of the proposed policy is, that it
enhances the position of the City of Sonoma.as an economic actor committed to the
protection of the livelihoods of workers.
The estimates contained in this report were generated using actual emooyment, "wage and
health coverage data f6uthe, employees of the City Departments, Service Contractors.and
Novi -Profit Organizations. likely to. be covered by the ordinance. They are based on
assumptions about the, likely exemptions and waivers to be granted should the proposed
policy be implemented.
The, following, section,discusses. the assumptions, .data, and methodology used to compile this
report. Section 3 examines the impacts on each category of employer covered by the
proposed tiving'Wage ordinance,,'Section 4.presents the aggregate impacts, of the. proposed
Living-Wage.ordinance and Section 5 provides a.conclusion.
2. Assumptions, Data and Methodology
A Living Wage Ordinance.fonhe City of Sonoma was introduced in March 2003 (see
www.livinawnesonoma:or )3., Note that we have assumed that the Ordinance will establish
$13, 20 per hour. asthe minimum value of wages and health benefits,; and that thei 127day paid
leave'benefit,is .pro=rated for part-time employees.
:The following. information was, requested from the Cityof Sonoma, and was provided by
Carol Giovanatto, Assistant City,Manager and Mike.Fuson, City Manager:
• City job classifications, with information on wages, benefit, coverage, and work hours.
• Names, contact infonnatibn:atid contract details regarding:
o Noii=profit organizations receiving grants./ contracts.,
o. For=profit service contract -holders.
o City :franchise-, concession- and lease -holders.
o 'Recipients of financial aid, grants;.fee waivers, and: other forms of`assistance.
o Contracts, joint ventures, partnerships and other arrangements that the City
entered. in order to purchase,or provide services with; other Cities ..and/or- public
agencies.
3 first draft report Februa -2004 was com _l"ete&prior, to -the introduction of an ordinance in the'Cityof-
Our p i r}'„ ) P
Sonoma, and.hence the report assumed to followlhe Sebastopol Living Wage Ordinance passed in December',2003,
U
31 May 2004 PROPOSED.LIVING WAGE - CITY OF, SONOMA Page 3 of 9
The methodology'foll'owed-in prepanrig this report has,been successfully developed in
previous prospective s`tudies.of Living Wage g
Ordinances.. Usin the contact information
provided by- tliel City —of 'Sonoma, we interviewed thirtyrepresentdtives of firms, nori-profit
organizations"and agencies to obtain specific .iriformafion;on the size and.nature of the
contractual arrangement, employment levels, hours,woiked, wagesand benefit coverage. The
report estimates wage 'and ,b.enefit improvements for directly' covered workers and .those that
may experience a spillover effect5,' as well as costs to employers.
3. Identification of covered workers
In order to estimate the impact�of'the proposed.Living'Wage ordinance we examine six
categories ofemployrri ansing from City activities "separately (see�Table 1). These
categories include city employees; public agency-empl'oyees,, non-profit employees, service
contractors, leaseholders and.franchisees. The remainder of This section out the number
Of employees, that will be covered by the proposed Living Wage,ordinance.
Table 1: Employment.resulting from City of Sonoma activities
'Category All Grants % Affected Grants / ' Employees " 'Comments
Contracts 7 Contracts / beriefittingg
Agreements Agreements
City. Departments, = - 47 7 regular employees; 40-part-
I'time EMTs and Paramedics
Public agencies 1 3 j
Non-profit 1 1 10 . Sonoma Valley Visitors
contracts / grants' I I Bureau
Service Contracts ,16 0 0, 12.Service Contracts
2 'Construction Contracts
2 'Public Sector Contracts
Leaseholders - 8 �' 0 0
Franchisees 3. 0 Q
Note: Only includes grants fo non=p-rofits >$75,000,and city'contracts>$1.0;000'per year.
4 See Hall (2003) Impacts. of the,proposed Living Wage�Ordinance for -the City of Sebastopol.. Report of the Institute
for Labor and Employment, UC,Berkeley [Available at w,ww`.son omal'ivinwaue.ore]. Also see.;Zabin,,Reich and
Hall (1999). Living. Wages at„the Port of. Oakland. Report.of the�CLRE (IIR); :UC Berkeley; and Reich; Hall and Hsu
(1999). Living Wages. and t1ie;San„Francisco Economy: The Benefits and the Costs (In two. releases): Rep ort.of the
Bay Area Living'Wage Research�Group'(IIR); UC Berkeley, [Both;available at'http://iir:berkelev.edu/livinQwaeelT
5 Living Wage Ordinances may:result.ifi higher wages+for workers not directly covered by the ordinance because of
what are known as spillover effects. Economists typically distinguish beiween,(1) vertical spillovers' raises within
the firm that are designed to maintain, -the wage hierarchy; and (2) .hoiizontal, spillovers; raises, within the firm to
maintain wage parity;between covered and uncovered workers or raises in other firms that are competing in the
same labor market as the covered firm. Empirical,studies of minimum wage; increases indicate that spillover. effects
attenuate rapidly; in other words. an increase in the wage floor does raise the wages.of those just.above the new
wage floor, but does not shiftthe, entire wage stricture upwards. Hence.such wage policies, result in wage
compression (for a.re"view And application to Califomia see Reich and Hall (2001). "A small raise for the bottom":
In: Lincoln, J and P Ong,. '(eds)'; "The State of Galifornia Labor. Institute of:Industrial Relations` Berkeley). Current
• research indicates'the spillover effec6s of living wage ordinances are more limited than those associated with
minimum wages°because they typically do not affect all the workers,in,a given labor market, but that they are
similarly attenuated and so do�contribute (modestly) to overall wage compression:'
31 May 2004 PROPOSED LIVING WAGE - CITY OF SONOMA Page 4 of 9
i
3.1 City Employees •
According to information provided by City staff,, there are no full-time positions that pay.
below the living. wage. Two part-time posiitibrisi are without benefits and/or paybelow the
living wage level. City; staff indicated that an; additional 5 employees will receive leave
benefits. Assuming that all currently .unfilled positions are filled, the; estimated cost of these
pay, leave and health benefits to the City is $12,300.
The City of Sonoma also employs 19 Paramedics and 21 EMTs who work, on, a part-time
basis.6 This is in addition to 18 volunteer, firefighters and firefighters with"EMT certification
who, by •custom and tradition, are paid "the minimum wage (firefighters without EMT
certification are paid $6.75 per hour without health'and leave benefits; firefighters with, EMT
certification are paid $9A9 per hour). While the volunteers will be exempt;from.Living Wage
coverage, EMTs and Paramedics are more likely, to, regard their positions as the first step in
their careers: Current entry, wages ,are `$11 per hour for paramedics and ,$9 per hour for EMTs,
without Health of4eave benefits.
The existing_ wage differential reflects the:higher skill level.required of paramedics, and it is
likely that some wage differential will be maintained when the Living Wage :Ordinance is
implemented. The size:'of the new'wage differential depends on bargaining,,and market forces,
and.need not„necessarily be the same absolute size as the previous differential.'Eviderice from
research on nummum wage increases in the 1990s indicates that ;there. "is both a ripple effect
and an absolute wage ;compression when,,such policies are implemented. This means that
some workers earning close to the new minimum wage level actually receive wage increases
above the =w minimum wage level, but these increases. are not as large as those: "received at
the oldminirnum'wage;,level. In other words, the wage differential is maintained'but. it is,
absolutely sina1ler1fidn before (see footnote 5 above)*.
We have therefore, estimated the ,costs of the. ordinance with EMTs paid $1120 per hour, and
paramedics'paid ,$1.4.20. (a $1 differential) and $15.20 (the current $2 differential) per; hour.
The cost, of the city of'thesewage, benefit and leave increases will be between. $93,30.0 and
$104,70.0 per year.
Although we have not.attempted to estimate the turnoverjetention, absenteeism and other,
improved performance'; benefits of the proposed Living Wage Ordinance we.note that these
maybe significant in°the case -of EMTs and Paramedics. Furthermore; Citystaff indicated,
that cost savings could be achieved if higher wages for part-time paramedics reduced the
nded:to assign tasks to firefighter%paramedics working overtime. This will'have the effect of
off. -setting a portion of the estimated cost increase to the City.
6 Note that' the number of,part-,time paramedics, EMTs and firefighters indicated here.is'the:number, that appeared on
the City'spayroll report, and that they were. not all employed:ai the same'.time. Hence, the total';numbers' feported
here exceed the number of active•employees at;any given point in time.
1 For recent research.on the:se'rvice benefits of the living Wage, see Reich, Hall arid:Jacobs,(2003). Living. Wages.
and Economic'Perforniance: The, San Francisco Airport Model. ILE (IIR), UC'. Berkeley; [Available on-line. at •
bftD://iir.ber-kelev.edu/livin,-,«aL,dl., See also Howard Greenwich (1999) Gity of Berkeley'Living: Wage,Analysis
prepared by Howard Greenwichiunder contract forthe City•of-BerkeleyDepartment:of Finance, November 1999.
' 31 May'2004 PROPOSED LIVING WAGE.- CITY OF SONOMA Page 5 of 9
3.2 Relationships -with Public Agencies
The City of Sonoma ,is involved in various contractual, relationships with public agencies for
protective services; at the'time of writing we,are aware of three. The first is a contract for
police dispatch: services with the Sonoma County:Sheriff s_Department which has been in
effect for about nine years, th'e second is' a pending, contract. for law enforcement services
with -the Sonoma County Sheriff s Department; and the third i`s Tor fire :and emergency
medical dispatch services with the REDCOM Joint.Powers: Authority. It was ascertained
during the inipact:study for the: Sebastopol .Living Wage that employees working in these
agencies are directly employed by the County of Sonoma, and that they received wages and
benefits above the proposed.living wage level. The proposed exemption of part-time
firefighters implies that the Valley of the Moon Fire. Protection District will not be affected
by the Living Wage Ordinance:
3.3 Grants / contracts with non-profit organizations
In the 2002/3 fiscal year<one grant./contract exceeding $75000 was -awarded. The Sonoma
Valley Visitor's Bureau is a.membership organization made up of more than 300 different
businesses that serve visitors to. Sonoma Valley. The Bureau operates two visitor centers.
They received $192,00,0' from the City for visitors' .services and ;economic development
activities. Due to the nature, of the grant, these employees of the Visitor's Center may
effectively be regarded as' contracted -out city employees. The Visitor's Center has 10
'Visitor Services Representative" positions that pay under'the proposed living wage
thresholds. These"positions are all filled by part time ,employees. Using payroll information
from the calendar. year,2003, we conclude -that the Visitor's Center would have to raise their
payroll expenses by approximately $24,500.
3.4 City Contracts
City Contracts:. In the 2002/3 financial year, the City let contracts of $10,000 or more to at
least sixteen organizations'. Of these, two were for construction, two for:protective services,
and twelve for professional services. None of the contracts forservices will result in wage
and fiscal ,impacts.
A. Services: Intl e 2002/3 Fiscal year the City let twelve service contracts in excess of
$10,000 for- a;;combined'total of at least,$608,000 (some contracts specify a:minimum annual
payment). The contracts.,included professional services such as, auditing, engineering'and
planning services, as well as landscaping: and janitorial services. All of these contracts are
exempt :from, or ;unaffected° by; the proposed ordinance: The reasons why these contractors
are not affected,are os follows:
o Four contractors already pay their employees more than the proposed',living wage
level.
o In 'three: cases, all employees of the contractor devote less than 20% o of their
working time `to the City Contract.
31 May 2004 PROPOSED LIVING WAGE - CITY OF SONOMA Page 6 of 9
o Two contractors employ fewer than 6 ,people.$ •
o ' Three contractors did not provide -information, but based on contractual
information; we estimate that they would he exempt based on the 20%:rude.
B. Construction: In the 2002/3 financial year, two construction contracts for.an amount
greater than;$°1,.0,000 were let. The City -of Sonoma .conducts most minorr maintenance and
repair work.in=house, and hence only relatively large construction projects are,bid out to ,
contractors: It is assumed that in future all 'of these contracts will be'sufficiently largeso,as to
:qualify'for Prevailing Wage coverage under the relevant state,and/or Tfederalregulations (,the
Califom a.Slate Labor Code and/or, federal Davis -Bacon Act). Hence the proposed living
wage ordinance is assumed to have no impact on construction contracts.
3.5 City Leaseholders
Currently eight organizations hold leases with. the .City of Sonoma. Leaseholders will, only be,
covered by the proposed Living Wage Ordinance if they have 25 employees, or more,,, and
revenue of $350`,000 or more per. year. Other exemption conditions also apply. The current
leaseholders are all exempt.fromthe-ordinance due�to number of.employees and.the size°of
their gross annual receipts. One' leaseholder; the Sonoma Valley Visitors, Bureau is subject"to
the living "wage coverage by reason of its service contract agreement.
3.6 City Franchisees
Currently three organizations hold franchises with. the City of Sonoma:. Franchisees will only
bex vered.bythe proposed. Living Wage ,Ordinance if they have 25 employees .or more, and
revenue of;$35b,000 or more per. year. Otherexemption conditions also, apply: The result is -
that no, franchisees are likely to be affected'b:y the proposed Living Wage. Ordinance, for the
following reasons:
o One franchisee already pays their employees more than the proposed living wage,
level.
o In two cases, .all employees of the franchisee devote less than 20% of their
working time to the .city franchise.
3.7 Miscellaneous
The Burbank,Housingbevelopment .Corporation. proposes combining'various funding
,sources in order to, develop affordable housing units in the City of Sonoma. The': City
Community,Development Agency is expected contribute more than $1:00,000'to this
d'eveloprnerit and.;hence this employer will be covered by the proposed' Living Wage
Ordinance. In an interview conducted..during the preparation of the impact study for the
Sebastopol Living `Wage, the Executive Director of Burbank Housing reported that, most; of
their employees already earn more than the proposed living wage level. The:;Director further
indicated that Burbank.Housing seeks to be an employer. that pays living wages,, and it is
s In the,previous version of'this`reporf we estimated the irnpact,of Living Wage coveiage on Guerrero Janitorial: We
•
have since learned that thi_"s fum.employs fewer than 6 people.
VV
3,1 May 2004 PROPOSED:LIVING WAGE - CITY OF SONOMA Page 7 of 9
assumed that this city financial assistant recipient=will not change -their development plans if
the Ordinance' is implemented, nor will they pass the additionaf costs on to the,City.
4. Aggregate Impacts of'the proposed Living Wage ordinance
Using the information presented in Section'3 (above), we are able to estimate the aggregate
impacts of the proposed Living, Wage ordinance. We provide several scenarios based on the
assumptions- discussed 4bove, This is shown in Table 2.
Table 2: Aggregate Impacts of the Proposed City of Sonoma;.Living Wage
Coverage - Average wage. Cost to employers increase Cost per
.Benefiting:,. and health benefit per yean(includes o
as in proposed as /o of resident
workers. increase per employer -paid.
ordinance with: Budget per year
Worker. per year 'taxes), .
City, SVVB 17' $1,020 .$ M-,800.00 _ A23% $4.03
City, SVVB, EMT /
Paramedic ($,1 4.20): 57 $2,090 $130,1 g0.00 0. 82% $14.25
City, SVVB, EMT
Paramedic ($15.20),. 57 ` $2,270 $141,X0.00 0.90P o $15.49
The estimates indicate�that.57 aow-wage workers- Will. receive wage, leave and/or health
• benefit increases worth. an average pf up to $2,270 perworker.'per .year under the proposed
policy.. This will cost:employers a total of up to $14.1,400 per year. These impacts will be felt
exclusively by the .City and one non-profit agency. It is expected that most of the additional
costs will be transferred.to. the City; given the close nature of the relationship between the
City and the affected nor" -profit, and its relatively inflexible staffing requirements. This
represents .up to 0.9% of the 2002/3 City -Operating Budget of over $15 million, or up to
$15.49 per residentper`year.
If the proposed' ordinance .is not, applied toEMTs'and P'aramed 'cs, then it is estimated 171ow-
wage workers, will receive wage; leave and/or Health°benefit increases worth an average of
approximately.$1,920'per worker. per year under, the ,proposed' policy. The total cost to
employers, which includes employer=paid,taxes; will be approximately$36,800.per year.
This,,represents '0.23% ofthe ,total 20.02/3 Operating -Budget of the City and approximately
$4.03 per year,for each ofthe 0,128 resident's of the City.
Note'that the.following additional,considerations apply to these estimates:
(1) We have assumed that.the administrative (monitoring and enforcement) costs of the
Ordinance to the City; and of compliance with responsible bidder requirements by City
Contractors, are negligibl'e.9 The;City will incur some one-offcosts to draft appropriate
language for'requestsI for bids and contracts, and to: establish appropriate procedures, as
well as the, ongoing costs of implementing the complaints procedure. However, given the
• 9 See Ehnore; Andrew "Living Wages Laws: Smarter Economic Development; Lower Than Expected,Costs".
Brennan Center for Justice'bttr)://v"-x-,",.brennancenter.ors/proi rarris,'liviri wake/elinorerenort.htrii]
31 May 2004 PROPOSED.LIVING WAGE - CITY OF SONOMA Page 8 of 9
scale of the City's contracting,: these costs should be, relatively small, and arguably should
be regarded as part of the.normal' costs of exercising appropriateTegulatory oversight in •
any contracting -out activity., Note also that the Ordinance is designed .so that the main
burden,of monitoring and enforcement falls on workers and members,of the community.
(2) 'The Living Wage Ordinance provides for:'a phase -in over a period,of up to three ,years as
existing contracts are renegotiated',, and covered 501(c)(3) nonprof is are not -required to
comply, until 2007. According to City,staff, thisprovis_ion does not affect the non-
.governmental employer that is immediately affected by the. ordinance —the Sonoma
Valley Visitors Bureau.
(3) We have not:included estimates of the costs and benefits of extending Living Wage
coverage W employees of potential future, recipients of City leases,, concessions;
franchises; or financial aid. It should .be noted that, recent research suggests that extending
living wage coverage to firms receiving business assistance may result.in widespread.
wage:increases for low -wage workers.'10 It.is however unlikely thavany S'onorria.low-'
wage workers will be affected by this mechanism, given the thresholds °for coverage
contained in the draft Ordinance,(e.g. only.Cify.Financial Aid Recipients receiving more
than $1,00,000 in any twelve-month period- would be covered). Two. ernplbyers received
grants in'excess. of $1000,000 from the Cityin fiscal year 2004 — the>Sonorria Community,
.Center received $250;0.00 in:assistance and Sonoma Valley Hospital received $110,000.
Since both- actions will;have taken ,place prior to the effective date of the living wage
ordinance„neither,employer, is impacted by its'provisions. •
S. Conclusion
From the analysis above, it is clear that the proposed Living Wage Ordinance Will.have a
modest but tangible impact on the workers, fries and City of Sonoma.. The relatively modest
costs and benefits ofthe proposed Living Wage Ordinance are a consequence of the fact that
Sonoma is a small city with. a small. budget; therefore the ordinance will have, little economic
'impact. However,, some of the services that the City purchases, and that -it provides through
the Visitor's Center; do employ people, at a low wage who, will benefit frofn the ordinance.
A signifrcant_proportion of the estimated benefits and costs, accrue because part-time:.EMTs,
and Paramedics working for the City are covered by the proposed policy. "If these: groups
were not covered under. the policy, the cost and benefits of the policy would be significantly
Teduced.
'OSee,-Neumark'(2002).,How Living Wage Laws.Affect Low -Wage. Workers and Low -Income Families., Public Policy
Insfitute:,of California. [Available;online at This research has been the subjec't.of considerable
,crificism fo'r over-stating.the effects of the�'Living Wage: see Brenner, Wicks -Lim, and Pollin (2002),..Measurmg the
Impact of Living Wage Laws.: A. Critical Appraisal'of David.Neumark''s: How Living Wage Laws Affect Low=,Wage
Workers and Low -Income Families. PERI, University of Massachusetts at Amherst (Working Paper Number 43).
[Available on-line:at https//www.umass.edu/peri/,research.html#lw]
31 May 2004 PROPOSED LIVING WAGE - CITY OF SONOMA Page 9 of 9
Notwithstanding • this qualification, recent research shows that Living Wage ordinances have improved economic development in the affected communities and have cost..much less .to
implement than.inost analysts initially expected. In fact, a survey of cities and counties with
recently passed Living, Wage ordinances found that.contract costs of the overall local budget
increased by less than 0.1 % in the years after the law was adopted.' i
For a relatively small;price, .the ordinance will bring an increase in:the welfare of a small
number of workers, and -azommensurate improvement in.the: quality of city services.', Most
importantly, in adopting the proposed Living Wage ordinance, the residents of the City of
Sonoma through their erected representatives, would be enhancingthe position of the City as
an economic actor committed to the protection of the livelihoods of workers.
Elmore, Andrew "Living Wages Laws%Smarter Economic Development,RLower Than Expected Costs". Brennan
Center for Justice htto://www.brennancenter.orp/DroVrams/livML wage/elmorere1jort.htm1
• iz For recent research on the service benefits of the Living'Wage,..see Reich, Hall and Jacobs (2003). Living Wages
and Economic Performance: The San Francisco Airport Model. ILE•(IIR),'UC Berkeley. [Available on-line at
http://iir.berkeley: edu/livingwage/]
2,00`0 - 2 0 01
prepared by Samantha TePIi.tzky
UC `Berkeley Institute for'
le, to and Employment
City of Petaluma -.Service Contracts'SuIIimary
I �
{ CONTRACTOR I PURPOSE
( AMOUNT I EXPIRATION
{ 1 { MV Transportation,. Inc I Transit
J'IM1,450 per year I ,
2 I PPSC I Paratransit
{ $366;8,15 per year _ {
3
North Bay Landscape median mowing'
$88,140
Management
4 I KeystoneTractor'S.eryice:. J_weed;abatement.
$17,500
{ 5 -{ Dion's Downtown"Towing� I towing
6 { American Tow Service_ I ;towing
7 { Old Adobe Developmental ('`clean-up services-
j 31.8 840 I f
8
I RMA Engineering and
I wastewater treatment
I •$610,2010
Management
9 { Raintree I carwash.
Contracts excluded-
--less than §10,000
-fewer- than six employees
--all construction grid pt,evail ng
wage
==all consulting and,Proifessdonal
servir.,es
A"Lving- Wa.ge
For '5t: to Rosa 'd eaAu a„
A Report on the Benefits. and Impacts,of ativing WAge Ordinance
on the�'Cities :of Santa -Rosa and Petaluma
August'2002
J
Sadnantha Tcplitzky, M.A.
A Publication'of the ITC Berkeley Centerfor'Labor Research and
Education
And the'UC Tnstitute for Labor and Emptoyment
Y
Sonoma: County and the Living Wage: Page 28
A Stud3r of the Impact of.A Living Wage Ordinance
on the Cities of Santa Rosa and Petaluma
found that the majority of Workers lack- health care coverage throughtheir employers at
the Marketplace and Town Center.
Table 6- Santa. Rosa Marketplace -and Santa ,Rosa Town Center Jobs Created
Store Category'by Number of . Number of Percent Entry-level
Size Stores Jobs Part -Time Wage
Jobs
5 —10 Employees 6 46
l 1 — 50 Employees 11 269
51+ Employees 6 971
TOTAL 23 1286
67%
$6.92
' 60%
$7.24
approx.50-
$8.79
60%
Source: Interviews with, sfore ,managers and employees, Oct. 2001.
Average
Wage
Summary of Santa Rosa:
Workers employed by city 'contractors and in city -subsidized projects, along with
temporary city employees, comprise a small proportion of a much larger pool. of low-
wage workers. who face the high -costs of living in Sonoma County.
The majority of workers who would be covered by the ordinance fall_ into tnc broau
categpry of 'servi'ce! sector Workers, particularly retail trade and business services. These
jobs are among the fastest growing — and, lowest paid -positions in the region and the
�riation overall.(see Table 1). In addition, the majority of such jobs are held ,by'adults, not
by teenagers as some'.critics, ofminimuln..and Living Wage increases maintain.41
$7:12
$7.97
NIA.
The proposed Living-, Wage ordinance could assist approximately 400 low=wage workers
employed. directly by the city of Santa' Rosa or its contractors. Provisions. related t-o economic
subsidies wguld only apply to .future recipients, -therefore -it is difficult to predict the full scope of
the ordinance.
B. Petaluma
Service Contracts
Petaluma is one-third as, large as Santa Rosa, and consequently employs, fewer, contracted
workers, most of whom were paid for professional services at billable rates :in the ,range
of $50 4150 per hour. Table 7 outlines the' distribution of :employees according to the
monetary amount of the contract. All contracts were obtained with the. assistance of the -
Petaluma City Clerk's office.
41 Hopy`Sklar, Laryssa Mykyta; Susan Wefald; Raise the Floor: Wages and Policies That Work for All of
Us New York; Ms' .Found'ation for Women, 2001; pp 62-63
Sonoma County and the ,Living W%Vage: Page 29
A Study of the Impact'of a Living Wage .Ordinance
Amkk on the Cities of Santa Rosa _and.,Petaluma
Table 7: Distribution of.Petaluma Service Contracts
Annual $ Paid # of emaovers or
contractors
$1.0,000-$24;000 , 5
$25,700,0 - $99,999 1
$1 OQ;000, 3
-Total 9
The Living Wage oid'inance- would cover 9 contractors who employ almost 100 workers.
Approximately 75 employees would.be affected by a"wage of $15.. The contrac..ts..are.,distributed...
among several industries; uicluding transit-, 'landscaping, maintenance° and waste management.
Table 8: City of Petaluma Service Contracts
City of Petaluma Service Contracts
Contract Type
Administrative and Support Services
Landscape Services
Other Services to Buildings & Dwellings
Waste Management and Remediation,Services
Transportation Support Activities
Repair and Maintenance
TOTAL
Number of
Average
Total
Percent,
Nrrniber
Percent
Nimiber
'Contracting,
Size:,
Number
Paid
Paid
Paid
Paid
,Firms,
of Finn"
. of [Yorkers'
<$12 50
< $12.50,
< $15.00
< $15.00
2
6
•12
71°%
9
77"/q
9
1.
4
4
-65%
3
73%
3
1,
50
•50 .
7 1 %
36
77%
39
2
8
16
55%
9
66%
11
3'
5
15
55%
8
66%
10
9
10.8
97
66%
64
730/.
71
Non -Profit Service Contractors
The City of Petaluma's Commum' Development„Commission• funds,,several nornprofts, most
of which deal with Housing' Administration, Projects and Programs. For the 2001-02" Fiscal
Year, the City has allotted ,$4,472,1DO for Homelessness .prevention and shelter services,
Transitional Housing, aFamily ,Rental Projects, Senior, Projects and.. Programs,, Homeownership
and Rehabilitation Programs, Colnmriity Revitalization Programs; and Administration costs.
The funds were distributed among ten ,ion -profit housing agencies;. employing an undetermined
number of -workers. As stated above;. Non -Profit Sector employees earn an average of 17.06 per
year,
Sonoma County,and the Living. -Wag: Page 30
A Study of the Impact of a Living'Wage Ordinance
on the Cities of Santa Rosa and Petaluma
Redevelopment/Economic Development Projects
The Petaluma .Factory Outlet Village project, began .in 1989. The City of Petaluma
entered into an agreement with the. Chelsea Group to rezone and develop the site.. A
report issued by .the Chelsea Group in 1950 estimated that the city would benefit 'from.
$700,000 in additional sales tax revenue ($4,00',000 from the outlet mall and $300,000
from the .adjoining River Oaks development), <an additional- $500,000 in ;property tax.
revenue, all of which would be allotted to the.�Petaluma'Redevelopment Agency, until.
1994 and after 1994 would be. shared..equally between the Agency and local schools.
The report also predicted $30,000;000 in additional community payroll in the ;'forER an
estimated 1,5..00 :new: jobs described :as high=paying, management" positions offering en
average.of $20;000 per year. The Chelsea Group also agreed to. pay $1,200;000 in traffic
mitigation'fees to.help construct a new overpass and interchange near the site: �
Although `the: Outlet Village ,did not, receive .,direct subsidies from the city, the indirect
subsidies, as well as general approval, act in a similar manner, — they, send,!a, message.
about the desirable form of development. 'The City's,permission was contingent upon the
developer's contribution to traffic mitigation; adherence to environmental; codes , and
promises to funnel shopping at the Outlet Village, into shopping :downtown, .but no
consideration was given'to the nature of jobs that would.be, created by the project. The
Outlet Village houses about 4.7 stores,- and employs approximately 270 workers. The
s'.o es Y a ige ui. ize from 5 to about. 30 employees, 66 percent of whom are part-time with
an average entry-level wage of $8.13 per hour. In addition; 88 percent of employees
represented by the survey were over 18' years- of age. Table 9 highlights the results of our
survey:
'fable 9:1Petal'uma Factorv'O.utlet Villaze:Jobs Created
Number of .Percent Percent Entry4evel Average Wage
Stores Full -Time Part -Time Wage
Surveyed Jobs Jobs
27 34% I '66% $8. 13 I $9..59.
Source: 'Interviews with -!store nmanagers and employees, Oct. 2001.
It should be noted that the omission of low -paid food, service workers from the Petaluma
Factory Outlet survey has. caused.its average, wages, to be slightly higher than those of the
Santa,Rosa shopping centers.-
Petaluina.SumMary:
The: proposed Living Wage ordinance could. affect approximately 75 low=wage workers
currently. iemployed.cin City contracts. The provisions of'the ordinance which apply to
economic development subsidies and assistance would have a larger .impact on future .
projects within the Petaluma redevelopment zones.:.
Economic! Justice Project
Noviarnber 2003
BRENNIW.NTERFORJUSTICE
AT NYU SCHOOL OF LAW
Living Wage Laws:
Expanding. Nationwide -
In one of the,most pronounced local policy trends in :recent years,
scores of cities and counties across the"'Uiiited. States=more- than
one.hund'redas of.luly„ 2003—have adopted local. "living wage' laws.
Under these laws; employers receiving city contracts or'ciiry business
subsidies ,rriusv pay full=time_'workers a wage sufficient- to support
themselves and their families at- a subsistence level.
The policy ,goals, driving these initiatives —that hard work should
be rewarded with adequate pay and benefits, and that taxpayer
dollars 'should ,not support jobs' that leave workers and families
in poverty —have found broad support among local lawmakers and
the public.
Questions. Raised About
Living Wage Laws
In assessing the -,Value of living wage laws as policy tools, it is impor-
tant to understand their .costs and benefits for communities.
Especially in, a time :of budget. deficits and, job losses, local policy -
makers have had'.two key questions about these laws:
Will they increase the costs of city contracts?
Will they limit .the ability of.cities to use business subsidies to
..increase the.number of,good jobs in their communities?
To answer these. Questions, we asked; local government officials in:' -
communities: with living wage laws to examine the: impact of these:
laws after they were implemented: We have collected: their findings
in this report. Significantly, local government officials- found:
The living wage laws?analyzed, in. this, report apply, to jobs
generatedunder two, types of`'city programs:
City Contracts
Cities :(and other local ;governments) employ private contractors
to provide a range of services for the government and the public.
'Living wage laws require firms: thatperform:cityservice contracts
to pay'their workers a "living wage' —generally set between $8
and'$17 per hour —and to provide health benefits.
City Business Subsidies
In orderto attract orretain j ' s, iwtheir communities; some
cities offer taxpayer=funded business subsidies —usually in the
form of grants, tax abatements or below -market bonds or
loan s—to.employers that pledge'to,,open or retain facilities in
the community. Living wage laws require employers receiving
city business subsidies to pay their work_ers.a living wage. and to
provide; health benefits.
Only small increases in city contract costs as a percentage of
,city budgets —and less -than initially expected.
• No significant adverse effects on city business subsidy
programs —and in some cases such programs -were actually
strengthened.
By collecting the actual findings4 government officials in commu-
;nities that have implemented living wage laws, this °report provides
detailed: -information that may be valuable to other communities
considering whether to enact similar laws._
Table 1: Increases in, City Contract Costs After Passage of LiVing,VVage Laws; 2001
Locality
I City Budget
Alexandria,VA
I $3,95,63,61000
Berkeley; CA.
$289546,000
Cambridge; MA
I $296,467,000
Hartford, CT
$422,667,000
Hayward, CA
I $1`35,400,000
Mad son; Wl
I $159,000,000
New Haven, CT
$51 1,071,000.
Pasadena, CA
$493,596',000
San,Jose; CA
$6451000wo
Warren, MI
$1-36;490,000
Ypsilanti; MI
I $13,000,000
YpsilantiTwnship, MI
I $24,745;000'
Contract Cost Increase
I Increase as a % of City Budget
$265,000
, 0.067%
$229;000
0.079%
$J50-$200,000
0.067%
$' 160;000
0.038%
$9000
0.006%
--
$29,000
I 0.01 Va
_$20;000
0.003%
$240,000
0.049%
$40;000
-
I 0:00'6%
$60,000
0.040%
$6,000 -
0.044%
$0
0.0%
The twelve .c... es'in' this ;table represent all' of°those that had had a living,wage,law iii force for at least one year�as,of2001 and that
were able to report tcr us internal ,assessments of the effects of thet:liwlaws on. costs for city, service ~contracts.
Table, 2; Increases in Human Services_ Contract Costs After Passage •of Living:Wage' Laws„ 2001
-' Locality Budget for Human Cost Increase for Increase as a % of
Services Contracts Human Services ;Contracts; Human Services Budget
:.
Berkeley, CA $6;0991000: $.170,000, 2.79%
Dane 'Cty, WI I $1 12,obb,000 $338,000 0:3%
San Francisco, CA I $312;000,000 $V14;000: 1.01
* The three localities in this table were those..that covered human services contracts-ur d'er.a living�wage law that had been in force for at
'least one year as of 2001 and, that were'able to report to us internal assessmenmof thc.resuliing costs. Because these localities were able
to break out their human services.coptracting budgets from the overall city or county budgets, wecompare the cost increases•to the
human services budgets rather than to the overall budgets as in Table 1.
City Contracts: City' usin.e0'SU' bsidies:
Lower Than Expected :Costs Smarter Ec.oho , is Development
For, city contracts, *local officials- reported that cost increases
have been small and less 'than °initially expected.
For most cities, contract costs increased;by less than 0.1 %' of -
the overall local budget in theyears after"a living wage law'was
adopted. See Table L at left.
a
'Generally, in each city a few contracts involving large numbers
of low -wage workers —for example_ , contracts,f6. janitorial or
security guard, services —increased; substantially in price. ;For
these few contracts, the contracting; businesses submitted high-
er bids, or negotiated for higher prices, to perform° the city.
'work once the living wage requirement took�effect.
But the officials interviewed found that_most contracts
increased, little, if any, in cost. 'In many cases, contracting
employers were repported to have absorbed,much or all of'the
,additional labor costs without demanding increased funds
:from the cities.
Living wage requirements encouraged some local governments
to institute competitive bidding for, contracts that had not
been put out forbid in many years, reportedly`yieldirig savings
for the cities.
In localities that extended, living wage requirements to human
services such as home healfficare.or child care 'services, cost
increases were slightly larger=ranging from .0.3%, to 2.79% of
local human services hudgets-although still .quite moderate
overall. See Table 2, above.
These increased costs reflect both4e high, concentrations of
low wages among city -contracted' caregivers; and the fact that
cities have sometimes, agreed to automatically pay for some
or all of the increased wage costs for such contracts because
#,Of the vital nature of human services.agd•the budgetary con-
straints faced by the non-profit agencies that often provide
these services.
,For city business subsidy programs, local, officials reported that
they- could; _still attract desired business development, and that
living wage.` laws: often.,reinforced smarter economic develop--
,,.
ment:focused on creating. higher' quality Jobs.
• Local officials reported that only in,a very few instances did
living wage:requiremenissthat applied to business subsidy pro-
grams,limit their ability to attract desirable employers to their
communities. See Table 3, following page.
Many, business subsidy programs already emphasized attracting
higher-wagejobs„ so,living"wage laws effectively formalized
and reinforced existing practices.
•' Some local' officials reported that a living wage requirement
increased- public support for their business subsidy programs
by assuring, -taxpayers that'public.funds would be spent to
attract only high wage'jobs.
• :Relatively few lo'cal.officials'reported using their business
,sub"sidy programs to attract jobs in low -wage sectors such as
.retail; shire such jobs: are less ,berie-ficial to local residents and
;the economy than higher paying jobs. The few that did use
subsidies -to attract retail jobs; reported that they were still
generally able, to attract such employers, although, some cities
'renegotiated subsidy packages or chose .to exempt some busi-
nesses from the living wage requirement.
A Guide fo,r Local Policyma�kers
Local governments, in their findings collected in this study, con-
sistently, report that living wage laws cause only small increases in
cityy contract costs; and do, not interfere with city business subsidy
Programs. . This snapshot of the actual effects ,of -fully implemented
living, wage laws Jr a range of communities provides useful guid-
ance for policymakers considering adopting such measures.
4
Table 3: Impact of. Living Wage Laws on City Business Subsidy Programs; 2001
Number of.Projects with
Number of Projects
Locality
Type,of Projects
Living Wage CbrWitioris
Cancelled Because of
Each'Year
Living Wage Law
Duluth, M1.
I Health Care, Technology
I .2 I
0
Los Angeles, CA
I Mixed Use
I 3 I
0
Minneapolis, MN I
Technology
J 6-7 I
0
Oakland, CA J
Mixed use
I 1 I
0
'San Antonio;TX
Technology, Finance, •
4
0
Manufacturing
I I
San Francisco, CA; I
Mixed use
I
I
`Toledo, OH I
Industrial
n/a .
0
Warren;.Ml (
Industrial; Manufacturing
4-6
.0
Ypsibnti;,Ml _ I
Industrial
I
0
Ypsilanti Township, MI I
Technology, Industrial
5
0
* The ten, cities `in 'this table represent all `of tHose nationally that had had a living-wagerequirement: for recipients of city, business
subsidies in force for at least
one year as of 2001* and that were able to report to us the impact of those. requirements on their economic
development programs.
The Study
The information, in this report was provided by local officials in,
twenty cities and counties -the ;entire 'set of cities and, counties
that, by late 2001, both a) h4d'• a 'liyirig wage law -that had been in
force for at least one year, and .b). had the„adm'inistrative capacity to
produce cost'impact estimates,.formal.internal evaluations, or other'
empirical ,assessments, of the effects of their laws. Collecting such,
information from larger cities .like San Francisco, CA and San
Antonio; TX, medium-sized cities like Oakland, CA, and smaller
cities likeMadison, WI and "Warren, MI,'fhe•study. reflects the expe-
riences of a broad range of communities with living wage laws:
i` mm
R FOR -JUSTICE
AT:NYLI-SCHOOL, OF LAW
The Brennan Center's
Eco,n,omic justice ;Projoct
Goodjobs�aie essential to the long-term viability'ofourcommunities
and our economy.' The Bterinan. Center's Economic .Justice Project
works with coalitions of stakeholders to createregional isolutions to
problems of job' quality and:economic competitiveness:. We also work
at a,broader level to help rebuild fhe.corejob and safety -pet, standards
that have- been dismantled over the past three decades. We ,support
these efforts to combat growing inequality with. a unique corribina-
tion offresearch„legal assistance, and policyanalysis.
Brennan Center for Justice
161 Avenue of the Americas, 12ih Floor
New York, New York 1001.3
212 9-98.6730 fax 212 99.5 4550
For more information, contact Paul Sonn at paul.sonn9n'yu.edu
A copy of the complete report is available on she Brennan' Center's
website at http://www.brennancenter;brg.
•
•
JITmn- � � �� ., � a � �-i L, � �: uP d Ni �� ;�� �, 1
,.;, ,:e , s^.lit 6i .:J (' L O;L yjL c
S, 0 A gto %;
I'LL
Since its establishment in July 2000.,;
the University of California Insti-
tute for Labor and Employment (ILE)
has clone. much to revitalize academic
research, education, and service pro -
,grams focusing on the state's labor
force. °The ILE builds on the work of.
the Institutes of Industrial Relafions
(IIRs) -at UC, Berkeley and UCLA,, es
shed,in -1945;.and on their',respec-
"C'ente'rs for Labor' Research and
Education. As a statewide, multicarn-
pus :research program, the ILE supports
and promotes labor and employment re- .
search throughout the entire UC system.
The ILE's mission is to study and
find solutions for problems `of labor
,and employment in Californta and
the .nation. The Institute also -serves'
as a unique bridge between the Urii
versity and the state's labor commu-
nity by facilitating;m.ultidiscipinary
and collaborative research opportu-
nities for. faculty, professional re-
searchers, postdoctoral scholars, and
students. The Institute provides fund-
ing support for faculty and students
to participate in research that will .in-
form the University, policymakers„
the, labor movement, and others of
important trends and changes rel-
evant to the state's workforce. -
...Established by an act of the
:Qa'lifornia State Legislature, .the
ILE was developed through an in-
tensive planning process carried
out by a,15-person Transition Team
appointed by the University of
California's Office of the President
(UCOP). The team, led by ILE in-
terim co -directors Jim Lincoln.and
Pawl Ong (then ,Dir,ectors of the
IIRs at UC Berkeley, and UCLA, respec-
tively) met frequently during the second
half of the year 2000 and the early part
of 2001 to craft a governance structure
for the•new,Institute and to adVrise UCOP
on.. the selection of the Institute.s first
Director. The team also developed a -re-
search.grant and fellowship program and
issued the ILE's first Request for Pro=
posals , in the fall of 2000, funding a
wide variety of faculty research
Please see ILE, page 2
projects as well as
graduate; student
„vm'A fellowships across
`'j" ° .the m UC 'syste._
V3
Subsequent REPS
were :isis,ued in
Y 'spring 20011. and
spring 2002.
y" In early 20.01.,
Ruth Milkman Ruthr Milkman, a
UCLA Professor of Sociology whose re-
search career has focused on labor and
workplace issues and -who also served
on the Transition Team, was�appointed
as ILE Director: Michael Reich; a UC
Berkeley Professor of Economics,
was appointed as the ILE's Research
Chair shortly afterward, and the Tran-
sitiori 'Team was
:replaced by a new,
smaller body, the,
3 ;eight -:monber
ILE Governing
r
,Lai* Council which
makes all major
policy and budget
-
decisions for the
Michael Reich
Institute.
The Governing' Council also estab-
lished a Research Advisory Board,
which makes funding decisions for•
the ILE's grants and fellowship pro-
grams. In July 2001,, the UCOP ap.-
p.oirited the ILE's. Advisory Board,
which is chaired by Pro fes;sor-
Manuel -Pastor of UC Santa. Cruz.
The Advisory Board, which, -meets
twice a year,:is comprised of faculty
representatives from all UC' cam-
puses as well as a wide,range of com-
munity representatives from around
the state.
Peter Olney, the ILE's Associate Di-
rector; joined the organization in,the fall
of.2001. He'holds an MBA from UCLA
and has spent most: of his career in
organized 'labor.
Additional staff
came on board
during the summer
and fall of 2061, in-
cluding Margaret
Leal-Sotelo, Chief
of Staff, and Neal
Sacharow, Commu-
nications Director:
On March 9, 2001, the ILE ;held its
first major conference at UCLA, on
"The New Economy and Union Re-
sponses." The format of this gathering
was somewhat unconventional. It was
structured around presentations by
experts from around the country who
have spent their, research careers in
the field of labor and employment;,
in some cases working:in•orgam" zatons
with missions somewhat akin to that of
the ILE. The speakers were asked to
give programmatic talks about the
kinds of work people in the labor and
emplo-ymentLeld should be doing in the
comingyears. This was,,in short, an in-
stitution -building conference that built on
the experienceof indivi'duals,and.organi-
zations from :around the U"riited States
who have:..been active in labor policy re-
search..
be, LE's research agenda
focuses, Oil: three k
areas: the new economy,'
new off; a - new
w.or,j6r-s"m CAfifornk
On this basis, the ILE developed
a research agenda that focuses on
three. key areas: the "new econ_omy,"
"new labor,;" and "new workers" in
Cali'foriiia-. We are especially :inter-
. �.
ested in supporting research .on e( nomic policy, -that tan help forge. a ne
social contract appropriate �to the re-
cent- technological and ,organizational
transformations in the state's work-
places; the: current'revifalization of the
organized labor _movement, which is -
especially concentrated in California;
and the. role .of immigrant workers,
who make up alarge.and ,growing pro-
portion of the states workforce. Al-
though the ILE supports a wide range
of research on labor, and employment
topics, these three areas dare of particu-
lar importance for us.
The ILE has sought :to :build truly
statewide .capacity through outreach to
all,theUC-campuses and the communities
surrounding;them.. 4LE-led,rouridtables
bringing together faculty, students; labor
leaders, policy, makers, and community
representatives' were held iri San Diego
and Sacramento 'in the fall.of 2.001,
and more are planned for the com-
ing months.
The ILE's work both reflects and
contributes to .the California labor
movement's role as a trendsetter for
the nation. Building bridges between
the academy and the world of labor,
with a wide array of; research., ed-
ucation, and service activities, the -
ILE is an important resource .for t,
state .and one `that, will continue
grow -in visibility: and capacity,in the
years to. come.
r.,aduates of the `first entirely
S apish -lap e labor
" r leader=
p g g-
ship training in the United. States re-
ceived, their diplomas on March S at
UCLA. As part: of a pioneering, series
of programs funded by the ILE and
offered' by the UCLA Labor Center,
"El Colegio de Liderazgo Laboral" pro=
moted `leadership development among
union workers throughout the, greater ,
Los, Angeles region.
Twenty-six immigrant workers, rep-
resenting janitors, `hotel workers, gar-
ment workers, nursing home and health
care workers, construction workers,
and security guardspparticipated in the
weeklong, in -residence program.. They
-were welcomed to, the campus by
UCLA Vice Chancellor for Research
Roberto Peccei, Labor Center, Direc-
tor Kent Wong, and Ruth..Milkman,
0�,ector :o,f the ILE and the UCLA
itute of Industrial Relations. "We
are very pleased that our Institute is
able to open, the doors of UCLA, with'
:its many resources, to all of you," Milk-
man. said. "I hope this is the first' of
many teaching and learning exchanges
between your communities and=those
of us here in the University."
Spanish-speaking immigrant work-
ers make up a large proportion of
California's workforce, and many are
turning to organized labor :for assis-
tance in addressing workplace issues.
A. new, generation of immigrant labor
leaders is emerging, and it is; precisely-
Phis group that the Cole 9oisl designed
to serve..
Kent Wong believes that participx-
tion in the Cahfornia,Union-Leadership
School's programs provides a very spe-
opportunity. "It brings together .
erienced educators and a broad
Ispectrum�of union members to address
the big picture issues that individual
local unions normally don't
have sufficient time to explore,"
lie noted.
Class members°were`inspired
by their .experiences. They con
tinued the work of the Colegio
into, the evenings with 'critical
reviews of each day's activities,.
small=group- discussions,,, and
film screenings. Many of the
-workers said the skills develop-
ment training they received; ;in- histo
eluding instruction in public -speaking,
effective one-on-one: conimuriication,
and details on how to, conduct ,meet-
ings; would be useful not only at work
but. in ;other aspects of their lives as
well.
"It was exciting 'to' learn about glo-
balization,and its impact on us as im-
migrants," said Aaron Gonzalez of ' Ser
vice Employees International Union -
Local 1`877, which represents, Los An'
geles'janitors. "I will definitely take this
information back to rnyumbn' , as ,vell
as to my community."
"It exceeded our, most ambitious
expectations," said Project Director
Stephanie Arellano, who supervised the
program. "Participants were.challenged
to shift their focus from wages and ben-
efits, and to adopt a broader vision. They`
ry and workplace health and safety issues
left with a new understanding of their
roles in their unions, their communi-
-ties, and contemporary history."
'The California Union Leadership.
School will offer additional educa-
tional programs through the. UCLA
and 'UC, Berkeley Labor- Centers. ®_
Colegio Director Stephanie Arellano
0 n February 22, 2002,.faculty
and ;students from several UC
campuses Joined labor and community
activists; in Riverside for an- JLE-
funded research. conference on the,hv-
ing,wage movement., Organized by UC:.
Riverside:economist David'Fairris, the
gathering drew researchers from;across
the state :and beyond.
Living wage�ordinance s:require des-,
ignored .employers,: usually those re'
ceiving contracts .and-/. or economic
development subsidies from localgov-.
ernment agencies; to pay wages above
those required by federal and state
minimum wage laws:.
Since Baltimore pa;s•sed a patli-
breaking living wage ordinancein 1-994,
dozens of communities nationwide-,
including° several it! California, have
enacted similar, ordinances. The living,
wage rnovement'is rooted in coalitions
of community groups, faith -based .or-
ganizations,, and, labor unions commit-
`ted to addressing the problems of the
working poor.
"From the stand-
point of the labor
economist confer-
ence organizer; Farris
_noted, "`living° wages
,are —of interest because
they -provide a _vehicle
Da,vid'Fa'irris. 'to study employment
impacts and` other •related consequences
of raising the minimum,wage.by a signifi-
cant amount."
Stephanie Luce
Stephanie Luce of
the Labor_ Center ,at
the ,University.of Mas-
sachusetts, Amherst,
began the day with a
keynote presentation
titled, "The Living
Graduate Research C®nfe'rence continued from p.1
to Milkman's presentation, the open-
ing plenary, titled "The New Labor
Movement:' Perspectives from the
Field," also featured presentations
from Amy Dean
from the South
iBay Central Labor
Council and Raahi
Reddy of the Ser-
`vice Employees Iri-
Amy Dean ternational Union.
"What 'I most
`liked about the
Conferencewas the
e
small; intimate at-
rnosphere and the:
wonderful choi�e
Raahi Reddy, of speakers," one.
student:said.. "I appreciated the interdis-
ciphnary'nature of the ,gathering 'said
another. `°Ibis `cross-pollination' of stu-
dents with .common issues of concern
is an important contribution of the
ILE', and the focus on`joiriing academ-
ics with activism injected an exciting,
inclusive energy."
The interdisciplinary. conference
included fifteen additional sessions
in which- 50 ,graduate~students. from
all over the UC system'presented re-
search papers from their ILE-funded
projects. The session.topics included:
Gender :and Labor, Labor and Political
Discourse, Migration and I,Uage Structure
in,Mexico and the U.S.-, Labor and.Edu-
cation, Case Studies of Key Sectors in
Los Angeles, Wbite-Collar. `Fork and
Its Discontents, Labor -and Economic
Policy, and Labor and Politics in His-
torical Perspective.
Faculty members from around the
state served as • discussants. They, in -
Wage Move.'ment and; Questions fsl
Researchers" Conference presentations
and discussions explored the 'impact of
living wage ordinances • on workers, firms,
and ,lo:cal govern-
menu The present-
ers included 1Vhchael
Reich ILE Research ^
t
Chair and Professor 3,
of Economics at UC
Berkeley;,' David
Runsten, aresearcher, David. Runsten
at the UCLA School of Public Policy
and .Social Research; and Richard
Sander, UCLA. Professor of Law.
In a lively series of discussions, con-
ference participants identified a host
of research challenges presented by
living wage laws. Do living wage ordi-
nances eliminate jobs; as some oppo-
nents have alleged?: Do they.lead em-
Please see Living Wage, page
cluded Abel Valenzuela (Urban Plan-
ning and Chicano 'S.tudies, UCLA);
Dana Frank, (American Studies,
UCSC), Michael B:urawoy (Sociol-
ogy, UCB); Judy S't'epan-Norris (So-
ciology, UCI); David Fairris (Eco-
nomics,,, UCR); Margaret Weir (Soci-
ology and Political Science,UCB);
Edna Bonacich (Sociology, UCR);
Paul,Frymer. (Sociology, UCS,D)-
M:anu:el Pastor .(Latino and. Latin
American .Studies, UCSC); Stuart
Tarinock (Education; UCB),; Gilbert
Go,n'zalez (Chicario Studies, UCI);
Peter- Evans (Sociology, UC,B);
Nelson Lichtenri•stein , (History,
UCSB);,and Carol Zabin (Labor Cen
ter, UCB).
The ILE: `plans to convene simila
conferences: for,gr-a.duate students in
future years.
1k,he ILE will release a detailed re, -
port on "The State of California
Labor"(SCL) in the fall of 2002. "This�
will be a unique examination of key
issues facing the California workforce,"
I -LE Director Ruth Milkman noted.
"The SCL will be an important new re-
source for academics, policymakers,
labor .organizations, and community
groups as well as the general public.
The. 2002 report will include analy-
sis of newly collected data from an.
ILE-sponsored statewide sample sur-
vey on employment practices and
worker attitudes about a range of is-
sues: It will also include the results
of the 2001 Union Census, a data col-
lection effort on.,union.membership in
the state (on which,no data have been
collected since 1987), an ILE project
currently underwayin,partnership with
California Department of Indus
trial Relations. The 2002 SCL -will in-
cl%ide,chapters auihoredbyILE-affiliated
scholars on the following topics:
Job Quality and Economic Growth
This analysis will focus on the quality
of jobs in the state,, analyzing° the
characteristics of jobs added to the
state's workforce ,during the period of
economic expansion.froin 1:992-2000,
particularly compared with previous
periodsnof economic growth. This will,
include a comparison between North-
ern and Southern California's major
metropolitan areas.
Employment Practices
'This, chapter will. analyze newly col-
lected data from the_ 2001 ILE Cali-
fornia Workforce Survey to, docume_nt
employment practicesand public at-
titudes on a. range of labor; related
public policy issues, based. on a sample
survey of Californians.
he ILE's new postdoctoral fel- Ph.D. in Economics in. May 2002
lowship program recently eom- ,from the University of Chicago, and
p'leied its first round of competition. John Logan, who holds a 200'0' Ph.D;
The program, designed for recent in History from UC Davin and'is cur-
Ph,D.s; will.support a new generation gently' a lecturer in Industrial Rela-
of�'scholars engaged ,in research on ti'ons at the London School of. Eco:=
issues of, labor 'and emp,foy.m'ent. n- omics and Political,. Science. Dube
Each year. the program;,sponsors two will be at. UC_ Berkeley.,and :Logan
postdoctoral fellows; one at -UCLA and. at: UCLA.
one at UC Berkeley,. Dube is, a labor ecornorn st who
ILE Fellows are selected'on a com- wrote his dissertation on `.`N�ew,La-
petidve basis and awarded an.annual bor Market. Institutions and .thebis
stipend of '$45,50.0 (plus benefits) to-' tribution of Income..". His topic, for
gether with a -$3,00.0 research,, fund they postdoctoral year is:"C:ommu-
for the.one-year program. Fellows are; nity-Based Organizi"r g:tthe Scope of
free of teaching and other adminis--. Collaboration Between <.the Labor.
trative duties but'are expec`ted,to. par- Movement, And Independent Worker
ti ate in ILE conferences aril pro= Centers:'''
s during the ;fellowship yearn. Logan, .is a historian- whose- work
w
in. 2002-03', the fellows will' be .spans 'a range_ of issues in 'legal and
, - receive a labor history. He has published Arindra'it Dube who will .
Union Density in California
This chapter will present a detailed
portrait of the s•tate's union mem-
bership, analyzing union density by
industry, region, and for various de-
mographic groups, and comparing
California to- the U.S.
Labor Relations Developments
Recent labor relations developments,
including union representation elec-
tions, major collective bargaining
agreements, and other noteworthy
data on labor relations in California
Will be analyzed here.
.Labor Law Enforcement
This chapter will provide a historical
overview of California's labor legisla-
tion in such areas as wages and hours,
-workers' compensation, and health and
safety legislation, with a focus on the
recent history of labor law enforce—
ment in the state.
eral articles in industrial relations
journals on employer opposition to
unionization in the U.S., Canada,
and the=UK, and has also written on,
the :issue of striker replacements.
His topic for the postdoctoral year
is "Using Public Policy to Revital-
ize the Ri6t to Organize: A Cali-
fornia Case Study."
The ILE Postdoctoral Fellowship
Program was established to encourage
highly quahf ed individuals to pursue
scholarly research on labor and employ-
ment issues in an interdisciplinary set--
ting. At each campus, Fellows have ac-
cess to the full range of university re-
sources (computers,;, faculty, libraries,
etc.) and work with an ILE-designated
faculty mentor in an environment that
fosters interdisciplinary learning and
collaborative research. IM
■ ■ ■■N■EEEerererrrErerEeser eENE NOON-9
rarnrn■ Nc�r:Er:�Natrrir■NrNE�N - nar7aEEErrr91■-,rr►.lrri N�,i■■SSE■EOrErrrONENSrENS\Orr■■■ONESNSOEEOSESONESSSSOS�1
rrr■rrrirrrE■ErrrerrrrNrEErErm sErr■'r■rrarNErrNrr■■ErrrrrrrrrrrrS'�ErrEEr■■r■ ■.r
he unionization of homecare
workers in massive'numbers' is one
of the proudest achievements of the
California labor movement in the
1990s. In Los Angeles alone; 74.,00.0
homecare workers, who feed, bathe,
and clean:for elderly and disabled. per-
sons, unionized in 1.99,9 in the single
largest organizing victory- for the la-
bor movement since 1937. These
low -wage, largely female: and, minor-
ity workers are now members of the
Service Employees International.Union
(SEIU).
A new ILE-funded study by
economist Candace Howes of Con-
necticut College and Laura Reif, a
faculty member at UC 'San Francisco,
analyzes the ways in which, the
homecare occupation.has been trans-
formed by Jmproved wages and con=
ditions, thanks largely to unioniza-
tion and living wage policies. The
high turnover levels, that were once
typical of the occup ation. have de
creased significantly; and this stabi-
lization process has in turn led to en-
hanced quality of care for.clients. and
An ILE Resource:
The U B .ILR Library
he ILE has provided new re
sources to enhance the excellent
library housed at the UC Berkeley In-
stitute of Industrial Relations: Under
the supervision of Library Director
Terence. K. Huwe, this facility has
been an importarit,source of research,
support `for many decades, serving
labor researchefs on and.near the Ber-
keley campus. With the :expansion- of°
its electronic and Web based, re-
sources, .the UCR IIR library ;i's in
creasingly able to serve as a xesource
for the state of California and beyond.
Please iee-Library;, page 7'
to irnproved living standards for
homecare workers themselves.
This research was showcased in -
Fresno at, the, Feb.r:uary 7 "Quality
Homecare,Conference, co -sponsored
by the IL.E. More than 15.0 participants
came .together to discuss the ,policy is-
sues surrounding homecare work.
Three stakeholder groups were repre-
seated: unions, disability and senior
consumer organizations, and the
county public authorities who are the
employers of -record. Elected officials
in attendance included California As-
semblywomari Dion Arorier; Susan.
Anderson and Bob Waterston from the
Fresno County. -Board of Supervisors,
and Henry P'erea, President of the
Fresno City Council.
The .conference, organized by
Loretta Stevens, Homecare Coordina-
tor for SEIU's Western Region,. UC
Berkeley Labor Center Director Carol
Zabin,, UCLA .Labor Center Project
Director- Linda .DAr), and others from
the ILE Homecare Working Group,
was a highly effective forum for dis-
seminating .ILE research results to the
community. In addition to the Ho
Reif findings, presentations include
one by UCLA Urban Planning profes-
sor Jackie Leavitt, who shared the re-
sults, of her ILE :fundedparticipatory
research on Los Angeles' homecare
workers' housing;, transportation, and
employment training needs.
As _Zabin explained, participatory re-
search has. `numerous advantages. In a
project she is coordinating on the labor
market conditions for homecare work-
ers in Alameda County, workers them-'
selves :helped to design the survey in-
strument andl to :conduct interviews.
"You getwery high quality data this way,"
Zabin said. "Not only are the questions
sharper, but, respondents tend Ito ,give
more accurate answers because -of their
built-in trust ,for the questioners."'
This was the -first-ever forum bring-
ing together homecare researchers with
key,stakeholder groups."in the corn
nity and in'the labor movement. It
emplifies the potential for fruitful ex-
change between 'researchers, activists,
and policymakers, that. the ILE is de-
signed to facilitate.
11
rrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrr®errrrrrrrrrrrrrrrrrrrrrrrrrrrr�rrrrrrrrmrrrgrrro�rrrr�am
iOr iiiio oMOMMO riii ivi ii iiiirmiiiiiriiriri rri
ployers to substitute more high'hy
`educated workers for those
#Ile"
merly employed at lower wages, a
phenomenon sometimes called "la-.
bor-labor substitution"? What impacts
do economic downturns have on the
passage of living wage ordinances.?
These are among the questions the re-
;s`earchers present at the conference
`are investigating.
The mix of different disciplines
and experiences represented .at- the
con'_ference made for a dynamic event.
"It's exciting to see academia. 'atten-
tion drawn away'from the iv.oty,tower.
and theories and toward th'exeaal
world;' Fairris said. He plans to,,-
con-tinue to b.tiild -a statewide research
community on the" living wage"'ques-
tion and to compile an ;edited volume
on the topic.
The library specializes in materials,on
labor, employment, and industrial, rela-
tions and maintains a print collection
of',more-than 70;000 volumes. Thanks,
to interlibrary loan, these materials are,
available- riot only to local researchers
but to scholars throughout the .state of
California and.. beyond. The library also
hosts public exhibitions of labor art .
and+photography and offers.regular train-
ing -sessions to interested researchers:,
Its Web site offers a wide variety of'„
'researchresources and,. with ILE— sup-
port, is currently expan&ftgtliat,.com-
ponent of its work. Please visit the site
at http://iir.berkeley.edu/library. .
An important priority for the library,
staff is providing reference services by
telephone and e-mail to researchers
throughout the state. To contact a ref-
ce librarian at the UCB IIR library,
pease call (510)642-1705 or e-mail
ii.r@socrates. berkeley.edu.
eresrr srr��rorrr rr�rr�r��r� rrsr�rr�rrrrrrrrrrrr�rr-�
on mannomia i iii iIisaeeiieao®iieoiIeiiiiiiiiiiiiiirrii
The ILE is _in the process -of. conside-ring applications for research grants and fellowships for fundingin the'200243
academic year. This, is the third round' of competition for such,awards.'Proposals may involve exploratory research on
topics that have not been, ex-fensively studied.in recent years; they may be analytical, they -may be� quad.titarive or
qualitative; -or they 'may be concerned vith,p 6licy designappraisal. Applications for. projects on any labor. and
and,
employmentI topic will be seriously considered; but the ;Institute ,will. give i- special consideration to high -quality re-
search proposals that have been developed jointly by.university faculty and labor organizations,
ions, community -based
organizations, or other ,pio- policy organizations that- are Working to improve the social and economic• well-being of
California's working families: ,Proposals will be reviewed by the ILEs eight -member Research' Advisory .Board.
R M., V
Fbnapplication covers eets; bud .g et worksheet5,,:cainpus�ptbcediir6s and additional information,
including alist of previousgrantees, consult theJL-E,Web site athttp://www�--acop.edu/lile;
of
Institute for U - bor and Employffierit, -Non-Profit
University -of' Cali . fornia Organization
U.S. P6ttage
UCLA Box 9514-7& PAID
Los Angeles, ,CA 900954478 V.G.L.A.
XI-4 OF
E
- -410�) 29
UC BERKELEY
CENTERLABOR*
UC Berkeley Center for Labor
Research and Education
Institute of Industrial Relations
2521 Channing Way
Berkeley, CA 94720
M
Whot Are
Our, staff is, made up of a diverse group
of individuals with decades of experience
working on labor issues. as researchers,
educators„ organizers,- and union_ leaders.
Our Advisory Board includes_`.Nortliern
California labor .leaders, labor educators,
conmunty,activists; and 'UC Berkeley
faculty with expertise in labor -issues..
What We Do.
The Labor Center provides educational,
research, and other programs that
increase the California.labor.movement's
capacity to:
v Organize and represent- workers in new
and traditional industries. r
• Reach -out to immigrants, young workers,
people .of color,. and women.
•"Identify and advance policies .that improve
low -wage jobs and,narrow income gaps.
• Develop a new.and diverse generation of
labor 'leaders.
Education
CALIFORNIA UNION LEADERSHIP SCHOOL:
Week long residential -course for executive
union officers on, economics, politics, and
strategic ,power. (Co -sponsored by the ,ILE. )
STRATEGIC CAMPAIGNS AND INDUSTRiiAL
TARGETING: Training for organizing, directors,
officers, and other leaders on how to plan
and implement.co"mprehensive, public
campaigns.
ADVANCED1SKILLS DEVELOPMENT: Training for
chief officers and staff oil. how to effectively
manage complex .labor.. organizations, including
finance and communications.
Research
ECONOMIC AND POLICY ANALYSIS: Applied
research that.provides practitioners with useful
information about labor markets and policy
initiatives.
STRATEGIC RESEARCH: Research and technical
support that help unions analyze and develop
effective organizing strategies for their industries
and constituencies:
PARTICIPATORY RESEARCH: Programs that involve
workers. in research about `their own workplaces
and communities.
University -Labor Collaborations
LABOR SUMMER: A. two=monthinternship
program that places UG students in unions
and community groups for training, research,
and on -the -ground campaigns . upport.
COMMUNITY SCHOLARS:, A semester -long, seminar
in which labor and community organizers
collaborate. with graduate students on action
research -projects.
CONVEININGS- Confererices,.{seminars, and
working,, groups that bring, stakeholders
together to discuss thigh -priority issues and
build consensus .for policy reform.
Accomplishments
During the past three: years; the Labor
Center has;
a Provided academic ;research and, expert_
testimony that contributed to the passage
of living wage ordinances in California....
e Convened a community sand labor coa_lition-
that played a key- role, ,in, advancing the new
AFL-CIO policy .on immigration..
Placedd-UC students in two month summer
internships: with 58 community and labor
organizations.
• Incubated innovative immigrant worker-,
and young worker organizing 'projects.
• Produced research, videos, and ,curricula
on .key topics .including homecare,
childcare,; farm labor, young. workers,
and globalization.,
The: Labor Center is a program of UC Berkeley's
Institute ofIndustfial Relations.and the Institute,for
Labor -and; Employment (ILE)„a statewWe research
program of the University of California.