Living wage policy dropped in face of state law

Oct. 16, 2013 @ 06:22 PM

County Commissioners have rescinded a policy that since 2004 had required some contractors who do business with their government to show proof they were paying employees a “living wage.”

The move complied with a new state law that barred cities and counties from attaching to bid-decided government contracts any minimum-wage restrictions that don’t apply to all companies in the private sector.

The law, part of a Republican-backed “regulatory reform” bill that passed the N.C. General Assembly on largely a party-line basis, went into effect on Aug. 23 after Gov. Pat McCrory signed it.

Durham commissioners, all Democrats, elected in a county where nearly 59 percent of the voters are registered Democrats, made it clear they were acting under duress.

“We’re only revising our policy because we’re being forced to,” Commissioner Wendy Jacobs said before Monday’s unanimous vote.

“This is a step backward, and I just think it’s a shame,” Commissioner Ellen Reckhow added.

The policy change affects decisions the county makes about service contracts, particularly small-dollar deals that the state didn’t closely regulate.

Assistant County Manager Drew Cummings said that the policy had only applied to 81 contracts in fiscal 2012-13.

The vast majority of the county’s contracts, about 800 to 900 contracts each year, were already exempt from the living-wage policy.

That’s because even before the new law took effect, the state allowed local governments to award many types of deals only to the low bidder. The county also exempted from living-wage requirements any service contracts with nonprofit groups.

The living wage by definition was higher than the federal minimum wage. County officials pegged it to the federal poverty level for a family of four.

For 2013-14, it would have translated into a wage of $12.17 an hour.

County officials enforced the minimum by including in the text of each contract. They also required quarterly reports from the affected contractors that showed what each person doing work on a project for the county was getting paid.

Before Monday’s vote, Reckhow encouraged Cummings and other administrators to check with contractors and see if they’d noticed any benefits to complying with the living-wage policy, particularly as it relates to any reductions in staff turnover or increased productivity.

“If we ever were to try at some point to educate our legislature, it would be interesting to know if there are employers who recognize it’s a good policy to use,” she said.

But Cummings acknowledged it’s possible that current contractors may respond to the situation by cutting wages to some of their employees.

There’s nothing to stop them because the former policy became “unenforceable” the minute the new state law went into effect, he said.

Commissioners coupled Monday’s vote to one that promised a living wage to all full- and part-time county employees, including those working seasonal jobs or in job-placement programs.

The policy until Monday had covered only full-time county employees.