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Living Wage;
City Hall Ignores Its Own Law and Now May Face Millions in Penalties.
By
Michael I. Niman
Buffalo Beat, March 8th 2001
In July of 1999 the Buffalo Common Council unanimously adopted a “living wage” ordinance, designed to guarantee that employees of businesses contracting with the City of Buffalo would earn enough money to be able to afford basic necessities and lift themselves out of poverty.
In their rational for the bill, the authors, former Council Members Barbara Kavanaugh and Byron Brown, state that salaries typically paid to service employees fail to provide them with “resources sufficient to afford life in the City of Buffalo.” The prevalence of such low wages contributes to Buffalo’s H.U.D. ranking of “Forth most distressed city in the United States,” with over 25% of its residents living below the poverty level. The low wages also, according to Kavanaugh and Brown, place an undue burden on Erie County’s already distressed social service system, with full time workers still qualifying for Food Stamps, HEAP home heating assistance, etc.
The living wage ordinance theoretically remedies this situation by requiring employers employing more than 10 workers and doing more than $50,000 worth of contract business with the City of Buffalo to pay their employees a “living wage” as a requirement of doing business with the city. That wage, which would be phased in over three years, would be $8.08 per hour with health benefits or $9.08 an hour without benefits by January 1, 2002. The current year’s wages would be $7.15 without benefits and $8.15 with benefits. By comparison, the living wage in Santa Cruz, California is currently $12.
The ordinance received wide support from labor leaders, clergy and a host of community organizations. Businesses representatives, however, particularly those from industries such as the restaurant industry, which habitually underpays its employees, opposed the bill both in Buffalo and nationally. Two Buffalo groups, the Coalition for Economic Justice (CEJ) and Citizen’s Action spent four years rallying support for the bill and forcing the living wage issue into the pubic eye. The movement took on a life of its own and eventually won the support of both proponents and former opponents on the City Council.
We Ain’t “Talking Proud” Now
The legislation, while innovative, was hardly original by the time Buffalo adopted it. The Buffalo ordinance was based on a tried and tested template developed first by Baltimore in 1994, then refined by dozens of other municipalities over the ensuing five years. In 1999 Buffalo was the 35th American city to pass a living wage ordinance.
Currently 53 American cities have living wage ordinances with community activists in over 75 other cities, ranging from Sacramento, Syracuse and Little Rock, to Pittsburgh, Dallas and New York, working to adopt similar laws. To our credit, historians will place us among the first wave of cities to buck the NAFTA induced downward wage spiral and adopt living wage legislation. Unfortunately this is where “talking proud” ends.
Buffalo now stands out with the odd distinction of being the city that first adopted, and then seemingly abandoned, the living wage. Though the Council passed the bill amid great fanfare, the administrative branch of city government has yet to implement any of the provisions of the law during the ensuing 18 months.
The authors of the Buffalo bill built a one-year grace period into the legislation, allowing the city until July of 2000 to prepare to implement the new law. Starting in July of 2000, however, all service contracts accepted by city agencies were to contain language spelling out that employees would be paid the established living wage during the contract period, and that other provisions of the law such as one that requires the law be posted in workplaces, be adhered to. This has not happened.
In fact, as of this writing, Bonnie Russell, the compliance officer in charge of overseeing the implementation of the law, has yet to receive a list of contractors who would be affected by the law. Without the list, she cannot begin her monumental task of assuring compliance.
The list promises to be huge, encompassing every major vender supplying City Hall, the Police Department, The Department of Parks and Recreation, The Board of Education, The Department of Streets and Sanitation, and so on. Presumably, employees of city vendors/tenants who operate city owned downtown parking ramps, pump fuel into city owned cars, sell hot dogs in city parks, work in city owned cafeterias etc., should currently be earning the living wage.
Joanne Cole of Citizen’s
Action suspects that many of these folks are not earning the living wage.
She can’t say for certain, however, because despite 12 months of
meetings with city officials discussing the living wage law, she, like Bonnie
Russell, has yet to receive a list of affected contractors.
Ooops! The City Might Owe Millions
It’s a safe assumption, however, that many contractors are out of compliance, since the city has not officially notified any of the affected contractors of their responsibilities under the law.
This brings up an interesting, and for the city, a potentially devastating question. The bill states that if an employer is in violates this law by paying a substandard wage, which until now has been the norm in much of Buffalo’s service industry, they would be required to pay restitution to each affected employee dating back to the date they were hired, or July 1, 2000, whichever is later. The million dollar question is, since the city never put the living wage requirements into vendor contracts as required by law, who is responsible for paying restitution to workers?
Maria Whyte of the Coalition for Economic Justice, Joanne Cole of Citizen’s Action, and their attorneys all believe that the city bears the ultimate financial responsibility. Their argument goes like this: The law states that the city must put living wage legislation into vendor contracts and must enforce compliance with the law. Since the city never put the language into the contracts, vendors are still in compliance with their city contracts, and have not broken any laws. It is the city, they argue, that is not in compliance with the law and it is the city that ultimately is responsible for what could amount to millions of dollars in back pay.
An informal Buffalo Beat survey found that employees of affected parking ramps, for example, are earning as much as $100 a week below the living wage. If Whyte and Cole’s legal premise proves correct, the city already owes these workers $3,400 each in back wages – a figure that continues to grow daily.
For Whyte, the issue goes beyond the apparent legal questions. She claims that, “by failing outright to enforce the living wage ordinance, the City of Buffalo is essentially contributing to the destabilization of the Western New York economy and the overall maintenance of hunger and poverty in our communities.” The question still remains, however; who in the city government is responsible for this failure?
Councilmember-at-Large Charley Fisher III (Democrat/Green) carries his indignation a step further, pointing his finger directly at the Masiello administration, stating, “I think it’s abominable that a law was passed by the Council and then ignored by the administration.” He says such inaction is “disgraceful, negligent and fraudulent” and makes him “ashamed to be part of city government.” Fisher is quick to point out that the council crafts laws while the administration is charged with enforcing them.
Apparently, from the time the mayor signed the law in July of 1999, until March of 2000, the administration took what appears to be virtually no action. In March, activists from CEJ and Citizen’s Action met with city officials to inquire about implementation plans, but still, there was no action on the part of the City. In May they asked specific questions, such as; who in city hall would be in charge of overseeing compliance of the law and how would they inform contractors about their responsibilities under the law? During the next nine months the activists met 12 times with city officials who, every time, promised that the city would quickly work toward compliance.
Finally, in November of 2000, six months after the bill officially took effect, the city designated Bonnie Russell as Compliance Officer for the living wage bill. The problem, as everyone associated with the issue is quick to point out, is that Russell is already working full time as the city’s Affirmative Action and Equal Employment Opportunities Officer and is already responsible for a somewhat monumental task. The administration gave her the added responsibility of insuring compliance with the living wage bill, but didn’t give her any additional resources. Currently Russell shares a secretary with three other people and has no other staff. In essence, she was saddled with an impossible task.
This task is made more difficult by the fact that Russell seems to receive little support or cooperation in city hall. As of the end of January of this year, city officials supplied her with only a half dozen of the hundreds of affected contracts that were up for renewal. On February 2nd, Mayor Masiello’s Chief of Staff, Vincent LoVallo sent a memorandum to all commissioners asking that they send Russell all contracts coming up for renewal, and all contracts which were recently renewed, even presumably those which were renewed out of compliance. During the ensuing month she received a scant three contracts. Without the contracts or even a list of vendors to work with, it is impossible to inform employers about the law or determine who is in compliance with the law.
Joanne Cole recently moved the computer at her Citizen’s Action office nearer to the window, so she could keep an eye on the restaurant across the street. She heard a tip that Morning Pride, a laundry service that supplies table clothes to the restaurant was also a city vendor who would be affected by the law. Cole is planning to watch for the Morning Pride truck, and, when she sees it, run out and ask the driver what he and his co-workers earn. Once they assemble a class of plaintiffs, workers who are employed by affected companies but don’t earn a living wage, Citizen’s Action and CEJ plan to sue the city. To date, this is the only enforcement action that is occurring regarding the living wage ordinance.
Fisher feels that the current administration is purposefully thwarting the law. He points to what he calls “the systematic abuse of seasonal sanitation workers.” According to Fisher, the city hires “seasonal” employees at sub-living wages and lays them off and then rehires them every nine months in an effort to keep them as “seasonal” and without benefits. Fisher questions the “hypocrisy” of the city, “asking a private contractor not to do what we ourselves are guilty of.”
If Masiello is in fact against the law, a charge he denies, he is not alone. Marriott and a host of other corporations with large low-wage workforces joined forces with The Washington Post, and successfully lobbied against a similar law in Maryland. Recently a coalition of hoteliers in Southern California spent over $1 million on a failed campaign to pass an ordinance that would have prohibited the adoption of a living wage law in Santa Monica. One “think tank” associated with the restaurant and hospitalities industry recently launched a website and published a book, both aimed at instructing local business groups in tactics to defeat living wage initiatives. The corporate clout lined up against the living wage movement, both locally and nationally, may lend insight into why Mayor Masiello and other city leaders lack vigor in enforcing the ordinance.
Despite a well funded opposition, however, the living wage movement is racking up victories at a quickening pace around the country. Labor and religious groups nationally are using the movement as both inspiration and a model for a renewed worker’s rights struggle.
Bonnie Russell, disagreeing with Fisher, believes that, “the mayor supports the law and always has.” The problem, she argues, stems from the fact that “many people in the Masiello administration were not aware of the ordinance.” People in city hall, she says, might have heard of it, but without a copy in front of them, paid little attention to it.
For what it’s worth, the administration did not corner the market on inaction. During their struggle to get the city to enforce the law, CEJ and Citizen’s Action representative met with both members of the council and representatives of the administration, all to no avail.
Joanne Cole agrees with Russell, stating that she too believes Mayor Masiello supports the legislation. “But city hall is so disorganized,” Cole speculated, “that it seems one hand doesn’t know what the other hand is doing.” Hence, according to Cole, nothing gets done “and no one seems to care.” The end result, she added, “is that our tax dollars support law breakers.” Masiello was not available for comment.
Russell thinks that, “Now is a good time for everyone to come together and make the law work.” To this end, she is once again trying to get a list of city contractors, this time from the city comptroller’s office. This, she says, would be the first step toward implementing the living wage law. Next, she suggests, would be for the administration to approach the council and ask for funding for staff to oversee the implementation of the law. Finally, she is counting on Cole and Whyte, both of whom are community activists not employed by city hall, to decipher the vendor’s list and lend direction to the enforcement effort.
In the meantime, Rochester passed a living wage ordinance last month and immediately began examining contracts and implementing the new law. Buffalo’s law, by comparison, is coming up on its second birthday. There is still no firm plan in place to assure compliance and the city is facing a potential multimillion-dollar exposure because of its inaction.
