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Budget Committee delays overhaul of city prevailing‑wage rules after departments raise concerns
Summary
The Budget and Finance Committee on Dec. 13 heard an update to San Francisco's prevailing‑wage ordinance that would consolidate older rules, expand coverage, extend retention from three to six months and tighten the employee vs. independent‑contractor test; the item was continued to Jan. 4 to allow department and nonprofit consultations and to reconcile amendments.
Chair Carmen Chu and Supervisor Wiener led a lengthy hearing on proposed changes to San Francisco's prevailing‑wage ordinance that would consolidate six ordinances into a single code section, broaden which city service contracts are covered, extend the worker transition period from three months to six months and close a loophole enabling independent‑contractor classifications in place of employees.
Supporters including labor leaders and SEIU Local 87 called the update ‘‘a necessary step to stop a race to the bottom’’ and to protect janitors, waste‑haulers and other workers from being reclassified to lower‑paid contractor status. Tim Paulson, executive director of the San Francisco Labor Council, urged the committee to move quickly to close the loopholes exposed by the city's sludge and janitorial contracts.
City staff and several departments expressed concern that removing nonprofit or small‑business exemptions could unintentionally raise costs for training programs and supportive‑housing providers that employ trainees or workers with disabilities. Phil Arnold, deputy director for finance at the Human Services Agency, said his agency contracts with sheltered‑work programs that employ developmentally disabled people and that those contracts include supervision and other costs that may not reflect prevailing‑wage rates.
Office of Labor Standards Enforcement staff said the biggest substantive change is a clarified test requiring that work on covered contracts be performed by employees, not independent contractors, which will help enforcement and prevent contractors from shifting costs to workers. Supervisor Wiener said he would offer a small set of amendments but—after feedback from departments and nonprofits—asked the committee to continue the item to the Jan. 4 Budget Committee meeting so technical changes can be finalized.
The committee agreed to the continuance. No formal ordinance was adopted; the record shows substantial support from labor but open fiscal and programmatic questions from HSA, DPH and other departments that staff and the sponsor will try to resolve before the next hearing.
