We’re In This Together
One thing the collapse of the financial markets makes clear: We are all in this economy together.
When working people can’t make ends meet — and can’t pay their mortgages — the house of cards falls down on all of us. When people in our community are struggling to scrape by on poverty wages, it’s everybody’s problem, and not just for humanitarian reasons. Locally as well as nationally, a healthy economy depends on strong middle-class jobs with paychecks that cover the bills.
The city of San Diego recognized this basic economic truth in 2005 when it adopted a living wage law. As with similar measures in about 120 other cities and counties, the law says companies that have contracts with the city must pay their workers at least a “living wage,” one that is enough to meet basic living expenses. In San Diego, it’s about $13 an hour this year — still a low wage but significantly more than minimum wage.
The living wage keeps many workers and families in our community on their feet financially.The difference of $2 to $5 an hour means dental care for some families, college tuition for others, and in some cases it means a family can keep up with house payments.
It’s a great law. The problem is enforcement.
This August, staff from the Center on Policy Initiatives (www.onlineCPI.org), and our allies did some field research at city parks, libraries, police stations and other facilities. We talked to more than 80 workers for 14 janitorial, landscaping and security companies with city contracts.
We heard the moving stories of the living wage keeping family budgets afloat. But we mostly learned of contractors violating the law. Many of the workers didn’t even know there is a living wage law. Those being paid at the required level usually had company seniority; new workers were not getting the living wage. And most workers said they don’t get the required annual increase.
The living wage law also has requirements for paid vacation and sick days, and a provision encouraging health benefits. All of that was news to many workers we spoke with.
One janitor, Kenneth Wells, newly informed that he should be making the living wage, asked his employer about it. He was fired. After a long battle and a lawsuit, Kenneth got back pay and a job with another contractor. The owner of another company, Prudential Uniform Supply, flat-out refused to pay the living wage. He eventually was forced to pay back wages to settle a lawsuit.
Enforcement of this crucial law has been practically an honor system. The city administration dedicated one-half of one staff person’s time to monitor and enforce the living wage requirement for its more than 100 contracts. Workers can file complaints, but how many people who desperately need their jobs want to take that big a risk of angering the boss?
The city has now added one person to the living wage enforcement staff. That’s a good start, but much more is needed to make sure our tax dollars aren’t flowing to employers who cheat their workers out of a fair and legal wage. Other businesses thrive while paying decent wages and providing health insurance; they shouldn’t have to compete for city business with those who don’t.
We’re all in this local economy together. The city government protects us all by ensuring that working families can make ends meet.
Contractors Need Strict Supervision
As a group, government contractors are like preschoolers at cookie time — you can’t count on them to behave without a lot of monitoring. Turn your back and they grab more than their share and make a mess.
The well-known examples start with Halliburton and its subsidiaries fleecing American taxpayers again and again with vastly overpriced and substandard services to the troops in Iraq. Then wounded troops ended up mistreated by the contractor hired to run Walter Reed Army Medical Center.
The list goes on. A long record of contractor untrustworthiness has accumulated in cities and states across the country. Studies from Maine to San Diego have documented these and many other examples:
A Metrolink train crashed in Los Angeles this month, killing 25 people, when an engineer employed by a contractor ran a red signal. Investigators are focusing on fatigue as the likely cause; the engineer was working back-to-back split shifts from pre-dawn to 9 p.m.
In Boston’s notorious “Big Dig” tunnel project, Bechtel Corp. was largely responsible for overseeing itself. A motorist was killed in 2006 when chunks of the tunnel ceiling fell off because the company had used inferior bolts and adhesive, while charging 6 times its original bid.
The contractor who’d been given the job of determining eligibility for public assistance in Texas also raised costs, and mistakenly dropped 30,000 children from a federally funded health insurance program.
In San Diego, a man was electrocuted at a bus stop because a contractor had miswired a street light and connected it to the metal bench. This is the most lethal in a string of cases of sloppy or inept work by contractors in San Diego.
None of this should come as a surprise. Contractors are in business to make money, not to serve the public, and they make more money the more they trim their expenses. The easiest way to do that: keep pay low and forget about health coverage and other benefits. The predictable result is a dispirited, inexperienced workforce with high turnover — and that in turn means lower quality services.
So the community pays double. Besides the deterioration of services, workers who are uninsured and make poverty wages often have to rely on publicly funded programs, they contribute less in taxes to the public revenue, and they have little to spend in the local economy.
What’s a city to do? Monitor. Regulate. Set strong penalties and enforce them.
The Center on Policy Initiatives has developed a set of proposals for strengthening enforcement of San Diego’s living wage law and protecting workers who complain of violations. We expect a City Council vote in a couple of weeks.
Enforce the law, strengthen the economy
San Diego taxpayers are doing business with lawbreakers. It’s high time for a crackdown.
We have a law on the books that says contractors have to be good corporate citizens if they want a chunk of our considerable collective business. Companies holding service contracts with the city of San Diego have to pay their workers — our fellow community members — a living wage. That includes health coverage or an extra health stipend.
But many contractors have found they can skirt the law. In August, staff from the Center on Policy Initiatives, the Maintenance Cooperation Trust Fund and members of the Living Wage Coalition spread out to city worksites and found rampant violation of the living wage law.
CPI has a package of proposals to strengthen enforcement:
•We need penalties strong enough to deter contractors from breaking the law.
• We need whistleblower protections for workers who report violations of the living wage or any quality issue.
• We need a fair, open system of investigating complaints promptly.
• We need to clarify who is covered by the living wage law and end unfair exclusions.
The City Council is expected to vote in October on these measures. We will be there with the stories of workers for responsible contractors whose family lives have improved because of the living wage, and of those cheated by irresponsible contractors.
Especially in this time of financial crisis, with those at the top of the income scale demanding handouts in the name of communal solvency, it’s time to do right by those at the bottom. The real solution to shore up our national and local economy is to move all workers into the middle class