BILL REQ. #:  H-0257.1 

Read first time 01/10/2007.   Referred to Committee on Commerce & Labor.

     AN ACT Relating to providing living wages on public contracts; adding a new section to chapter 43.19 RCW; adding a new section to chapter 47.28 RCW; and adding a new chapter to Title 39 RCW.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:

NEW SECTION.  Sec. 1   The legislature finds that the state annually awards contracts to private contractors and vendors, and that such expenditures should be spent in a manner that promotes the creation of jobs that allow residents to support themselves and their families with dignity. The legislature further finds that the present federal and state minimum wages generate income at a level below the amount required to support a family at a basic level and that jobs that do not pay living wages result in families who have greater need of social services provided by the state and paid for by state taxpayers. The payment of adequate wages to workers employed by private contractors and vendors that contract with the state will promote stability and reduced turnover, resulting in a higher quality of service.

NEW SECTION.  Sec. 2   The definitions in this section apply throughout this chapter unless the context clearly requires otherwise.
     (1) "Contract" means public works contracts, personal services contracts, and purchasing contracts for goods and services.
     (2) "Contractor" means any person, firm, or corporation that, in the pursuit of an independent business, undertakes a contract with the state.
     (3) "Department" means the department of labor and industries.
     (4) "Director" means the director of the department of labor and industries.
     (5) "Employee" has the meaning set forth in RCW 49.46.010. In addition to the individuals excluded under RCW 49.46.010, "employee" does not include an individual:
     (a) Seventeen years old or younger;
     (b) In a position that is designated for a trainee, apprentice, or is otherwise part of a training program;
     (c) In a work study position, internship, or who is in a position that requires student status as a prerequisite to being employed in that position; and
     (d) Subject to a bona fide collective bargaining agreement.
     (6) "Subcontractor" means any person, firm, or corporation that, in the pursuit of an independent business, undertakes a contract with another person, firm, or corporation who holds a contract with the state.

NEW SECTION.  Sec. 3   (1) All contractors and subcontractors covered under this chapter shall pay employees a living wage no less than eight dollars per hour if health benefits are paid for in whole or in substantial part by the employer, or nine dollars and fifty cents per hour if health benefits are not so provided.
     (2)(a) Beginning January 1, 2008, and each following January 1st as set forth under (b) of this subsection, every contractor and subcontractor shall pay each of his or her employees at a rate of not less than the amount established under (b) of this subsection.
     (b) Beginning September 30, 2007, and on each following September 30th, the department shall calculate an adjusted living wage rate as specified under this subsection (2)(b). Each adjusted living wage rate shall be calculated to the nearest cent, and shall take effect on the following January 1st.
     (i) If the per capita personal income for the prior calendar year for Washington is equal to or greater than the per capita personal income for the prior calendar year for the United States, the adjusted living wage rate shall be calculated using the sum of:
     (A) The percentage increase in the consumer price index for urban wage earners and clerical workers, CPI-W, or a successor index, for the twelve months prior to each September 1st as calculated by the United States department of labor; and
     (B) The average annual percentage increase in per capita personal income for the prior two calendar years as calculated by the United States department of commerce bureau of economic analysis.
     (ii) If the per capita personal income for the prior calendar year for Washington is less than the per capita personal income for the prior calendar year for the United States, the adjusted living wage rate shall be calculated to the nearest cent using the percentage increase in the consumer price index for urban wage earners and clerical workers, CPI-W, or a successor index, for the twelve months prior to each September 1st as calculated by the United States department of labor.

NEW SECTION.  Sec. 4   (1) In circumstances where a contract also requires the contractor or subcontractor to pay its employees prevailing wages, the contractor or subcontractor shall pay its employees at the contractually prescribed prevailing wage rate or the minimum living wage payable under this chapter, whichever is higher.
     (2) The contractor or subcontractor also shall pay its employees at the minimum wage rate under chapter 49.46 RCW or the minimum living wage payable under this chapter, whichever is higher.

NEW SECTION.  Sec. 5   No contractor or subcontractor shall retaliate or discriminate against an employee in his or her terms and conditions of employment for:
     (1) Reporting a possible violation of this chapter to the director;
     (2) Participating in any legal or administrative proceeding in respect to this chapter;
     (3) Seeking civil remedies to enforce his or her rights conferred by this chapter; or
     (4) Otherwise asserting his or her rights under this chapter.

NEW SECTION.  Sec. 6   (1) An employee claiming a violation of this chapter may report the violation to the director.
     (2) The department has the same administrative and enforcement powers as identified in chapter 49.48 RCW.

NEW SECTION.  Sec. 7   (1) Compliance with this chapter is required in all state contracts to which it applies. Upon award of a contract covered by this chapter, the contractor must certify that he or she will comply, and will require all subcontractors to comply, with the requirements of this chapter.
     (2) Such contracts shall provide that upon a violation of this chapter, a contractor or subcontractor who is out of compliance for the first time has thirty days to come into compliance including the payment of any back wages required. If the contractor or subcontractor remains out of compliance after thirty days, the state may terminate the contract and otherwise pursue contractual remedies for breach of contract. The contractor or subcontractor may appeal the finding of the department made under this section in accordance with the administrative procedure act, chapter 34.05 RCW.
     (3) Within ten days of a request by the state, the contractor or subcontractor shall provide satisfactory proof of compliance with the living wage provisions of this chapter in the form of payroll records, benefit records, or other appropriate evidence.
     (4) If the state finds that a contractor or subcontractor has violated this chapter a second time, the state may terminate all contracts with the contractor or subcontractor, and the contractor or subcontractor shall be prohibited from contracting with the state for a period of two years.

NEW SECTION.  Sec. 8   Nothing contained in this chapter may be construed to limit in any way the remedies, legal or equitable, that are available for violations of this chapter.

NEW SECTION.  Sec. 9   If any provision of this act or its application to any person or circumstance is held invalid, the remainder of the act or the application of the provision to other persons or circumstances is not affected.

NEW SECTION.  Sec. 10   (1) The living wage requirement imposed by this chapter applies to all contracts and related subcontracts entered into, renewed, or extended by either the department of community, trade, and economic development or the department of social and health services on or after January 1, 2008.
     (2) This act does not apply to any contracts entered into before January 1, 2008.

NEW SECTION.  Sec. 11   A new section is added to chapter 43.19 RCW to read as follows:
     All contracts entered into under this chapter by either the department of community, trade, and economic development or the department of social and health services on or after January 1, 2008, are subject to the requirements established under chapter 39.-- RCW (sections 1 through 10 of this act).

NEW SECTION.  Sec. 12   A new section is added to chapter 47.28 RCW to read as follows:
     All contracts entered into under this chapter by either the department of community, trade, and economic development or the department of social and health services on or after January 1, 2008, are subject to the requirements established under chapter 39.-- RCW (sections 1 through 10 of this act).

NEW SECTION.  Sec. 13   Sections 1 through 10 of this act constitute a new chapter in Title 39 RCW.