Living Wage Act

SECTION 1. SHORT TITLE

This Act shall be called the Washington "Living Wage Act".

SECTION 2. FINDINGS AND PURPOSE

(A) FINDINGS – The legislature finds that:

1. The state of Washington awards contracts that result in the employment of thousands of individuals. Many of these individuals, employed indirectly by the state, receive sub-poverty level wages.

2. The creation or promotion of jobs that pay sub-poverty level wages is shortsighted economic and social policy. Such jobs do not lead to a self-sufficient workforce or support sustainable community development. Instead, they increase the need for government services, such as public assistance for food, housing, health care, and child care.

3. The state is not an innocent bystander in the payment of sub-poverty level wages. It is necessary and appropriate for the state to require that contractors working on state business pay at least a living wage.

(B) PURPOSE – Recognizing that the state is a major contractor for services, this law is enacted to increase the wages of service employees who indirectly work for the state in order to improve public health and welfare, promote the economic strength of our society, and take pressure off state social service programs.

SECTION 3. LIVING WAGE

After section XXX, the following new section XXX shall be inserted:

(A) DEFINITIONS – In this section:

1. “Secretary” means the Secretary of the Department of [LABOR], or the Secretary’s designee(s).

2. “State” means the state or a principal unit of state government.

3. “State contractor” means a for-profit or not-for-profit entity that has a state contract.

4. “State contract” means: a. A contract for services with the state valued at $100,000 or more; or

b. A subcontract valued at $25,000 or more for providing part or all of the services covered by another entity’s contract for services with the state valued at $100,000 or more.

5. “Basic health insurance benefits” means an insurance plan where an employer pays 100 percent of the premium for individual coverage or 80 percent of the premium for family coverage if the health insurance:

a. Covers at least 80 percent of the costs of office visits, emergency care, surgery, and prescriptions; and

b. Has an annual deductible of no more than $1,000.

(B) PAYMENT OF LIVING WAGE

1. Any state contract for services must require state contractors to pay an hourly wage rate that is at least the living wage.

2. During the duration of a state contract, a state contractor shall pay to each employee who is working on the state contract an hourly wage rate that is at least the living wage.

3. If a state contract is subject to prevailing wage requirements under [appropriate citation], the state contractor shall pay the living wage or the prevailing wage, whichever is higher.

(C) CALCULATION OF LIVING WAGE

1. The living wage shall be figured monthly to be three times the prevailing rent for a one-bedroom apartment. Hourly wages will be divided from this monthly base wage.

2. On July 1 of each year, the Secretary shall adjust the living wage in direct proportion to any increase or decrease in the Consumer Price Index for [insert region], as reported by the U.S. Department of Labor, except that the hourly wage rate shall not be set at less than $10 per hour without basic health insurance benefits or $8.50 per hour with basic health insurance benefits.

(D) WAIVERS AND EXEMPTIONS

1. A not-for-profit entity that is subject to this section may apply to the state agency that is responsible for the state contract for a waiver of the living wage requirement, based on economic hardship. The state agency may only grant such a waiver after:

a. A review of the not-for-profit entity’s financial situation, including salary levels of the entity’s management personnel; and

b. A determination that the application of this section would cause an undue hardship to the entity’s operation.

2. Any granted waiver of the living wage requirement must be renewed annually.

3. The living wage does not apply to a trainee who is enrolled for less than six months in a job readiness or job training program run by a non-profit entity.

4. The living wage does not apply to an intern who is under 21 years of age, employed by a non-profit entity before or after school, or during the summer for a period not longer than three months.

5. If a state agency responsible for a state contract determines that application of this section would conflict with a federal program requirement, this section does not apply to that contract.

(E) ENFORCEMENT

1. No state contractor shall discharge, demote, harass or otherwise take adverse actions against any individual because such individual seeks to enforce this section, or testifies, assists, or participates in any manner in an investigation, hearing, or other proceeding to enforce this section.

2. No state contractor shall split or subdivide a contract, pay an employee through a third party, or treat an employee as a subcontractor or independent contractor to avoid payment of a living wage.

3. This section shall be enforced by [appropriate state agency], which shall promulgate such regulations as are necessary to implement and administer compliance. Regulations shall include procedures to receive, investigate, and attempt to resolve complaints; and bring actions in any court of competent jurisdiction to recover appropriate relief for aggrieved employees.

4. In any action under this section in which an employee prevails:

a. The employee shall be awarded monetary relief, including back pay in an amount equal to the difference between the employee’s actual earnings and what the employee would have earned but for the employer’s unlawful practices.

b. The employer shall be enjoined from continuing to underpay employees, and the employer may be ordered to take such additional affirmative steps as are necessary, to ensure compliance with this section.

c. The employer shall pay a reasonable attorney’s fee, reasonable expert witness fees, and other costs of the action.

SECTION 4. EFFECTIVE DATE

This Act shall take effect on July 1, 2004. The living wage shall apply to state contracts executed or renewed on or after October 1, 2004.