Nassau County Executive Laura Curran signed changes in the county’s Living Wage Law last Wednesday that she said would help ensure that county workers or those working for contracted vendors are paid fairly and receive all the time off and benefits to which they are contractually entitled.
The loophole would have permitted vendors and contractors doing business with the county to transfer contracts to subsidiary, sister or parent companies not party to the original agreements. Companies whose CEOs made less than six times the average amount paid other employees and whose annual budgets were $1 million or less could apply for waivers to the living wage law under the previous rules.
Such companies were required to present their books for examination as part of the waiver process. However, subsidiaries, sisters and parents were not. In theory, once a company was granted a waiver, it could transfer its contract to a related entity that did not meet the original criteria, which would then be able to benefit from the waivers.
In closing the loophole, Curran said vendors applying for waivers would be required to submit the books for all heir companies’ related entities to ensure that no such abuses could occur. “The loophole we closed today allowed [some] companies to appear smaller than they actually were to avoid paying workers a living wage” she said.
The living wage for vendors doing business with the county is $16.41 per hour, for companies that do not offer benefits; or $14.27 per hour for those that do. Vendors are required to pay the differential, either in health care or day care benefits, at the discretion of the employee.
“It’s a great day,” said Long Island Federation of Labor President John Durso, who also chairs County Comptroller Jack Schnirman’s Living Wage Advisory Board. “This took years to get done … by removing loopholes in the law and further strengthening these important protections, we add additional guarantees that taxpayer dollars are being used properly and are being reinvested in our workforce.”
“If you want to do business with Nassau County, you have to play by the rules, Schnirman said. “Closing this loophole is protecting workers from contractors who try to game the system. … This is good, smart, common-sense reform,” he said.”
While the number of companies applying for waivers has declined since the new administration took office last year, the potential for abuse was significant, Schnirman added. The county granted fewer than a dozen waivers last year.
The Living Wage Advisory Board began auditing vendors that requested waivers in 2018, uncovering more than $250,000 in unpaid wages and other compensation.
“The fact that a quarter of a million dollars has been recovered for Nassau County workers is proof positive that these rules changes needed to happen,” said wage board member and 1199 Service Employees International Union Political Director Onika Shepherd. “Most employers want to abide by the living wage law, but some … will use any tactic to avoid paying proper wages. These new rules will hopefully… put more money in workers’ wallets.”
Curran also announced the creation of a bilingual hotline — 516-571-WAGE — for workers to ask questions or report contractors suspected of non-compliance.