solid waste, and moving services. this legislation does a few things. first, it does some cleanup and consolidation because the prevailing wage ordinance has evolved over time and there is some reorganization for consistency that needs to occur. it broadens the kind of contracts covered by the ordinance. it also makes the change to the transition employment period, extending that to six months. we saw earlier this year at one south van ness, when there was a change in janitorial service, tenders were let go without sufficient transition. it also clarifies and closes a loophole, in terms of using independent contractors who are actually employees in reality, to avoid a prevailing wage requirement.

i will invite ms. levitt from to speak about -- from olse to speak about it. we have several amendments that are small and we have been advised that they are substantive and would require a continuance. at the end of this, i will ask that this is continue to next meeting, january 4. in addition, the city purchaser has indicated she has several amendments, which i believe will be non-controversial, but unfortunately right now, i have not received those amendments. i was hoping to make those amendments by the city purchaser today. if i do not receive them today, we will consider them when we receive them and that could require a for the continued from a january 4 until january 11. i would prefer to avoid that, so hopefully, we will have those amendments today. i also want to go to a couple of

things. first, i know some representatives local labor 261 are here today. we are continuing to work with laborers around landscaping, prevailing wage issues, that may be handled in trailing legislation. we also have, in the last few days, have been contacted by some folks in the disability community including nonprofits who work disabled people in terms of developing employment skills, as well as to the department to have some questions. between now and the next budget committee hearing, my office will continue to meet with and work with both labor, as well the disability community, the impact on city departments, just to make sure that we can all be on the same page to the extent possible and work to find common

ground. i would ask during public comment today, if people have concerns about the legislation, if possible, that they propose concrete changes, so that we can start the brainstorming process around that. with that said, i will invite ms. levitt up from the office of labor standards enforcement to address the committee. i'm sorry. i should say what the amendments are that i have. one is on page two, line 16, to remove the phrase "property contracts." page two, line 17, to remove the word "subcontracts." and then on page 34, line 18, after the word "hire" to add the phrase "once worked for hours worked for the employer."

with that, ms. levitt. >> good morning, supervisors. excuse me. i do not have my normal voice today. supervisor wiener did a good overview of the most significant changes that are before you today. in general, the amendment takes what was six different ordinances, combined them into one, with consistent prevailing wage worker retention and enforce the provisions. most significant to the office of labor standards enforcement are the following -- one is the requirement that work has to be performed by employees, rather than independent contractors. supervisor mirkarimi: you might want to put the microphone to you.

>> i thought i would highlight the provision most committed to the office of labor standards enforcement. one is the provision that requires work on city contracts be performed by individual employees, rather than people classified as independent contractors. this is significant for the prevailing wage provisions for the hauling of sludge. our office had done two audits now to determine if workers were paid the correct prevailing wage who were driving trucks on that contract. because of the definition of employee in the current prevailing wage ordinance, the majority of the workers of the current contract are excluded because it says managerial employees are excluded. what has happened is the current

contractor has been able to pay independent contractors at a significantly less rate of pay without benefits than was envisioned when we passed the prevailing wage for the region ordinance for the hauling of sludge. another change, as you heard in item 4 on the agenda, the annual passage of the prevailing wage rates, the city adopts the state prevailing wage rates for public works, but the city goes a step further and has its own requirements for different city services when performed on city property. so it is those services that are being considered in this current amendment. what has happened to date is every year, the civil service commission recommends to the

board the adoption of the appropriate collective bargaining agreement, which lays out the prevailing wage and benefit rates. with this amendment, the sole service commission will actually laid out, instead of adopting the collective bargaining agreement, which is sometimes very complicated and hard to figure out what rates need to be paid. now every year, bidders, workers, our office, the purchasing department will have before them the actual wage rates and fringe benefit rates for each craft and classification of work. that would be a big help in consistent enforcement and workers understanding what their rights are under the ordinance.

other than that, i think supervisor weener's synopsis hit the high point. if there are any questions, happy to answer. supervisor chu: just a few questions. part of it was articulated. one was the three months policy that would be changing. the second component you talked about was the employee versus the independent contractor component. then there were other pieces that were part of it, the exemption of the small business to nonprofits? >> that is for the janitorial contracts only. as was mentioned, and i think this group out of -- grew out of -- seiu members are here today. the city purchased one south bend ness. janitorial contract went out to bid. it turned out the low bidder

was small enough so that they were exempt from both the prevailing wage provisions in the current ordinance and the worker retention provisions in the current ordinance. so we amendments before you seek to address that and make it so that all contractors will be bidding on a level playing field. supervisor chu: i try to understand this. i am glad we will have a continuance so i have a chance to better understand some of the issues that may have gone into the drafting of the legislation. i am wanting to understand what this means for our city departments, not contractors, city businesses. with regard to work for individual employees versus independent contractors, on that component, to receive other examples aside from the sludge contractor where that is the case? >> no. we could, but we have not. supervisor chu: that is a unique situation we have seen in the

city? >> correct. supervisor chu: with regard to the three-month, six-month detention policy, what was the reason? >> that is a question better addressed by supervisor wiener. is my understanding it would provide greater drops a dirty for folks who were being displaced. that was the intent. supervisor wiener: the current is 3 months. there had been discussions, a desire by some to extend to one year. we went with six months as something that was a reasonable increase. one year was probably too long. there is nothing magic about the six months. it was simply a result of an number of conversations. supervisor chu: ok. anything else you would add,

other presentation you would bring up? supervisor wiener: that is it. thank you, ms. levitt. unless there are further comments from colleagues, we can open up for public comment. i have five speaker cards. if you would like to speak to this item and have not filled out a card, they are appear. -- up here. tim paulson, labor counsel. jeff tiller. olga miranda. patrick regan. steve craviel. >> supervisors, jeff pillar. i am here on behalf of employees employed in the waste hauling, parking industry, theatrical industry, janitorial industry. as supervisor wiener said, attempting to address some

significant holes that are in the existing ordinances that have been around since at least 1999. as you have heard, one of the primary changes is the change to make what has now been a prevailing wage ordinance which the city has attempted, city departments have struggled to apply to situations involving non-employees, independent contractors, to require anyone bidding on any of these contracts to have a employer- employee relationship. the reason for that, one cannot apply a prevailing wage ordinance to people who do not earn wages. it is not an apples to apples comparison, by any means. what was noted to earlier by mr. levin was the sludge contract came up last year, the before. frankly, that is a good example -- not the only example, but an example of the problems that exist in this field, where you have a situation where employees

will be paid what appears to a layperson as a large amount of money per hour, but the bulk of that money goes to the maidens of their own trucks, insurance, all the other provisions would be required. the department of labor relations simply said, look, we cannot apply a prevailing wage ordinance to that type of arrangement. not only have we taken that position, but the state of california's department of industrial nations has taken the same positions. you cannot apply in these circumstances to a non-employee. there is also a change in the definition of contract, which had been noted, and that applies only to janitors -- if i could continue for a moment. only two janitors and to the waste haulage provisions. the janitors provisions, as have been noted, exception for small businesses and nonprofits has

been removed. the reason for that has to do with, again, creating a level playing field, circumstances where bids -- supervisor chu: if i could ask you to conclude. >> contracts have gone out to bidders. the other change and want to know for the record, if there is a change in the city's existing arrangement for purposes of the garbage franchise, that would also be subject to this ordinance. supervisor chu: before we continue on, i would ask folks to respect the time period did we know that this i will be continued. i know that there will be other opportunities and i want to get the other agenda items in time. supervisor wiener: before we proceed, there are two represented this from the department of public health and human services agency that i would like to bring up. they are not the public comment. okubo from dph.

phil arnold. if you could come up to address the committee on behalf of your departments. >> phil arnold, a deputy director for finance and administration for the human services agency. we have some issues -- five issues -- with the custodial section of this revised ordinance. the first issue we have is the deletion of the section that applies to contractors to provide training to disabled persons. we have a contract with the arc of san francisco, which does provide some custodial and recycling services to our agency. it employs approximately five developmentally-disabled persons. we pay the contractor a flat rate. i do not think -- i do not know -- but i do not think a flat rate is the prevailing wage. it also includes supervision and administration of the contract.

that is one of our issues. supervisor wiener: the minimum wage in san francisco is now -- is about to go to $10.25, if i'm not mistaken. it will be 10 and a quarter in january. my understanding that the prevailing wage for janitorial is about 1250 or 1275, we're talking about 2 and 1/4, to end the half dollars difference, is my understanding. some people assume that everyone is making 20, 30, $40 an hour. janitorial, it is not that much higher than minimum wage. can you address that?

>> that raises one of the other issues is that we have job training programs that we fund which are literally training programs. they are not fully functional ready to go custodian's but they do engage in custodial activities. the idea is to eliminate that exclusion from this ordinance. we're not sure what that would do to our programs unless we need to pay the rate for trainees. the budget analyst said that he is not able to tell you. i know that there will be a cost increase to our agency as a result of this and it would be good for us to know what that is before this legislation goes

forward. whether we are asked to swallow cost or whether we have the additional funds to pay these costs. we are seeking information at this time. >> ok. >> we do have several contracts for our housing program where we have employees that have multi functions. on we don't have a full-time custodians in these housing units but some people who work on maintenance or assess clerks also provide maintenance services and we are not sure if they are covered or non covered. this would change the wage structure for many of our contracts. this could be affected by this change. finally, the issue of the leases. we too have several leases where

the custodial services were provided as part of the lease and again, we don't know whether there would be increased costs to us or to these changes which would then be passed on to us in the form of additional lease costs. we would like to know before this legislation gets put forward. >> i don't know if you have spoken with my office. if you could make sure to talk to her, we want to convene people and make sure that we're working through these issues and we appreciate the feedback. now, the department of public health. >> good morning.

we have a concern that is very similar. we have one contractor that provides a jobs program, vocational rehab for our clients and they provide janitorial services. then we have supporting housing sites which provides janitorial services on site. we do appreciate the opportunity for the continuance and having further discussions. >> we would like to get your concerns down. i know for book this item and for the previous item where we send the prevailing wage, you had indicated an inability to estimate the cost. that seems like a prevailing wage issue generally. can you explain that? >> yes, madam chair, members of the committee, it is unknown of

whether or not that a contractor as a result of an increase in prevailing wage rates would increase the bids to the city. we don't know if this could result in a higher bid. if it does and the resultant increase costs, it would be an increase loss to the city. >> that is the prevailing wage generally? >> absolutely. that is what we advise the board in previous years. >> this is somehow not unique in that regard? >> no, it is not. it has the new specific provisions that could result in some increases in costs but as far as the prevailing wage, this is not unique. >> ok, we will proceed with the

remaining public comment. >> supervisors on the budget committee, good morning. i'm the executive director of the san francisco labor council and we fully support this legislation. i think all of you on the board of supervisors have struggled with the various contracts in the various years in the industries we have talked about because there has been a race to the bottom with some of them. we are trying to close some of the loopholes. all of these different industries that you have indicated, they have put together a standard of prevailing wages in order to stop this race to the bottom of

this really will close the loophole. i want to make one comment. the idea of an independent contractors, this is prevalent in many areas of the nonunion private-sector. for this tikrit into the public sector and is something that the supervisor should be looking at. the contractor pointed out that this is a real disease that we have to stop and we applaud you for moving forward. we to fully support this legislation. we want to make sure that the issues get covered because that

might not be quite as tight in this piece of legislation. we urge due diligence. thank you. >> they cued -- the que. next speaker. >> and want to ask the members of local 87 if they can stand and also local 251. all of these members are members that every day come to our individual local hiring looking for work. it has been about jobs and could too of like to share our anxiety and frustration. talk about the race to the bottom.

we have a lot of single mothers and fathers i cannot make red because of these jobs. and stand the prevailing wage will be a high topic within the city. it is about trying to make this month's rent. we want to make sure that we can have a city that we can be proud of that can speak on behalf of all of those families. what i mean is that a gentleman from one of the department's spoke about disabled member is getting a flat rate. i think it is a disservice because people are disabled, we should shortchange them in terms of what they need. the nonprofits that have questions, they can work on this together. thank you. >> thank you.

next speaker. >> [singing] said the worker man to uncle sam, do you hear what i hear? more budget wage money shining in the night, shining their bright and bold, let us bring them silver and gold let us bring them silver and gold let us bring them silver and gold and gold >> [regular voice] thank you. >> and good morning. i end with a nonprofit social

enterprise in the city. we are one of the contractors that were referenced. we serve about 400 individuals both in job training and placement. my main concern with the removal of the exemption is that when -- that our training programs would not survive. most of these people are on it as as i -- are on ssi. this would jeopardize the program. my name suggestion would be to leave in the nonprofit exemption or social enterprise exemption. >> one thing that i am more interested ideas about the non-

profit exemption which is very broad and if there are perhaps a more narrow exemption that could accomplish the goals of this legislation while taking account into the needs of these very specialized programs. >> we came down and learn about it. we have a great time with your staff. thank you very much for including us. >> hello, i am from a social enterprise that has a history of training and employment for people with disabilities in san francisco. we really support the goals of

consistency and consolidation. we have concerns about the unintended consequences that were spoken about for the people that we serve, people with disabilities, are around benefits and viability of our training program. we thank you for the offer to continue the dialogue and we will be in touch with gillian. >> thank you very much. >> speaking as a community advocacy organization working to promote opportunities for disadvantaged communities, we strongly support this legislation. it is very good. we think it is important what is happening here. in light of the fact that we will take another week to work out some of these chang