COUNCIL OF THE CITY OF PHILADELPHIA PUBLIC HEARING AND PUBLIC MEETING BEFORE COUNCIL COMMITTEE ON LABOR & CIVIL SERVICE - - - Room 400, City Hall Philadelphia, Pennsylvania Tuesday, April 25, 2000 5:16 p.m. - - - BILL 000108 - Enacting a new Chapter 9-2300 of the Philadelphia Code, entitled "Protection of Displaced Contract Workers," and amending Section 19-2602, entitled "Licenses," to require that all contractors awarded contracts for the performance of food and beverage, hotel service, health care, janitorial, or building maintenance services within the City of Philadelphia retain certain non-supervisory employees of the previous contractor for a 90-day transition employment period during which period retained employees may not be terminated, except for cause, and to require that said employees be provided with various other job security protections, providing penalties for noncompliance including, but not limited to, revocation of the business privilege license of violators, and granting remedies to aggrieved parties, all under certain terms and conditions. PRESENT: COUNCILMAN DARRELL L. CLARKE, Chair COUNCILMAN ANGEL L. ORTIZ, Vice Chair COUNCILMAN DAVID COHEN COUNCILMAN W. WILSON GOODE, JR. COUNCILWOMAN BLONDELL REYNOLDS BROWN COUNCILMAN FRANK RIZZO - - - VINCENT VARALLO ASSOCIATES, INC. Registered Professional Reporters Eleven Penn Center, Suite 600 Philadelphia, PA 19103 (215) 561-2220 2 I N D E X Juan Ramos, Director . . . . . . . . . . . . . 6 Fair Labor Standards Unit, City of Philadelphia Joseph Rauscher, President . . . . . . . . . . 12 Philadelphia Council of AFL-CIO Pat Coughlan, President and Business Manager 15 Local 274 3 P R O C E E D I N G S
Good evening, we're going to start. First I'd like to thank everyone for coming this evening. Hopefully, we will be able to do this relatively quickly. It's my understanding that we have another stadium town meeting tonight -- I'm sure all of you would like to stay and hear that. First of all, I'd like to thank the members of the unions and all of the participants and the heads of the unions for working with us on this particular bill in the prior hearing. Councilman Ortiz gives you all a hand. This is a hearing that was recessed until today. First I'd like to make note that Councilwoman Blondell Reynolds Brown is available, Councilman Ortiz, Councilman Cohen, and Councilman Wilson Goode. I thank you all. Today, we will have opening remarks on this bill, Bill No. 000108, but before we do that, I would like to ask Councilman Ortiz, would he like to make some opening remarks?
I'll just make one 4 4/25/00 LABOR, CIVIL SERVICE - BILL 000108 short statement, Mr. Chairman. If anything had proven the necessity for this bill -- and sometimes things occur in very different ways that faith sort of dictates certain things, but on the day that were having the first hearing on this bill, the building at Fifth and Chestnut was getting transferred in terms of contract. And the first thing the contractor did, when he took over the Lafayette Building at Fifth and Chestnut, is that he fired his whole janitorial workforce that same day, leaving, I think, over 70 or close to 85 individuals out of work. And so if we needed any proof -- not -- forget Los Angeles and their agreement that they achieved just this week in terms of this same sort of issue, if anything, proved that this bill is necessary, that action at the Lafayette Building did. And I think it's necessary, I think it's about time, and I think it's something that -- we have stood up for developers in this Council and we have stood up for the other individuals, so it's about time that we stood up for the working-class people of this city. 5 4/25/00 LABOR, CIVIL SERVICE - BILL 000108 Thank you, Mr. Chairman. (Applause.)
Thank you, Councilman. Let the record reflect that Councilman Fran Rizzo has now joined the committee hearing. Will the clerk will please read the title of the bill.
Bill No. 000108, enacting a new Chapter 9-2300 of the Philadelphia Code, entitled "Protection of Displaced Contract Workers," and amending Section 19-2602, entitled "Licenses," to require that all contractors awarded contracts for the performance of food and beverage, hotel service, health care, janitorial, or building maintenance services within the City of Philadelphia retain certain non-supervisory employees of the previous contractor for a 90-day transition employment period during which period retained employees may not be terminated, except for cause, and to require that said employees be provided with various other job security protections, providing penalties for noncompliance including, but not limited to, revocation of the 6 4/25/00 LABOR, CIVIL SERVICE - BILL 000108 business privilege license of violators, and granting remedies to aggrieved parties, all under certain terms and conditions.
Thank you. I understand that we have three individuals to testify today. I'd like to ask Mr. Ramos to step to the table. (Mr. Ramos comes forward.)
Yes. My name is Juan Ramos. The spelling of my last name is R-A-M-O-S, And the spelling of my first name is J-U-A-N. Mr. Chairperson, to my right is the Deputy Director of the Office of Labor Standards, Mr. Robert Glowry (ph.).
Distinguished members of City Council, my name is Juan Ramos, and I am the Director of the Fair Labor Standards Unit for the City of Philadelphia. I am here today to describe and explain how the passage of this bill would affect my department. 7 4/25/00 LABOR, CIVIL SERVICE - BILL 000108 The Philadelphia Labor Standards Unit, or the PLSU, was established in 1958 to enforce the federal and municipal prevailing-wage laws, as outlined in both the Davis-Bacon Act and in Section 17-107 of the Philadelphia City Code. Today, the PLSU consists of 8 employees, who are responsible for monitoring 9 approximately 500 ongoing projects throughout the 10 City. The PLSU is responsible for overseeing all projects conducted by any City operating department. The PLSU is also responsible for overseeing projects conducted by the Philadelphia Housing Authority, the Philadelphia Parking Authority, the Office of Housing and Community Development, and other similar agencies. Specific duties include, but are not limited to: involvement in a prebid meeting, involvement in a pre-construction meeting, ongoing site inspections, and weekly payroll monitoring. In addition to monitoring projects throughout the City, the Philadelphia Labor Standards Unit is responsible for developing, issuing, and maintaining the prevailing-wage rate schedule for all City contracts and all service contracts. 8 4/25/00 LABOR, CIVIL SERVICE - BILL 000108 While the PLSU faces a multitude of important duties and obligations, the PLSU remains a non-funded unit that operates out of the Managing Director's Office. Funding for our unit comes from a makeshift patchwork of organizations, including, but not limited to, the Philadelphia Housing Authority, the Philadelphia Water Department, and the Office of Housing and Community Development. Under the proposed ordinance, in addition to the duties and obligations stated above, the Department will be responsible for the enforcement of the bill. This would include: Providing notice of the ordinance to all persons currently engaged in the industries covered by the bill; Maintaining a current list of all business privilege license-holders for the industries covered by the bill; Investigating all complaints against any contractor, subcontractor, or awarding authority; Making written findings of all complaints filed; sending those findings to the 9 4/25/00 LABOR, CIVIL SERVICE - BILL 000108 complainant and the contractor and maintaining those findings on file; Upon request, providing any affected contractor with a hearing; Referring all complaints determined to have merit to the Department of Licenses and Inspections for revocation of the offending person's business privilege licenses; And monitoring the operations of contractors to ensure compliance with the ordinance. The addition of these tasks will place both a new financial burden and an increased personal challenge upon the Philadelphia Labor Standard Unit. A financial impact statement prepared by the Department of Licenses and Inspections, who was initially named as the enforcing agency under the ordinance, projected that approximately $477,698 would be necessary to meet the enforcement responsibilities as outlined in the ordinance. L&I also estimated that seven additional employees would need to be hired, trained, and stationed in order to meet the duties outlined in the ordinance. I expect that the PLSU 10 4/25/00 LABOR, CIVIL SERVICE - BILL 000108 would incur the same costs and personnel expense as L&I in order to meet obligations of the bill. As I have stated, the PLSU already faces the challenge of being an unfunded unit. These new duties would add an additional burden upon our already fiscally challenged unit. Additionally, these new responsibilities would divert the PLSU from its original purpose and mission -- to maintain and enforce the federal and municipal prevailing-wage laws.
I feel that it is of particular importance to note that without additional funding to support the new duties, the PLSU will be forced to make severe reductions in the amount of time it spends monitoring prevailing-wage issues in this city. This is significant not only for the prevailing-wage products that the PLSU's already oversees, but also for the prevailing-wage projects that the Philadelphia Labor Standard Unit may be responsible for overseeing in the future. For example, at the present time, the PLSU is currently exploring the feasibility of monitoring and enforcing prevailing-wage issues within the Philadelphia School District. Such expansion 11 4/25/00 LABOR, CIVIL SERVICE - BILL 000108 would, at best, suffer; and, at worst, be unlikely if the PLSU were also responsible for enforcing this bill. Members of City Council, these are some of the challenges facing the PLSU if this bill is passed and the Unit is ultimately responsible for enforcing Bill 108. I would appreciate your consideration of my testimony in your deliberations, and I thank you for inviting me to speak here today.
Thank you, Mr. Ramos. Are there any questions from members of the committee? (No questions.)
Thank you, sir. I'd like to call Mr. Rauscher and Mr. Coughlan. (Witnesses come forward.)
Gentlemen, if you see a dolly go under your chair, get up quickly, 'cause I don't want to see you go away. (Laughter.)
Please state your 12 4/25/00 LABOR, CIVIL SERVICE - BILL 000108 name for the record.
Mr. Chairman, I'm Joseph Rauscher, R-A-U-S-C-H-E-R, President of the Philadelphia Council of AFL-CIO. And I believe that our testimony today is very, very important because this might affect the City Councilpeople that are being displaced out of their chairs. (Laughter.)
But I thank you for this time, and I will be very, very brief, 'cause all I came here to say today, after all of the testimony that you've heard at the last one, two or three meetings that you had on this is that this is a very, very important thing. Councilman Ortiz touched on it, that it always seems like it's the poorest of our workers, the lowest paid of our workers, who do nothing but get up in the morning, go to work, raise their families on the meager salaries that they get that they have to fight for, have a little bit of health and welfare coverage because they're union members. And, hopefully, if they live and survive long enough, they'll have a pension when they retire and be able to enjoy the rest of their 13 4/25/00 LABOR, CIVIL SERVICE - BILL 000108 life. There are people out there in management that -- and it's nothing new, it's no 5 surprise to anybody that it's strictly the bottom line, everything is dollars and cents to these people. Take the building at Fifth and Chestnut, some of those people worked there between and 9 30 years, I believe. Now, again, these are people 10 that just went to work; I mean, they didn't ask for anything, they probably never set foot in this body, coming down here demanding things from you people. They belong to their union because they believed in it, they believed in the brotherhood and sisterhood of being together, and they felt that they were protected. And what happens? The building's sold, and within a matter of almost hours, they're told to go clean out their lockers, that they're no 20 longer necessary. Now, if these people made $10 an hour, they were making a lot of money. Now, it's something in this day and age, with that happening, is just not right. And I urge you -- I know every one of you sitting up there and your brothers and sisters of Council 14 4/25/00 LABOR, CIVIL SERVICE - BILL 000108 that are not here today, that this is something that is good for everybody, it's something that you're going to get that good feeling in your heart. And you newer members of City Council, this is what it's all about. I mean, you've got a chance now to do something for people that really can't help themselves, that need you, need us to do it. So, again, I'm not going to give a long speech. I just urge you, and I know you will do the right thing. And this should be coming out of this body when it's done unanimously, and we should be a model for the whole country of doing something like this. So I thank you for your time. Anything I can do to assist, I'll be very, very happy to do it. Thank you very much.
Mr. Coughlan? 15 4/25/00 LABOR, CIVIL SERVICE - BILL 000108
Thank you, Mr. Chairman. My name is Pat Coughlan, through C-O-U-G-H-L-A-N, and I'm the President and Business Manager of Local 274, the hotel employees, restaurant employees. Mr. Chairman and Members of Council, I too will be brief, we've had quite a few conversations in the last couple of weeks ago on this bill. I think back to the campaign, the mayoral campaign a few months ago that we just came through, and we listened to our current mayor talk about the little people in Philadelphia. And if any bill epitomizes protecting the little people in Philadelphia, this is certainly that bill. Service workers take pride in their jobs. They're not the highest paid members or citizens of Philadelphia, but they are some of the proudest workers we have in Philadelphia. And most service workers live in the City, unlike some of the higher-paid workers that we have who live in the suburbs. We have protections in this city for 16 4/25/00 LABOR, CIVIL SERVICE - BILL 000108 higher-paid workers. Teachers have tenure, construction workers have prevailing-wage protections, developers get tax breaks, developers are given free land to build. But yet, the little people, the service workers, don't have don't have those protections. I could tell story after story after story in my years as a business agent with 10 Local 274 of cafeterias, even hotels, restaurants 11 under new management, where someone would come in, 12 and all of the workers are escorted out of the 13 building, and they don't have a job. One that 14 really sticks in my mind happened a little more 15 than a year ago. There was a rally and, of all days, Martin Luther King's birthday, at Community College. That's almost a 100 percent union- organized university in Philadelphia when it comes to the Community College-employed staff. But the contract workers were food workers, and they were employed by a Philadelphia contractor Aramark, who, by the way, if Aramark takes over a service contract, it is usually their policy to rehire the workers. That's a Philadelphia-based company. They normally do not displace the workers. 17 4/25/00 LABOR, CIVIL SERVICE - BILL 000108 However, there was an organizing drive, and those workers proudly stood up and voted to unionize. Aramark began to negotiate with Local 274, but a company from outside of Philadelphia won the contract from the Community College Board of Directors, came in, and did not hire one of those cafeteria workers. Members of the Council, there is nothing that anyone can say that will convince me that the only reason those workers were not hired was because they were union members. There was no 13 call for that. Those were poorly paid workers to begin with, they had to pay for their own health care, so most of them didn't have it because they couldn't afford it, and none of them had a pension. Those were items that we were negotiating, and the new company was afraid of that, so they immediately terminated all of those workers. One day they came in and they found out they had no jobs. This is a bill that protects those workers' jobs for at least a short period of time. This bill doesn't guarantee that they would have pensions, this bill doesn't guarantee health 18 4/25/00 LABOR, CIVIL SERVICE - BILL 000108 and welfare benefits, this bill doesn't even guarantee wages. It just guarantee their jobs, and that's a protection that the little people of Philadelphia deserve. Thank you.
Any questions from members of the committee? (No questions.)
That being so, we will move from the public hearing into a public meeting. Can I move for a motion?
Mr. Chairman, I have 19 4/25/00 LABOR, CIVIL SERVICE - BILL 000108 some amendments to the original bill. On May 17th, if you can follow me, I circulated a memo in which all of the amendments are integrated, and I have the pink sheet. And on -, where it says "Service Contract, No. " The rest of the bill 19 remains the same. " That's just stylistic but it says a whole lot, because literate means two 20 4/25/00 LABOR, CIVIL SERVICE - BILL 000108 different things. " On of the pink sheet and on of the amended version, in Section 9-2303 labeled "Enforcement," the following words are added: "An employee who has been discharged in violation of this chapter by a successor contractor" -- that is eliminated and to be replaced by "An employee displaced or terminated in violation of this chapter may bring an action in a court of competent jurisdiction against the awarding authority to terminate a contractor and/or the successor contractor jointly or severally for violations of any obligations imposed under this chapter and may be awarded. " And going down to of the amended version, still on of the pink, it says, under Section 9-2303, it's still an enforcement in 21 4/25/00 LABOR, CIVIL SERVICE - BILL 000108 number 5. " This is a new addition, and you see it and I'm not going to read it, but we're going to just add it because there's a notice both in English and Spanish that will be added to the legislation, that will be sent to any displaced worker or any worker who is going to be displaced, and it's in both English and Spanish. And we will add other languages as needed. , we're adding a new section d. In Section 2, Section 19-2602 of the Philadelphia Code is amended to road as follows: "19-2602 Licenses," after 4, a new insert will read, "The Department of Licenses and Inspections shall refrain from issuing or shall revoke the business privilege license of any person who, under color of such license, intends to operate or is operating in violation of the provisions of subsection 1292602-(4)(b) or (4)(c) or (4)(d) or 22 4/25/00 LABOR, CIVIL SERVICE - BILL 000108 (4)(e) and shall take all steps necessary to terminate the business operations of any business establishment that has violated any subsection, including, but not limited to the following. . " And then we add the following: "e. Refrain from violating any provision of Chapter 9-230 of the Philadelphia Code, entitled 'Protection of Displaced Workers,' the Philadelphia Labor Standards Unit" (and this is an added amendment) "shall have the responsibility for the enforcement of the provisions of this subsection and in connection therewith shall: "(1) cause a notice containing the provisions of this ordinance to be sent to all persons currently engaged in performing food and beverage, hotel service, health care, janitorial or building maintenance services within the City of Philadelphia, as indicated on the obligation for Philadelphia business tax account number filed with the Revenue Department, and to all persons who shall, in the, future indicate on their application for Philadelphia business tax account number filed with the Revenue Department that they intend to engage in such businesses; 23 4/25/00 LABOR, CIVIL SERVICE - BILL 000108 "(2) maintain a current list of all business privilege license-holders for performing food and beverage, hotel service, health care, janitorial and building maintenance services within the City of Philadelphia; "(3) investigate all complaints against any contractor, subcontractor, or awarding authority in connection therewith or with respect to any investigation shall have full power and authority to subpoena any witnesses, books, records, and other data of any person for the purposes of obtaining information pertinent to such investigation.
The director of the Philadelphia Labor Standards Unit shall make a finding in writing with respect to each complaint filed and shall send a copy thereof to the complainant, and the contractor shall maintain it on file. " And those are the amendments, Mr. Chairman. The rest stands as is.
Thank you, Councilman. Any witnesses on the amendments? (No response.)
There being none, I'll ask for motion on the amendments.
All in favor? Opposed? The amendment is adopted. I'd like to move for a motion on Bill 24 000108, as amended.
I so move. 25 4/25/00 LABOR, CIVIL SERVICE - BILL 000108 (Duly seconded.)
All in favor? All opposed? The ayes have it, and Bill No. 000108 has been reported out of this committee with a favorable recommendation. (Applause.)
Thank you all very much. (Adjourned at 5:45 p.m.) - - - C E R T I F I C A T E I HEREBY CERTIFY that the foregoing proceedings of the Council of the City of Philadelphia of Tuesday, April 25, 2000, were reported fully and accurately by me, and that this is a correct transcript of same. RE: COUNCIL COMMITTEE ON LABOR AND CIVIL SERVICE BILL NO. 000108 __________________________________, JOSEPHINE CARDILLO, Registered Professional Reporter