(a) Purpose; Application; Exclusions. The intent of the following provisions is to ensure that the City does not enter into any contract for services in excess of fifty thousand dollars ($50,000.00) with any contractor or grantee who does not pay its work force a living wage as defined in this section.
(b) Definitions. For purposes of this section the following terms and phrases shall be defined as follows:
(1) "Contract for services" shall mean the act of entering into a contract to perform services, including the subcontracting of services, however, contracts for the purchase of goods and contracts to lease or purchase property, or professional consulting services, are excluded.
(2) "Contractor" shall mean a person that contracts with the City to perform services for it.
(3) "Employee" shall mean an individual who is employed by another to provide labor in exchange for payment of wages or salary.
(4) "Employer" shall mean the person who engages employees to provide labor in exchange for payment of wages or salary.
(5) "Federal Poverty Line" shall mean the official poverty line defined by the office of management and budget based on bureau of census data for a family of four, as adjusted to reflect the percentage change in the consumer price index for all urban consumers.
(6) "Health care benefits" shall mean the right granted to an employee under a contract, certificate or policy of insurance to have payment made by a health care insurer or health care corporation for specified medical or health care services for the employee and dependents.
(7) "Living wage" shall mean an hourly wage rate which is equal to or greater than the Federal Poverty Line established for a family of four for a 40-hour work week, 50 weeks per year.
(8) "Person" shall include firms, joint ventures, partnerships, corporations, clubs, and all associations or organizations of natural persons, either incorporated or unincorporated, however operating or named, and whether acting by themselves or by a servant, agent or fiduciary, and includes all legal representatives, heirs, successors and assigns thereof.
(9) "Plant Rehabilitation and Industrial Development District Act" shall mean Public Act 198 of 1974, M.C.L.A. 207.551 et seq.; MSA 7.800(1) et seq.
(c) Limitations on Contracts for Services. The City shall not enter into any contract for services with any contractor who does not file with the City a sworn attestation, and demonstrate, if requested, that it pays its work force a living wage which is equal to one hundred and twenty-five percent of the Federal Poverty Line, unless health care benefits are provided to its employees equal to the level of benefits customarily provided in the industry, then the contractor shall demonstrate that it pays its work force a living wage which is equal to one hundred percent of the Federal Poverty Line. The contractor shall be required to maintain this rate of pay for the duration of the contract period.
(d) Compliance with Adjustments in the Federal Poverty Line. The Finance Director, his or her designee or other employee designated by City Council shall serve as the Contract Compliance Auditor. The Contract Compliance Auditor shall monitor the Federal Poverty Line and shall notify anyone with a service contract with the City of any adjustment in the Federal Poverty Line. The Contract Compliance Auditor shall require all contractors with service contracts with the City to annually demonstrate compliance with the requirements contained in subsection (c) hereof. In addition, any contractor who is required to pay its work force a living wage under subsection (c) hereof shall post a notice of such requirement in the work place during the contract period. The notice shall also state that if the contractor has failed to comply with the requirement of subsection (c) hereof that the employee may file a notice of noncompliance upon the City Contract Compliance Auditor and serve a copy on the contractor.
(e) Notice of Noncompliance. Any employee of a contractor who believes the contractor has failed to comply with subsection (c) hereof shall file a notice with the Contract Compliance Auditor and serve it on the contractor alleging noncompliance. Upon receiving the notice alleging noncompliance, the Auditor shall forward a copy to the Living Wage Appeal Committee for review. The Auditor shall determine the accuracy of the allegation and shall notify the contractor to submit proof of compliance within 30 days or it shall be grounds for termination of the contract.
(f) Noncompliance. In the event the Auditor determines that a contractor has failed to comply with the provisions of this section, the failure to rectify the noncompliance within 30 days shall be grounds for the termination of a contract for services.
(g) Limitation on Bid Acceptance. The City shall not accept any bids for a period of five years from any contractor who, while contracting with the City, had failed on two separate occasions to comply with subsection (c) hereof during the previous five-year period.
(h) Exemptions from Application of this Section. Exemptions from compliance with the provisions of this section shall apply to the following:
(1) Any public corporation shall be exempt from the provisions of this section;
(2) Any private corporation that has received SOI(c)(3) qualification, which has ten employees or less, shall be exempt from compliance with this section;
(3) Any employees covered by a collective bargaining agreement;
(4) Where federal, state, or local law requires payment of a prevailing wage;
(5) Any employee enrolled in a job training program, seasonal employment program, recreation services or work study program;
(6) A proposed contract implemented through the Downriver Community Conference;
(7) Payments in the form of grants provided, however, when a payment of funds is made for the purpose of purchasing services, property, or goods on behalf of individuals being assisted by a covered employer (sometimes known as a "pass through" grant), said purchases shall not be considered a grant; such funds shall be considered a grant only to the extent that any such funds are retained by the covered employer to provide financial assistance and support to its own operations; or
(8) When necessary to avoid violation of any federal, state, or local law.
(i) Appeal from Application of this Section. Any person desiring to contract with the City shall have the opportunity to appeal the application of this section to the Living Wage Appeal Committee. The appeal must be filed with the City Administrator at least 15 days prior to the deadline for the submission of bids. The Living Wage Appeal Committee shall consider the request at a public meeting convened in accordance with the Open Meetings Act (being P.A. 267 of 1976). The Committee may exempt a contractor from the application of this section upon demonstration of the following:
(1) Hardship. In cases in which compliance with this section would cause demonstrable financial hardship
(2) Resulting Harm. In cases where the benefit of applying this section is clearly outweighed by the harm resulting from its application.
(j) Membership of the Living Wage Appeal Committee. The Living Wage Appeal Committee shall consist of five members: the Mayor or designee; the City administrator or designee; a member of the City Council or designee; a member of the Southern Wayne County Chamber of Commerce as designated by the Mayor and confirmed by City Council; and a Southgate resident nominated by the Michigan State AFL-CIO, appointed by the Mayor and confirmed by the City Council. Each member of the Committee shall serve for a three-year term. The Committee shall meet as necessary to review any appeal filed for exemption from the application of this section.
(Ord. 741. Passed 2-13-02.)