PURPOSE
The purpose of this policy is to provide pr ocedures for the authorization of travel and payment of travel expenses for Ci ty employees attending conferences, training, and meetings. The po licy will ensure that all tr avel related expenses are reasonable and necessary for the conduct of City business.
For the purposes of this policy, City em ployees shall mean all full-time or part- time exempt and non-exempt employees. Temporary or contract employees must receive express authorization in advanc e from the Assistant City Manager or designee for all travel related expenses.
Any exceptions to this policy must be ap proved by the Department Head and the Assistant City Manager or designee.
PROCEDURE
A. Extended Travel
1) Authorization for Travel
Prior to the commitment or expenditure of any City funds for extended travel (requiring an overnight stay or airfare), the employee shall obtain approval for the event from a Depart ment Head or C ouncil Appointed Officer (CAO). This authority cannot be delegated. The authorization for out-of-state extended trav el must also be approv ed by the Assistant City Manager or designee.
No individual may authorize his/her own travel. Department Head travel shall be approved by the City Manager or designee and CAO travel shall be approved by the Assistant City Manager or designee.
A Pre-Travel Authorization form shall be used to request approval and to document an estimate of total expenses (i.e., registration fees, lodging, transportation, and meals). A copy of the official event brochure and/or agenda of the event that describes the schedule of sessions, provided transportation and meals, and other amenities of the event must be attached to the form. IRS per diem rates shall be used for calculating estimated meal expenditures.
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The Pre-Travel Authorization form includes boxes that must be checked by the employee and verified by the Department Head, CAO, Assistant City Manager or designee, or City Manager or designee to indicate that:
Government rates have been requested for hotel and registration Employee agrees to submit a Travel Expense Report within 30 days after return from the trip
Professional Development will be us ed to reimburse employee for the travel or training (if applicable)
Department Head/CAO/Assistant City Manager/City Manager approval indicates that:
Government rates for hotel and registration have been verified The request complies with the City’s Travel Policy and Procedures Applicability of using Professiona l Development funds has been determined
The original approved Pre-Travel Authorization form, along with the official event brochure and/or agenda of the event, should be maintained by the department and submitted with th e Travel Expense Report at the appropriate time.
2) Travel Arrangements
Departments are encouraged to make travel arrangements (registration fees, lodging reservations, air transportati on, and rental cars) on the Internet, utilizing a procurement card for paymen t. A copy of the approved Pre- Travel Authorization form should be attached to the monthly procurement card activity log.
3) Reimbursable Travel Expenses
a) Registration Fee
Registration fees for those expenses indicated in the published event materials. Government rates and/or any discounts offered for early registration should be obtained whenever possible.
b) Lodging Expense
Travelers shall select single o ccupancy, standard, non-deluxe accommodations and should stay at hotels offering economical ITEM 4
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lodging rates. Travelers attendi ng a conference or seminar are encouraged to stay at conference hotels, which offer a negotiated conference rate. When making rese rvations, travelers should request government rates, if available. Traveling employees should carry their City identification cards.
The City shall not reimburse any co st related to the extension of a hotel stay beyond the time necessar y to complete th e event. An out- of-state trip involving cross-co untry travel may require hotel accommodations both before and after the conference or training.
Within California or adjoining stat es an extra night’s hotel stay should not be necessary if flight arrangements can be made the same day.
The use of hotels is restricted to cities located beyond 50 miles (one- way) from the City of Palo Alto or the traveler’s residence (whichever is shortest). For ex ample, if the destination is Sacramento and you live in Palo Alto (118 m iles) or Oakland (81 miles), you would qualify for a hotel. However, if you live in Vacaville (35 miles) or Lodi (36 miles) you would not qualify for a hotel.
c) Transportation
Air Transportation
Travelers shall fly economy coach cl ass on the lowest cost flight available for the most direct rout e to the final destination, which could reasonably include schedul ed layovers. Travelers are encouraged to make air reservations as early as feasible to obtain the greatest discount and to consider the use of alternate but nearby airports to take advantage of the lo west fares. Extension of the trip to cover a weekend stay to obtain a lower ai rfare does not entitle the traveler to be reimbursed for the extra day's hotel costs or meal expenses. Travelers may use City travel to qualify for frequent flyer credits, but the selection of an air line for a given trip shall not be made for the purpose of accumulati ng such credits. Travelers that choose to use their personal frequent flyer miles for City business shall not be reimbursed for the valu e of the tickets. If the airline charges for all checked baggage, the City will cover the cost for one checked bag only. Excess baggage charges are not reimbursable.
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Rental Cars
Rental cars shall only be approved, if other ground transportation, such as shuttles or taxis, is more expensive during the stay at the destination. Only economy or co mpact car models may be rented, unless the upgrade is provided by the rental agency at no cost. Rental car options such as GPS devices are not reimbursable. Because the City is self-insured, employees should decline any additional insurance offered by the rental company. Employees must also decline any Fuel Purchase Options (which allow for prepayment of a gas tank refill) and shall refuel prio r to returning the rental car, if additional charges apply for refueling. Use of a rental car, in lieu of a private auto, to travel to and fr om an out-of-tow n event will be reimbursed either at the current IR S mileage rate or the car rental cost apportioned for the number of days used for City business, whichever is less.
Private Automobiles
Employees may use private automo biles for personal or group transportation on extended trips. Re imbursement shall be made at the current IRS mileage rate. The di stance to be reimbursed shall be measured from the place of work and from the employee’s home, and the calculated mileage reimbursement shall be based upon which of the two distances is shorter. Mileage reimbursement shall not exceed the cost of refundable roun d trip air transportation (economy class) for a reservation made at l east seven days in advance of the trip.
City Pool Cars
City pool cars normally may not be used for transportation on extended trips. Requests for use of City vehicles for this purpose should be directed to the Fleet Manager, Equipment Management Division, Public Works. For use of vehicles assigned to specific divisions and/or individuals, refer to Vehicle Use Policy and Procedures 4-1.
d) Meals
Effective April 27, 2 015, the City will provide a per diem (“per day”) allowance for meals and inci dentals to employees who travel overnight for official City business. Travelers will receive a flat rate for meals and will not be required to submit receipts. If travelers use a P-Card to pay for meals, it negates the per diem.
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The per diem rate varies and is dependent on the destination of travel. The rates for the various travel destinations are available on the U.S. General Services Administration website
(http://www.gsa.gov/portal/content/104877) (these amounts are subject to change every year). Each city has a dollar value for the full day depending on the relative cost of meals in that jurisdiction.
When meals are provided as part of the cost of an event, that meal will be deducted from the full day per diem rate. Travelers will receive 75% of the full day per diem amount for days requiring transportation to and from the location (i.e. departure day and return day) regardless of departure and arrival times. Meals provided on days of travel shall be deducted at full-value.
Travelers are required to look up the per diem rates as part of the pre-approval authorization process.
e) Incidental Expenses
Incidental expenses related to C ity business shall be reimbursed at cost as supported by submitted recei pts. Incidental expenses may include hotel parking charges, In ternet connection services, and telephone charges.
The actual costs for parking will be reimbursed when approval to use a personal vehicle or rental car is obtained in advance. Travelers should use the lowest cost alternative for parking within a reasonable area from the destination. Internet connection services purchased to conduct City business are reim bursable. Employees will be reimbursed for telephone calls to City of Palo Alto offices. The hotel bill should indicate any calls that are of a business nature.
Reimbursement for calls home is limited to one call per day of reasonable length. Other charges on the hotel bill, such as pay-TV movies, cleaning, laundry, room service charges (additional over cost of meal) or charges for additional guests are not reimbursable.
4) Travel Expense Report
Within thirty business days after th e employee's return from the trip, a Travel Expense Report must be filed with the Accounting Division of ASD.
Employees are encouraged to complete the Travel Expense Report electronically in Excel. Employees sh all print and sign the Travel Expense Report. When signing the Travel Ex pense Report, the employee certifies that the expenses listed on the Repor t were incurred in conformance with ITEM 4
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the Travel Policy and that the “am ount due the employee” has not been received from any other source. The original Pre-Travel Authorization form must be attached to the Travel Expense Repo rt. The filing of this report is necessary whether or not reim bursement is requested in order to document to the IRS that the tr avel expenses do not constitute miscellaneous income to the employee. If this report is not filed within the required thirty working days, no future travel requests will be processed for the individual until outstanding travel and expense claims are complete.
The Travel Expense Report must ac count for all expenses, including expenses paid by the procurement card, and all expenses must be supported by itemized original receipts or copi es of electronic receipts. For air transportation, the original airline tic ket or flight confirmation printout should be attached. It is not sufficient to provide Internet quotes or pre-stay web confirmations for air travel or lodging. For expenses paid with the P- Card, the original receipts must be a ttached to the P-Ca rd statement and copies of the receipts should be attached to the Travel Expense Report.
The Travel Expense Report must be approved by the Department Head/CAO or designee. (Each department/office provides a list of designated approvers to ASD on an annu al basis). Department Head travel shall be approved by the City Manager or designee and CAO travel shall be approved by the Assistant City Ma nager or designee. Department Head/CAO approval is required for any expenses that were not authorized on the Pre-Travel Authorization form. For missing documentation, the traveler shall attach a written expl anation detailing th e expenditure and reason for the missing receipt, and obtain Department Head approval.
If reimbursement is due to the employe e, a check will be issued to the employee using the Travel Expense Report (no separate claim voucher is needed). If the reimbursement amount is $150 or less, the employee may request reimbursement via petty cash.
B. Local One-Day Travel
Employees shall obtain verbal approval fo r one-day local travel (not requiring airfare and/or an overnight stay) fro m his/her Department Head, Assistant Department Head, Deputy Director, Divisi on Head or designee prior to the traveler’s departure. Designees must be management staff. A Pre-Travel Authorization form is not required for local travel.
Typical reimbursable expenses for loca l travel include mileage, public transportation, parking, bridge tolls, me eting or conference registration fees, ITEM 4
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and meal expenses. Only expenditures su pported by itemized receipts will be reimbursed.
Travelers may be reimbursed for meal e xpenses. Itemized receipts for meals must be maintained. The maximum reimbursement amount for meals shall be:
$15.00 for breakfast, $16.00 for l unch, and $28.00 for dinner. Under no circumstances will expenses for alcoholic beverages be reimbursed by the City.
Meal reimbursements for local conference s, meetings, or training conducted between the hours of 8 a.m. and 5 p.m., will be limited to lunch. When meals are provided as part of the cost of an event, travelers will not be reimbursed for the actual expenses of these meals.
Local travel meal expenses that do no t meet the IRS defi nition of “business related” will be considered taxable inco me and added to th e employee’s W-2.
For a meal to be considered non-taxabl e, it must be “directly related” and “associated with” the active conduct of C ity business. To meet this definition, business must be conducted during the me al period. Meal expenses associated with training do not meet the IRS defi nition of a business related meal. Such meals will be considered taxable income and added to the employee’s W-2.
For all meal expense reimbursements, the form should include an explanation of why the meal was necessary for the conduct of City business.
C. Night Meeting Meals
Meals taken by management employees as signed to attend night meetings will be reimbursed for actual dinner expenses up to $20. Itemized receipts for meals must be maintained. Reimbursement shoul d be requested on a Citywide Petty Cash Reimbursement form. To obtain the form, refe r to the City’s Petty Cash Policy. The Petty Cash Reimbursement form must be accompanied by the meeting agenda.
Night meeting meal reimbursements are considered taxable income and will be added to the employee’s W-2.
D. SEIU Overtime Meals
Meals taken by SEIU employees wo rking emergency and non-emergency overtime will be reimbursed in accordance with the contract between the City and SEIU, currently in the amount of $1 0 for breakfast, $15 for lunch, and $20 for dinner. No receipts are required. Reimbursement should be requested on a Citywide Petty Cash Reimbursement form.
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E. Reimbursement for Personal Vehicle Use on City Business
City pool cars, assigned vehicles or pub lic transportation should be used for trips between City facilities, to local m eetings/training, or other events outside the City limits but within the Bay Area whenever possi ble. If a city vehicle or public transportation is not available or feasible, personal cars may be used and mileage will be reimbursed at the preva iling IRS rate for the distance between the employee’s home and the destinatio n or work and the destination, whichever is less. Mileage reimbursement requests shall include the number of miles driven, the employee address, and the purpose of the trip.
Reimbursement requests that cover more than one date will be accepted on one form if the trips are for the same purpose or meeting.
Recipients of an automobile expens e allowance may not receive personal vehicle mileage reimbursement, except in the case of business travel beyond the Bay Area counties of Santa Clara, Al ameda, Contra Costa, Solano, Napa, Marin, San Francisco, San Mateo an d Sonoma. In addition, CAO’s and Department Heads who receive an auto mobile expense allowance in lieu of exclusive use of a City automobile may not use City pool cars for business use except on an emergency ba sis, which is documented by memo to the City Manager.
NOTE: Questions and/or clar ification of this policy sh ould be directed to the Administrative Services Department.
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6 City Council
STAFF REPORT
From: City Manager
Report Type: ACTION ITEM
Lead Department: Public Works
Meeting Date: January 30, 2023
Title
Review and Provide Direction on Wage and Benefits Requirements for Inclusion in a New Janitorial Services Request for Proposal (RFP)
Recommendation
Staff recommends that Council review and provide direction on the wage and benefits requirements for the new Janitorial Services Request for Proposal (RFP).
Executive Summary
Staff is seeking Council direction on wage and benefit requirements for inclusion in a new janitorial services RFP that will solicit proposals to service City facilities. To assist Council in the discussion, options are presented for further input.
Wage and benefit requirement options:
Option 1 City-Determined Wages/Benefits: Total wage and benefits of $20.84 (estimated)
Option 2 PUC Prevailing Wage/Benefits: Total wage and benefits of $29.98 Option 3 PUC + Union Wage/Benefits: Total wage and benefits of $29.98 or higher
Adding two additional janitorial job classifications for a total of seven classifications with higher pay requirements for more demanding or highly skilled work
Councilmember Burt and Vice Mayor Stone, through a Colleagues Memo, have recommended that a new janitorial contractor be required to provide PUC prevailing wages and benefits at a minimum and require employees be covered by a collective bargaining agreement.
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6 This item was originally agendized for Council’s November 14, 2022 meeting but was continued.
To avoid a gap in janitorial services, Council approved an amendment to extend the current contract by six months. The new contract expiration date is August 31, 2023. Council direction on RFP wage and benefit requirements is critical to proceeding with the RFP. Following the RFP process, staff will bring forward a new contract for Council consideration in spring 2023.
Background
The City’s current janitorial services contract expires on August 31, 2023. The contract was for a five-year term beginning in 2017, with six-month extensions approved by Council in June 2022[1] and December 2022 [2]. Past janitorial contractors struggled to meet the City’s contract performance standards. As part of the 2017 procurement, staff placed greater emphasis on meeting performance solutions and adequate staffing levels. As part of the 2017 RFP requirements and evaluation process, staff recognized that emphasis on characteristics such as paying a higher wage and provision of health care and paid time off benefits would support the goals of a more reliable and higher performing work force. The current contractor proposed the highest employee hourly wage, provided paid time off, and health and welfare benefits to their employees. Wages and benefits were included in the contract terms given their importance in determination of the successful bidder. The improvement from previous contractors has been dramatic. The contract custodial staffing has been well-managed by the current contractor, with a significantly improved employee retention rate. Staff receives infrequent to no complaints of service levels, a significant improvement from the daily complaints of missed or poor services experienced with prior service providers.
Discussion
An RFP to solicit responses for janitorial services has been drafted and is ready for issuance pending refinements as directed by the City Council as part of this item. The RFP retains key changes from the 2017 RFP model to eliminate past contractor performance issues and focus on quality and consistency of services by: requiring a minimum level of staffing, requiring a minimum level of management, and requiring a minimum cost for material and supplies to help contractors bid the job more accurately.
In addition to the continuation of 2017 RFP requirements, the current draft RFP specifies two new requirements:
1. Baseline wage and benefit requirements for the contract: This provides a degree of transparency in the proposers’ cost structure, clarity of objectives, and hopefully ensures meeting goals of high retention rates as currently have been experienced.
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6 2. Defines two proposed additional janitorial job classifications for a total of seven classifications: This provides higher wage requirements for more demanding or highly skilled work (see Table 1 below).
Wage requirements, referenced as ‘City-determined Wages’ in Table 1, are essentially a continuation of the wages required by the current contract. For example, the current contract hourly wage for the Custodian classification is $17.39, while the hourly wage contemplated for the RFP is $17.50. This figure could be adjusted higher based on CPI. This remains in compliance with the City’s minimum wage effective January 1, 2023 of $17.25 per hour.
Staff has also considered requiring proposers to include alternative pricing based on the California Public Utilities Code (PUC) prevailing wage for Janitor/Cleaner work in Santa Clara County (Attachment A). While the PUC prevailing wage requirements do not legally apply to the City’s janitorial services, they can be used to define a standard for wages and benefits for this work in Santa Clara County, albeit only for the single job classification of Janitor/Cleaner.
Concurrently, Councilmember Burt and Vice Mayor Stone have submitted a Colleagues Memo on this topic. The Colleagues Memo recommends that the new janitorial contractor be required to provide PUC prevailing wages and benefits at a minimum and have employees covered by a collective bargaining agreement.
Table 1 provides a comparison of hourly wage options for the new janitorial RFP. The PUC prevailing wage is only defined for “Janitor/Cleaner”, so it would apply to all of the custodian classifications that have been defined by the City. If Council directs that wages and benefits be based on the PUC prevailing wage, staff could also develop wage requirements for the classifications other than Custodian, using the PUC prevailing wage for Custodian as a basis. The hourly wage for Union janitorial employees where the wage must be equal to or greater than the PUC prevailing wage is not known, as it would be dependent on specific collective bargaining agreements. Consistent with the current contract, staff expects to include a proposed wage requirement of 3% annual wage increases over the five-year term, or to require increases in alignment with the PUC prevailing wage.
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6 Table 1: Comparison of Janitorial Worker Hourly Wage Options Applicable in May 2023 Classification City-determined
Wages*
PUC Prevailing
Wage
PUC + Union
Wage
Custodian $17.50 $20.00 $20.00 or higher
Parking Garage Custodian $19.50 $20.00 $20.00 or higher Parks Custodian $19.50 $20.00 $20.00 or higher
Utility Custodian $21.50 $20.00 $20.00 or higher
Lead Custodian $22.50 $20.00 $20.00 or higher
Police Department Custodian $25.50 $20.00 $20.00 or higher Supervisor $30.50 n/a unknown
*Classifications and wages developed by staff for the current draft RFP.
In addition to minimum hourly wages, the City’s current contract and the PUC prevailing wage require benefits such as time off and healthcare plans. Table 2 compares the total wages and benefits, expressed as an hourly total, for the three potential RFP options. Similar to the hourly wages comparison in Table 1, the wages and benefits for the for Union janitorial employees where wages and benefits must be equal to or greater than the PUC prevailing wage is not known, as they would be dependent on specific collective bargaining agreements.
Table 2: Comparison of Janitorial Worker Custodian Classification Wages and Benefits Expressed on an Hourly Wage Basis Applicable in May 2023
May-23
City-determined
Wages/Benefits
PUC Prevailing
Wage/Benefits
PUC + Union
Wage/Benefits
Hourly Staff Cost Wage $17.50 $20.00 $20.00 or higher
Sick & Vacation Benefits $0.34 $0.81 $0.81 or higher
1-week PTO 5-10 days vacation, 3
days sick
5-10 days vacation,
3 days sick or more
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6 Holiday $0 $0.46 $0.46 or higher
no paid holidays 4 holidays 4 holidays or more
Health & Welfare $3.00* $8.25 $8.25 or higher
Only after 24 months
of service
After 24 months of
service or earlier
Pension $0 $0.30 $0.30 or higher
401k optional
Leadership & Education $0 $0.09 $0.09 or higher
other training
Other Payment $0 $0.07 $0.07 or higher
Industry
Investigation Fund
Total Wage & Benefits $20.84 $29.98 $29.98 or higher
% Increase from “City-
determined
Wages/Benefits” n/a 44% 44% or higher
* Estimated based on Health & Welfare benefits provided under current contract.
As demonstrated in Table 2, transitioning to PUC prevailing wages results in an estimated 44 percent increase in labor costs for the janitorial service provider. Transitioning to PUC prevailing wages as a minimum with Union representation results in an estimated minimum 44 percent increase, dependent on the terms of the collective bargaining agreement.
It is possible for staff to proceed with the RFP requesting alternative pricing for more than one level of required wage and benefits. However, should Council direct the RFP to require a collective bargaining agreement, staff would recommend this be stated as a proposal requirement as individual proposers would likely either meet this requirement or not.
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6 Timeline
The current contract expires on August 31, 2023. Once staff receives Council direction on RFP wage and benefit requirements, staff will proceed with the RFP process, and will bring a new contract to Council for consideration in spring 2023.
Resource Impact
Funding for the current contract extended through August 31, 2023 (approximately $2.5 million annually) was appropriated as part of the Fiscal Year 2023 Adopted Budget, with funding for July and August 2023 subject to the Council’s appropriation of Fiscal Year 2024 funding. Based on input from Council regarding the wage and benefits requirements for the RFP, additional funding is expected to be needed and will be requested for appropriation when staff returns to Council to recommend contract award. Adjustments to the funding for this contract will also be recommended for alignment with the approved contract as part of the annual budget process for subsequent fiscal years, subject to the Council’s appropriation of funding. Council may also question the comparison of the costs described above with an alternative of providing janitorial services with City employees. A preliminary review indicates that an in-house alternative would cost at least 40 percent higher than the highest cost alternative shown here.
Policy Implications
The City does not have a practice of including discretionary wage and benefit requirements in its solicitations for services. Council direction for this janitorial contract RFP may lead to the conclusion that other services should have similar requirements.
Stakeholder Engagement
Staff is seeking direction from Council on wage and benefits requirements for the new RFP, and will conduct industry outreach based on direction received.
Environmental Review
No environmental review is required.
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6 [1] City Council Staff Report June 2022 ID# 14161 https://www.cityofpaloalto.org/files/assets/public/public- works/facilities/sr-14161-amendment-to-extend-term-with-swa-services-group-inc_1.pdf [2] City Council Staff Report December 2022 ID#14820 https://www.cityofpaloalto.org/files/assets/public/agendas- minutes-reports/reports/city-manager-reports-cmrs/2022/id.-14820-approval-of-amendment-no.-3-with-swa- services-group-inc.-swa.pdf
ATTACHMENTS
Attachment A: Prevailing Wage Sheet
Report #:
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5 Attachment A
GENERAL PREVAILING WAGE DETERMINATION MADE BY THE DIRECTOR OF
INDUSTRIAL RELATIONS PURSUANT TO CALIFORNIA PUBLIC UTILITIES CODE, SECTIONS 465, 466 AND 467
Determination: STC-2021-1Reference: 22-1877-2
Issue Date of Determination: December 22, 2021Supersedes Det: STC- 2019-1
Expiration Date of Determination: April 30, 2024*. Effective until superseded by a new determination issued by the Director of Industrial Relations. Contact the Office of the Director – Research Unit at (415) 703-4774 for the new rates after ten days from the expiration date if no subsequent determination is issued.
Locality: Santa Clara County
Craft: Janitor/Cleaner
Wage Rates: Classification Basic Straight-Time Hourly Rate Janitor/Cleaner Expires 4/30/2022 $18.25
Effective 5/1/2022 $19.25
Effective 5/1/2023 $20.00
Employer Payments: (Public Utilities Code Section 465)
Health & Welfare:$8.25 per hour after 24 months of service.
Paid Holidays:Five (5) holidays per year or $0.35 per hour after 60 days of service. Effective 5/1/2022 Five (5) holidays per year or $0.37 per hour after 60 days of service. Effective 1/1/2023 Six (6) holidays per year or $0.44 per hour after 60 days of service. Effective 5/1/2023 Six (6) holidays per year or $0.46 per hour after 60 days of service. Effective 1/1/2024 Seven (7) holidays per year or $0.54 per hour after 60 days of service.
Pension:$0.15 per hour after 90 days of service.
Effective 5/1/2023 $0.30 per hour after 90 days of service.
Paid Vacation:Five (5) days after 1 year of service or $0.35 per hour Ten (10) days after 3 years of
service or $0.70 per hour
Fifteen (15) days after 12 years of service or $1.05 per hour.
Effective 5/1/2022 Five (5) days after 1 year of service or $0.37 per hour Ten (10) days after 3 years of service or $0.74 per
hour Fifteen (15) days after 12 years of service or
$1.11 per hour.
Effective 5/1/2023 Five (5) days after 1 year of service or $0.38 per hour Ten (10) days after 3 years of service or $0.77 per
hour Fifteen (15) days after 10 years of service or
$1.15 per hour.
Paid Sick Leave:Three (3) days or $0.21 per hour.
Effective 5/1/2022 Three (3) days or $0.22 per hour.
Effective 5/1/2023 Three (3) days or $0.23 per hour.
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5 Training:$0.075 per hour.
Effective 5/1/2022 $0.08 per hour.
Effective 5/1/2023 $0.085 per hour.
Other Payment: $0.05 per hour to Industry Investigation Fund.
Effective 5/1/2022 $0.06 per hour to Industry Investigation Fund.
Effective 5/1/2023 $0.07 per hour to Industry Investigation Fund.
Bereavement Leave: Three (3) days paid leave and covers immediate family members (mother, father, spouse, son, daughter, brother, sister, grandmother, grandfather, grandson, granddaughter, and registered domestic partner).
Recognized Holidays: New Year’s Day, 4th of July, Labor Day, Thanksgiving Day and Christmas Day. If a holiday falls on a Sunday, it shall be observed on the following Monday. If a holiday falls on a Saturday, it shall be observed either on Friday or Saturday as determined by the employer. Effective 2023, add Memorial Day. Effective 2024, add President’s Day.
Straight-time Hours: Eight (8) hours per day. A week’s work shall consist of five (5) consecutive days.
Overtime Rate: All work performed in excess of 8 hours per day and on the 6th day shall be paid at one and one- half times (1½) the basic hourly rate. All work performed on the 7th day shall be paid double (2x) the straight-time hourly rate. Work on a holiday shall be paid at one and one-half (1½) times the basic hourly rate in addition to the regular day’s pay.
Travel and Subsistence: Employees required to furnish own vehicle between locations shall be reimbursed at the rate of the standard IRS mileage rate.
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CITY COUNCIL
COLLEAGUE’S MEMO
Sponsor(s): Greer Stone, Patrick Burt
Meeting Date: January 23, 2023
TITLE
Responsible Contracting Standards Colleague's Memo (Stone & Burt)
BACKGROUND
On March 21, 2022, speakers at the City Council meeting raised concerns over labor conditions and wages associated with the City’s third-party contract for janitorial services provided to the City of Palo Alto. On July 14, 2022, the San Jose Spotlight released an article detailing allegations of wage theft made by seven janitors that clean City facilities. left unaddressed, the City faces the potential risk for labor disruption, interruption of services, and turnover of its essential workforce. In addition, the city has a moral obligation to assure that the rights are protected of workers performing contracted services to the city.
Background and Discussion:
In 2017, the City awarded its current janitorial services contract. As part of the bidding process, City staff recommended the adoption of evaluation criteria to address issues with turnover and low-quality performance. On March 21, 2022, speakers at the City Council meeting raised concerns over labor conditions and wages associated with the contract. These concerns included failure to pay contract wages, failure to provide a clear “Paid Time Off” or vacation policy, failure to provide necessary materials to perform job duties, failure to reimburse expenses and mileage, failure to provide safety training or personal protective equipment, and failure to provide sufficient staffing.[1]
On September 15, 2022, Congresswoman Anna Eshoo wrote to Mayor Burt, recognizing “the prevalence of reported exploitation in the janitorial industry, employers must be vigilant to ensure that janitors are treated fairly.” Additionally, Congresswoman Eshoo encouraged the city to “take into consideration the labor practices of any janitorial contractor with which it engages.”[2] The City also received a letter on June 15, 2022, from State Senator Josh Becker, encouraging an investigation into allegations of wage theft, because “property service industries tend to have track records of high turnover, poor quality of service, and wage theft.
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These issues are particularly prevalent in the janitorial industry where exploitation, sexual harassment, and violations of wage and hour laws are commonplace.”[3] Assemblymember Berman also urged Palo Alto to “adopt a higher level of standards for these subcontracted services.”[4]
On July 14, 2022, the San Jose Spotlight released an article detailing the allegations of wage theft made by seven janitors that clean City facilities. The article cited a report by the Maintenance Cooperation and Trust Fund, a janitorial industry watchdog organization, which describes the predominantly female Hispanic janitorial workforce as “especially vulnerable” dealing with “greater hardships than many other types of low-wage”[5] workers. The article also made reference to a situation in 2019 at the City of Fremont, which faced a two day labor stoppage after janitors had a dispute over medical benefits. The article also referenced how Mountain View recently adopted stricter standards to protect their subcontracted janitorial workforce.[6] On January 28, 2020, the City of Mountain View adopted a motion that required its Janitorial Services RFP to include that the awarded vendor be a firm whose employees are covered by a collective bargaining agreement, janitors receive wages no less than the prevailing wage as listed under the California Public Utilities Code, and that the State Labor Code’s worker retention period be extended from 60 to 90 days.[7]
Recommendation:
As a City, we have an interest in ensuring we have uninterrupted operations, high quality services, and that contracted workers performing services for the city are treated fairly. We recommend the City Council direct staff to address the issues facing the City’s subcontracted janitors by developing a policy that would heighten standards where needed within the Janitorial Services RFP for the City Council to adopt for the upcoming and future such RFPs. This policy should establish standards similar to those adopted by the City of Mountain View per below:
“That the successful proposer be a firm whose employees are covered by a collective bargaining agreement prior to the effective date of contract and that any individual performing janitorial services for the City be paid no less than the prevailing wage and benefits established for janitorial services pursuant to the California Public Utilities Code and set by the Department of Industrial Relations.
That the higher wage rates and/or benefits will be paid should the collective bargaining agreement’s wages and benefits and the prevailing wage and benefits differ.
That the State Labor Code’s worker retention period be extended from 60 to 90 days.” Resource Implications:
Independent of this Colleagues Memo, staff has been evaluating options related to wage requirements for the upcoming janitorial services Request for Proposals (RFP). Given the time sensitivity of this issue in order to initiate a new contract for services, staff will present their analysis to the City Council at the same time this Colleagues Memo is considered.
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[1] City of Palo Alto, “Council Consent Agenda Responses,” June 20, 2022. https://www.cityofpaloalto.org/files/assets/public/agendas-minutes-reports/council- questions/20220620cqccs.pdf
[2] Congresswoman Anna Eshoo Letter, September 15, 2022. https://drive.google.com/file/d/1U5fZAzM3u5tLZf- rZFpZZBofUJ8BynO0/view?usp=sharing
[3] Senator Josh Becker letter, June 15, 2022.
https://drive.google.com/file/d/14ZFpJNfSYmwT3Wznba3fTJzIC82vmgDc/view?usp=sharing [4] Assemblymember Marc Berman letter, July 20, 2022. https://drive.google.com/file/d/1GeYSYxkrLungCxWg- voHK3bHEuaHtmvL/view?usp=sharing
[5] “Janitors: The Pandemic’s Unseen Essential Workers,” Maintenance Cooperation Trust Fund, April 2021 [6] Ruth Silver Taube, “Palo Alto janitorial workers shed light on wage theft,” San Jose Spotlight, July 14, 2022. https://sanjosespotlight.com/silver-taube-palo-alto-janitorial-workers-shed-light-on-wage-theft/ [7] City of Mountain View, “Meeting Minutes - Final,” January 28, 2020.
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City Council
Supplemental Report
From: Brad Eggleston, Director Public Works/City Engineer Meeting Date: January 30, 2023
Item Number: AA1
TITLE
Supplemental Report - Wage Requirements for the Contract for next Janitorial Services After the agenda for January 23, 2023 City Council meeting was published, staff received the following questions related to payment of back wages to current and former SWA employees. While SWA employee back wages are not directly related to Council’s discussion and direction on wage and benefit requirements for the next janitorial contract, the questions and their answers are useful background information for the discussion and are therefore being provided in this Supplemental Report.
1. My understanding is that checks will be mailed to the address SWA has on file, for both current and former employees. Correct?
As required by Amendment No. 3 to the City’s contract with SWA, payment of back wages will be the responsibility of SWA. SWA has informed the City they intend to make these payments either by direct deposit or by a check mailed by certified return receipt to the employee’s last known address.
2. If former employees want to ensure their address is up-to-date, should they contact the city, or SWA, or both?
Former SWA employees should contact SWA to ensure their address is correct.
3. Does the city have an independent estimate of the number of workers affected and how much each should receive? If so, what are they?
The City does not have an independent estimate, however, has reviewed a detailed spreadsheet provided by SWA that lists each employee and the variance between actual ITEM AA1.
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pay and pay required by the contract for each pay period. Based on this list from SWA there are about 60 individual current or former employees who are owed back wages. The City does not have the calculation of back wages and compounded interest, this is the responsibility of SWA, however, staff anticipates requesting records from SWA for review in alignment with the current City Auditor task of reviewing the SWA contract.
4. How is the city planning to ensure compliance? Who in the city can workers contact if they don’t receive their check?
Amendment No. 3 to the City’s contract with SWA requires SWA to make the back wage payment including interest by March 31, 2023, and to provide records to the City by April 28, 2023 demonstrating the performance of these obligations. City staff will perform spot checks of some payments to ensure they align with the back pay and interest expected. SWA employees should contact SWA if they don’t receive their payment, and staff suggests that they copy the City on their communication to SWA for the City’s awareness.
APPROVED BY:
Brad Eggleston, Director Public Works/City Engineer
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