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1 RiversideCA.gov
1 RiversideCA.gov
CONTRACTOR/SUBCONTRACTOR
TRANSPARENCY ORDINANCE
City Council
September 5, 2023
Councilmember Ronaldo Fierro
RiversideCA.gov
2 BACKGROUND
• Wage theft is a widespread problem in the construction industry
– According to California Center on Policy Initiatives, official complaints are rare – Majority of cases are filed for the most egregious of wage theft violations: no payment for all time worked
• Cash-only nature of under the table work leaves workers vulnerable to wage theft. Misclassified and legally employed workers can be vulnerable, too
• A study of construction workers in California found that workers paid under the table earn just 52 cents for every dollar earned by workers with employee status
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3 BACKGROUND
T h eC i t yo fR i v e r s i d ec a nt a k eam o r ea c t i v er o l ei nc o m b a t i n g wage theft and upholding labor standards in Riverside by updating our verification requirements for contractors and subcontractors of large projects in the city and keeping record of all contractors and subcontractors throughout the duration of the project.
RiversideCA.gov
4 BACKGROUND
Currently, applicants must submit a Contractors Verification Form that requires subcontractors to be validated through the Business Tax Division prior to final Certificate of Occupancy.
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5 STRENGTHENING THE PROCESS
This policy can be strengthened to better identify
potential bad actors and ensure a transparent
process through
– Updating the time of reporting
– Identifying a reporting threshold
– Requiring reporting of past labor violations
– Codifying requirements for incomplete reporting
– Violations for not reporting information
RiversideCA.gov
6 PROPOSED CHANGES
1. Time of reporting : Change from validating before
Certification of Occupancy to validation before
building permits are issued
2. Reporting threshold : Exempt smaller projects, only
mixed-use developments with 20+ units or commercial /
industrial 20,000 square feet or more
3. Reporting of labor violations : Add requirement for
reporting any past or present / pending labor violations as defined by the California Labor Code
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4 RiversideCA.gov
7 PROPOSED CHANGES
4. Incomplete reporting : Currently not clear what
happens when someone provides an incomplete
report. This ordinance will clarify that applicants will have 2 days to finish an incomplete report.
5. Violations/Enforcement : Multiple remedies:
1) Stop work order
2) Revocation of permit
3) Penalty fee equal to cost of original permit fee
RiversideCA.gov
8 That the City Council introduce and subsequently adopt an Ordinance amending Chapters 5 and 16 of the
Riverside Municipal Code to amend Section 5.04.300 –
Business Tax and add Section 16.04.300 relating to license requirements of contractors and subcontractors.
RECOMMENDATION
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