Everett City Council OKs Wage Theft Ordinance in 9-1 Vote, One Dissents

By Neil Zolot

The City Council voted 9-1 to approve an ordinance promoting fair labor standards and preventing wage theft at their meeting on Monday, March 23, with Ward 1 Councillor Michele Capone dissenting and Councillor Michael Marchese absent. It reads, “The purpose is to promote fair labor standards and lawful wage practices, prevent wage theft, ensure the City contracts only with responsible employers, protect workers through a transparent complaint process and safeguard taxpayer funds from supporting employers who violate wage and hour laws.” Wage theft is defined as failure to pay minimum wage, overtime, the prevailing wage and/or pay in a timely fashion. Making unlawful deductions from wages and misclassification of employees as independent contractors are other elements.

The ordinance applies to contractors applying for permits or tax incentives, with denial of issuance as a possible outcome. “We’ll have the ability to revoke a contract,” Ward 2 Councillor Stephanie Martins explained. “As a City, we’re choosing not to do business with contractors and businesses who have a judgement in violation and are requiring contractors to maintain accident insurance, maintain daily sign in and out logs, comply with healthcare laws and submit monthly payroll records.”

She added that the ordinance will create standards and a system for employees to report violations, especially nonunion workers.

Capone objected on the grounds the City can’t enforce all the regulations. “If we vote this in, what would we be able to enforce and what are the subjective and objective standards?” she asked. “The state runs a lot of this; are we opening ourselves up to lawsuits?”

“Are we not going to do the right thing because someone might sue us?” Martins asked back. “That’s not right.”

Councillor-at-Large Katy Rogers added that the ordinance will give Everett the ability to report violations to state authorities.

In discussion, Capone argued the ordinance violated “interference with contractual relations” regulations and that the City can be sued if it claims to have authority it doesn’t have. “We represent all the residents of Everett to try to prevent lawsuits, so they don’t have to pay unnecessary money,” she said.

In Public Participation, former Everett and current Lynn resident Justin Anshewitz said he’s helped Lynn craft a similar ordinance in his role as chairman of its Wage Theft Advisory Committee. He is also a member of the North Atlantic States Regional Council of Carpenters (NASRCC). He said such ordinances give communities “tools to address these things in their community and protect workers and themselves in the procurement process.”

He said that before Lynn had a wage theft protection ordinance it referred issues to the state Attorney General and Department of Labor, but it took three years for them to determine how it would be resolved. “If Lynn had had tools, workers wouldn’t have had to wait three years for nearly half a million dollars in restitution that was coming to them and city coffers,” he said.

NASRCC Legislative Director and former Worcester Mayor and City Councillor Joseph O’Brien also spoke in Public Participation. “If you’re going to use public money with tax credits, you have to follow the language of their ordinance,” he said. “It will protect workers who are too often exploited in the construction industry and protect honest contractors who have to compete when they pay taxes and provide things like workers compensation and make sure people have access to unemployment insurance but compete against people who don’t. Wage theft hurts all taxpayers. When contractors don’t pay into the compensation system, that costs everyone.”

He also said the state Executive Office of Housing and Livable Communities passed “responsible contractor guidance,” in part because so many developments with affordable housing are not subject to local regulations under Massachusetts General Law 40B and/or use public money or receive tax incentives in public/private partnerships.