The United States continues to lag behind other industrialized democracies when it comes to a national paid leave law protecting workers. The U.S.’ lack of paid leave policies—family, medical, and sick leave—has a disproportionately harsh impact on low-wage workers, who are predominantly women, immigrants, and people of color. These workers are far less likely to receive paid time off or have flexibility in controlling their work schedules, even though their need for leave is every bit as acute.

Workers with a union are far more likely to have paid time off and schedule certainty. Unions have bargained for paid leave, scheduling flexibility, and other benefits important to workers—particularly workers with familial demands (EPI 2021). The reach of this union advantage is limited, however, given that only 6% of private-sector workers are covered by a collective bargaining agreement (Shierholz et al. 2024).

Policymakers have tried to enact various laws to address workers’ needs for paid time off and flexible and predictable work schedules. Particularly at the state level, policymakers have adopted paid time off requirements, and in a few places, ordinances requiring greater predictability around scheduling—an important reform that gives workers (and particularly low-wage workers) the certainty they need to be able to schedule appointments or even work another part-time job if they need to. However, progress has been slow, and these reforms still do not cover most workers. At the federal level, progress has been stalled as Congress has failed to act on paid leave or scheduling fairness legislation.

Some workers are doing gig or short-term work—including digital platform or app-based gig work—in an effort to have more flexibility and control over their work schedules.1 This is the case despite research showing that the majority of gig and other contingent workers would prefer permanent, full-time employment (NELP 2021).

Moreover, this flexibility is often illusory, given the degree of control employers retain over workers and their schedules. Even more problematic is the effort by some companies, led by digital platform transportation companies like Uber and Lyft, to leverage the flexibility myth in attempts to defend their employment practices. These app-based companies misclassify their drivers as independent contractors, claiming that this is a necessary practice for meeting drivers’ demands for flexibility. However, this practice deprives drivers of crucial workplace protections, including guarantees for paid time off and scheduling certainty, where such laws exist. Moreover, experience has shown that companies can easily meet workers’ need for flexibility while maintaining their status as employees.

Policymakers should reject this Orwellian move by the app-based companies and others to use workers’ desire for flexibility to justify their employment practices. Allowing these practices for app-based workers will not be limited to drivers but will quickly spill over to health care, hospitality, and many other workers, given the growing use of app-based placement services in these industries (Gerstein 2024). Policymakers should focus on enacting legislation to provide workplace benefits and protections that offer employees real flexibility with real protections—including paid leave legislation; scheduling fairness legislation; and legislation to strengthen workers’ ability to form and join unions, so they can bargain collectively for these benefits and protections.

Research on workers’ demand for flexibility and related benefits

Flexibility is often cited as a core reason for individuals seeking app-based and gig work. In a survey conducted by the Pew Research Center, 49% of gig workers cited “being able to control their own schedule” as a reason why they enter the gig workforce (Anderson et al. 2021). The same survey found that flexibility is also highly valued among individuals in gig work: 53% of gig workers said being able to control their own schedule was “essential or important” to them. A survey conducted by Morning Consult for the Flex Association found that 42% of respondents said they chose app-based work for their “ability to choose when to work” (2022).2

Research shows that gig workers don’t always find the flexibility and earnings that they are seeking and are more likely to move to another job. A survey conducted by EPI and Harvard’s Shift Project found more than half (55%) of gig workers intended to find a new job in the next three months, compared with 36% of W-2 service-sector workers (Zipperer et al. 2022).

Research shows that in general, workers prefer flexibility in their work arrangements. A 2021 survey by Workable found that 58% of workers surveyed valued the ability to work flexible schedules (Mackenzie 2023). A survey by Future Forum found that 80% of knowledge workers surveyed want flexibility regarding where they work, whereas 94% want schedule flexibility (2022). According to a Morning Consult survey conducted for Zoom, 81% of U.S. respondents said that flexible hours and schedules were top priorities (2023). A Gallup survey of service facing workers found that 31% of respondents valued flextime and the ability to choose when they worked. Further, the survey found that 33% of respondents valued flexible start and end times (Pendell 2023).

Most recent survey data from the Department of Labor (DOL) shows that a significant portion of workers currently have some sort of flexible work arrangement. In a Bureau of Labor Statistics (BLS) survey, 57% of wage and salary workers had a flexible schedule with the ability to vary start and stop times. Of these workers, 35% of could frequently change their schedule; 46% could occasionally change their schedule; and only 19% rarely had the opportunity to change their schedule (2019). Data from DOL Women’s Bureau (n.d.) find that 57.2% of men have flexibility in the times they begin and end work, compared with 55.8% of women surveyed. Union workers have more input into the number of hours they work (Bivens et al. 2017).

Despite this research showing that workers would like flexibility in their schedules, many workers experience the opposite: a lack of stability and predictability in their schedules. For example, according to research by the Shift Project, the majority of retail and food service workers they surveyed have little advance notice of their schedules; two-thirds have less than two weeks’ notice, among which 50% get less than a week’s notice. Workers’ schedules are also often changed at the last minute, with 14% reporting at least one cancelled shift in the last month and 70% reporting at least one change to the timing of one of their shifts in the past month. Women workers and workers of color are particularly hard hit by these unpredictable scheduling practices. Significantly, 75% of workers in the Shift survey said they would like a more stable and predictable schedule (Schneider and Harknett 2019).

Other research similarly demonstrates that despite valuing flexibility, workers would prefer stable, full-time employment with benefits. According to a report by the National Employment Law Project (NELP), 79% of people surveyed said they would prefer having one stable full-time job instead of having more than one job with schedule and location flexibility—with a variation of only three percentage points across gender, age, and race (NELP 2021). In addition, NELP reported on polling by the global management consultant firm McKinsey & Company, who found that contract, freelance, and temporary workers would overwhelmingly prefer to have permanent employment, with first-generation immigrant (76%), Latinx (72%), Asian American (71%), and Black (68%) respondents most strongly favoring permanent employment. According to a survey of New York City residents, 57% of app-based workers said they would prefer to have an employer that provided benefits (NELP 2021). In the same vein, the majority of app-based workers surveyed by Veena Dubal said they would prefer to be classified as employees (2019).

It is important to point out that Black and Latinx workers provide a disproportionate share of digital labor platform work in the United States. BLS data show that Black and Latinx workers make up almost 42% of workers for Uber, Lyft, and other “electronically mediated work” companies, although they comprise less than 29% of the overall U.S. workforce (NELP 2021).

Moreover, the lack of paid sick time disproportionately harms low-wage workers. While access to paid sick time has grown from 63% to 78% of all private-sector workers since 2010, most low-wage workers—i.e., the workers who need it most and are most harmed by taking unpaid leave—still lack access to paid sick days. Among the 10% of private-sector workers with the highest wages, 96% have access to paid sick days (Table 1). By contrast, among the 10% of workers with the lowest wages, just 39% have access to paid sick days (Gould and Wething 2023).

Table 1

Finally, it is worth noting that paid leave requirements are extremely popular, with large majorities of both Democratic and Republican voters favoring paid family and medical leave policies and viewing them as important to improving workers’ lives (Todaro 2023).

Flexibility is often illusory

The argument that digital platform or app-based work provides drivers with flexibility overstates the amount of control drivers actually have over their work lives. In fact, Uber and Lyft exercise significant control over how drivers handle their work, and drivers are “deactivated”—i.e., fired—if they deviate from company policy. Thus, the so-called flexibility drivers seek is often illusory (Mishel and McNicholas 2019).

Uber advertises to drivers that they will work for themselves. On its website, the company claims that driving for Uber is flexible, with the driver in control. Interested drivers just download the driving app and complete a “sign-up” process, requiring only that drivers have a valid driver’s license and insurance and “complete a background screening.” The company states that drivers set their own hours and may “cash out” after each trip (up to five times per day on the app). Uber brands itself as merely a technology platform that allows drivers to find earning opportunities for their own entrepreneurial endeavors (2019).

However, in reality, Uber drivers’ experiences are a far cry from the company’s marketing narrative. Drivers have no say on setting fares, on what they are paid, or on the commissions the company takes. Drivers are not shown the passenger’s destination or how much they could earn on a fare before being asked to accept a ride request, and they have limited say on whom they choose to have as customers (Rosenblat 2018a). Drivers are not even able to choose the route to take—Uber reserves the right to retroactively adjust the fare if it decides that an inefficient route was taken (Rosenblat and Stark 2016; UK Judiciary 2016). And Uber also exerts control over drivers through an automated passenger rating system. Tools like the fare and rating systems serve as “algorithmic managers,” nudging drivers to act in certain ways and penalizing them when they don’t. For example, in certain services on Uber’s platform, drivers who fall below 4.6 stars on a five-star rating system may be “deactivated”—never “fired.” This pressures some drivers to tolerate bad passenger behavior rather than risk losing their livelihoods because of retaliatory reviews (Rosenblat 2018b). Given that a driver’s low rating (as unilaterally defined by Uber) may lead Uber to deactivate them from the app (i.e., fire them), drivers do not have the independent control typically associated with a small business owner.

Drivers cannot readily turn down short rides; rides that are not close by (note that the time between dispatch and rider pickup costs time and vehicle expense and provides no revenue to the driver); or rides that go to destinations that will make it difficult to obtain a follow-up ride. When the app alerts a driver to a potential ride, the driver has a very short time—about 15 seconds—to respond as to whether they will accept the rider (Rosenblat and Stark 2016; Rosenblat 2018a). There is no other way to provide a ride through Uber (such as picking up someone hailing you on a street corner) other than this process that is governed by the algorithms and the app (Rosenblat and Stark 2016).3

Like digital platform or app-based drivers, workers with flexible or part-time schedules also lack real control over their schedules, with employers making last-minute changes to their schedule, which wreaks havoc with child care, medical appointments, transportation, and other needs (Schneider and Harknett 2019; Waldman 2024). Unless they are protected by a union contract or a local fair scheduling ordinance, workers do not control their schedule or work hours; these decisions rest with their employers. Employers typically use their power to shift schedules and work hours based on production needs—or for less legitimate reasons, such as retaliation for union organizing (Greenhouse 2023). Adjusting workers’ hours according to “just-in-time” scheduling is common in (but not unique to) app-based work and undermines workers’ actual control over their schedules and their scheduling flexibility.

The importance of employee status

The problem of employers misclassifying workers as independent contractors is pervasive and widespread. Employers in the construction industry, building services, and homecare, among other sectors, have misclassified workers as independent contractors to gain a cost advantage over law-abiding employers, which has resulted in the loss of important workplace benefits and protections for workers (Rhinehart et al. 2021). This problem has become even more widespread with the growth of app-based services such as Uber and Lyft, who misclassify their drivers as independent contractors. Other app-based staffing services such as Instawork and Gigpro follow this same practice, often treating hotel, health care, and other workers as independent contractors instead of employees (Gerstein 2024).

Misclassification has significant negative implications for worker protections. Most federal and state labor and employment protections are granted only to those classified as employees—and not to those classified as independent contractors. This includes basic protections such as minimum wage, overtime pay, unemployment insurance, and workers’ compensation, as well as health and safety protections, nondiscrimination protections, paid sick or medical and family leave, and rights to organize and collectively bargain (Table 2).

Table 2

Misclassification robs workers of income and employment-based benefits because it shifts financial responsibilities for Social Security tax onto workers and deprives them of coverage under labor and employment laws. This is very costly, resulting in lost annual income and benefits of over $10,000 for a typical construction worker and over $6,000 annually for a home health aide (Schmitt et al. 2023).

In addition, misclassification deprives the federal, state, and local governments of important tax revenue and contributions to social insurance programs such as workers compensation and Social Security. These lost revenues amount to billions of dollars each year (NELP 2020). EPI research estimates suggest social insurance programs losses per worker range between $585 per year (security guards) and $1,781 per year (construction workers). Higher estimates put the range of annual per-worker revenue losses between $1,101 (security guards) and $3,031 (truck drivers) (Schmitt et al. 2023).

Not only are these costs shifted onto workers, but they have been shifted onto other taxpayers as well. Because they are (mis)classified as independent contractors, Uber and Lyft drivers are not generally covered by unemployment insurance.4 When demand dropped dramatically at the start of the COVID-19 pandemic, drivers were unable to draw on unemployment benefits from the state unemployment insurance system. Congress enacted legislation to provide unemployment benefits to independent contractors, and one in five Uber and Lyft drivers applied for and received these benefits, at taxpayer expense (Iacurci 2021).

The Fair Labor Standards Act does not prevent flexible schedules

One of the myths perpetuated by digital platform or app-based companies and other employers is that workers need to be classified as independent contractors in order to have flexibility in their hours because of the federal Fair Labor Standards Act (FLSA). This is incorrect and sets up a false choice.

Enacted in 1935, the Fair Labor Standards Act, is the primary federal law establishing minimum wage and overtime protections. The FLSA requires employers to pay workers at least an established hourly minimum wage—currently stuck at $7.25 per hour due to Congress’ failure to raise the minimum wage for 15 years. The FLSA also requires employers to pay employees overtime at the rate of 1.5 times their regular rate of pay for hours worked in excess of 40 in any given week. Employers must keep records documenting an employees’ work hours to help ensure compliance with the law.

Not all employees are covered by the FLSA’s overtime protections. For example, among others, administrative, executive, and professional employees are excluded from the FLSA’s overtime requirements.5 Still, roughly 140 million workers are covered by the FLSA’s overtime protections.6

Companies and employers incorrectly claim that the FLSA prevents flexible scheduling, but employers control scheduling decisions and can organize work schedules to meet FLSA’s requirements. Employers have long been able to provide flexible schedules and comply with wage and hour laws, and flexible schedules have been negotiated by employers and unions in compliance with the law. Scheduling decisions are the employer’s prerogative (in negotiation with their workers’ union, if there is one), and they can and do set and change schedules in accordance with production demands.

As the Department of Labor states, “The Fair Labor Standards Act (FLSA) does not address flexible work schedules. Alternative work arrangements such as flexible work schedules are a matter of agreement between the employer and the employee (or the employee’s representative)” (DOL Wage and Hour Division 2024a; 2024b).

Nor does the FLSA restrict an employer’s ability to change workers’ schedules according to the employer’s needs. According to DOL, “The Fair Labor Standards Act (FLSA) has no provisions regarding the scheduling of employees, with the exception of certain child labor provisions. An employer may therefore change an employee’s work hours without giving prior notice or obtaining the employee’s consent (unless otherwise subject to a prior agreement between the employer and employee or the employee’s representative)” (DOL 2024). Moreover, FLSA’s requirements are employer specific. If an employee works 20 hours each week for one employer and 25 hours for a second employer, the employee is not entitled to overtime from either employer (unless there is a joint-employer relationship between them).

Thus, as long as the employer retains sufficient records documenting an employee’s work hours; pays employees at least the hourly minimum wage; compensates the employee at the overtime rate for hours worked over 40; and meets any applicable obligations to bargain with the employees’ union, the employer may set and implement flexible scheduling policies without running afoul of the FLSA. The idea that the FLSA prevents flexible scheduling—and that independent contractor status is needed to allow flexibility—is false.

Collective bargaining can yield paid leave benefits and schedule flexibility and predictability

Unionized workers are far more likely to receive various workplace benefits compared with nonunion workers. These benefits include paid leave of various types (sick, family, vacation, personal), employer-provided health care, retirement benefits, and more. Establishing these benefits as part of collective bargaining and including them in a collective bargaining agreement gives unionized workers confidence and security that these benefits will be there when they need them, because a collective bargaining agreement is a legally binding contract (Bivens et al. 2017; Shierholz et al. 2024).

For example, 86% of unionized workers have paid sick time at work, compared with 72% of workers without a union (Gould 2020). Unionized workers have more input into the number of hours they work each week. Unionized workers are far more likely to know their work schedules four weeks or more in advance compared with nonunion workers (Figure A). Thus, unionized workers are far more likely to have the stable jobs with good wages and benefits that workers seek.

Figure A

In addition to providing paid leave and other benefits, unions and employers have created mechanisms through collective bargaining for workers to have part-time, flexible schedules, along with scheduling predictability and certainty that allows workers time to meet their other needs.

For example, the United Food and Commercial Workers (UFCW) International Union’s St. Louis area local unions, Locals 655 and 88 and Schnuck’s grocery recently negotiated a new “Flexforce” program through which workers use an app to create their own schedule from available shifts. Flexforce workers receive the same benefits as other union members. UFCW represents thousands of Schnucks employees in the greater St. Louis area (Schnucks 2024). The program was recently expanded to cover more stores and workers.

Similarly, UNITE HERE has bargained provisions allowing certain hotel and casino employees to bid for shifts and create a schedule that meets their needs. These employees receive employer-paid health insurance, retirement contributions, and other important benefits, in addition to scheduling predictability.7

The Teamsters have tens of thousands of UPS drivers who have a set part-time schedule—leaving time for personal needs—and still receive health care, retirement, and other important benefits (UPS 2023).8 The Teamsters negotiated historic raises for part-time drivers in the most recent negotiations (Teamsters 2023).

These are just a few examples of the collectively bargained approaches to providing schedule flexibility and part-time arrangements that provide workers with the flexibility they need but also with scheduling predictability and certainty and benefits. Strengthening the law to enable more workers to form and join unions and bargain such benefits with their employers would be an important step in addressing workers’ need for flexibility and paid leave.

Policy reforms to support paid leave and scheduling flexibility and predictability

As the research summarized above shows, most workers want stable employment with predictable schedules and wages and benefits that allow them to meet their family’s needs. These needs can be met through promoting various reforms that empower workers and protect flexible work without exploitation and include:

• strengthening workers’ ability to form and join unions;
• preventing misclassification of workers as independent contractors; and
• establishing minimum standards around paid leave and scheduling fairness.

These reforms can be—and have been—pursued at the federal, state and local levels. A brief description of these reforms follows.

Federal reforms

Pass the Protecting the Right to Organize (PRO) Act. As explained above, workers with a union are in a much stronger position to negotiate with their employers for paid time off, predictable work schedules, and other important protections. Workers covered by a collective bargaining agreement also have “just cause” protection, meaning that the employer cannot retaliate against them or fire them without a valid reason. This gives workers more confidence to access and use the benefits they have earned, because they have less fear of employer retribution when they do so. Strengthening the ability of workers to form and join unions, as the PRO Act would do, would provide a mechanism for workers to organize and bargain for flexibility, fairness, and related workplace benefits. Current law is too weak to meaningfully assure workers these rights, given employer ability to interfere and the absence of any financial penalties for violating the law. The PRO Act also adopts the ABC test to prevent misclassification of workers as independent contractors. Particularly given the record-high levels of demand for unions among nonunion workers, and especially young workers and workers of color, passage of the PRO Act should be a top priority for lawmakers.

Pass the Healthy Families Act to provide earned sick leave. The Healthy Families Act, first introduced in 2004, includes provisions that would allow workers in workplaces with 15 or more employees to earn at least one hour of paid sick time per 30 hours worked, up to 56 hours or seven days of paid sick time per year. Despite repeated introductions of the Healthy Families Act (most recently in May 2023) federal policymakers have so far not been successful in passing it. The lack of a national standard for paid sick leave places the United States behind its international peers. Passage of the Healthy Families Act is particularly important for low-wage workers, who disproportionately lack paid leave.

It should be noted that the Biden Administration’s proposed budget for 2024–2025 includes paid family, medical, and sick leave (White House 2023).

Pass the Schedules that Work Act to provide scheduling stability and fairness. The Schedules that Work Act would require that workers in designated occupations—including retail, food service, cleaning, and others—be given a minimum of two weeks’ advance notice of their schedules, with pay premiums for late changes (Rep. DeLauro 2023).

State and local reforms

Because of the lack of national standards for paid sick leave and scheduling fairness, several states and localities have adopted laws to provide these benefits. At the same time, rideshare companies and other app-based employers have lobbied state legislatures to classify app-based workers as independent contractors and deprive them of the protections of workplace laws. Reforms to expand protections for workers and prevent erosion of their rights should be prioritized by state lawmakers. These reforms include:

• Repeal state preemption of local labor standards that prohibit localities from developing and implementing policies to raise standards for working people. Over 44 states have preemption laws that prohibit localities from improving labor standards for workers, including minimum wage, paid sick leave, and fair scheduling laws (Sherer and Poydock 2023; EPI 2024).

• Resist or repeal language that excludes app-based workers from coverage under state employment laws or that defines “Transportation Network Company (TNC) drivers,” “marketplace contractors,” or other app-based workers as nonemployees or independent contractors (Sherer and Poydock 2023).

• Adopt strong, protective legal tests, such as the ABC test, for establishing employee status and preventing the misclassification of workers as independent contractors. Strong ABC tests are those that establish a presumption that an individual performing service for an employer is an employee, not an independent contractor, unless the employer can establish three factors: A) The work is done without the direction and control of the employer; B) The work is performed outside the usual course of the employer’s business; and C) The work is done by someone who has their own independent business or trade performing that kind of work (Rhinehart et al. 2021).

• Strengthen enforcement and increase penalties to deter the misclassification of workers as independent contractors. This includes adequately funding and staffing state agencies to strategically enforce the law and crack down on worker misclassification. In addition, states should increase penalties for employers who violate labor law to deter worker misclassification (Sherer and Poydock 2023).

• Pass earned sick time laws. There is no federal law that allows workers the ability to earn paid sick leave. Over the last decade, 15 states and the District of Columbia have adopted earned paid sick time laws. However, millions of workers—especially low-wage workers—lack access to paid leave (Gould and Wething 2023).

• Pass state or local fair scheduling laws. Several cities and more recently the state of Oregon have passed fair workweek laws to give workers more advance notice of their schedules. Some of the laws also require employers to make more hours available to part-time workers before hiring more full-time employees (Wolfe, Jones, and Cooper 2018).

Conclusion

Workers have consistently expressed their desire for good-paying, permanent jobs with scheduling predictability and benefits like paid leave, health insurance, and more. These types of jobs can be (and are being) provided for both full-time and part-time employees through collective bargaining and state and local policy reforms. Nothing in the current law requires workers to give up their rights as employees and be classified—or misclassified—as an independent contractor to enjoy flexibility in their work schedule. Policymakers should reject these arguments and prioritize passage of policies that empower workers and provide the benefits they want and deserve.

Notes

1. In the most basic terms, gig work can be defined as work done by individuals who are classified as self-employed, freelancers, or independent contractors. However, in recent years the term “gig work” has become synonymous with working for digital platform companies, including driving for rideshare apps, making deliveries for restaurants, shopping or delivering groceries, and performing errands or household tasks. 

2. The Flex Association represents app-based and digital platform companies such as DoorDash, Uber, Lyft, and Instacart.

3. Several states have recently enacted legislation or won provisions in legal settlements that provide rideshare drivers with appeal rights when they are deactivated. However, most rideshare drivers currently have no appeal rights from deactivation by the companies.

4. Drivers are covered in Washington State through a new statute, and several states have sought to recover payments for unemployment insurance premiums from the rideshare companies, indicating that they believe drivers are covered by their state’s unemployment law.

5. The Trump administration tried to roll back these protections and the Biden Administration has since finalized a rule that strengthens overtime protections for workers.

6. Defining and Delimiting the Exemptions for Executive, Administrative, Professional, Outside Sales, and Computer Employees, 89 Fed. Reg. 32842-32973 (April 26, 2024).

7. Interview with Susan Valentine, UNITE- HERE, Feb. 22, 2024.

8. See National Bargaining Agreement Between the International Brotherhood of Teamsters and United Parcel Service Inc. (2023).

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Zoom, in partnership with Morning Consult. 2023. Survey: Flexible Work Rises as Top Perk. November 2023.

I am testifying in strong support of SB 170 and SB 171—two bills to repeal Public Act 98 and Public Act 105, respectively. Public Act 98 has prohibited local governments from entering project labor agreements on publicly funded projects since 2011, and Public Act 105 has prohibited local governments from enacting a wide range of important labor standards since 2015.

For several years, EPI has closely tracked the ways in which the spread of abusive forms of “preemption”—state interference in local policymaking—is not only preventing shared prosperity but also deepening economic inequality.1 Preemption in this context refers to situations in which state lawmakers block local ordinances from taking effect—or dismantle existing local ordinances outright. In the past decade, lawmakers in some states have increasingly misused preemption to interfere with local governments’ ability to set job quality standards. Blocking these local policies results in wage suppression for all workers and contributes to maintaining racial and gender pay gaps.

Preemption of local policymaking is embedded in a racist history

The use of preemption laws to block local labor standards is deeply intertwined with a long history of racism. In the 2020 EPI report Preempting Progress, we trace current-day preemption of workers’ rights back to state-sanctioned policies and practices begun in the post-Reconstruction South, which disadvantaged Black and brown workers, as well as women and low-income workers.2 In a 2021 EPI report focused on Midwestern states, we looked further at how the abuse of state preemption is entangled in histories of segregation, redlining, and other policy choices that reinforced anti-Black racism and white supremacy following the Great Migration.3 I begin with this background because the deep inequalities plaguing our economy today remain rooted in this history of racism and worker exploitation.

Today, preemption laws are often passed by majority-white legislatures, erecting barriers to economic security in cities whose residents are majority people of color. State lawmakers who have used preemption to disempower local governments are often bending to pressure from corporate interests and right-wing groups such as the American Legislative Exchange Council (ALEC).4

Preemption of local labor standards suppresses wages and increases economic inequality

Michigan’s legislature in 2015 used preemption to deny local governments the ability to improve job quality by passing Public Act 105, nicknamed the “Death Star Bill” for its complete destruction of localities’ power to enact nearly any policy that could benefit workers —ranging from minimum wage increases to fair scheduling laws, paid leave, and a host of other standards.

The result stripped cities and counties of their ability to address growing inequality and declining worker wages. As recently as 2005, Michigan boasted a relative state median wage that was 7% above the national median. But as Figure A illustrates, Michigan’s wage advantage has since disappeared, and for the past decade Michigan’s relative median wage has remained below the U.S. median.

Figure A

During this same period, state preemption deprived local Michigan communities of policy tools that could have improved the lives of workers and their families.

For example, in our 2021 report, we examined the fair scheduling prohibition included in Michigan’s preemption law to assess preemption’s direct impact on workers. Unfair scheduling practices can take many forms. Some employers use computer algorithms to make last-minute staffing decisions. Others use on-call scheduling, where workers are asked to stay available without pay, but are not told whether they are required to come in until immediately before a shift. Alternatively, workers may be scheduled for full shifts but then sent home early with no notice, depriving them of income while still requiring them to pay for child care, transportation, or other arrangements. Such practices are widespread in retail and food service jobs also characterized by low wages and meager benefits.5

Fair scheduling laws mitigate these practices by ensuring workers receive advance notice of schedules or additional pay when schedules change without notice. Because of the importance of predictable schedules for workers and families, cities from New York to Chicago to San Francisco have adopted fair workweek ordinances.6

But in Michigan, state legislation has denied local governments the opportunity to adopt similar policies that could especially benefit women and workers of color, who are far more likely to hold low-wage jobs subject to erratic schedules.7 For example, if Detroit were able to enact fair workweek legislation, we estimate that 38,702 workers in retail and food service would benefit. As Table 1 shows, the vast majority (29,943 or 77.4%) of those workers are Black. Women would particularly benefit from a fair workweek ordinance focused on retail and food service, where they make up over half the workforce.

Table 1

Empowering local government to set job quality standards is especially critical at a time of unprecedented opportunity for Michigan communities to compete for historic federal investments in infrastructure, clean energy, and manufacturing

Massive federal investments now flowing to state and local governments via scores of programs created by the Bipartisan Infrastructure Law (BIL), the CHIPS and Science Act, and the Inflation Reduction Act (IRA) present huge opportunities to accelerate the transition to clean energy while creating good jobs in communities that need them most.

To maximize the benefits of federally-funded projects, cities, counties, and school boards need immediate access to a full range of implementation tools including local policy options that Michigan state preemption laws currently prohibit. Specific local policy tools like project labor agreements (PLAs), prevailing wage standards, and apprentice utilization thresholds are especially important for shaping job outcomes on public infrastructure and green energy projects.8

PLAs can also serve as the foundation for broader agreements—known as community workforce or community benefits agreements— through which local governments can ensure that major public construction projects target priority community needs. A host of competitive grant programs administered by federal agencies (Departments of Energy, Labor, Transportation, and others) explicitly encourage state and local applicants for funds to use project labor agreements or more expansive community benefits agreements to set minimum standards for all jobs on a project.

To illustrate with just one example, the Department of Energy’s Regional Clean Hydrogen Hub program (created by the Bipartisan Infrastructure Law) designates $7 billion for 6–10 regional projects to advance clean hydrogen production and use. The program requires applicants for these funds to submit a Workforce and Community Agreement Statement describing any plans to negotiate a project labor agreement or community benefits agreement to ensure projects generate high-quality jobs. Proposals including strong plans are scored higher, increasing their chances of drawing down the largest federal funding awards for their communities.9

To take a second—potentially transformative—example: Under the Inflation Reduction Act, cities, counties, and school districts can maximize their access to direct payments from the IRS to recoup the cost of clean energy projects only if the projects pay workers a prevailing wage and utilize a certain percentage of registered apprentices.

Cities like Boston, Chicago, Los Angeles, New York, or Seattle—in states where local governments have not been restricted by preemption—have long experience using these policy tools to maximize high-road economic impacts of major projects. These cities are already exercising their competitive advantage in drawing down new rounds of federal funds via competitive grant programs.10

Given current opportunities for local governments to leverage federal funds toward good jobs, there is no time to waste in empowering Michigan cities, counties, and school districts to attach prevailing wage, PLAs, and apprenticeship requirements to upcoming infrastructure and green energy projects. 

Reversing preemption of local standard-setting is the next essential step in restoring Michigan’s role as leader in good job creation

Workers, advocates, and policymakers across the country have begun to push back on the trend of harmful state preemption after years of observing its economic damage. There was a time when the Midwest was a leader in incubating local laboratories of democracy—including progressive cities, counties, and school districts that enacted innovative policies to support working families. By taking steps today toward passage of SB 170 and 171, Michigan can restore its position as a regional leader on the path back to a high-road economy. Michigan workers need and deserve better jobs and opportunities, and passage of these two bills will restore the critical ability of local governments to enact labor standards necessary to help reverse inequality and build local economies that work for everyone.

Notes

1. The Economic Policy Institute’s Workers’ Rights Preemption in the U.S.: A Map of the Campaign to Suppress Workers’ Rights in the States, last updated in August 2019, tracks state legislation that preempts local action on key worker rights including minimum wage, fair scheduling, project labor agreements, prevailing wage, paid leave, and labor standards in the gig economy.

2. Hunter Blair et al., Preempting Progress: State Interference in Local Policymaking Prevents People of Color, Women, and Low-Income Workers from Making Ends Meet in the South, Economic Policy Institute, September 30, 2020.

3. Julia Wolfe et al., Preempting Progress in the Heartland: State Lawmakers in the Midwest Prevent Shared Prosperity and Racial, Gender, and Immigrant Justice by Interfering in Local Policymaking, Economic Policy Institute, October 14, 2021.

4. Lisa Graves, ALEC, “Model” Legislation, and Preemption, Local Solutions Support Center, March 15, 2023.

5. Daniel Schneider and Kristen Harknett, It’s About Time: How Work Schedule Instability Matters for Workers, Families, and Racial Inequality, The Shift Project at the Institute for Research on Labor and Employment, University of California at Berkeley and University of California at San Francisco, October 2019.

6. HR Dive, “Predictive Scheduling Laws: A Running List of States and Localities That Have Adopted Predictive Scheduling Requirements” (web page), last modified February 13, 2023.

7. Leila Morsy and Richard Rothstein, Parents’ Non-Standard Work Schedules Make Adequate Childrearing Difficult: Reforming Labor Market Practices Can Improve Children’s Cognitive and Behavioral Outcomes, Economic Policy Institute, August 6, 2015.

8. Karla Walter, 4 Job Quality Questions All Applicants for Federal Funds Should Answer, Center for American Progress, June 20, 2023.

9. U.S. Department of Energy, Office of Clean Energy Demonstrations, Guidance for Creating a Community Benefits Plan for the Regional Clean Hydrogen Energy Hubs, last updated October 17, 2022.

10. U.S. Department of Labor, Project Labor Agreements as Tools for Equity; New York City Mayor’s Office of Contract Services, “Project Labor Agreements” (web page).

• establishing dedicated local labor standards offices that enforce workers’ rights laws 
• establishing ongoing worker boards or councils 
• passing local worker protection laws
• actively enforcing local worker protection laws 
• setting job quality standards for contractors with the municipal government 
• establishing legal consequences for labor violations among applicants for municipal permits or licenses 
• practicing high-road employment principles in relation to municipal employees
• championing worker issues through public leadership 

While other reports have done an excellent job of exploring local action on specific issues like paid sick leave, living wages, and creation of worker boards, this report identifies and examines the broader trend of increased local action and analyzes the landscape of cities and other localities’ pro-worker actions in a comprehensive way.

Why it matters: Policies and enforcement that protect the rights of workers, ensure workers are able to meet their basic needs, and support workers’ efforts to organize are foundational to building healthy, thriving, and equitable communities. Working people in the United States today face multiple crisis situations that not only adversely impact their well-being, but also undermine the health and well-being of communities. Outdated labor laws are skewed against workers trying to form and join unions, and workers who try often face retaliation and other violations by employers. Public enforcement resources are inadequate, and workers are increasingly unable to bring their claims in court because of forced arbitration. In this context, cities and localities are vitally important and necessary actors in the effort to expand and enforce workers’ rights. They are close to their residents, and often are nimble and fast-moving in responding to emerging needs. A few cities (along with a few states) are also at the vanguard of innovating on policy and piloting new approaches to expanding and protecting workers’ rights. There is very meaningful work currently happening at the local level, with untapped potential for much more local action. 

What can be done about it: Local policymakers, enforcers, advocates, and community members can work together to pilot new local laws, create dedicated labor enforcement agencies and worker boards, develop strategic community enforcement partnerships, and use permits to drive compliance. Localities can fight abusive state preemption that impairs the abilities of local governments to build upon minimum standards set at the state level. Unions, worker advocates, and the public can think creatively about how to enact measures within their own localities and press for action. Other actors and observers in this space—federal and state government, the media, funders, academics, and more—should develop a greater understanding of the emerging role of cities in protecting working people. They should work to institutionalize and chronicle protecting and supporting workers as part of our understanding of what localities do. This report offers a road map of opportunities to enact policies at the local level that advance workers’ rights and improve working conditions.

Executive summary

In recent years, cities, counties, and other localities have become innovators and leaders in standing up for working people. Responding to increased inequality, degraded working conditions, and insufficient or inconsistent worker protections at the state and federal level, localities have in many cases joined states as the “laboratories” of experimentation (as Supreme Court Justice Louis D. Brandeis described) in relation to workplace matters.1 A number of localities have come to view protecting workers and improving their conditions as part of their core municipal function.

This report provides an overview of some of the most noteworthy ways in which localities have taken action on behalf of working people in recent years:

• Some localities have established dedicated local labor standards offices that enforce workers’ rights laws; educate employers, workers, and the public about these laws; and in some cases help formulate or inform municipal policy in this area.
• Localities have established ongoing worker boards or councils to provide workers with a formal role in local government and/or access to local officials and agencies.
• Other localities have focused on passing local worker protection laws, including ordinances regarding minimum wages, paid sick leave, and fair scheduling; industry-specific protections for sectors with high violation rates or specific vulnerability (such as the domestic worker, gig, hotel, retail, fast-food and freelance industries); broader anti-discrimination protections; and specific laws responsive to the COVID-19 pandemic.
• Localities are actively enforcing local worker protection laws, including with funded community partnership models in some instances.
• Some localities have established job quality standards for contractors, while others have established legal consequences (including denial and revocation) for applicants for initial or renewed municipal permits or licenses who have a history of wage theft violations or unresolved labor standards orders.
• Localities are demonstrating how to be a high-road employer of municipal employees, including by incorporating labor standards like higher minimum wages and paid sick leave, and enabling or facilitating collective bargaining among workers in local government.
• Active localities and local elected and appointed government leaders are exerting leadership in the public sphere, through education and outreach about labor laws, issuance of reports, convenings and public hearings, and use of the bully pulpit.

Federal—and in some cases state—preemption creates some limitations on what localities can do to expand and protect workers’ rights. Preemption occurs when federal or state law prevents subordinate levels of government (in this case, municipalities) from legislating or acting on a given issue. Still, local governments have considerable opportunity to take meaningful action on behalf of the working people within their jurisdictions.

The time is ripe for local action to advance workers’ rights. Working people are expressing dissatisfaction with worsening working conditions by resigning, forming and joining unions, and demanding change. 

Overview and introduction

Policies and enforcement that protect the rights of workers, ensure that workers are able to meet their basic needs, and support workers’ efforts to organize are foundational to building healthy, thriving, and equitable communities (Bhatia et al. 2013; USC ERI 2020). Working people in the United States today face multiple crisis situations that not only adversely impact their well-being, but also undermine the health and well-being of communities. The COVID-19 pandemic has led to many workplace clusters. Federal and state workplace measures have been varied, yet insufficient, to provide adequate protection from the virus.

Even before the pandemic, working people had been experiencing a multitude of serious challenges. Two widespread challenges are wage theft—the practice of employers failing to pay workers the full wages to which they are legally entitled—and misclassification of workers as independent contractors—the practice of employers labeling workers as independent contractors, rather than employees, to avoid paying unemployment and other taxes on workers and covering them with workers’ compensation insurance. Outdated labor laws are skewed against workers trying to form and join unions, and workers who try often face retaliation and other violations by employers (McNicholas 2019). Public enforcement resources are inadequate, and workers are increasingly unable to bring their claims in court because of forced arbitration (Hamaji et al. 2019). Employers who fail to pay unemployment or other taxes deprive public coffers of resources needed for programs serving important human needs (Erlich 2019). Meanwhile, the labor market itself is skewed—workers’ wages have not kept up with their productivity (Mishel 2021), and corporate concentration along with anti-competitive practices add to workers’ challenges in getting a fair wage (Stansbury 2021). These challenges have fallen hardest on workers of color and workers in low-wage industries.

Federal and state leaders who wish to take action on these thorny and deep-seated issues often face significant obstacles when they seek to pass laws, promulgate regulations, or take other steps responsive to workers’ needs. Such challenges can be even greater in relation to emerging developments in the workplace.

Supreme Court Justice Louis Brandeis famously described states as laboratories of public policy experimentation.2 In relation to workers’ rights, U.S. localities3 have been true laboratories of experimentation in recent years (Diller 2014).4 Historically, the federal government and states have been responsible for workplace regulation; over the years, cities and localities have not generally taken a leading role.5 But in roughly the past decade, cities and localities have become increasingly important actors in expanding and enforcing workers’ rights—what some commentators have called the “municipalization” of labor law (Sarchet 2021).

Cities and localities have introduced cutting-edge laws that do not exist at the federal or state level (including some responsive to newly emerging problems); established new offices devoted to protecting workers; used their contracting, licensing, and permitting powers to drive employer compliance; and implemented new methods of enforcement, including close and even funded partnerships with worker and community organizations. Such action by localities has occurred not only in traditionally worker-friendly regions, but also in progressive cities located within more conservative states. (Efforts in such locales have often, but not always, been met with state-level preemption measures, as noted by Blair et al. 2020 and Wolfe et al. 2021). And in some cases, such as the expansion of paid sick days, policy leadership at the local level has provided proof of concept and helped build momentum for states (and earlier in the pandemic, even the federal government) to take action. Local government action on workers’ rights also often reflects efforts to address local conditions when it comes to cost of living, dominant and emerging industries, and the needs and organizing of specific communities (especially communities of color and immigrant communities).

This report provides both an outline and a road map: an outline of actions that cities and localities have taken in recent years to protect workers, and a road map of possible policy and enforcement options for local leaders, both elected and appointed, to consider.6 Such actions include:

• establishing a dedicated department, office, or subagency within city government focused on worker issues
• creating boards or councils that provide workers with a voice, a role, and/or access to local government
• passing laws that create new and essential rights for workers
• enforcing worker protection laws, including through strategic, innovative, and/or collaborative approaches
• leveraging contracting, licensing, and/or permitting powers to raise and address worker issues
• incorporating high-road employment practices and labor policies in relation to their own municipal workforces
• using soft powers, including community education and outreach, issuance of reports, and other “bully pulpit” vehicles for reaching the community and highlighting worker needs and available resources

Notably, some cities and localities have taken meaningful action to protect workers and advance their rights and well-being during the COVID-19 pandemic; more should follow suit. This report also outlines a number of measures taken at the local level in response to COVID-19.

This report is intended not only for local leaders, but also for labor unions and worker advocates, to help deepen their understanding of policy and enforcement levers at the local government level in order to guide advocacy and collaborative governance efforts. This report can also inspire academics and other researchers to study local efforts to advance workers’ rights. Finally, policymakers at all levels of government should pay attention to the innovative solutions advanced by localities. ​​

At least 20 localities have created or are creating dedicated local labor agencies

A number of localities have created agencies specifically dedicated to enforcing workers’ rights under local ordinances, including laws addressing minimum wages,7 wage theft, paid sick and safe leave, fair scheduling/fair workweek requirements requiring advance notice of scheduling, fair chance hiring laws, gig worker rights, and more. Several of these agencies are also charged with analyzing and potentially proposing local labor policies. In other instances, localities do not have a dedicated stand-alone office, but units of other municipal agencies focus specifically on workers’ rights matters. And some localities without dedicated units have tasked specific government entities with enforcing wage theft or paid sick leave laws, such as a city manager, treasurer, or attorney; office of human rights; unit of the mayor’s office; or other officials (A Better Balance n.d.b.; Boulder 2022; Pinellas OHR n.d.; Miami-Dade WTP n.d.).8

Creation of a dedicated unit within local government focused on workers’ rights can be transformative. It ensures that municipal public servants will be involved in worker protection in a continuous, proactive, ongoing, and in-depth manner. It allows specialized staff to develop expertise on the relevant municipal laws and policies, as well as deep knowledge of issues affecting local workers. Where there is a dedicated worker-focused office in local government, staffers can develop ongoing relationships with relevant stakeholders like worker advocacy groups, unions, immigrant rights advocates or service providers, employment lawyers, and employer associations, as well as other relevant government enforcement agencies at the local, state, and federal levels. A dedicated office also can be mobilized to address emerging needs, including those that arose in the COVID-19 pandemic. Most importantly, establishment of a dedicated office institutionalizes and embeds the work within local government, ensuring the focus on workers and their challenges will continue beyond a particular administration.

Jurisdictions with dedicated agencies, subdivisions, or staff include Berkeley (California), Boston, Chicago, Denver, Duluth (Minnesota), Emeryville (California), Flagstaff (Arizona), Los Angeles City, Los Angeles County, Minneapolis, New York City, Philadelphia, San Francisco, San Jose, Santa Clara County (California), Seattle, St. Paul (Minnesota), and Tacoma (Washington).9 In addition, the San Diego County Board of Supervisors voted in 2021 to create a county labor office, and the San Diego City Council followed suit in 2022 by voting to create a labor enforcement office in a new Compliance Department.10 Tucson, Arizona, voters in 2021 passed a ballot initiative to create a local minimum wage and also a city Department of Labor Standards.11 Numerous Florida localities have created wage theft enforcement or mediation programs of various kinds: Broward County (complaint form), Miami-Dade County, and Pinellas County.12 Via court order, Palm Beach County created a Wage Dispute Division within the county civil court.13

More dedicated units to enforce workers’ rights are likely on the horizon. For example, a legislative proposal resulting from the work of an Earned Sick and Safe Leave Task Force is currently under consideration in Bloomington, Minnesota (population of approximately 90,000), home of the Mall of America.14 The city manager there has stated that two full-time equivalent staffers (one attorney and one paralegal) would be needed for this work.15

Snapshots of several local agencies in cities of varying size:

Berkeley, California (Pop. 124,321): The Workplace Enforcement and Standards Unit was created in 2014. It currently has a single full-time equivalent (FTE) employee, who also holds nonlabor-related responsibilities in addition to enforcing the city’s minimum wage, living wage, paid sick leave, and other laws (U.S. Census Bureau 2022a).

Chicago (Pop. 2.7 million): Chicago’s Office of Labor Standards, housed in the Department of Business Affairs and Consumer Protection, began operating in 2019 (its official launch date was in 2020). As of June 2022, the office has eight FTEs. It enforces the city’s minimum wage, wage theft, paid sick leave, fair workweek, COVID and vaccine anti-retaliation laws, as well as a law effective in January 2022 requiring employers of domestic workers to provide them with written contracts (U.S. Census Bureau 2022b).

Denver (Pop. 715,522): Denver Labor, created in 2019, is a division enforcing wage and hour laws located in the Denver auditor’s office. The office has 25 FTEs, and it enforces the city’s minimum wage laws, as well as a number of laws related to government work: a minimum wage applicable to city contractors, the city’s prevailing wage, the city’s living wage, and more. The office also has a community education emphasis: there are full-time community education staff and an annual outreach/education plan, including radio and internet ads, weekly online training, hundreds of outreach events, and multilingual written materials (U.S. Census Bureau 2022c).

Duluth, Minnesota (Pop. 86,697): Enforcement of Duluth’s earned sick and safe time law (effective in 2020) is handled through the equivalent of one employee housed in the city clerk’s office (U.S. Census Bureau 2022d).

Los Angeles City (Pop. 3.9 million): The Office of Wage Standards in the city of Los Angeles was created in 2015. It is authorized to have 30 FTEs, although in February 2022, this figure included nine vacancies. It enforces the city’s minimum wage, paid sick leave, and fair chance hiring laws (U.S. Census Bureau 2022f). (The county of Los Angeles has a separate enforcement agency that enforces the county’s own workplace laws.)

Minneapolis (Pop. 429,954): The Labor Standards Enforcement Division was created within the city’s Department of Civil Rights in 2016. The office has five FTEs, and it enforces the city’s paid sick and safe time, minimum wage, wage theft, and freelance worker protections laws, as well as a law giving hospitality workers the right of recall, which will sunset one year after the COVID-19 public health emergency (U.S. Census Bureau 2022g).

New York City (Pop. 8.8 million): New York City’s Office of Labor Standards and Policy was created in 2016, and is housed in the Department of Consumer and Worker Protection (DCWP). (That agency was long known as the Department of Consumer Affairs; its name changed in 2019 (Greenbaum 2019) in part to convey the agency’s focus on workers as well as consumers.) In 2021, the office had 33 FTEs. While it lacks jurisdiction to set a city minimum wage, the office enforces the city’s Paid Safe and Sick Leave Law, Freelance Isn’t Free Act, and the Fair Workweek Law in retail and fast-food, as well as several new cutting-edge laws, including a “just cause” termination law giving fast-food employees protections against arbitrary termination, and a law giving food delivery workers greater control over their working conditions and authorizing DCWP to set a minimum pay rate (U.S. Census Bureau 2022h).

Philadelphia (Pop. 1.6 million): In the June 2020 primary election, voters of Philadelphia overwhelmingly approved a ballot question to amend the city charter to create a city department of labor, demonstrating widespread public support for municipal involvement in workers’ rights issues (U.S. Census Bureau 2022i; Ballotpedia n.d.). The head of the Philadelphia Department of Labor is the deputy mayor for labor, holding a high-profile position within city government. The Office of Worker Protections, located within the department, has a total of nine FTEs, and enforces wage theft, paid sick leave, and fair workweek laws; laws covering specific industries (domestic worker bill of rights, wrongful discharge of parking employment, recall and/or retention of hotel, travel and hospitality workers); and more. The office established a domestic worker task force and has been tasked with creating a portable benefits system for domestic workers (Orso 2020), likely to be the nation’s first. In addition, in 2020 and 2021, the office partnered with worker organizations on a citywide effort on the Philadelphia Worker Relief Fund (MF Phila. n.d.; Cox 2020), which distributed more than $2.2 million to 2,820 families left out of COVID-19 government relief (Philadelphia 2020a). The office also collaborated on a referral system with the city health department’s COVID-19 containment unit to mediate paid sick leave when workers reported exposure.

San Francisco (Pop. 873,965): San Francisco’s Office of Labor Standards Enforcement (OLSE) was created nearly 20 years ago (San Francisco n.d.a; SF OLSE n.d.e). The office has 30 FTEs, and currently enforces more than 30 citywide laws, including ordinances on minimum wage, paid sick leave, fair chance employment, scheduling laws, and others, as well as a handful of other laws related to government contracting (SF OLSE n.d.f; U.S. Census Bureau 2022j).

San Jose (Pop. 983,489): San Jose’s Office of Equality Assurance, with a staff of eleven, implements, monitors, and administers the city’s wage policies, including the living wage law applicable to city service contracts, the prevailing wage law which covers public works (construction) projects, and the minimum wage ordinance applicable to employers for work performed within the city. The Office also contracts with a number of neighboring localities to provide minimum wage enforcement services for their own local minimum wages. For example, in 2020, the City of San Jose entered into contracts with the nearby cities of Burlingame, Cupertino, Milpitas, Redwood City, San Carlos, San Mateo, Santa Clara, South San Francisco, and Sunnyvale; maximum compensation under the contracts is $40,000 to $45,000 to cover a period of two and a half to three years. This arrangement allows smaller localities to functionally pool resources in order to have their local laws enforced (San Jose 2020; San Jose n.d.; U.S. Census Bureau 2022k).

Santa Clara County, California (Pop. 1.9 million): The County’s Office of Labor Standards Enforcement was created in 2017. The office has capacity for five FTEs; four were filled as of May 2022. Among other things, the office ensures that recipients of county permits, licenses, and contracts comply with labor laws and satisfy outstanding judgments issued by the California Labor Commissioner’s Office. The office also enforces wage theft prevention and living wage requirements related to contracting, contained in Chapter 5 of the Santa Clara Board of Supervisors Policy Manual (Section 5.5.5.4) (SC BOS 2020). In 2021, the office also enforced a hazard pay ordinance related to COVID-19 (SC OLSE n.d.c; U.S. Census Bureau 2022l).

A deeper dive into Seattle’s local labor agency

Seattle’s Office of Labor Standards has grown rapidly since its creation in 2015 as a division within the Seattle Office of Civil Rights. The Office of Labor Standards became an independent, standalone city agency in 2017, and the breadth and impact of its activities provide a useful example of the potential of municipal labor agencies.

Staffing: As of February 2022, the office had 34 FTEs and one full-time temporary position. These position include a director, deputy director, communications manager, seven outreach positions, four policy-focused positions, three operations and finance positions, and eighteen enforcement officials.

Ordinances: The office enforces 18 city laws. These include laws of broad application (paid sick and safe time, fair chance employment, wage theft, and commuter benefits ordinances); laws targeting specific industries (secure scheduling ordinance for retail and food services workers, as well as ordinances protecting domestic workers, transportation network company drivers, and hotel workers); and laws enacted during the COVID-19 pandemic (paid sick and safe time for gig workers, as well as premium/hazard pay for gig workers/grocery employees) (Seattle OLS 2012, 2013, 2015a, 2015b, 2017, 2020b, 2020d, 2020e, 2020h, 2021a). Finally, on September 1, 2022, the Independent Contractor Protections Ordinance (Seattle OLS 2021b) will take effect; it will require commercial hiring entities to provide certain precontract disclosures and payment disclosures, and also requires timely payment of contracts. See Section 6 for more in-depth discussion.

Enforcement: The office has brought a number of successful enforcement actions, including in fast-food, gig economy, construction, retail, grocery, and other industries. These cases are described in Section 7.

Policymaking: The office has helped develop city labor policy in various ways. The office ran a broad policymaking process to develop two labor standards ordinances for transportation network companies (TNC) drivers, including contracting for a minimum compensation standard study (Reich and Parrott 2020). The office conducted an extensive stakeholder process and drafted the eventual TNC Driver Minimum Compensation Ordinance (Seattle OLS 2020i), which went into effect in 2021 and the TNC Driver Deactivation Rights Ordinance (DRO). The DRO provides drivers protection against unwarranted termination from companies’ platforms, a pathway to resolve deactivation disputes before a neutral arbitrator, and which created a first-in-the-nation Driver Resolution Center to provide consultation and direct representation to drivers facing deactivation, along with culturally relevant outreach and education, and other support. The Office of Labor Standards completed a request for proposal to award an 18-month contract for just more than $5 million to a community organization to get the Driver Resolution Center up and running (Seattle OLS n.d.h).16

In addition, pursuant to a city council resolution and recommendation by the city’s Domestic Workers Standards Board,17 the Office of Labor Standards will be crafting a proposal for portable paid time off for domestic workers.

Pandemic response: The Office of Labor Standards has taken numerous actions in response to the COVID-19 pandemic. In April 2020, following amendment of the city’s Paid Sick and Safe Time Ordinance (PSST) to expand PSST uses in response to COVID-19, the office conducted emergency rulemaking to ease the burden of verification for use of PSST on workers and the health care system. The office provided updated information in more than 11 languages and, with the city’s Department of Neighborhoods, increased access to this information through audio and video recordings, as well as through trainings and town hall meetings. Responding to the increase of domestic violence during the pandemic, the office also partnered on a safe leave training with a local community organization, API Chaya, and the Mayor’s Office on Domestic Violence and Sexual Assault.

The office also assisted in distribution of food vouchers and masks via community-based organizations, including the office’s Community Education and Outreach Fund partners, to workers who experienced structural or institutional barriers to accessing support from government (e.g., language barrier, fear of deportation, experienced domestic violence, did not qualify for other benefits). The community-based organizations enrolled more than 800 workers who had lost their jobs or experienced a decrease in hours or wages due to the pandemic. Each worker received $1,920 in grocery vouchers over a seven-month period.

Finally, along with the mayor’s office and the Office of Immigrant and Refugee Affairs, the Office of Labor Standards worked to increase access to unemployment funds for workers, especially for potentially misclassified gig workers and domestic workers, and also to enhance access to information about unemployment benefits in multiple languages. One effort included contracting with a community organization for three months to provide cultural- and language-specific outreach and referral assistance to transportation network company, taxi, and for-hire vehicle drivers seeking to access COVID-19-related relief resources. The community organization assisted 1,400 workers with their unemployment insurance claims in 12 languages, including Kiswahili, Nuer, Twi, and Hausa. Another effort included partnering with a local civil legal aid organization to provide training on unemployment insurance, and paid sick and safe time.

Several cities have created boards or councils to provide workers with a formal role and/or access to local government

Workers’ boards are bodies established by governments that include worker representation and that typically aim to provide workers with a voice and formal role in setting higher minimum standards for jobs in particular industries. These boards typically investigate challenges facing workers by conducting hearings and outreach activities, issuing reports on findings, and making recommendations regarding minimum wage rates, benefits, and workplace standards. By focusing on workers in specific industries, these boards are able to address industry-specific issues and involve workers and their organizations directly in governance decisions.

Professor Arindrajat Dube, based on his analysis of industry-specific wage boards in Australia, concludes that wage-setting boards “are much better positioned to deliver gains to middle-wage jobs than a single minimum pay standard” (Dube 2018); the local boards described here do not have wage-setting powers, but some may make recommendations. In 2019, the Center for American Progress issued a how-to guide for state and local governments and advocates interested in developing workers’ boards or similar structures (Andrias, Madland, and Wall 2019). The guide’s detailed recommendations include ensuring a broad mandate; requiring representative and democratic selection of members; granting boards authority to gather relevant information through hearings and investigations; granting boards authority to issue recommendations; creation of strong enforcement mechanisms to ensure compliance with new standards; and empowering worker participation in board activities by requiring employers to provide reasonable time to participate and compensating workers for their participation, among other things.

In some states, preemption of local wage or standard-setting limits potential recommendations a board could make that would result in material policy change; however, even then, workers’ boards may be able to impact local government purchasing and contracting policies, workforce development programs, tax abatement and incentive policies, economic development planning and community benefits agreements, distribution of local government funding, and workplace safety trainings. They may also be able to provide independent monitoring of local, state, and federal public health and labor laws, and inclusive economic development planning. Worker boards are a relatively new development, mostly established in the last five years.

The following are examples of several local worker boards or similar structures:

Seattle Domestic Workers Standards Board: In 2019, Seattle passed the Domestic Workers Ordinance, which along with establishing a minimum wage and entitling workers to rest and meal breaks, also created a Domestic Workers Standards Board (Seattle CC 2018). The board, members of which are appointed by the mayor and city council (and one member is appointed by the board itself), requires representation from domestic workers (including workers who are and are no members of worker organizations), employers, and the community (with an emphasis on vulnerable populations like people with disabilities) (Seattle OLS 2018a). The board is empowered to provide recommendations to the city council on workplace safety standards, discrimination and sexual harassment, training for workers and employers, access to leave, wage standards, workers’ compensation, hiring agreements, and other topics, and has been granted funding to implement these recommendations.

Detroit Industry Standards Boards: Detroit passed an ordinance in November 2021 creating a structure for industry standards boards (SEIU Healthcare 2021; Detroit 2021). A standards board in a specific industry can be established under the ordinance by the city council, at the request of the mayor, or by petition of at least 225 workers in a given industry. The standards boards are composed of workers, employer representatives, and other individuals appointed by the mayor and city council. The industry boards are tasked with investigating industry conditions, conducting outreach to workers, making recommendations as to pay, benefits, training opportunities and scheduling, and forwarding complaints to relevant enforcement agencies.

Harris County (Texas) Essential Workers Board: Harris County established an essential workers board in 2021 to advise the county on programs and policies that support essential workers. All members must be “low-income essential workers,” with at least one worker representative from each of the following essential industries: airport or transportation; construction; domestic work or home care; education or child care; grocery, convenience, or drug store; health care or public health; janitorial; food services, hospitality, or leisure services; and retail (Trovall 2021; Harris County 2021). In addition to advising the county on its overall approach to protecting essential workers’ rights and providing a public forum, the board is also tasked with providing feedback on the county’s “purchasing and contracting policies, workforce development programs, tax abatement and incentive policies, community benefits agreements, distribution of federal COVID-19 relief and recovery funds, disaster preparedness and recovery programs, OSHA trainings, independent monitoring of local, state, and federal public health and labor laws, and inclusive economic development planning.”

Durham (North Carolina) Workers’ Rights Commission: In 2019, Durham formed the Workers’ Rights Commission as an advisory body to the city council on working conditions in Durham. Except for a liaison to the city council, all members are workers appointed by the city council and must include workers from the largest employers in Durham, workers in low-wage industries, workers organized in unions, and unorganized workers. The commission aims to provide a public forum for discussion and exploration of workers’ rights, conduct studies, recommend pro-worker policies for the city council’s state legislative agenda, craft a workers’ bill of rights and develop a voluntary recognition program to reward employer compliance, propose standards to encourage all employers within the city to establish a minimum standard, support workers in union campaigns, and provide channels of communication between organized and unorganized workers (Durham WRC n.d.).

Twin Cities’ Workplace Advisory Committees: In 2016, Minneapolis created a Workplace Advisory Committee in connection with passing the city’s safe and sick time ordinance (Minneapolis 2016a). The committee is composed of representatives from organized labor, workers, and employer representatives, among others. The committee is tasked with providing advice on workplace initiatives, recommendations on community engagement, and monitoring and evaluating implementation of workplace policies (Minneapolis 2016a). St. Paul’s Labor Standards Advisory Committee (St. Paul n.d.a) advises and supports the city’s Labor Standards Enforcement and Education Division. The committee includes representatives of employers, employees, and the public, and advises in the development and implementation of policies, procedures, and rules related to the city’s minimum wage and earned sick and safe time ordinances; recommends actions to improve strategic community outreach and education efforts; supports strategic enforcement and strategic outreach; explores and recommends opportunities and resources to help small businesses; assists with community partnerships; and engages business owners, workers, and community stakeholders to gather feedback and recommendations.

Los Angeles County Public Health Councils (LA PHC n.d.): In November 2020, Los Angeles County approved a program establishing public health councils to help ensure that employers follow COVID safety guidelines. Implemented and overseen by the county’s Department of Public Health, the program empowers workers to form public health councils at their worksites to monitor compliance with county health orders in the following industries: food and apparel manufacturing, warehousing and storage, and restaurant (LA County BOS 2020). The Department of Public Health will enlist the help of certified worker organizations to conduct outreach and education to workers interested in forming public health councils.

Localities can serve as model employers in relation to their own workforces

Localities can support working people by creating good working conditions for their own municipal workforces. Nationally, about one-third of state and local employees are paid less than $20 per hour, and more than 15% are paid less than $15 per hour. In 13 states, more than 20% of state and local workers are paid less than $15 per hour (Sawo and Wolfe 2022). Women and Black workers are more likely to be employed by local and state governments, so improving working conditions for local government workers advances important equity goals (Cooper and Wolfe 2020).

A significant portion of local government employees are union members (40.2% in 2021) (BLS 2022); high unionization rates among law enforcement and teachers contribute to these numbers. Working conditions for these employees are established through collective bargaining agreements with the locality. Working conditions of nonunionized municipal workers are governed by applicable federal, state, and local laws, as well as municipal policy.

Localities can support workers by raising labor standards for their own employees regardless of union membership. They can also take steps to allow and facilitate collective bargaining by their employees.

Limited public funds can lead to concerns about the cost of supporting municipal workers in light of other pressing public funding needs. However, in addition to improving municipal job quality as a matter of values and commitment to working people, localities themselves can benefit from doing so. High-road job offerings can help attract better-qualified workers to local government and reduce turnover, both of which enable local governments to provide higher-quality public services, as well as avoiding the cost associated with employee turnover. Municipal employers are often the largest employers in many regions (Hain and Coffin 2020), and thus improved standards for municipal workers can also lead to additional benefits, like public health gains when paid sick leave prevents spread of illness, and stabilizing and stimulating the local economy in times of stagnation or recession. By exemplifying practices of a model employer, local governments also can play a leadership role for private and nonprofit employers, helping create local norms that lift local working standards generally. And collective bargaining in particular can help reduce racial and gender pay gaps, attract workers to local government, and create high-quality jobs (Morrissey and Sherer 2022).

Local governments can also support municipal workers by limiting and resisting privatization, defined as the shifting of governmental functions and responsibilities to the private sector through such activities as contracting out (Local Progress 2019). Privatization of local government functions has proliferated in the recent past, affecting services and infrastructure like water treatment, trash collection, and toll collection (Early 2021; Dutzik, Imus, and Baxandall 2009). Privatization not only denies opportunities to municipal workers who are more likely to be unionized and to have higher job standards, it also undermines democratic accountability. Moreover, projected cost savings from privatization often do not materialize, and service quality often declines under private provision (PWF n.d.b).18

Localities have raised labor standards for municipal employees

A number of localities have raised the minimum wage paid to their own municipal workforce; recent examples include Atlanta; Jersey City, New Jersey; Milwaukee; New Orleans; North Miami Beach, Florida; Tallahassee, Florida; and West New York, New Jersey (Noble 2021; Fox 2021a, 2021b; Atlanta 2017; Miami Times Staff 2021). More than 100 localities have passed paid family or parental leave policies for their municipal employees (NPWF 2020). Many local governments extended emergency paid sick leave to their municipal workers during the pandemic, and some front-loaded the annual sick leave allotment for all employees (Hain, Yadavalli, and Wagner 2020). The city of Austin distributed stipends to some city workers who continued to provide in-person services during the COVID-19 pandemic (Newberry 2020).

Localities can enable and support collective bargaining and union organizing by municipal workers

Localities also can enable or facilitate collective bargaining and unionizing among their municipal workforce. Public employee unions can be stable bargaining partners to local governments, promote labor peace, and ensure the delivery of high-quality services.19 In addition, unions reduce inequality as well as race and gender disparities (EPI 2021; Bivens et al. 2017) and boost democratic participation (McElwee 2015).

Whether or not local government workers can form and join unions varies by state and by the type of municipal worker. Many state statutes expressly authorize collective bargaining by teachers, police officers, and firefighters (Sanes and Schmitt 2014). In some states, local governments are permitted to collectively bargain with all municipal workers (Monroe 2018; Vermont 1973).20 In some states, local governments are prohibited from doing so.21 In states where collective bargaining for local employees is neither guaranteed nor prohibited by state law, localities can facilitate unionizing and collective bargaining by their own workforces by passing local ordinances permitting collective bargaining. Two states where there has been heightened attention to this issue in recent years are Virginia and Colorado. In Virginia, the General Assembly in 2020 passed a law lifting a previous ban, thereby allowing localities to recognize and collectively bargain with unions by passing an ordinance. A number of Virginia localities have since passed collective bargaining ordinances, including the city of Alexandria, Arlington County, Fairfax County, Loudoun County, and the Richmond School Board (Alexandria Magazine Living Staff 2021; Armus 2021; Olivo 2021; Loudoun 2021; Hunter 2021). In 2022, the Colorado state legislature passed a bill granting public employees the right to collectively bargain; previously localities could decide whether to grant such rights, and out of approximately 270 localities in the state, only 16 had collectively bargained contracts with any of their workers (Colorado General Assembly 2022; Miller 2022; Vo 2022; Kenny 2021). For example, Adams County, Colorado, had passed a resolution in 2017 authorizing collective bargaining for county employees.22 In states such as Colorado and Virginia, localities can explicitly grant their municipal workforce the right to collectively bargain. Cities like Louisville, Kentucky, Memphis, Tennessee, Salt Lake City, Utah, and Tulsa, Oklahoma, have recognized and entered into collective bargaining agreements with municipal unions (Louisville HR n.d.; AFSCME 1733 2021; SLC HR n.d.; Tulsa HR n.d.).

In addition, localities can emulate legislative measures taken by certain states to facilitate public employee union access to government workers in response to the Supreme Court’s decision in Janus v. American Federation of State, County, and Municipal Employees, Council 31, et al. That case held that requiring public employees to pay union fair share agency fees to cover the costs of collective bargaining violates the First Amendment (McNicholas 2018).23 The decision bars unions from requiring workers who benefit from union representation to pay their fair share of that representation, thereby reducing public employee union resources and potentially their stability. In the wake of the Janus decision, a number of states, including California, Massachusetts, New Jersey, Washington, and several others, passed measures to reduce barriers to public-sector unionization, such as by requiring public employers to allow public employee unions access to new employee orientations, and to provide public employee unions with lists of new and current employees with contact information (NCSL 2019).

Finally, the 2022 Report of the White House Task Force on Worker Organizing and Empowerment (Harris and Walsh 2022) contains a number of recommendations for the federal government to increase unionization rates among federal employees. While some of the measures contained in the report would potentially be preempted by the National Labor Relations Act, many of them could be adopted readily by local governments, such as:

• facilitating exposure to unions during the hiring process for job applicants and onboarding process for new employees, including listing information about whether a position is in a bargaining unit and the relevant union in job opportunity announcements, and encouraging agencies to offer their unions more opportunities to communicate with new hires during onboarding
• developing guidance and labor relations materials for agencies to use in trainings for managers and supervisors regarding unfair labor practices and neutrality in union organizing campaigns
• increasing and visibly supporting workers’ right to organize, including a know-your-rights initiative on the right to organize and collectively bargain

The report contains extensive analysis and practical suggestions about ways to encourage and facilitate collective bargaining.

Localities have enacted worker protection laws on a range of topics

Local governments typically have some authority to initiate legislation, subject to their authority under the relevant state constitution, state statutes, and city charters. In recent years, local governments have increasingly used this power to pass laws to advance workers’ rights.24

Laws setting higher minimum wages

In recent years, localities have often led the nation in policymaking to raise workers’ wages. The Fight for 15 campaign and other worker advocates and organizations have played a key role in seeking increased local minimum wage floors, which has paved the way for more innovative policymaking to advance workers’ rights by local governments (Meyerson 2019).25 Local wage and hour laws exist in a statutory landscape, including the federal Fair Labor Standards Act (FLSA), which establishes a federal minimum wage, overtime pay, record-keeping, and youth employment standards, and state laws that similarly establish their own state-level minimum wage and hour standards. The FLSA, and in some cases state law, acts as a floor, permitting local governments to provide more generous protections for workers. Some states, however, preempt local governments from setting higher local requirements, as discussed in further detail below (EPI 2019).

Currently, 52 cities and counties have local minimum wage laws that raise the minimum wage above the level established by state and federal governments (UC Berkeley Labor Center 2022; Lathrop 2021).26 Local minimum wages aim to keep workers out of poverty and to increase consumer purchasing power to spur economic growth. Such wages sometimes are enacted in metropolitan areas where the costs of living are higher relative to the rest of the state or region. Local minimum wages may vary in terms of wage levels, implementation timelines, and exemptions (for example, based on the size or classification of an employer, such as employers with more than 25 employees or nonprofits). Since 2012, local minimum wage increases have affected more than 4 million workers, more than half of whom are workers of color, and generated more than $33 billion in additional income for these workers each year (Lathrop, Lester, and Wilson 2021).

One way to increase the wages of many service workers without setting a higher minimum rate is for a locality to disallow the lower minimum wage that is permitted in many states and under federal law for workers who customarily and regularly receive tips (USDOL 2022b). Tipped workers are more likely to be women and people of color, and more likely to be subject to sexual harassment (Schweitzer 2021).27 In 2016, the city of Flagstaff eliminated the tipped minimum wage by referendum (Results for America n.d.). Las Cruces, New Mexico, also has enacted a higher tipped minimum wage than the state.28

In some instances, laws setting local minimum wage rates have focused on particular industries. Seattle’s Domestic Workers Ordinance requires domestic workers be paid at least the city’s minimum wage (Seattle OLS 2018a). At least four California cities—Los Angeles, Oakland, Santa Monica, and West Hollywood—have required a higher minimum wage for their hotel workers (LA DPW n.d.; Oakland n.d.; Santa Monica n.d.; West Hollywood n.d.).29

Laws addressing wage theft

Wage theft occurs when employees do not receive wages to which they are legally entitled for their work, including paying workers less than the minimum wage, not paying overtime premiums to workers who work more than 40 hours a week, or asking employees to work “off the clock” before or after their shifts. Cooper and Kroeger (2017) investigated just minimum wage violations, and found that in the 10 most populous states in the country (California, Florida, Georgia, Illinois, Michigan, New York, North Carolina, Ohio, Pennsylvania, and Texas), 17% of eligible low-wage workers reported being paid less than the minimum wage, amounting to 2.4 million workers losing $8 billion annually. Cooper and Kroeger estimate that workers nationwide lose $15 billion annually from minimum wage violations alone. A 2021 study found that more than $3 billion was recovered on behalf of workers by federal and state enforcers and through private litigation (Mangundayao et al. 2021).

In addition to setting up dedicated enforcement agencies and ensuring that these agencies are robustly funded to pursue violations, local governments can pass laws to address the problem of wage theft. For example, Denver passed a wage theft ordinance that classifies wage theft as a criminal misdemeanor and empowers the city attorney’s office to prosecute claims of $2,000 or less and seek restitution (Denver 2021).

In some instances, such measures may be a way for cities preempted from setting minimum wage rates to nonetheless have an impact on wage-related concerns and to protect workers within their jurisdiction from predation and abuse. Numerous localities in Florida have passed ordinances setting up administrative processes that make it easier for workers to file a complaint and recoup stolen wages without retaining a lawyer. In Florida, Miami-Dade County led the way, followed by Alachua County, Broward County, Hillsborough County, Osceola County, Pinellas County, and the city of St. Petersburg (Huizar 2019b). These ordinances set out a procedure for administrative resolution of wage theft claims by first allowing workers with claims of more than $60 in unpaid wages to settle claims with the city’s help. If those claims are not resolved, workers then may proceed to a hearing where the employer may be exposed to additional penalties (Miami-Dade WTP n.d.). An analysis of the Miami-Dade County Wage Theft Program found that between its adoption in 2010 and September 2014, workers recovered $2,039.83 in unpaid wages, on average, an amount researchers found was “well above the average recovered by federal enforcement” (RISEP-FIU 2014).

Finally, more wage theft protections at the city level may be on the horizon. The Austin (Texas) City Council passed a resolution in early 2022 directing the city manager to develop an ordinance on wage theft, with stakeholder input.30 Houston and El Paso, Texas, had previously passed similar resolutions (Ramirez 2022).

Paid sick and safe leave

Presently, 19 cities and counties have laws requiring employers to permit workers to take time to recover from an illness or care for a sick loved one and to be compensated for that time (A Better Balance n.d.b, 2021).31^, 32 Now 14 states and Washington, D.C., also have passed laws requiring paid sick leave (A Better Balance n.d.b), but local governments first led the way. For example, Jersey City, New Jersey, first enacted a paid sick leave ordinance in 2013, followed by 12 additional cities before a statewide law took effect in 2018.33 Research shows that paid sick leave ordinances effectively slow and reduce the spread of contagious illnesses by reducing the likelihood that workers will go to the workplace sick (otherwise referred to as sick presenteeism) (WCEG 2020). Especially for workers in low-wage industries, paid sick leave provides economic security when facing illness. Meanwhile, research has shown that businesses do not find such laws to be particularly burdensome once they are in effect. For example, a study of New York City employers revealed that “[b]y their own account, the vast majority of employers were able to adjust quite easily to the new law, and for most the cost impact was minimal to nonexistent” (Appelbaum and Milkman 2016). Moreover, 86% of the employers surveyed expressed support for the paid sick days law.

Local paid sick leave laws vary—i.e., exemptions for smaller employers, how family and loved ones are defined, the rate at which workers accrue sick time, and when workers start to earn sick time and whether it rolls over. However, many of them were developed with the technical assistance of groups like the nonprofit organization A Better Balance (A Better Balance n.d.a), and therefore have similar features. They generally provide somewhere in the range of 40 to 48 hours of leave annually, and prohibit retaliation against workers for taking leave.

Some of these laws also create a right to “safe leave” for situations in which workers or their family members are victims of domestic violence, stalking, and sexual assault (A Better Balance 2019). Safe leave laws can be used, for example, to obtain a protective order, access social services, or relocate.

Fair scheduling

Eight cities—Chicago; Emeryville, California; New York City; Philadelphia; San Francisco; San Jose, California; SeaTac, Washington; and Seattle—have laws to ensure workers have predictable schedules, more opportunities for existing employees to work, and sufficient periods of rest between shifts (A Better Balance 2022c). This set of policies, which have commonly been referred to as fair workweek or fair scheduling laws, have been championed and implemented because workers, particularly in the service sector, commonly receive their weekly work schedules only a few days in advance, and their scheduled work hours and workdays often change substantially from week to week. Fair workweek laws were first passed at the local level (Fair Workweek Initiative n.d.), paving the way for state-level action; Oregon has now adopted a statewide fair scheduling law.

Research suggests that unstable and unpredictable work scheduling practices undermine workers’ health and well-being and also lead to economic insecurity and income volatility, and that the fair workweek law in Seattle increased not only schedule predictability, but also subjective well-being, sleep quality, and economic security (Harknett, Schneider, and Irwin 2021). Most fair scheduling laws cover specific industries, such as retail or fast-food. They require covered employers to provide an initial estimate of a worker’s schedule upon hiring, advance notice of schedules, and compensation (predictability pay) for employer-initiated schedule changes with less than the requisite notice; workers also typically have the right to decline shifts that do not allow for a requisite period of rest, and the right to request a modified schedule.

In addition, because many workers in the relevant sectors seek additional work hours, fair workweek laws generally require employers to offer additional hours to existing employees before hiring new staff. Such laws also typically include provisions that prohibit employers from retaliating against workers for exercising rights under fair scheduling laws. Fair scheduling laws differ as to which employers are covered (typically limited by size and industry), notice and rest times, the level of predictability pay, and the like. San Francisco’s Family Friendly Workplace Ordinance specifically entitles workers to request a flexible or predictable schedule to assist with caregiving responsibilities, and requires employers to engage in an interactive process with the worker (San Francisco 2013).

Laws governing platform companies in the ‘gig’ economy

Almost all federal and state laws governing the workplace protect employees and not independent contractors. Platform companies in the so-called “gig” economy, in which workers are hired via apps, treat workers as independent contractors instead of as employees, thereby avoiding the obligations of an employer. This practice has led to considerable litigation, including lawsuits by the attorneys general of California and Massachusetts, alleging that such workers are misclassified (Gerstein 2020). Employer misclassification of workers as independent contractors is a longstanding, pervasive problem affecting millions of workers annually (Rhinehart et al. 2021).

New York City and Seattle have both passed ordinances creating various rights and protections for these workers, even as the cities have refrained from determinations about employee status. In 2018, New York City passed legislation34 empowering the relevant regulatory agency, the Taxi and Limousine Commission (TLC), to set minimum pay rates; accordingly, later that year, the TLC issued a rule (NYC TLC 2018) setting a minimum pay standard based on a study it had commissioned (Reich and Parrott 2020). In 2020, Seattle passed a similar ordinance (Seattle OLS 2020i) setting minimum pay for transportation network company drivers. New York City has also passed legislation35 allowing a city agency to set minimum payments for third-party (typically app-based) food delivery and courier providers. A comprehensive proposal to improve pay and transparency about working conditions for such workers was passed in 2022 by the Seattle City Council (Bull 2022, Taylor 2022a).

Seattle also passed a Transportation Network Company (TNC) Driver Deactivation Rights Ordinance (Seattle OLS 2021l), which grants drivers the right to challenge unwarranted deactivations before a neutral arbitrator, and creates a Driver Resolution Center to provide representation for drivers.36

Finally, in 2021, New York City passed a series of policies to protect delivery workers whose precarity was made clear during the COVID-19 pandemic (Figueroa et al. n.d.). An organization of bicycle delivery workers, Los Deliveristas Unidos, played a significant role in advocating for the new law (Los Deliveristas Unidos n.d.; City Staff 2021). The policies include a requirement that restaurants allow delivery workers to use their restrooms as long as they are picking up an order; minimum per-trip payments; transparency for customers and workers about tips (whether the tip goes to workers, in what form, and on what timeline); a prohibition on fees for receiving payment and a requirement that payments are made weekly, including at least one option that does not require a bank account; a prohibition on charging workers for insulated delivery bags; and permission for workers to limit their personal delivery zones (Sugar 2021).

Protections for freelancers or independent contractors

Minneapolis, New York City, and Seattle have passed laws to aid freelancers and independent contractors in securing timely payment for their work. Because such workers are not generally protected by employment law, they often face challenges in securing payment for their work, which is enforced by contract law and therefore typically requires securing legal counsel for any enforcement action (Yang et al. 2020). These local ordinances protecting freelancers require a written contract that includes certain written terms (e.g., pay rate and payment schedule) for a value greater than a minimum amount, require payment within 30 days of completion of the contract, offer protection against retaliation, and set up an administrative enforcement process. In 2022, the New York State legislature passed a state-level Freelance Isn’t Free Act based on New York City’s model (Maher 2022).

Protections against discrimination

Although the focus of this report is labor standards, not discrimination, it is worth noting that local governments have passed laws to expand protections from employment discrimination beyond what is protected under federal and state law. These local laws are typically enforced by local fair employment practices agencies (FEPAs), which are typically separate from agencies that enforce labor laws that regulate workers’ wages, hours, and benefits. For example, at least 330 local governments have passed nondiscrimination ordinances protecting workers from discrimination at work on the basis of sexual orientation, and at least 225 have done so to protect workers from discrimination on the basis of gender identity as well (MAP n.d.; HRC n.d.). Some local ordinances also protect workers from discrimination on the basis of marital or partnership status, family status, immigration status, status as a veteran, credit history, caregiver status, sexual and reproductive health decisions, salary history, weight and height, and status as a victim of domestic violence, stalking, or sex offenses (Vanderbilt 2012; Eidelson 2022; Brown 2002). In addition, federal employment discrimination protections only apply to employers with 15 or more workers, and local ordinances also often cover smaller workplaces (Clampitt n.d.). New York City in 2022 included domestic workers in the law prohibiting workplace discrimination (NYC CHR 2021). In addition, San Francisco in 2017 passed a law requiring employers to provide a reasonable break for a worker desiring to express breast milk for their child and to provide a space for lactation, other than a bathroom, that is shielded from view and intrusion (San Francisco 2017).

Several types of local anti-discrimination laws are described in more detail below.

Fair chance hiring

At least 22 local governments have passed laws requiring private and public employers to consider a candidate’s job qualifications before inquiring about a candidate’s criminal history—commonly referred to as “ban-the-box” or “fair chance” policies (Avery and Lu 2021). They may also prohibit consideration of certain types of past offenses, or require hiring entities to consider evidence of an applicant’s rehabilitation. Even more cities and counties have adopted fair chance hiring for their vendors’ or their own hiring. Fair chance policies vary as to the size of covered employers, when a background check is permitted in the job application and interview process, penalties, and enforcement.

Salary history bans

At least 20 local governments have passed laws prohibiting employers from inquiring about a job applicant’s salary history during the hiring process (HR Dive 2022; AAUW 2022).37 These ordinances seek to remedy systemic pay discrimination against women and people of color by allowing applicants to negotiate a salary based on their qualifications and earning potential, rather than being measured by their previous salary. Some local ordinances apply to private employers operating in the jurisdiction, whereas others apply only to local government hiring processes.

Pay transparency law

In January 2022, New York City became the first city38 to enact a pay transparency law,39 which requires employers to list a minimum and maximum salary for positions located in the city. This type of pay transparency law helps curb pay inequities. The law amends the New York City Human Rights Law (NYCHRL), the city’s ordinance that protects against employment discrimination, and makes any failure to post salary ranges an “unlawful discriminatory practice.” Ithaca, New York also passed a similar pay transparency law in May 2022 that applies to any employer with more than three permanent workers based in Ithaca (Zerez 2022).

Crown Act

Twenty eight municipalities, including New York City, have passed laws prohibiting discrimination based on a worker’s hairstyle or hair texture (NYC CHR 2019). Often known as the Crown Act (NAACP LDEF n.d.), these laws aim to address the impact of natural hair-based discrimination Black workers face in the workplace.

Protections against wrongful termination

Throughout the United States, almost all states have what is known as at-will employment; employers may terminate workers for reasons unrelated to job performance, as long as they are not discriminatory, retaliatory, or otherwise violative of the law. Just cause protections prevent employers from legally firing workers without warning or explanation (Tung, Sonn, and Odessky 2021). Such laws promote economic security and stability for workers and their families; they also protect workers from retaliation for raising concerns about violations of workplace laws.

Both Philadelphia and New York City have adopted ordinances that prohibit employers in certain industries from arbitrarily terminating employees. In Philadelphia, parking workers may only be terminated for just cause (which requires progressive discipline) or a bona fide economic reason (Philadelphia DOL 2021). New York City passed similar legislation applicable to fast-food workers (NYC OM 2021e).40 That legislation was recently upheld in the face of a legal challenge.41

In addition, in the wake of Hurricane Irma in 2017, the Miami-Dade Board of County Commissioners passed an ordinance (Miami-Dade Cty. 2018) prohibiting employers from retaliating or threatening to retaliate against nonessential employees for complying with county evacuation or other county executive orders during a declared state of local emergency.

Worker retention laws

Some localities have passed laws to protect workers’ employment when services are contracted out or when a contract changes hands (see Weil 2014, Weil n.d. on the “fissured workplace”). At least four cities (Hoboken, Newark, New York City, and Philadelphia) have passed laws that generally require successor contractors that operate in those cities to retain employees for at least 90 days, provide written offers of employment, retain employees by seniority, and maintain a preferential hiring list of employees not retained (Keon 2021; Kiefer 2022; Hoboken n.d.b., Jackson Lewis P.C. 2016). These laws differ in the categories of workers that are covered; Philadelphia’s ordinance provides the broadest coverage including security, janitorial, building maintenance, food and beverage, hotel service, and health care services workers (Keon and Sopher 2021). Unlike the policies addressing contractors discussed in Section 8, these ordinances apply to all contractors and subcontractors, not only those contracting with the relevant local government.

Industry-specific protections

Workers in certain industries may be subject to specific harms or be especially vulnerable to violations of the law. As a result, some local governments have passed laws specifically protecting workers in those industries.

Domestic workers

Chicago, Philadelphia, and Seattle have passed laws to provide domestic workers’ rights. In Seattle and Philadelphia, domestic worker bills of rights seek to ensure healthy working hours, sufficient earnings, and protections from sexual harassment and other exploitation. There are 2.2 million domestic workers in the United States—these housekeepers, child care workers, and home care workers are overwhelmingly (91.5%) women and are likely to be people of color, born outside of the United States, and older than other workers (Wolfe et al. 2020). Domestic workers are three times as likely to be living in poverty as other workers, and often are not protected by federal and state labor laws (Wolfe et al. 2020).42 Bill of rights ordinances typically provide domestic workers with meal and rest breaks, paid time off, and protections from sexual harassment and discrimination. Seattle’s law also created a Domestic Workers Standards Board, which provides a forum for employers, domestic workers, worker organizations, and the public to consider, analyze, and make recommendations to the city on other possible legal protections and standards for domestic workers (Seattle OLS 2018a). Chicago and Philadelphia have laws that provide domestic workers with the right to a written contract in English, as well as the language preferred by the worker (Chicago Dept. BACP 2021b; Philadelphia 2021b; Esposito 2021).

Hotel workers

At least seven cities have passed laws requiring hotels to equip workers with panic buttons, GPS-enabled devices that alert security when activated, and other protections (Hotel Tech Report 2022; Oakland OCA 2019). Entering a hotel room occupied by a visitor often places workers at risk of sexual harassment and assault, and data show that women in the hospitality and restaurant industries have the highest rates of sexual harassment on the job (Campbell 2019). In addition to requiring panic buttons, local ordinances typically require notice in each hotel room indicating that workers are equipped with panic buttons, and, in some cases, require hotel employers to develop and comply with a sexual harassment policy, take safeguarding steps after receiving an allegation of harassment, and prohibit retaliation for reporting sexual harassment or assault (UNITE HERE Local 1 2022; West Hollywood CC 2021). At least five cities have also passed laws regulating workloads, including regulation of hours and amount of work denoted in maximum square footage cleaned in a day (Stokes and Sarchet 2018; Santa Monica 2019; Sarchet 2021; Wagner 2020; Seattle OLS 2020f; Emeryville 2022). A few localities require additional payments from employers to increase health care access, and preferential hiring to retain workers when hotel ownership changes (Wagner 2020; Sarchet 2021; Santa Monica 2019).

Fast-food workers

New York City in 2017 passed a law, which is no longer in effect, requiring fast-food employers, upon authorization by an employee, to deduct voluntary contributions from workers’ paychecks and remit them to a nonprofit organization (not a labor union) designated by the employee (NYC n.d.c).43 The voluntary contributions were intended to enable and facilitate such workers having support and assistance from an organization advocating on their behalf, addressing work-related issues and other matters affecting working people.

Grocery workers

Los Angeles, New York City, and San Francisco have grocery worker retention policies that require new grocery store owners to retain employees of the previous owner for a 90-day transitional period after a change in ownership of the grocery store (NYC OLPS n.d.a; PWF n.d.e).44 The ordinances also establish a review process through which workers will be considered for continued employment.

Car wash workers

New York City’s car wash accountability law requires car washes to obtain a license to operate (NYC DCWP n.d.a). In addition to a license application, car washes must provide proof of workers’ compensation insurance, proof of disability benefits insurance, proof of commercial general liability insurance, and proof of unemployment insurance. Notably, car washes must also post a surety bond (also known as a wage bond) to cover potential wage claims as a condition of doing business.

Adult entertainment workers

Minneapolis in 2019 passed an ordinance requiring adult businesses to give workers copies of their contracts, post rules for customer conduct and workers’ rights, and prohibit retaliation against workers who report violations (Otárola 2019). Under the law, managers and owners are also prohibited from taking tips from workers, and workers will be provided security escorts when leaving after a shift. The ordinance also requires businesses to follow standard cleaning procedures, clear tripping hazards, and install security cameras to monitor all areas where entertainers interact with customers.

Wage standards and other requirements for local contractors or license/permit holders

Many localities have placed requirements on their contractors, including prevailing wage laws, living wage laws, and responsible bidder rules. In addition, some localities have created requirements for license or permit holders, in relation to compliance with labor laws or disclosure of past violations. Section 7 contains a detailed discussion of local laws affecting government contractors, and those affecting license and permit applicants and holders.

Higher labor standards for airport workers

Airports throughout the country are owned and operated by public entities—local and state governments, and regional entities composed of such governments (NASEM 2017).45 These public entities have required minimum wages for contractors and vendors at airports as a condition of being permitted to operate there. Many airport workers are low-paid; research has shown declining or stagnant wages, and poor working conditions (Sainato 2018; Editorial Board NYT 2018; Houston n.d.; Dietz, Hall, and Jacobs 2013). The Service Employees International Union (SEIU) has catalyzed airport-driven wage increases as a way to improve the working conditions of poorly paid janitorial, catering, food service, and other workers in airport facilities.

In places where local governments have authority to regulate the airport, many localities have exercised this authority to require all airport contractors to pay a higher minimum wage than the wage broadly required within the surrounding jurisdiction. Counties that have taken such action include Broward County (Fort Lauderdale, Florida) and Miami-Dade County, Florida (Miami-Dade Cty. n.d.a, n.d.b; Broward 2021). Cities taking similar action include Chicago, Denver, Houston, Los Angeles, Oakland, Philadelphia, Portland, Oregon, St. Louis, San Francisco, and San Jose, California (Spielman 2022; SEIU 2019; Houston n.d.; LAWA n.d.; Philadelphia CC 2021b; Holton 2021; Philadelphia CC 2021a; Port of Portland 2020; Port of Oakland 2001, 2021; STL Air Portal n.d.; SF OLSE n.d.d; Aitken 2021). In some instances, additional labor standards are required of airport contractors; for example, San Francisco also applied its health care ordinance to airport workers (San Francisco 2020), and the city of Los Angeles includes a worker retention provision (LAWA n.d.).

Some localities like Miami-Dade County, Philadelphia, and San Francisco, require certain contractors operating at the airport to enter into labor peace agreements with labor unions (LAWA n.d.).46 A labor peace agreement generally requires the employer and union to waive certain rights under federal law with respect to union organizing (for example, neutrality and nonopposition to the union on the employer side and a promise not to strike, picket, or disrupt the employer’s operations on the union side) to ensure uninterrupted workflow or, in the case of government, uninterrupted delivery of public services. In addition, the city of SeaTac, Washington, does not contain Seattle’s airport, but largely surrounds the airport; it passed an ordinance setting minimum employment standards for hospitality and transportation industry employers that requires higher wages for hotels and other businesses in the airport’s immediate vicinity (SeaTac n.d.).

Protecting workers and public health during the COVID-19 pandemic

Local governments have played a crucial role in protecting public health and worker safety during the COVID-19 pandemic. Especially given the failure of the federal government to take actions to protect worker safety in the beginning of the pandemic—and then subsequent action by the U.S. Supreme Court preventing the federal government from implementing a vaccine-or-test standard for workplaces—local and state governments have had to take emergency action to protect workers and public health (Rosenberg 2021; Totenberg 2022). Given that COVID-19 spreads through airborne transmission of respiratory droplets from infected people, protecting workers from contracting and spreading COVID-19 also plays an important role in protecting overall community public health and safety. Moreover, because of racial health disparities and the overrepresentation of people of color as essential workers, Black and Latino workers have been and remain at higher risk of contracting and developing serious complications from COVID-19 (UIC SPH 2021).

Local governments have used myriad authorities and programs to address the challenges facing workers during the pandemic, including emergency authorities often pegged to the duration of a local public health emergency order.47 Local governments—most typically by mayoral executive order—have used these emergency authorities to issue stay-at-home orders, as well as masking, testing, quarantine, and vaccination requirements (Foster n.d.; Kim and Romero 2021). For example, in December 2021, New York City’s mayor issued an order requiring all workers who perform in-person work or who interact with the public to be vaccinated (NYC DOH n.d.). These orders were typically enforced by local public health departments which, in some places, have taken complaints from workers and taken enforcement actions to stop workplace spread. Although these local public health measures are not always tied to the workplace, they are crucial to worker health and safety by ensuring that workers can stay home when necessary and reducing the likelihood of unmasked interactions.

In addition to the specific policies and programs intended to protect workers and public health during the pandemic outlined below, local governments also have established worker boards to hear from workers affected by the pandemic;48 mounted public education campaigns to inform workers, employers, and patrons about COVID safety at work (SAW LA n.d.); provided personal protective equipment (PPE) to employers for distribution to workers (St. Louis 2020); and set up funds for undocumented workers who were excluded from unemployment insurance and other federal funding (MF Phila. n.d.).

Paid sick leave: Modifications, enforcement, and emergency policies

As discussed above, 19 local governments have permanent paid sick leave laws. At least 16 local governments have made clear that paid sick leave may be used when their workplace or their child’s school or child care facility is closed due to a public health emergency (A Better Balance 2020, 2022b).49 Philadelphia, San Francisco, and Seattle temporarily limited employers from requiring a doctor’s note for employees to take sick leave (Philadelphia OMD 2020; SF OLSE 2020; Seattle OLS 2020g).

In addition to clarification and enforcement of permanent paid sick leave policies, local governments have also enacted emergency paid sick leave policies to supplement or extend federal emergency protections.50 For a period, the federal Families First Coronavirus Response Act required employers with fewer than 500 employees to provide workers with paid sick leave or expanded family and medical leave for reasons related to COVID-19, including the need to quarantine, care for an individual in quarantine, or care for a child whose care or schooling has been disrupted by the pandemic. Several local governments have passed paid sick leave legislation that supplements federal protections, for example by applying to employers with more than 500 workers, adding eligibility by permitting workers to take paid leave because they are older than 65 or are particularly vulnerable to COVID-19, and expressly permitting workers to take leave for vaccination-related illness (A Better Balance 2020). Local governments like Burlington, Vermont; Flemington, New Jersey; Shelby County, Tennessee; and Wilmington, North Carolina, enacted such emergency paid sick leave policies for their local government employees (A Better Balance 2020). Philadelphia51 and Seattle52 have passed emergency paid sick leave policies that extend to food delivery and transportation gig workers. Los Angeles County passed legislation requiring employers to provide additional paid leave for vaccination and recovery for workers who had exhausted their paid leave (LA County LED 2021).

Protection against retaliation in connection with workplace safety

Los Angeles County and Philadelphia passed ordinances prohibiting employer retaliation against workers in connection with workplace safety and compliance with COVID-19 public health orders. Los Angeles County’s law prohibits any adverse action by an employer against a worker for blowing the whistle on noncompliance with public health orders; discussing any perceived noncompliance with the county, other employees, or members of a public health council; belonging to a public health council; or informing employees of their rights under this ordinance (LA LED 2020; LA County n.d.). Notably, Los Angeles County’s law does not sunset. Philadelphia’s law53 prohibits employers from taking any adverse action against a worker for refusing to work in unsafe conditions if the worker reasonably believes the employer is operating in violation of a public health order and has notified the employer. An anti-retaliation law passed in Chicago (Chicago Dept. BACP 2022) protects against retaliation in relation to compliance with COVID-19 public health orders.

Hazard and premium pay

More than two dozen local governments in California and in the Seattle metropolitan area passed laws mandating hourly hazard pay bonuses of typically $4 or $5 per hour for grocery store workers (Egan et al. 2021; King 5 Staff 2021). Some laws also cover drugstore employers and vary as to the size of the employer covered (Kinder and Stateler 2021). Seattle also passed an ordinance providing food delivery gig workers premium pay on a per pick-up and drop-off basis (Seattle OLS 2020c).

Right to recall

At least 18 cities (Fair Hotel 2021) have passed laws—commonly referred to as “right to recall” or “right to return” laws—to protect workers in certain affected industries that were laid off during the pandemic. In particular, the leisure and hospitality sector accounts for 39% of total jobs lost due to the pandemic, which disproportionately affected workers of color (Huang 2021). These laws require employers to offer positions that become available first to qualified laid-off workers, typically in order of seniority. The laws vary as to which employers are covered (hospitality, event centers, commercial real estate), and whether laid-off workers can become qualified for the position with the same training that would be provided to a new employee hired into that position, enforcement, and notice. Detroit also passed a resolution in support of the right of recall, but is preempted by the state of Michigan from enacting an ordinance to that effect (DeVito 2021). Five cities have also applied this right to recall to changes in ownership of the employer (Fair Hotel 2021).

Severance

Shortly after emergency federal unemployment insurance relief in response to the COVID-19 pandemic expired, New York City passed a severance law requiring hotels with at least 100 rooms to pay a weekly severance of $500 per employee per week to laid off-employees for up to 30 weeks until the hotel has recalled 25% or more of its employees or reopened to the public (Moss 2022).

Vaccination

In addition to providing emergency paid sick leave for vaccination and recovery, local governments also have partnered with worker organizations to promote vaccination. Philadelphia partnered with the National Domestic Workers Alliance to transport workers to vaccine sites, where city officials addressed concerns by providing information about paid sick leave laws. Houston partnered with SEIU to deliver vaccines to janitors (Gerstein and Salas 2021).

Discrimination

San Francisco ​​enacted an ordinance prohibiting employers from discrimination based on exposure to or having tested positive for COVID-19 (SF OLSE n.d.b). Employers are prohibited from taking any adverse action (i.e., firing, threatening to fire, suspending, disciplining, rescinding an offer) against a worker because the worker tested positive for COVID-19 or is isolating or quarantining due to COVID-19 symptoms or exposure.

Federal and state preemption should be considered but still permit considerable action on workers’ rights matters

Preemption occurs when a higher level of government (for example, the federal or state government) restricts or withdraws the authority of a lower level of government (such as a city council) to act on a particular issue. While a detailed discussion of preemption is beyond the scope of this report, it is important for local governments to consider potential preemption by federal or state law.

Federal preemption

An analysis of federal preemption starts with the question of congressional intent: Did Congress intend to displace state or local law? Federal preemption limits some possibility for local action on workers’ rights, but still leaves significant room for legislation, enforcement, contracting consequences, and other local innovation. Some relevant federal laws and points to consider are as follows:

• The National Labor Relations Act (NLRA) guarantees and regulates the right of private-sector workers to organize into unions, bargain collectively, and take collective action to improve their working conditions. NLRA preemption is quite broad, and for workers covered by the NLRA, local and state governments are preempted from regulating workers’ rights to form and join labor unions or to bargain collectively with their employers, employer speech about unionization, and bargaining rules and obligations (Sachs 2011). Notable exceptions are when a state exercises traditional police powers; also when a state or local government acts as a “market participant,” it enjoys the same freedom to structure its labor policies as a private party and is not limited by NLRA preemption. Thus, local governments can require contracts to honor prehire agreements, for example.57 Moreover, local governments are free to enact labor laws that otherwise would be preempted by the NLRA for workers who are not covered by the law (i.e., farmworkers and domestic workers).
• The Occupational Safety and Health Act (OSH Act) regulates workplace safety nationally. It only preempts local and state action when there is a standard set by the Occupational Safety and Health Administration (OSHA) addressing a particular and specific workplace hazard (Flanagan, Gerstein, and Smith 2020). However, even if there is an OSHA standard, a local law, regulation, order, or government action will not be preempted if it protects the general public; to wit, laws of “general applicability (such as laws regarding traffic safety or fire safety) that do not conflict with OSHA standards and that regulate the conduct of workers and non-workers alike would generally not be pre-empted.”58 For example, a New York City building code provision regulating cranes was found not to be preempted because it protected not only workers, but also the “safety of the general public in the vicinity.”59 In addition, 21 states and Puerto Rico have become OSHA-approved “state plans” (USDOL OSHA n.d.) that regulate private-sector workplace safety and health themselves; they are subject to OSHA oversight and their provisions must be as protective of workers as OSHA standards and regulations (USDOL OSHA n.d.).60 In such states, federal OSHA preemption would not apply.
• There is no preemption of local standards that are more protective of workers under the Fair Labor Standards Act (FLSA), which sets the floor for minimum wage, overtime pay, record-keeping, and youth employment standards nationwide.61 In other words, the FLSA does not preempt higher minimum wages at the state and local levels.
• As a general matter, exercise of traditional police powers (civil or criminal) does not lead to preemption concerns. Longstanding principle in preemption cases requires courts to “start with the assumption that the historic police powers of the states are not to be superseded…unless that was the clear and manifest purpose of Congress.”62 For example, criminal prosecutions of employers, or civil tort lawsuits, for conduct that would also give rise to occupational safety and health violations generally would not be preempted (Flanagan, Gerstein, and Smith 2020).

State preemption

Local policymaking to advance and expand and protect workers’ rights, as well as other progressive causes, is substantially hindered by the emergence of state preemption used in a punitive manner (Briffault 2018).63 In particular, conservative state legislatures have increasingly preempted local efforts to increase the minimum wage, guarantee paid sick leave, require fair scheduling, regulate gig employers, and set prevailing wages for municipal contracts (Wolfe et al. 2021). For example, at least 26 states have passed preemption laws to prohibit local governments from setting minimum wages higher than the state minimum wage (EPI 2019). The preemption of local policies to support workers’ rights is most common in the South and Midwest, where these laws are part of a long history of efforts to limit the rights and freedoms of Black people (Blair et al. 2020; Wolfe et al. 2021). Even a progressive state like Washington recently moved in this problematic direction when the state legislature passed a bill on transportation network companies (like Uber and Lyft) that preempts any local regulation of the industry.64

An encouraging development in this area occurred in Colorado, when the state in 2019 reversed its prior preemption of local labor standards, providing cities and worker advocates in other states with potential lessons in how to do the same elsewhere (Huizar 2019a).

Even in the face of state and local preemption, there are still opportunities for localities and local government leaders to take action to protect workers: passing legislation that is not preempted; setting high standards in relation to local government employees; conducting extensive know-your-rights outreach and public education about workers’ rights; supporting pro-worker state legislation; conducting research and issuing reports on worker issues; documenting the extent of labor violations; promoting labor compliance by local government contractors, permit-holders, and licensees; and advocating for an end to state-level preemption. In addition, the Local Solutions Support Center and National Employment Law Project have created resources to assist localities in making assessments regarding preemption of desired action (Huizar 2021; LSSC 2020a, 2020b).

Enforcing local worker protection laws

This section provides examples of the enforcement cases brought by local labor agencies in recent years. However, it is important to note that the case descriptions are just a sampling of enforcement work performed at the city level, based on publicly available media coverage and press announcements. Only a few city agencies routinely issue news releases or disclose employer information about their investigations. More could recognize news releases as a tool in their worker protection toolkit, given the documented impact (Johnson 2020) of deterring employer violations by issuing press releases in workplace enforcement.

Some office websites include dashboards, posted annual reports, or other compilations of enforcement work, which should be consulted in conjunction with the below case descriptions, in order to obtain a fuller picture of the work being done. For example, Denver Labor, a division of the Denver Auditor’s office created in 2019, posts restitution stories (Denver n.d.b) on its website, summarizing the office’s enforcement work, including industry of employers, type of work, amount of money recovered, and the number of workers involved, although it does not mention specific employer names. The Seattle Office of Labor Standards has a Resolved Investigations (Seattle OLS n.d.e) section of its website, with detailed information about closed cases, and in 2021 released a press announcement (Seattle OLS 2021h) commemorating the office’s six-year anniversary and detailing accomplishments in that time. In addition, a number of offices post annual or periodic reports that include information not only about enforcement actions, but also about legal developments, outreach and public education activities, regulations issued, and more. (See Section 9 for more detail).

In addition to dedicated labor standards offices, it should be noted that city and county attorneys, who represent local government entities in legal proceedings, have sometimes enforced local worker protection laws. Some city and county attorneys have criminal authority to prosecute misdemeanors, but they typically bring and defend civil suits on behalf of local governments. Many city and county attorneys have the authority to enforce local ordinances to protect workers, although such enforcement is uncommon in many jurisdictions. In some states, they also have the authority to enforce select state laws,65 and they also can bring impact litigation on behalf of local governments (Justice Catalyst et al. 2019). In some cases, city or county attorneys have enforced workplace laws, either independently or in conjunction with municipal labor standards offices or other government entities.66 District attorneys, and in some places county or state’s attorneys, are responsible for criminal enforcement, and are increasingly using those powers to prosecute employer crimes involving serious violations of workers’ rights. In some jurisdictions, they have authority to bring civil cases as well.67 Criminal prosecutors have also been increasingly active in bringing charges against employers to protect workers’ rights (Gerstein 2021). In addition, some local auditors and controllers also enforce workplace laws. For example, in New York City, the comptroller plays a significant role in enforcing prevailing wage and other laws within the city (NYC Comptroller n.d.), and the city controller also enforces Pittsburgh’s prevailing wage ordinance (Pittsburgh 2010). Local departments or agencies that focus on contract enforcement may also enforce worker protections and standards in local governments contracts (LA City BCA n.d.). While enforcement action by these various officials is noteworthy, the cases outlined below generally include those brought by local labor standards agencies.

Examples of enforcement

In the compilation of cases below, where the same employer has committed multiple violations of law, to avoid duplication, cases are listed in one category only.

Paid sick leave

Enforcing paid sick leave laws has been a significant focus for many local agencies, particularly since these laws often exist only at the local level. New York and Seattle have been particularly active in this area. Agencies have obtained restitution for workers, as well as reinstatement in some cases. In some instances, settlements have also included crediting workers with additional paid sick leave in the future. New York City required Starbucks to educate the public about paid sick leave laws through posters in public areas, and Minneapolis required a home health agency to train all managers and staff on the relevant law.

New York City’s Department of Consumer and Worker Protection has enforced paid sick leave laws in multiple industries, with noteworthy cases involving fast-food, home care, and airline industry workers.

• The department conducted multiple investigations of paid sick leave violations involving home health agencies, including a 2021 collaborative case with the New York state attorney general’s office resulting in the recovery of up to $18 million for 12,000 home health aides at two agencies that underpaid workers and did not provide paid sick leave. In 2022, the department also reached settlements involving two domestic workers who had been denied paid sick leave (NYC DCA 2018a; NYC OM 2020a, 2021c; NYC DCWP 2022).
• Fast-food industry cases include a $155,000 settlement with a McDonald’s franchisee in 2019 (also involving fair workweek violations); an ongoing case against Chipotle, in the midst of which the city obtained reinstatement for a worker who had been unlawfully terminated; and a 2019 settlement with Starbucks, jointly with the New York state attorney general’s office, in which the company agreed to create a $150,000 restitution fund for employees whose rights had been violated, and to promote public education about the paid sick and safe leave law by requiring Starbucks to post an educational poster about paid sick leave in public locations in all New York City stores (NYC OM 2019b, 2020c NYC OM 2019c).
• The department in 2019 sued American Airlines for violating the paid sick and safe leave law by assigning disciplinary points and thereby illegally retaliating against workers for taking leave. American Airlines later sued New York City challenging the law. The case was ultimately settled in 2021; the airline agreed to pay workers restitution and to comply with the law going forward. The department in 2021 also settled a case involving a Southwest Airlines ground crew worker who was illegally fired for using sick leave; the resolution required reinstatement and payment of restitution. And in 2020, the department settled a case with an American Airlines contractor that staffed wheelchair attendants, customer service representatives, baggage handlers, and cargo agents; the contractor was required to pay more than $100,000 in restitution, and also to credit workers with additional prospective paid sick leave (NYC DCWP 2019b, NYC OM 2021b, 2021d, 2020b).
• In one case involving a law firm that violated the paid sick leave laws, the department obtained a hearing officer decision requiring payment of $172,000 to the worker (NYC DCWP 2019a).
• The Department of Consumer and Worker Protection settled two cases involving domestic workers who were denied paid sick leave (one was fired for using sick leave and for filing a complaint, ultimately losing their housing as a result) (NYC DCWP 2022).
• New York City’s law also requires paid safe leave to be used by those experiencing domestic violence, human trafficking, stalking, or similar offenses; the office in 2020 obtained a $25,000 settlement in its first paid safe leave case (NYC DCWP 2020b).

The Seattle Office of Labor Standards in 2011 recovered (Seattle OLS 2021i) more than $290,000 from a cleaning company for paid sick leave and other violations, including not paying for all hours worked, paying subminimum wages, and making unauthorized deductions from workers’ pay for training and other costs. In 2021, Seattle’s Office of Labor Standards resolved a paid sick and safe leave (Seattle OLS 2021c) involving Compass, a multinational food service company with hundreds of thousands of employees worldwide.

The Labor Standards Enforcement Division of the Minneapolis Department of Civil Rights has brought a number of paid sick leave enforcement cases, including against the national sandwich shop Jimmy John’s (Mahamud 2021) and a local gas station (Minneapolis 2018), as well as a home care business (Du 2021). In that last settlement, the division required the employer to train managers and staff on the relevant law, and to credit all workers with 80 hours of sick leave.

Chicago’s Office of Labor Standards in 2021 reached (Chicago OM 2021) paid sick leave settlements (Channick 2021) with a Burger King franchisee, recovering more than $458,000 in restitution for workers plus $100,000 in city fines, and with global snack food company Mondelēz Global LLC, recovering $476,000 in restitution for workers plus $95,000 in fines.

Wage theft

Some city agencies have authority to enforce municipal minimum wage or other wage-related laws. Wage theft68 cases brought by city enforcement agencies include the following.

Seattle’s Office of Labor Standards has been a national leader in enforcement activities in this area. Cases include:

• a $2 million settlement with a Domino’s franchisee in 2022 based on the employer paying workers below the city’s minimum wage and failing to pay overtime when employees’ work at multiple locations led to workweeks in excess of 40 hours; the case also involved fair scheduling violations (Seattle OLS 2022a)
• a 2022 settlement for more than $250,000 with a national traffic control company that paid below the city’s minimum wage, among other things (Seattle OLS 2022b)
• a finding in 2021 that construction contractors and subcontractors were jointly and individually liable for $2 million in underpayment based on a host of violations, including unauthorized deductions from workers’ paychecks, subminimum wages, uncompensated work time, nonpayment of overtime, and failing to provide paid sick and safe time (Seattle OLS 2021g)
• a 2021 settlement for more than $290,000 with a cleaning company for minimum wage paid sick and safe time violations, and retaliating against workers (Seattle OLS 2021i)
• a 2019 settlement for $182,000 with two Hyatt hotels that were paying a lower minimum wage for small employers instead of the applicable higher wage, and a $686,000 settlement, also in 2019, with a staffing company based on similar violations; the office also reached a $120,000 settlement for underpaid home care providers (Seattle OLS 2019d, 2019c, 2019b)
• after finding wage theft and other violations by two painting contractors, the office provided trainings in 2018 to the industry trade association
• the office also recovered more than $40,000 on behalf of workers with disabilities after the city eliminated a previously existing subminimum wage for such workers
• in one 2018 case involving a restaurant that had retained workers’ tips and failed to provide paid sick time, the employer apologized to employees (Seattle OLS 2018c, 2018d, 2018b)

Other local enforcement actions include a 2018 settlement (Minneapolis 2018) for $20,000 with McDonald’s by the Labor Standards Enforcement Division of the Minneapolis Department of Civil Rights, and a 2021 lawsuit (Chicago Dept. BACP 2021c) by the city of Chicago against DoorDash that focused on other legal issues, but also contained allegations that the company illegally retained workers’ tips.

In addition, Denver Labor reported (Denver OA 2021a) multiple successful enforcement actions in 2021 involving cases under the city’s minimum wage law, contractor minimum wage law, and prevailing wage law. Minimum wage cases included investigations involving a local restaurant, home improvement sales workers, a national retailer, a janitorial company, a fast-food chain, and a hair salon; sample prevailing wage cases involved a custodial contractor at the Denver Zoo, a crane contractor on a federal prevailing wage project, and solar power contractors at Denver International Airport.

COVID-19 pandemic-related enforcement

Seattle’s Office of Labor Standards has brought several actions enforcing the city’s gig worker paid sick and safe time law passed in June 2020. These enforcement actions have resulted in a $3.4 million settlement with Uber (Seattle OLS 2021d), a nearly $1 million settlement (Seattle OLS 2021e) with Postmates, and a $160,000 settlement (Seattle OLS 2021f) with DoorDash, all in 2021. In addition, the office recovered (Seattle OLS 2021j) more than $330,000 for 101 wine and alcohol shop workers who did not receive hazard pay as required by city law, as well as more than $100,000 (Seattle OLS n.d.g) for workers for the gig delivery company Go Puff. Los Angeles County also took enforcement (LA County CBA 2021b) actions against a number of employers based on pandemic-specific workplace protections, including a grocery store that failed to pay “hero pay” (also known as premium pay during the pandemic), and a construction company that terminated a worker for requesting indoor use of face coverings. Pursuant to New York City’s Grocery Worker Retention Act, the city’s Department of Consumer and Worker Protection filed a case (NYC DCWP 2020c) against a Bronx supermarket in 2020 and resolved it several months later (NYC DCWP 2021a) with payment of restitution and reinstatement of most of the discharged workers.

Protections for gig workers and freelancers

The broader issue of classification of workers for app-based driving and delivery companies generally has been playing out at the federal and state, and not local, level. The issue has emerged, for example, in relation to state laws on wages, workers’ compensation, and unemployment insurance (NELP 2019).69 However, there have been some instances of localities challenging misclassification of such workers as independent contractors rather than as employees. In other cases, several cities have created municipal-level wage, paid sick leave, or other protections that apply broadly, including for so-called gig workers, and have taken action to enforce those municipal laws in relation to app-based companies.

In addition to the COVID-19-related cases brought by Seattle described above, other cases include a civil lawsuit (SF ODA 2021) against the cleaning company Handy filed in 2021 by the district attorneys of Los Angeles and San Francisco, as well as a 2021 letter inquiry (Fox, Marchese, and Shimko 2021) regarding Handy’s potential misclassification, sent by the Seattle and Chicago Offices of Labor Standards and the Philadelphia Office of Worker Protections. Also, in 2021, the San Francisco city attorney, San Francisco Office of Labor Standards and Enforcement (OLSE) and a city supervisor announced (SF OCA 2021) a $5.3 million settlement with DoorDash, the largest in the OLSE’s history, after an investigation into allegations of violations of San Francisco’s paid sick leave law and a separate health care security ordinance (SF OLSE 2022), which creates an employer spending requirement to fund health care benefits (health insurance, dental, or vision coverage) for employees in the city. In 2020, OLSE reached a settlement of nearly $750,000 with grocery delivery company Instacart (Said 2020).

In addition, New York City agencies have taken action to enforce the city’s Freelance Isn’t Free Act (NYC DCWP n.d.e), which gives freelance workers (NYC DCA 2018c) the legal right to written contracts, timely payment, and freedom from retaliation. In late 2021, the New York City Law Department and Department of Consumer and Worker Protection announced (NYC OM 2021f) a lawsuit (NY Supreme Court 2021) against French global fashion media company L’Officiel, based on a pattern of failing to pay freelancers on time or at all, including writers, editors, photographers, videographers, graphic designers, and illustrators. According to DCWP, the agency has received 2,024 complaints from freelancers since the law’s inception in 2017, and has helped freelancers recover more than $2.1 million in owed compensation for their work.

Fair scheduling laws

Several cities have fair scheduling or fair workweek laws, which require employers in certain industries (usually retail and/or fast-food) to provide workers with their schedules with advance notice. These laws ensure that workers can plan for child care, elder care, education, second jobs, and other responsibilities, without having the insecurity of unstable and unpredictable schedules. In some cases, fair workweek laws also require employers to offer current part-time workers additional hours before hiring new employees, thereby increasing opportunities for full-time employment.

Seattle’s Office of Labor Standards has resolved a number of investigations under its secure scheduling ordinance, including recovery (Seattle OLS n.d.f) in 2020 of nearly $2 million from Macy’s in a case involving more than 800 workers, and recovery (Seattle OLS 2020a) that same year of more than $600,000 from Fred Meyer’s supermarkets in a case involving approximately 750 workers. In 2019, Seattle resolved a secure scheduling case (Seattle OLS 2019a) involving two franchises operating nine Jack in the Box locations and employing more than 500 workers.

New York City’s fair workweek law applies only to fast-food employers, and the Department of Consumer and Worker Protection has brought a number of actions. Most notably, in 2021, the department sued (Scheiber 2021) fast-food chain Chipotle for extensive and ongoing violations at several dozen stores, alleging that workers are owed $150 million as a result. The 2021 filing followed a prior case (NYC OM 2019a) in 2019. New York City also enforced its fair workweek law in cases involving McDonald’s and Pizza Hut (NYC OM 2021a) locations, the owner of 30 KFC stores (NYC DCA 2018b), and multiple other fast-food employers (NYC DCWP 2020a).

Philadelphia’s fair workweek law covers service, retail, and hospitality workers. A 2021 case involved the resolution (Reyes 2021a) of allegations of violations by a local Target.

Additional cases: Just cause termination rights, health care, and consumer protection

In addition to the broad categories described above, offices also have brought cases under other laws to protect workers and consumers. For example, in 2021, the New York City Department of Consumer and Worker Protection announced (NYC DCWP 2021b) the resolution of its first investigation of a termination of two Subway workers in violation of a new city law (NYC OM 2021e) protecting fast-food workers from being fired without just cause or for a bona fide economic reason. And in a consumer-related case, the department settled charges against (NYC DCA 2017) a large New York City parking garage company that began charging monthly customers an additional “living wage fee” after an increase in the city’s minimum wage under state law. The San Francisco city attorney has worked with the Office of Labor Standards in bringing cases under the city’s health care security ordinance, including a 2019 lawsuit (SF OCA 2019) against a tour bus company, and recovery in 2014 of $1.34 million from a janitorial company (SF OCA 2014).

Funded strategic enforcement partnerships with worker organizations

Some local labor agencies have explicitly and formally included worker organizations in aspects of the labor law enforcement process, by contracting with community organizations to support community partnerships that conduct public education and outreach, and refer violations to the enforcement agencies. Such relationships are sometimes referred to, most commonly by worker advocates, as “co-enforcement.”

This model has long existed at the federal level: The Occupational Safety and Health Administration (OSHA)’s Susan Harwood Training Grant Program since 1978 has awarded grants to nongovernmental entities, including worker organizations, “to provide training and education programs for employers and workers on the recognition, avoidance, and prevention of safety and health hazards in their workplaces and to inform workers of their rights and employers of their responsibilities” under the Occupational Safety and Health Act.

Several local agencies in more recent years have created similar formal, funded partnerships with worker organizations, including unions, worker centers, and community-based organizations. Some of these organizations played a role in advocating for what is now the longest-standing local program of this type, in San Francisco (Patel and Fisk 2017). The city was a forerunner in creating its community partners program was established under a 2006 amendment to the city’s minimum wage law, requiring the Office of Labor Standards Enforcement to create a community-based education and outreach program focused on workers in particular industries (San Francisco 2011).

The Office of Labor Standards in Seattle has a Community Outreach and Education Fund that grants money to community organizations focused on workers who experience high rates of workplace violations, including women, workers of color, immigrants and refugee workers, LGBTQ workers, workers with disabilities, veterans, and youth workers. The most recent round of grants was announced (Seattle OLS 2021k) in December 2021; nearly $3 million in funding will be provided over two years to nine organizations that will provide outreach, education, and support to low-wage workers. The office also has a Business Outreach and Education Fund (Seattle OLS n.d.a), which provides assistance and outreach to small businesses owned by low-income and historically disenfranchised communities, in order to increase their compliance with city labor laws. For the two-year period starting in January 2021, the fund committed $1.1 million to five organizational grantees. In 2021, the office also granted $50,000 to an organization to provide outreach to domestic employers about their obligations.

In 2021, the Chicago Office of Labor Standards announced (Chicago Dept. BACP 2021a) a $100,000 grant, funded in part by the city and in part by the Chicago Foundation for Women, to the nonprofit Arise Chicago. The funding is for outreach and education on city labor laws, with additional activities focused on domestic workers: providing trilingual trainings in developing contracts, and offering template contracts in Spanish, Polish, and English, among other things.

A Minneapolis ordinance requires the development and implementation of “a multilingual and culturally specific outreach and community engagement program to educate employees and employers about their rights and obligations under this chapter…[with] media, trainings and materials accessible to the diversity of employees and employers in the city.”70 Accordingly, the Office of Labor Standards has devoted $300,000 annually to contracting with community organizations for these purposes. The Centro de Trabajadores Unidos en La Lucha (CTUL)(CTUL n.d.) is a grantee and also helps administer the contract; in 2021, CTUL subcontracted also to Awood (a worker center serving the East African community) (Awood n.d.) and the local chapter of Restaurant Opportunities Centers United (ROC-United n.d.; Walsh 2021).

Finally, the Santa Clara County Office of Labor Standards Enforcement also provides funding for education and outreach to community-based organizations providing services to workers and businesses in Santa Clara County (SC OLSE n.d.e, n.d.b, and n.d.a).

Localities have created labor standard requirements and consequences for their government contractors, and for applicants/holders of licenses and permits

A considerable number of businesses interact with localities not just as regulated entities, but also as government contractors or vendors, or as holders of local government-issued permits or licenses. These relationships present opportunities for localities to improve working conditions or drive compliance with worker protection laws. Local governments may have more ability or leverage to positively affect employer conduct in these situations, when businesses are actively seeking approval, funding,71 or a contract from the government.

In relation to contractors or vendors, localities may wish to ensure their contracting funds family-supporting employment, not low-road, underpaid, precarious jobs. They may wish to ensure contractors do not win contracts through a race to the bottom on working conditions. They may also be aware of the practical benefits of contracting with companies that employ highly skilled unionized workers, where turnover and job disruptions may be reduced and product quality may be higher. Or they may wish to ensure their contractors—even if they are not high-road employers—at the very least do not have a history of violating basic workplace and other laws. This report provides a general overview of some options, but localities wishing to achieve these goals should consult more comprehensive and informative resources on this topic (Walter and Madland 2015; Walter, Rowell, and Wall 2020; IIIFFC 2017).

Before approving license/permit applications or renewals, localities may wish to ensure that applicants and license/permit holders are financially responsible, and that they are at least in compliance with the basic applicable workplace statutes.

In relation to contracts, permits, and licenses, localities also may wish to have laws and operations in place to allow termination of such relationships in the event of established and unremedied violations.

Accordingly, localities have passed laws and taken other actions in relation to their contractors, as well as license and permit holders.

Localities have imposed requirements related to public projects or projects seeing public approvals

Localities have imposed prevailing wage and living wage requirements on contractors, passed responsible bidder ordinances, and used project labor and community benefits agreements

Prevailing wage

Prevailing wage laws require covered government contractors to pay a wage and benefit rate based on similarly employed workers in a given geographic region (ILEPI n.d.a; Mahalia 2008). Sometimes ordinances also will require payment of prevailing wages by entities like developers and owners that receive local subsidies or tax abatements. These laws can help make sure that public funds support good jobs, and that bidders do not win government contracts through race-to-the-bottom labor practices. The federal prevailing wage laws (the Davis-Bacon and Service Contract Acts) cover federally funded construction and service contracts. Roughly half of U.S. states (USDOL 2022a) have prevailing wage laws. A number of localities do as well; for example, New York City requires payment of prevailing wage on city-contracted construction projects, to service workers (such as security guards) working for city contractors, and to service workers in residential projects that receive more than $1 million in city financial assistance with 120 or more residential units (Wall, Walter, and Madland 2020; NYC DHPD n.d.). In early 2022, San Diego County passed the “Working Families Ordinance,” which requires contractors for construction projects on county land working on projects of more than $1 million to use skilled, trained workers and pay prevailing wages. It also requires employers on county-leased land to provide paid sick leave. (Brennan 2022). Local prevailing wage laws more commonly cover construction of “public works,” or public buildings, roads, and structures, but they also may be enacted to cover service contracts with the locality as well (Walter, Rowell, and Wall 2020). Studies have found that prevailing wage laws have an overall positive economic impact, and also that costs savings were not realized in jurisdictions where such laws were repealed (Manzo IV 2018). The Center for American Progress in 2020 published a how-to guide with information for states and localities wishing to enact or expand prevailing wage laws within their jurisdictions (Walter, Rowell, and Wall 2020).

Living wage

Living wage laws require employers who receive contracts, tax benefits, or government subsidies from a locality to pay their workers a higher-than-minimum wage (PWF n.d.d; Bernstein 2002). These policies are meant to cover the cost of living, and the wage rates are often calculated based on ensuring that a family would be raised to or above the poverty threshold. Living wage policies in some cases establish different wage levels for employers who provide health insurance and those who do not. A 2011 compilation by the National Employment Law Project (NELP 2011) reported there were more than 120 localities with living wage requirements at that time.

As an example, Boston’s living wage law, enacted in the late 1990s, has as its purpose “to assure that employees of vendors who contract with the City of Boston to provide services earn an hourly wage that is sufficient for a family of four (4) to live at or above the Federal poverty level. This Chapter is also designed to maximize access for low- and moderate-income Bostonians to the jobs that are created, maintained or subsidized through service contracts with the City of Boston.”73 It covers city vendors and beneficiaries of city financial assistance. The law defines financial assistance broadly (Boston n.d.a),74 and covers any employer with at least 25 employees who has been awarded a service contract or subcontract with the city (Boston n.d.a).75 The law contains employee notice and employer reporting requirements, and a mechanism for enforcement, with potential penalties and remedies including fines, restitution, suspension of ongoing contracts and subcontract payments, and ineligibility for future city contracts for three years or until all penalties and restitution have been fully paid (Boston n.d.b).76 Companies bidding or negotiating on a service contract must complete an affidavit regarding the living wage (Boston 2022) prior to the awarding of the contract.

A major shortcoming of Boston’s law is that its formula for calculating the living wage can result in a relatively low dollar amount (the 2022 living wage is $15.87 per hour (Boston OWD n.d.), compared with the state’s 2022 minimum wage (Massachusetts n.d.b) of $14.25.

By contrast, the County of Santa Clara for 2021–2022 has a living wage set at $25.31 per hour (SC OCE n.d.) for employers who do not provide health or retirement benefits; employers who provide such benefits may pay a lower rate ($23.31 per hour with either health or retirement benefits; $21.31 per hour with both). In addition, Santa Clara County’s living wage requires77 provision of up to 12 paid days off to be used either as paid sick leave for the worker or for that worker to care for a family member or designated person.

Some city living wage laws incorporate other kinds of requirements, such as worker retention policies (PWF n.d.e). Hoboken, New Jersey, recently enacted a living wage ordinance for building service workers that includes both a monetary wage component and paid leave requirements.78 The city also passed an ordinance requiring contractors or subcontractors with a service contract in the city to ensure that when there is a change in employer, the successor employer must retain building service workers for 90 days.79 In 2022, the Newark (New Jersey) City Council passed an ordinance (TAPinto Staff 2022) to protect subcontracted janitors, security officers, and door attendants from losing their jobs for 90 days when a contract changes hands through no fault of workers.

Responsible contractor requirements

Numerous local governments have passed laws requiring contractors bidding for public projects (above a certain value) to meet certain “responsible contractor” criteria (ILEPI n.d.b). A responsible bidder ordinance is a policy that sets minimal requirements for all contractors bidding on publicly funded projects in a given political jurisdiction.

Criteria may include, for example, previous compliance with worker protection laws (i.e., laws prohibiting wage theft, misclassification. etc.), appropriate insurance coverage (i.e., for workers’ compensation), participation in a registered apprenticeship training program, and appropriate professional licenses (ILEPI n.d.b). While such requirements are based in commonsense and noncontroversial approaches, they do diverge from the frequently taken approach of awarding contracts to the lowest bidder based solely on price alone (IIIFFC n.d.d).

The Indiana, Illinois, Iowa Foundation for Fair Contracting has developed a Responsible Bidder Toolkit (IIIFFC 2017) providing guidance to municipalities wishing to pass such measures; the organization also compiled a list of nearly 50 responsible contractor ordinances in municipalities within those three states (IIIFFC n.d.a, IIIFFC n.d.b; IIIFFC n.d.c). Other localities are considering such requirements. New Orleans, for example, passed (New Orleans MO 2021) a responsible contractor ordinance after the collapse of the Hard Rock Hotel, which was under construction; three workers died in the accident. New Orleans also specified that the primary contractor would be responsible for any subcontractor violations.

Seattle’s minimum wage ordinance contains a provision disallowing employers from bidding on city contracts if they are the subject of a final order and have not paid all money owed; if an employer has been the subject of a final order twice or more within five years, the contractor cannot bid on city contracts for two years.80 Most of the city’s other labor ordinances contain similar language.

San Diego’s municipal code requires city contractors, during the term of a contract, to “comply with all applicable local, state, and federal laws, including health and safety, labor and employment, and licensing laws, that affect the employees, the worksite or performance of the contract.”81

Minneapolis bars the city from contracting with entities included on a list of companies with outstanding violations of the city’s wage theft law (Minneapolis n.d.c). The city of Omaha, Nebraska, sets contractor rules for contracts greater than $500,000. These rules include a “bid incentive” for contractors to use apprenticeship training programs (allowing them to be competitive while submitting slightly higher bids), and also require proof of workers’ compensation insurance, proper classification of workers as employees, and disclosure of subcontractors; penalties for noncompliance include withholding by the city of any payments still owed to the contractor, as well as a year of being debarred from bidding on contracts if there are two violations (Omaha n.d.).

Toledo, Ohio, has a municipal code that requires payment of prevailing wages for contracts of $10,000 or more, and prohibits awards of such contracts to bidders who have been convicted or found liable under the city’s wage-related law in the previous two years. For construction projects of more than $100,000, city law sets criteria, including continuity and experience of the workforce, local hiring, whether there is an apprenticeship program, and whether the employer provides benefits (health insurance and retirement or pension plan), as well as the bidder’s record of compliance with tax, wage and hour, and unemployment laws (Toledo n.d.b).

Other cities that disqualify contractors with a history of wage theft and other labor standards violations from winning city contracts include Cincinnati (Hussein and Coolidge 2016); Columbus, Ohio (Columbus n.d.a, n.d.b); Coralville, Iowa (Zaluska 2021); El Paso, Texas; and Houston.

In 2021, New York City amended its law to include a requirement, currently being challenged in litigation, that human services contractors and subcontractors must agree to labor peace agreements as a condition to being able to win or renew a city service contract with city agencies. Among other things, they must file an attestation that the employer has entered into a labor peace agreement with a labor union, or that no union has sought to represent their workers, and if a union seeks to represent their employees during a contract, they must enter a labor peace agreement within a set period of time (NYC n.d.a).82

Local and targeted hiring policies

Local and targeting hiring programs require or incentivize businesses that receive public dollars to hire workers from the local community, or from targeted populations in the community. Local hiring creates hiring preferences for people who live in a specific geographic area, which can be as large as an entire city or county, or as small as specific zip codes or neighborhoods. Targeted hiring refers to hiring preferences based on a range of worker characteristics, such as veteran status, gender, race or ethnicity (where allowed), residency in a low-income neighborhood, having been formerly incarcerated, having a disability, or being long-term unemployed (Gross and PolicyLink 2019). Local and targeted hiring policies can be implemented by ordinance, as part of responsible contractor standards, or negotiated as part of project labor agreements or community benefits agreements (UCLA Labor Center 2014). Baltimore’s local hire law, for example, requires compliance by vendors, contractors, and subcontractors who do business with the city, and is applicable to city-awarded contracts of more than $300,000, and city-subsidized projects of more than $5 million. The law requires businesses and all of their subcontractors to post new jobs with the mayor’s Office of Economic Development exclusively for a period of seven days, that 51% of all new hires are Baltimore residents, and for businesses and subcontractors to submit monthly reports (Baltimore OED n.d.).

Project labor and community benefits agreements

Project labor agreements (PLAs) are used primarily in the construction industry to establish the terms of employment for all workers on a project. Generally, PLAs specify workers’ wages and benefits, and may include provisions requiring contractors to hire workers through union hiring halls, otherwise establish a unionized workforce, or develop procedures for resolving employment disputes. PLA terms often also prevent workers from striking, and employers from locking workers out, during the project (Mangundayao, McNicholas, and Poydock 2022). PLAs can help eliminate costly delays caused by labor conflicts or shortages of skilled workers. While many states have policies that promote PLA use in state-funded projects, some states restrict or disallow them (Brubeck 2018; FC and SLC 2018; Von Wilpert 2017). Local governments such as those in Boston, Los Angeles, and New York City have successfully used PLAs for years; more localities could use PLAs on major projects.

Community benefits agreements are made between developers of a commercial and/or residential project and representatives of community groups where the project is being developed (PWF n.d.a). Communities can stipulate certain requirements for the projects, such as hiring from the local community, or guaranteed financial or social benefit from the project; in return, the developer receives the community’s support for the project (Island Institute 2021). Major development often occurs on city land, receives public funding or tax breaks that can accrue value to the developer, and in almost all cases require land use approvals that require the support of local government officials (PWF and LP 2019). Consequently, local governments are sometimes parties to community benefits agreements directly, may have a separate agreement with developers that is also part of negotiations, or may otherwise leverage their land use or funding powers as a part of these community benefits agreement negotiations.

Some examples of community benefits and labor peace agreements are as follows:

• In 2012, a community coalition and the city of Oakland negotiated a community benefits agreement that included requirements for local and targeted hire, living wages, fair chance hiring, limitations on the use of temporary workers, and community oversight and enforcement (PWF n.d.c).
• In 2018, the city of Nashville supported a community coalition in winning a community benefits agreement that included requirements for local hire, a $15.50/hour minimum wage, mandatory worker safety training for construction workers and supervisors, and workforce development (Porterfield 2021).
• A 2008 community benefits agreement regarding the development of the Bayview-Hunters Point neighborhood of San Francisco included a labor peace agreement in key industries related to the project (PWF n.d.c).
• Pittsburgh also has an ordinance from 1999 that requires hotel contractors and employers to sign labor peace agreements when city financing has been involved in the development of the hotel (Pittsburgh 1999).

Some localities created compliance requirements to obtain, retain, or renew permits or licenses; however, limited enforcement lessens deterrence

The licensing and permitting process can be used to drive improved labor standards and conditions; accordingly, some localities have incorporated labor-related requirements into these processes (Madland and Rowell 2017). This can take the form of requiring disclosures or evidence of compliance as part of the application or renewal process, or imposing potential permitting or licensing consequences in the event of certain established violations.

One caveat regarding the numerous laws that have been passed in this area: lack of media reports suggests very limited exercise of these powers by localities that have passed them. As with any law, the effectiveness of these provisions depends in large part on enforcement. Economists have observed that “employers will not comply with the law if the expected penalties are small either because it is easy to escape detection or because assessed penalties are small” (Ashenfelter and Smith 1979). Licensing and permitting consequences change both parts of the equation—the ease of escaping detection, and the scale of the assessed penalties. In addition, as discussed in Section 9 below, media coverage of these consequences would likely significantly drive deterrence.

Localities face several challenges in operationalizing these requirements. First, there is the need for at least some dedicated staff time on the local level to make the program work. There is also the logistical challenge of ensuring that local licensing or permitting agencies learn about serious violations, which will require proactive outreach and research. In addition, unless they are given very clear direction or mandates from the ordinance and/or from their chain of command, licensing or permitting agencies may be reluctant or resistant to imposing consequences based on workplace violations (even those that are proven and unremedied), seeing these issues as outside of their substantive purview.

There also may be concerns about revocation of a license or permit possibly leaving workers out of jobs. However, licensing and permitting provisions generally provide ample opportunities to cure, as well as a range of consequences—not only the most severe—including a period of temporary suspension for a license or permit, or a probationary period. In addition, the existence of licensing or permitting consequences could permit an agency to reach a negotiated settlement with terms to ensure future compliance, such as requiring an employer to engage an independent monitor. Such negotiated settlements or less punitive measures could in many cases be preferential to revocation.

In addition, it is likely that even one or two well-selected, well-publicized uses of these powers would achieve much of the desired deterrence in a given industry or neighborhood. Further, the limited available examples suggest that these consequences work: as described below, the Santa Clara County Office of Labor Standards Enforcement has operationalized food permit consequences for restaurants with unpaid wage-related determinations from the state labor commissioner. In response, almost all employers involved have paid what they owed in order to avoid further consequences.

In short, this tool appears to be underutilized despite its apparent untapped potential in terms of deterring violations. Localities without these laws might consider passing them, along with required annual reports on activities. Localities with such laws might wish to systematically enforce them through leveraging the license application and renewal process, and through scheduled routine checks with local, state, and federal labor enforcers, and routine searches of court filings.

Sample legislative language

Even without language specifically addressing wage theft or other labor conditions, licensing or permitting laws may contain general language with catch-all provisions that may be used for the purposes of ensuring licensees or permit holders comply with workplace laws. The Minneapolis Code (Minneapolis n.d.d) section on business license holders provides several examples of this:

• It requires license holders to“maintain and operate the business in compliance with all applicable laws and ordinances, including the zoning, fire, environmental health, environmental management, license, food, liquor, housing and building codes” (emphasis added).83 The “all applicable laws and ordinances” provides a basis for taking adverse action against a licensee based on proven violations of wage or other workplace laws.
• It requires license holders to “pay all delinquent court judgments arising out of their business and business operations.”84 This provision could provide a basis for adverse action in a situation where a judgment related to wage, discrimination, or other workplace violations remains unsatisfied.
• Finally, the code states, “The provisions of this section are not exclusive. Adverse license action, inclusive of, but not limited to, revocation, may be based upon good cause at any time upon proper notice and hearing. This section shall not preclude the enforcement of any other provisions of this Code or state and federal laws and regulations.”85 This broad “good cause” language again provides an opening for action based on workplace practices, such as persistent ongoing violations or egregious infractions.

In addition to potential use of this type of general language, some city laws specifically reference working conditions and labor violations in relation to issuance or revocation of permits and licenses.

For example, Philadelphia’s city code allows the city to “deny, suspend, or revoke any license or permit issued or pending” for a period of up to one year if the applicant or licensee was found guilty, liable, or responsible for violating the city’s anti-wage theft ordinance. In addition, all applicants for a commercial or business license must certify that they have not been found guilty, liable, or responsible for violating wage theft laws within the past three years (Philadelphia n.d.b). Similarly, Jersey City, New Jersey’s wage theft prevention law prohibits issuance or renewal of a license or permit to an applicant or entity that has been found liable for wage theft and has not come into compliance within 90 days of any final judgment. It also requires disclosure of wage theft cases within the two years prior to license or permit application, and requires the city to make an annual request to the state labor department for any wage claims (and associated documents) filed against licensees in the past two years (Jersey City n.d.).

Permits

Some localities have used the permitting process to drive labor compliance. Prior to issuance of a permit for construction of a building above a threshold size, the city of Milpitas, California, requires applicants to sign a form (Milpitas n.d.) acknowledging responsibility for complying with certain state and local labor laws. They must also sign a form certifying compliance before a certificate of occupancy will be issued for the project (Milpitas n.d.). For issuance of a special construction permit under the Quincy, Massachusetts, city code, all levels of entities involved in the project (construction manager, lead contractor, contractor, subcontractor, etc.) must comply with wage payment-related laws; if not, the city’s measures to achieve compliance include issuance of a stop-work order until there is compliance.86

Michigan City, Indiana, creates requirements for issuance of building permits for construction projects of more than $250,000, including that in the past three years, the contractor must not have been barred from bidding on public work because of, or been found to have committed, legal violations pertaining to wages, taxes, workers’ compensation, or misclassification. It also requires contractors who receive permits to comply with these laws as well, and requires the property owner applying for a building permit to use their best efforts to require all contractors to comply with these obligations. The law contains serious potential consequences, including suspension of the permit (requiring stoppage of work), or even revocation (Indiana n.d.).

The Better Builder Program in Austin, Texas, uses a carrot instead of a stick. The program, in partnership with the Workers Defense Project (WDP n.d.), provides an innovative example of creating permit-related incentives for employers willing to commit to higher labor standards. In the program, construction companies willing to ensure certain protections for construction workers on commercial projects may receive expedited handling of their permits (Austin n.d., Hasan 2017; Anderson 2017).

Licenses

A number of localities incorporate wage theft and labor compliance into their business licensing laws and practices. For example, the city of Toledo prohibits issuance of a license to any applicant who has found liable or been convicted pursuant to the city’s anti-wage theft laws or any other wage-related provisions of local, state, or federal law within the previous two years.87 The Seattle municipal code empowers the Department of Finance and Administrative Services to deny, refuse to renew, or revoke an employer’s business license, if requested to do so by the Office of Labor Standards as a result of an unsatisfied settlement or order.88

In Boston, a 2017 executive order allows the city’s licensing board to take into consideration whether a licensee has been found to have violated state or federal wage laws in determining whether to reissue, modify, suspend, or revoke a license (Boston MO 2017). A number of localities in Massachusetts have similar provisions. In Northampton, the License Commission has authority over issuance and administration of licenses for a range of types of businesses: service and sale of alcoholic beverages; operation of restaurants, hotels, inns, and lodging houses; indoor and outdoor entertainment for licensed and nonlicensed premises; car dealers; and more. When issuing a new license or a renewal, the License Commission requires completion of a Fair Wage Compliance Certificate (NLC n.d.), attesting that the business is not subject to a judgment or final determination resulting from a violation of state or federal wage protection laws. If they do not certify as such, they may be required to provide a wage bond for the time period covered by the license (Northampton n.d.). The media reported on a case in which this wage bond requirement could potentially be triggered, based on citations issued by the Massachusetts attorney general’s office (Fieldman 2021).

The Santa Clara County (California) Office of Labor Standards Enforcement is an agency that has begun to meaningfully operationalize permitting consequences for violators of labor standards laws. Data from the California Division of Labor Standards Enforcement showed that Santa Clara County workers filed the highest number of wage theft claims in the state: over a nearly five-year period, retail food vendors were found to owe nearly $5 million in back wages, an estimated $2,900 per employee. In addition, worker advocates reported on (Gleeson, Taube, and Noss 2014) the high incidence of wage theft and highlighted potential responses by local government. Accordingly, the county established a food permit enforcement program (SC OLSE n.d.d) to encourage payment of existing judgments by conditioning the issuance, renewal, or retention of food facility permits on compliance with labor standards.

If a retail food vendor is determined to be in violation of a judgment for nonpayment, the county may elect to temporarily suspend or revoke the vendor’s food health permit. The program, which is being rolled out gradually to all zip codes in the county, contains graduated measures to encourage payment of outstanding wages: the county sends three notices (a notice of outstanding judgment, notice to comply, and notice of violation, with 15 days to respond to each), and ultimately, continued nonresponsiveness or noncompliance will lead to a food permit suspension of at least five days (with notice provided to the public regarding the reason for the suspension). The county created a flow chart to explain the process, contained in Figure A. One noteworthy aspect of this process that may increase its likelihood of success and effectiveness is its focus on only one industry (restaurants), and its gradual rollout plan, based on zip codes. This kind of approach—targeting a problem industry and gradual implementation—could readily be replicated elsewhere. The county also added ongoing wage theft violation information to its “SCCDineOut” app, which allows county diners to view restaurants’ food safety records on their smartphones (Ochavillo 2019).

Figure A

Retail food vendors may have food health permit suspended or revoked for noncompliance. In addition, in 2010, the San Francisco Department of Public Health, recognizing the socioeconomic determinants of health and the poor health outcomes resulting from labor violations, incorporated certain labor elements into its restaurant permit review process, including requiring proof of workers’ compensation insurance by all applicants, as well as successfully leveraging the permitting process in relation to unremedied serious labor violations by several employers (Bhatia et al. 2013).

Localities can support workers through exercise of public leadership: education and outreach, issuing reports, holding hearings, and general advocacy

Localities have leveraged their soft powers to support workers’ rights and organizing. Local agencies devoted to protecting workers’ rights have used a range of tools to educate workers about their rights, inform employers about their obligations, and share information with the broader community about issues affecting workers. They have issued reports, conducted extensive public education and outreach, made materials available on their websites, garnered media coverage, and more. Localities without dedicated labor agencies can also use these soft powers to promote public and worker education. Moreover, local elected officials—whether individually or collectively alongside other officials and community labor groups—can use their public platforms and convening authority to provide public education and support workers, including those who are actively forming and joining unions.

Strategic communications, including use of media, is particularly important in educating workers about their rights and deterring violations. Media coverage increases employers’ knowledge about their legal obligations; it also increases their perceptions about the likelihood and cost of detection of violations. A recent study showed that press releases about OSHA enforcement of workplace safety violations deterred other workplace safety violations, an effect likely applicable to other labor standards laws as well (Johnson 2020). In addition, many workers, especially low-wage workers, have limited knowledge about the laws that affect them (Rankin and Lew 2018; Miller and Tankersley 2020). There are numerous communications tools that localities can use to reach the public (Gerstein and Goldman 2020).

Many local labor agencies have issued reports on worker issues or on their activities supporting workers

Several local agencies have issued regular reports on their activities or on the state of workers’ rights within their jurisdiction. Annual reports generally provide a comprehensive overview of an office’s work. In some jurisdictions, such as Chicago, Duluth, and St. Paul, annual reports are required by statute, a beneficial requirement that ensures transparency and continued focus on the labor offices’ work (Chicago n.d.c; Duluth n.d.; St. Paul n.d.c). In other jurisdictions, such as New York and Seattle, there are not annual report requirements per se, but other mandates for regular report-backs; Seattle’s ordinance requires an annual report regarding required funding for the Office of Labor Standards (Seattle n.d.a) (which necessarily requires an accounting of the past year’s activities), and individual laws in New York City have their own specific reporting requirements (NYC n.d.b).

Here’s a look at some local reports:

• The Chicago Office of Labor Standards issued annual reports covering its activities in 2019 (Chicago OLS 2019), 2020 (Chicago OLS 2020), and 2021 (Chicago OLS n.d.).
• The Denver auditor issues an annual report (Denver OA 2021a), and the 2021 version has a section (Denver OA 2021b) on wage-related enforcement.
• The city of Los Angeles issued a milestone report (LA City OWS 2022) in January 2022, detailing its activities and accomplishments since 2016.
• The Minneapolis Labor Standards Enforcement Division has a running dashboard (Minneapolis n.d.a) on its website, with data about the division’s activities, and issues an annual report (Minneapolis 2020).
• St. Paul includes labor enforcement data in the annual report (St. Paul 2020) of the Department of Human Rights and Equal Opportunity.
• The New York City Department of Consumer and Worker Protection has issued annual reports (NYC n.d.d) on the state of workers’ rights since 2017. The department in 2018 issued a report (NYC 2018) specifically on paid care workers.
• The Philadelphia Department of Labor issued annual labor policy and compliance reports (Philadelphia OLS & OWP n.d.) in 2019, 2020, and 2021. In addition, the department issued a report (Cox 2020) in 2020 on the Philadelphia Worker Relief Fund, which provided foundation and city-funded cash assistance to workers excluded from unemployment insurance and pandemic-related stimulus, through distributions via 14 community-based organizations.
• The San Francisco Office of Labor Standards has issued three annual reports (SF OLSE n.d.a).
• The Santa Clara County Office of Labor Standards Enforcement has issued several reports, including an annual report (SC OLSE 2020) in 2020.
• The Seattle Office of Labor Standards has an extremely detailed interactive dashboard (Seattle OLS n.d.b).

Local labor agencies have launched campaigns to educate communities about workers’ rights

Many local labor offices are extremely active in reaching out to the public and educating workers about their rights as workers. The New York City Department of Consumer and Worker Protection has engaged in a number of targeted campaigns, including educating the public about the city’s paid sick leave law when it first took effect, introducing the agency’s new name (NYC 2019c) to include the word “worker,” and reaching out to nail salon workers (NYC 2019b). During the early months of the COVID-19 pandemic, the department set up a hot line (NYC 2020a) for workers with questions about the city’s reopening.

The Minneapolis Labor Standards Enforcement Division held a workshop to help employers plan for a minimum wage increase, (Minneapolis 2018), as well as a workshop on paid sick and safe time for immigrant-owned small businesses (Minneapolis 2017). The Philadelphia Department of Labor has extensive know-your-rights resources on its web page (Philadelphia DOL n.d.), including access to a video (Philadelphia 2021a) about city worker protections during the COVID-19 pandemic.

The Chicago Office of Labor Standards and Denver Labor are both relatively new offices that have taken considerable action to educate the public in their cities. In Chicago, the Department of Business Affairs and Consumer Protection, within which the Office of Labor Standards is located, has its own YouTube channel, and the Office of Labor Standards has posted numerous webinars there on a wide range of labor-related topics (Chicago Dept. BACP n.d.; Chicago n.d.b). The office also created a “Your Home is Someone’s Workplace” campaign focused on domestic workers, and has a web page specifically focused on this workforce, as shown in Figure B (Chicago n.d.a). 

Figure B

The Chicago Office of Labor Standards also engaged in an outreach campaign about a new law giving domestic workers the right to a written contract from their employer (Chicago n.d.a; Chicago Dept. BACP 2021b). Some outreach took place in conjunction with the nonprofit worker organization Arise Chicago, which provided trilingual (English, Spanish, and Polish) sample contracts for employers’ use (Arise Chicago n.d.).

Los Angeles County announced a similar “Your Home is Someone’s Workplace” campaign to educate employers about domestic workers’ rights, and the Philadelphia Labor Department conducted a fair workweek survey in English and Spanish (LA County CBA 2021a; Chewning 2021b, 2021a).

Denver Labor has an extensive outreach and public education function. The office holds “Wages Wednesday” live on Wednesdays on the Denver Labor Facebook page, including programs in English and Spanish (Denver 2022b, n.d.a). The office held nearly 50 live Facebook trainings in 2021, and had bilingual (English and Spanish) staff available to answer questions (Denver OA n.d.a). The office web page highlights restitution stories, and contains online resources for small businesses about compliance (Denver n.d.b, n.d.c). It also contains tools for workers and employers: a regional address finder to assess whether work performed was in the relevant local boundaries, and a minimum wage and tip calculator, among other things. Also, the office launched an “Earned It, Deserved It” campaign to raise awareness of the city’s minimum wage ordinance, with bilingual ads at regional bus stops, and on radio, television, and social media platforms (Denver OA 2021a, p. 16).

Local labor agencies have highlighted worker issues in their jurisdictions through advocacy, hearings, and convenings

Several city labor agencies have gotten involved in various worker advocacy efforts.

In 2021, officials from several local enforcement agencies, including Chicago, New York City, Philadelphia, Seattle, and the district attorneys of Suffolk County, Massachusetts, and Washtenaw County, Michigan, all signed a joint letter (NYC DCWP 2021), along with 11 state attorneys general, to the U.S. Department of Homeland Security (DHS) supporting the agency’s plan to change its approach to worksite enforcement to support labor rights, and recommending changes to DHS policies and practices to facilitate the ability of state and local labor officials to enforce workplace laws. The letter was in response to a recent DHS memorandum (USDHS 2021) to Immigration and Customs Enforcement (ICE), Customs and Border Protection (CBP), and U.S. Citizenship and Immigration Services (USCIS), directing them to adopt practices and policies to deliver more severe consequences to exploitative employers, and increase workers’ willingness to report violations of worker protection laws.

In March 2020, agency officials in four cities (Chicago, New York, Philadelphia, and Seattle) called on (NYC 2020b) FedEx, UPS, and XPO to improve their policies in response to the then-new pandemic, particularly in relation to paid sick leave. Also in 2020, four localities (Chicago, New York, Philadelphia, and Pittsburgh) joined (NY AG 2020) a coalition of 24 state attorneys general in submitting a comment letter (NY AG et al. 2020) to the U.S. Department of Labor opposing a proposed regulation that would make it easier for employers to classify workers as independent contractors instead of as employees.

Finally, the New York City Department of Consumer and Worker Protection has held a number of hearings and convenings. For example, in 2017, it held a public hearing (NYC 2017) on the state of workers’ rights in the city, along with the Mayor’s Office of Immigrant Affairs and the New York City Commission on Human Rights, and in 2019, the same three agencies, along with partner organizations, held a convening (NYC 2019a) focused on immigrant workers.

Making know-your-rights resources, labor law posters, and other materials widely available, including in multiple languages

Some local agencies have been particularly aware of the need to reach the broad range of workers within their jurisdictions, and have translated materials into multiple languages. Cities and counties operate on the ground serving diverse communities, and may sometimes be more attentive to language access concerns than agencies at other levels of government.

The New York City Department of Consumer and Worker Protection has produced workers’ bill of rights booklets in 15 languages and audio files in five indigenous languages (Garifuna, K’iche, Kichwa, Mixteco, and Nahuatl), as well as an animated video. The animated video and audio files also enhance access for people with varying literacy levels. The Philadelphia Department of Labor web page (Philadelphia DOL n.d.) contains workers’ rights resources in 12 languages. Los Angeles City has minimum wage and paid sick leave posters available in 13 languages (LA City OWS n.d.a). Santa Clara County’s Office of Labor Standards’ web page provides information (SC OLSE n.d.f) in five languages. Even smaller jurisdictions, like Emeryville, California, with a 2020 population (U.S. Census Bureau 2022e) of less than 13,000, offers minimum wage and paid sick leave notices and posters (Emeryville n.d.) in six languages.

Local labor agencies have generated media coverage about worker issues

In addition to issuing press releases and reports, some offices have been effective in helping to catalyze coverage of workers’ rights issues in the local press. The Philadelphia Department of Labor has been especially effective in this regard, helping place news stories about workers’ rights under the city’s fair workweek law when it was first enacted, about its issuance of an annual report that would shame employers with records of violations, and about the Philadelphia Worker Relief Fund for workers excluded from other public assistance during the pandemic (Dorfman 2021; Reyes 2021b, 2020; Marin 2020).

The Santa Clara County Office of Labor Standards received coverage (Reese 2021) on a county contracts enforcement pilot program, in which the office reviews judgments and orders from state and federal labor authorities to determine whether a contractor should be disqualified from working with the county. The office also received coverage (Telemundo n.d.) on Telemundo about its enforcement program related to county food permits.

Finally, workers themselves can catalyze coverage of enforcement actions by local labor enforcement agencies, as when a worker whose case was handled by the San Francisco Office of Labor Standards gave a TEDx Talk (Winner 2019) and was featured in a PBS NewsHour program (Nawaz and Carlson 2021) about the city’s fair chance ordinance, which requires employers to consider mitigating circumstances and rehabilitation evidence for job applicants with a criminal record.

Local elected officials have used their public platforms and convening authority to support workers

Local elected officials have used their public platforms to demonstrate their support for working people in many ways. Such officials have shown up at rallies, events, and actions (including strikes (Aponte 2021) and walking workers back to work after days of action). Local elected officials have also written opinion pieces (op-eds) in support of worker advocacy and to bring attention to harms and challenges experienced by workers (Rosenthal 2021), and have written and signed letters to employers expressing concerns about worker treatment. Moreover, local elected officials can hold hearings, which allow workers an opportunity to share about their experiences and for officials to ask employers relevant questions.

Local elected officials can also show support for ongoing worker organizing campaigns. For example, in 2022, New York City Comptroller Brad Lander, as a public pension fund trustee, led a shareholder effort to address high injury rates and turnover at Amazon warehouses (Newman 2022). Also in 2022, the Seattle and Philadelphia city councils both passed resolutions supporting Starbucks workers seeking to unionize (Taylor 2022b; Valentine 2022). A Local Progress website provides additional ideas and resources for local elected officials wishing to show support for the Starbucks worker organizing campaign (Local Progress, n.d.b.).  

Conclusion: Localities throughout the country can adopt supporting workers’ rights as among the core functions they perform for their communities

There is a wealth of possibilities for localities that wish to get involved in expanding and enforcing workers’ rights. While some recent local action emerged in response to the Trump administration’s hostility to workers’ interests, much of cities’ work in this area pre-dated 2016. Accordingly, the local role in protecting working people continues to be relevant and critically important, even in the context of a worker-friendly federal administration.

Localities have been key innovators on labor matters, piloting new laws on such issues as paid sick leave and fair workweek; with proof of concept at the local level, such laws are later adopted at the state level (and perhaps eventually at the federal level as well). Creation of worker boards, strategic community enforcement partnerships, and using permits to drive compliance are also local innovations that help move the field forward. In addition, expansion and robust enforcement of workers’ rights at the local level serves as a hedge in our federal system, helping ensure at least some continued protection of workers in times when federal or state government is unfriendly to workers or insufficiently effective in protecting them. Moreover, public enforcement of workers’ rights is of even greater urgency when skyrocketing use of forced arbitration blocks workers from bringing their cases in court.

Localities in states without preemption of local laws may undertake any and all of the actions described above. However, even localities facing serious legal, political, or financial constraints in relation to their involvement in worker issues still can take action that will have a meaningful impact on workers’ lives.

Specifically, even in states with preemption:

• Localities can offer high-road standards to their own workforces, including enabling or facilitating collective bargaining where permitted, as well as sufficient minimum wage and paid sick/family leave for municipal employees.
• Localities can consider enacting laws that may not be preempted, such as those that do not set labor standards. These might include anti-wage theft ordinances that do not set a local minimum wage, but simply enforce existing rates; responsible bidder ordinances; ordinances concerning licensing or permitting consequences or incentives; or laws on salary transparency, for example. Local leaders can examine their state’s preemption law to assess the realistic possibilities.
• Localities can assess whether there is authority to require increased labor standards at the local airport.
• Localities can establish a worker advisory board to create a vehicle for open lines of communication and opportunities for worker leaders to raise newly emerging issues that the locality may be able to help address.
• Localities can establish a dedicated labor office or at the very least, a dedicated labor liaison at the local level. Even in a state with strong preemption, such an office could likely do some or all of the following:
  • Conduct outreach and public education on workers’ rights. Create a workers’ rights landing page on the locality website (in languages commonly used in the locality), with information about federal, state, and local workers’ rights applicable within the jurisdiction, (however expansive or limited they may be), as well as hyperlinks to relevant government agencies and other worker-oriented resources. Conduct outreach and include basic workers’ rights information in community outreach by existing local officials (such as by Fair Employment Practices Agencies, where they exist).
  • Review contracting, licensing, permitting standards, especially in industries with high rates of violation. Consider whether new laws are needed in order to impose compliance prerequisites or consequences for violations of labor laws. If so, try to enact them. In either case, routinely review labor compliance records of recipients of local government contracts, permits, or licenses, and consider whether action can be taken by contracting, licensing, or permitting agencies.
  • Review forms used for contracting, permitting, and licensing. Incorporate workplace law information about employer responsibilities on application forms and require signed certification by bidders or applicants that they will comply with these laws.
  • Research working conditions within the locality (possibly in conjunction with local or state academics), and issue and publicize reports on findings
  • Hold convenings or hearings to uncover and highlight problems facing workers, and to generate media coverage of these issues.
  • Create a comprehensive complaint form for workers and become a one-stop shop for reporting violations, serving as a gateway to help workers navigate other agencies and resources.
  • Publish enforcement data and stories to demonstrate effectiveness and deter violations.
  • Enlist and/or organize local resources, such as law school clinics or the local bar, to address worker issues. For example, the Massachusetts attorney general’s office holds a monthly wage theft clinic for cases it cannot handle, with nonprofit organizations, pro bono lawyers, legal services offices, lawyers who can take contingency cases, etc. (Massachusetts n.d.a). Along similar lines but addressing a problem unrelated to labor, the California Attorney General’s office in 2015 convened a roundtable of law firms and immigrants’ rights advocates about the legal needs of unaccompanied minors fleeing Central America; these efforts led to the legal representation of more children in immigration cases (CA DOJ 2015).

Localities in states without preemption, in locales more friendly to workers’ rights, can consider enacting any and all of the above measures. In addition, they have even more leeway to act, since they can:

• enact higher labor standards for all workers within their jurisdiction
  • minimum wage, overtime, paid sick and safe leave, fair workweek, expansive anti-discrimination laws, strong anti-retaliation protections
  • protections needed in particular industries: domestic workers, hotel, retail, fast-food, car wash workers, freelancers, etc.
  • cutting-edge worker protections such as just cause termination, gig worker pay or termination standards, salary transparency, and more
• meet with local worker organizations to learn what issues they identify as pressing
• create, fund, and empower a robust local office of labor standards with
  • enforcement power, including subpoena power
  • the ability to inform the administration and legislators on policy matters
  • a strategic enforcement approach
  • a funded community partnership model
• enact and enforce job quality standards (prevailing wage, living wage) and responsible bidder ordinances for local government contractors
• enact and fully operationalize workplace law compliance prerequisites and consequences for applicants and holders of locally issued permits and licenses.

In all localities—those in states hostile to workers, friendly to workers, and in between—there are opportunities to stand up for working people and take action.

Acknowledgments

The authors would like to thank Daniel Perez and Katherine DeCourcy, who provided excellent research assistance.

About the authors

Terri Gerstein is the director of the State and Local Enforcement Project at the Harvard Law School Labor and Worklife Program and a senior fellow at the Economic Policy Institute. She was recently an Open Society Foundations Leadership in Government Fellow. Previously, Terri was the labor bureau chief in the New York State Attorney General’s Office and a deputy commissioner in the New York State Department of Labor. Before her government service, Gerstein was a nonprofit lawyer in Miami, Florida, where she represented immigrant workers and co-hosted a Spanish language radio show on workers’ rights. She was a law clerk for Judge Mary Johnson Lowe of the U.S. District Court for the Southern District of New York. Her writing on workers’ rights issues has appeared in numerous outlets, including the New York Times, Washington Post, NBC News Think, The American Prospect, Politico, Slate, The Nation, and more; a complete listing is available at www.terrigerstein.com. She is a graduate of Harvard College and Harvard Law School.

LiJia Gong is the policy and legal director at Local Progress. She leads the development of Local Progress’ policy and research capacity to support members, and drives the development and growth of national program areas. Gong is an attorney with more than a decade of experience in policy, litigation, and political strategy. Prior to joining Local Progress, she served as counsel at Public Rights Project, an organization that empowers local and state governments to advance civil rights, worker and consumer rights, and environmental justice. At Public Rights Project, she launched a partnership with Local Solutions Support Center to fight abusive state preemption of local policymaking. Gong worked on the 2018 campaign to re-elect Sen. Elizabeth Warren of Massachusetts and served as a law clerk for Judge Kiyo Matsumoto of the U.S. District Court for the Eastern District of New York. Prior to becoming a lawyer, Gong worked as a research assistant at the Federal Reserve Board of Governors. LiJia earned her J.D. from Georgetown University Law Center and her B.S.F.S. from Georgetown University.

Endnotes

1. New State Ice Co. v. Liebmann, 285 U.S. 262, 311 (1932) (Brandeis, J, dissenting).

2. New State Ice Co. v. Liebmann, 285 U.S. 262, 311 (1932) (Brandeis, J., dissenting).

3. This report uses the terms “localities” and “local governments” as an umbrella term for political subdivisions of a state that include, for example, counties, cities, townships, villages, and school districts. Local government decision-making structures and authorities vary significantly–in some localities the executive has far more authority than the legislative body (often referred to as “strong mayor” systems as applied to cities), while in some localities significant control rests with appointed offices like a city manager. Localities also vary tremendously in terms of size–some towns have only a few hundred or thousand residents, whereas Los Angeles County has more than 10 million residents. Accordingly, the capacity for policymaking and enforcement among localities also varies greatly. Due to this diversity across localities, this report uses “localities” and “local governments” generally to refer to powers that may belong to the local executive, legislature, administrative agencies, or some combination thereof in a given jurisdiction.

4. Diller argues that cities’ smaller scale, concentrated political preferences, and streamlined lawmaking processes facilitate public health innovation.

5. Many localities have longstanding agencies that enforce human rights, civil rights, or other anti-discrimination laws; this report touches on the work of such agencies, but they are not the focus. 

6. Because in its employment-related lawmaking and enforcement, Washington, D.C., operates more akin to a state than a city, it is not included in this report. For more information for enforcement actions taken by D.C.’s attorney general, please see Gerstein 2020.

7. The federal government sets the federal minimum wage; that rate serves as a national floor. Under the federal minimum wage law, the Fair Labor Standards Act, states and localities may pass minimum wages that are higher. Many, but not all states, also allow localities to require pay higher than the state minimum wage.

8. The advocacy group “A Better Balance” has an option on its website that enables filtered searches of enforcement agencies handling paid sick day enforcement (A Better Balance n.d.b). Several localities assign this function to their offices of community relations or of human rights (Boulder 2022; Montgomery n.d.; Pinellas OHR). In Duluth, Minnesota, the city clerk has authority to enforce the law (Duluth 2022b). In Miami-Dade County, a consumer mediation center handles wage disputes (Miami-Dade WTP). This list is illustrative but not exhaustive.

9. UC Berkeley 2022; Boston OWD n.d.; Chicago OLS 2022; Denver 2022a; Duluth 2022a; Emeryville 2022; Flagstaff 2022; LA City OWS n.d.a; LA City BCA n.d.; Minneapolis n.d.b; NYC OLPS n.d.b; Philadelphia n.d.a; SF OLSE n.d.c; Santa Clara n.d.a; SJ 2022; Seattle OLS n.d.d; St. Paul n.d.b; Tacoma n.d.

10. Brennan 2021; San Diego 2022.

11. Kelty 2022; Ludden 2021.

12. Miami-Dade WTP n.d.; Pinellas OHR n.d.; Broward OPSHR n.d.; Broward OIAPS 2022.

13. In re: Palm Beach County Wage Dispute Docket and Creation of “WD” Division, Administrative Order No. 3.907-3/15, March 9, 2015. Fifteenth Judicial Circuit Court in and for Palm Beach County, Florida. See Palm Beach 2015.

14. Bloomington n.d.

15. Bloomington 2022.

16. In March 2022, a Washington state bill was signed into law that will preempt Seattle’s local regulations of TNCs HB 2076, 2021–22 House of Rep., Reg. Sess. (Wash. 2022). See Washington 2022.

17. Res. 32038, 2021 City Council, Seattle (Seattle 2021). See Seattle CC 2021.

18. For an in-depth analysis of privatization generally, see Cohen and Mikaelian 2021.

19. Brief for the States of New York, Alaska, Connecticut, Delaware, Hawaii, Iowa, Kentucky, Maine, Maryland, Massachusetts, Minnesota, New Jersey, New Mexico, North Carolina, Oregon, Pennsylvania, Rhode Island, Vermont, Virginia and Washington, and the District of Columbia as Amici Curiae in Support of Respondents, Janus v. American Federation of State, County and Municipal Employees, Council 31, et al., 138 S. Ct. 2448 (2018); see also Brief for the City of New York as Amicus Curiae in Support of Respondents, Janus v. American Federation of State, County and Municipal Employees, Council 31, et al., 138 S. Ct. 2448 (2018); Brief of Mayor Eric Garcetti, County Executive Dow Constantine, Mayor Jenny Durkan, Mayor Rahm Emmanuel, Mayor James Kenney, and Mayor Bill de Blasio as Amici Curiae in Support of Respondents, Janus v. American Federation of State, County and Municipal Employees, Council 31, et al., 138 S. Ct. 2448 (2018).

20. See, e.g., Louisiana (Louisiana Revised Statute 44:67.1(a), Davis v. Henry, 555 So.2d 457, 459 (La., 1990).

21. See, e.g., North Carolina (N.C. Gen. Stat. Ann. § 95–9).

22. Res. 2017–259 2017, Adams County Board of County Commissioners (Colo. 2017). See Adams Cty. BOC 2017.

23. Janus v. American Federation of State, County, and Municipal Employees, Council 31, et al., 138 S. Ct. 2448 (2018).

24. This authority typically derives from the “police power”—as in the power to promote the health, safety, welfare, and morals of the community—among the powers delegated to local governments. See, for example, Utah Const. art. XI, § 5 (delegating “the authority to adopt, and enforce within its limits, local police, sanitary, and similar regulations”).

25. Before 2012—the beginning of the Fight for 15 movement—only five local governments had minimum wage laws (UC Berkeley Labor Center 2022).

26. Birmingham, Alabama; Johnson, Lee, Linn, Polk, and Wapello counties, Iowa; Kansas City, Missouri; Louisville and Lexington, Kentucky; Miami Beach, Florida; and St. Louis, Missouri, passed local minimum wages that were higher than the state minimums, but they were subsequently preempted by state legislation, thereby rendering the local ordinances ineffective (UC Berkeley Labor Center 2022).

27. Dependency on tips often makes workers more vulnerable to sexual harassment.

28. Council Bill 18–008, 2018, Las Cruces City Cncl. (N.M. 2018). See Las Cruces 2018.

29. Oakland’s hotel minimum wage is higher than the citywide minimum wage for hotel workers who do not receive employer benefits.

30. Res. No. 20220127–053, 2022, Austin City Cncl. (Texas 2022). See Austin 2022.

31. There is a distinction between paid sick leave, and paid family and medical leave laws. Paid sick day laws require employers to pay workers for a modest number of days out of work for the short-term health needs of themselves and their families, while paid family and medical leave laws establish social insurance programs, typically funded by employer contributions and employee payroll deductions, to be used for longer-term medical issues, care for a new child, or care for a family member who is ill. This discussion addresses paid sick leave. Paid family and medical leave has been generally addressed in the United States at the state level, although some local governments do provide paid family and medical leave for their own employees. See Onuma 2015.

32. Austin, Dallas, and San Antonio passed paid sick leave laws that subsequently were found to be preempted in litigation. The laws were challenged by business groups arguing that the local ordinances were preempted by a Texas law that prohibits localities from enacting a minimum wage higher than the state’s. As a result, workers in these three cities lack the legal right to paid sick time. See A Better Balance 2021.

33. The state law in New Jersey mooted and preempted the numerous local paid sick leave laws.

34. Law 2018/150, 2018, New York City Cncl. (N.Y. 2018). See NY City Council 2018.

35. Law 2021/aa5, 2021, New York City Cncl. (N.Y. 2021). See NY City Council 2021.

36. Seattle’s local regulations of transportation network companies will be preempted pursuant to a state law passed in March 2022. See Washington 2022.

37. These localities include Albany County (New York), Atlanta, Chicago, Cincinnati, Columbia (South Carolina), Jackson (Mississippi), Kansas City (Missouri), Louisville, Montgomery County (Maryland), New Orleans, New York City, Philadelphia, Pittsburgh, Richland County (South Carolina), Salt Lake City, San Francisco, St. Louis, Suffolk County (New York), Toledo, and Westchester County (New York).

38. Colorado had passed a similar law in 2021. S.B. 19-085, 2019 Gen. Assemb., Reg. Sess.

39. Law 2022/031, 2022, New York City Cncl. (N.Y. 2022). See NY City Council 2022.

40. N.Y.C. Admin. Code § 20–1271 et seq.

41. Rest. Law Ctr. v. City of New York, 2022 U.S. Dist. LEXIS 24268, __ F. Supp. 3d __, 2022 WL 409190.

42. Rest. Law Ctr. v. City of New York, 2022 U.S. Dist. LEXIS 24268, __ F. Supp. 3d __, 2022 WL 409190.

43. N.Y.C. Admin. Code § 20–1301 et seq.

44. City of Los Angeles Municipal Code Chapter XVIII § 181.00 et seq.; San Francisco Police Code Article 33D.

45. A 2003 survey conducted by Airports Council International-North America concluded that city ownership accounts for 38%, followed by regional airports at 25%, single county at 17%, and multijurisdictional at 9%.

46. 8 Phila. Code § 18–201(8); Miami-Dade Cty. Res. No. R–148–07 (Feb. 6, 2007); Rules and Regulations, San Francisco Airport, Rule 12.1.

47. By using a state’s grant of local emergency authority, local governments might plausibly be able to adopt temporary emergency policies even when state law preempts such policies under normal circumstances (Haddow, Davidson, and Huizar 2020).

48. See discussion in Section 4.

49. These local governments include Chicago; Cook County, Ilinois; Duluth, Minnesota; Emeryville, California; Los Angeles; Minneapolis; Montgomery County, Maryland; New York City; Philadelphia; Pittsburgh; San Diego; San Francisco; Seattle; St. Paul, Minnesota; Tacoma, Washington; and Westchester County, New York. In general, this clarification of existing paid leave laws was permanent.

50. Many of these ordinances are no longer in effect, and the remainder that are still in effect are set to sunset on a specified date or after the conclusion of the relevant COVID-19 emergency order.

51. Bill No. 200303, 2020, Philadelphia City Cncl., (Pa., 2020). See Philadelphia CC 2020a.

52. CB 119793, 2020, Seattle City Cncl., (Wash., 2020).

53. Bill No. 200328, 2020, Philadelphia City Cncl. (Pa., 2020) See Philadelphia CC 2020b.

54. Coronavirus State and Local Fiscal Recovery Funds [rule], 87 Fed. Reg. 4338–4454 (January 27, 2022).

55. Minneapolis n.d.e.

56. The nonprofit organization Good Jobs First has lamented the lack of transparency in relation to state use of ARPA funds; it is likely that similar concerns exist in relation to local decision-making. See Furtado 2021.

57. Building & Construction Trades Council v. Associated Builders & Contractors of Massachusetts/Rhode Island, Inc., 507 U.S. 218 (1993).

58. Gade v. National Solid Wastes Management Association, 505 U.S. 88, 99–100 (1992).

59. Steel Inst. of New York v. City of New York, 716 F.3d 31, 34 (2d Cir. 2013).

60. In addition, five state plans cover only local and state government workers.

61. 29 USC § 218 (“No provision of this [Act] shall excuse noncompliance with any Federal or State law or municipal ordinance establishing a minimum wage higher than the minimum wage established under this [Act] or a maximum work week lower than the maximum workweek established under this chapter.”)

62. Wyeth v. Levine, 555 U.S. 555 (2009).

63. Also referred to as the “new preemption” or “abusive preemption” by some legal scholars.

64. HB 2076, 2021–22 House of Rep., Reg. Sess. (Wash. 2022). See Washington 2022.

65. For example, many state consumer protection and public nuisance laws empower city, county, and district attorneys to bring actions to enforce those laws. See, e.g., N.C. Gen. Stat. §§ 160A–193, 153A–140 (providing cities and counties with authority to abate public nuisances); Cal. Bus. & Prof. Code § 17204 (2019) (providing city and county attorneys in local jurisdictions with more than 750,000 residents the authority to bring unfair competition claims).

66. The Oakland city attorney’s office brought a case alleging wage and hour violations alongside a civil legal services organization to vindicate the rights of hotel cleaners (Oakland OCA 2018). In 2019, the San Diego city attorney’s office brought suit against Instacart alleging misclassification of its shoppers who obtain and deliver groceries and obtained an injunction, which was rendered inoperative by the passage of Proposition 22 in 2020 (Allsup and Mulvaney 2021).

67. In Alabama, California, Colorado, Florida, Kansas, Kentucky, Michigan, Minnesota, Missouri, and Montana, district attorneys have civil authority to enforce the state unfair deceptive acts and practices (UDAP) law. Ala. Code § 8–19–4, 8–19–8 (2019); Cal. Bus. & Prof. Code § 17204 (2019); Colo. Rev. Stat. § 6–1–103 (2018); Fla. Stat. § 501.203, 501.207 (2019); Kan. Stat. Ann. § 50–626(a)–632(a)(3) (2018); Ky. Rev. Stat. Ann. § 367.300 (West 2019); Wayne Cty. Prosecutor v. Wayne Cty. Bd. of Comm’rs, 93 Mich. App. 114, 127 (1979); Minn. Stat. § 325F.67, 325F.70 (2019); Mo. Rev. Stat. § 407.020 (2018); Mont. Code Ann. § 30—14–121 (2019).

68. Wage theft is the practice of employers failing to pay workers the full wages to which they are legally entitled. It includes situations in which employers refuse to pay promised wages, pay less than legally mandated minimums, fail to pay for all hours worked, keep worker tips or deductions intended for worker benefits, or do not pay overtime. In some states, the term “wage theft” is defined in the law, but more commonly it is used as a colloquial and descriptive term to refer to a set of practices. See Rosado Marzán 2020 for a detailed description of wage theft.

69. See also, In re Vega, 2020 N.Y. Slip Op. 02094 (N.Y. Court of Appeals March 26, 2020).

70. Minneapolis Code 40.110.

71. Localities also may provide conditions on grants to improve worker standards. For example, Boston funded a pilot program to support small restaurants and their workers during the COVID-19 pandemic. The grants were conditioned on the small businesses paying workers $12.75 an hour, as compared with the $5.55 tipped minimum wage under Massachusetts law (Edwards n.d.).

72. Somerville Code of Ordinances, Chapter 9, Article III, Division 2. See Somerville n.d.

73. City of Boston Municipal Code Chapter 24. See Boston n.d.a, n.d.b.

74. “Assistance shall mean any grant, loan, tax incentive, bond financing, subsidy, or other form of assistance of one hundred thousand ($100,000.00) dollars or more realized by or through the authority or approval of the City of Boston, including, but not limited to industrial development bonds, Community Development Block Grant (CDBG) loans and Federal Enhanced Enterprise Community designations awarded after the effective date of this Chapter. The forgiveness of a loan shall be regarded as financial assistance. A loan shall be regarded as financial assistance to the extent of any differential between the amount of the loan and the present value of the payments thereunder, discounted over the life of the loan by the applicable Federal rate as used in 26 U.S.C., Section 1274(d) 7872(f). A recipient of assistance shall not be deemed to include leases and subleases.” City of Boston Municipal Code Chapter 24 § 24-2(a).

75. City of Boston Municipal Code Chapter 24 § 24-2(e). See Boston n.d.a.

76. City of Boston Municipal Code Chapter 24 § 24-11(a). See Boston n.d.b.

77. Res. BOS-2016-196, 2016 Board of Supervisors, Santa Clara County (Santa Clara 2016). See Santa Clara n.d.c.

78. Hoboken Municipal Code Chapter 23. See Hoboken n.d.a.

79. Hoboken Municipal Code Chapter 199. See Hoboken n.d.b.

80. Seattle Municipal Code § 14.19.080 (I). See Seattle n.d.b.

81. San Diego Municipal Code Article 2 Division 30 § 22.3004(c). See San Diego n.d.

82. Social service agencies have filed a lawsuit challenging this law. See Blau 2022. 

83. Minneapolis City Code § 259.250 (2). See Minneapolis n.d.d.

84. Minneapolis City Code § 259.250 (5). See Minneapolis n.d.d.

85. Minneapolis City Code § 259.250 (5). See Minneapolis n.d.d.

86. City of Quincy, Massachusetts, Code § 9.4.9-9.4.10. See Quincy n.d.

87. City of Toledo, Ohio, Municipal Code § 701.04 (b). See Toledo n.d.a.

88. Seattle Municipal Code 14.19.100 (A) (4). See Seattle n.d.b.

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There is a penalty for working part time in America that goes beyond the lower annual earnings and fewer employee benefits that part-time workers get. Part-time workers are also face an hourly wage penalty: they are paid 29.3% less in wages per hour than workers with similar demographic characteristics and education levels who work full time. And when controls for industry and occupation are added, part-time workers are paid 19.8% less than their full-time counterparts. This part-time wage penalty is on par with the gender and racial wage penalties in the United States.

This report provides new analysis of data on the part-time wage penalty overall, by race/ethnicity and gender, and by the reasons workers give for working part time. White men and black men suffer the largest wage penalty for working part time. However, because women constitute a disproportionate 60% share of the part-time work force, they bear the brunt of the wage penalty for working part-time jobs. Moreover, the part-time wage penalty is worse for people who work part time but want full-time hours, relative to part-time workers who cannot or do not want to work full time. In addition, there is a broader compensation penalty in employee benefits, faced by part-time workers, in particular part-time workers employed in service occupations. (Note: penalties are calculated using 2003–2018 microdata from the Current Population Survey.)

Following are the key findings from the report:

• Part-time workers earn 29.3% less per hour worked than other workers with similar demographic characteristics and education levels.
• The part-time wage penalty is smaller but still substantial, 19.8%, when the worker’s industry and occupation (as well as demographics and education) are controlled (these controls yield the “fully adjusted wage penalty.”) This reduction with the industry and occupation controls added suggests that a share of the wage penalty is attributable to being relegated to certain lower-paying sectors or job types dominated by part-time work.
• By race and ethnicity, the fully adjusted wage penalty is across the board—it is 20.7% for white workers, 20.2% for African American workers and 14.2% for Hispanic workers, suggesting majority workers are just as prone to the part-time wage penalty.
• By gender, the adjusted wage penalty is 15.9% for women and 25.8% for men, suggesting that men pay a noticeably higher price for working part time. However, women constitute nearly two-thirds (63.3% in 2019) of those employed part time, and are much more likely to work part time: 22.8% of all female workers work part time, compared with 11.8% of all male workers in 2019). Thus, a greater proportion of women than men bear the brunt of the wage penalty, albeit smaller in size relative to the part-time men.
• By gender and race, white men face the highest wage penalty, at 28.1%, followed by black men at 24.6%, while the penalty for black women is 17.2%, for white women it is 16.4%, and for Hispanic men it is 16.9% while it is 12.3% for Hispanic women. The racial gap in part-time wage penalties likely reflects a combination of whites’ advantage in wage rates at their full-time jobs along with a shared disadvantage when they are in part-time jobs.
• The part-time wage penalty is greater for those working part time but wanting a full-time job (i.e., those whose reasons for working part time are categorized by the BLS as “for economic reasons,” which includes “slack work or business conditions” and “could only find part-time work”). Part-time workers who say they work reduced hours because of “slack work or business conditions” experienced a 22.3% wage penalty, while those who say they work part time because they “could only find part-time work” experienced a 29.5% wage penalty. Those working part time for “noneconomic reasons” (such as child care problems and family or personal obligations) still experienced a wage penalty, 18.3%, though a smaller-sized penalty than those who were part time for “economic reasons.” (Though respondents who work part time for “noneconomic reasons” may prefer to work full time if, say, they could afford child care, they are not included in the standard count of part-timers who want full-time work.)
• The penalty for part-time workers who want full-time work can be characterized as a double penalty: they are constrained to working fewer hours than they want and thus have lower total earnings, while they also make less for each hour they do work.
• There has been a notable increase in the part-time pay penalty over time. A 2005 study by Barry T. Hirsch, using data from 1995–2002, found a part-time pay penalty of about 10% for women and 22% for men. Our present analysis using a comparable method but with 2003–2018 data show a pay penalty of about 16% for women and 26% for men. Since the hourly pay penalty estimates control for year, this 6 percentage-point increase for women and 4 percentage-point rise for men likely reflects some kind of change in the labor market affecting both genders in the more recent period, beyond that attributable to just the Great Recession.
• Part-time workers face even more of a disadvantage in benefits than in wage rates. Benefits make up about 20.1% of full-time workers’ compensation, but only about 16.4% of part-time workers’ compensation. The inequity in benefits means that the compensation penalty (including wages and benefits) is a full 5.5 percentage points larger than the wage penalty. Thus, a part-time worker on average faces a full compensation penalty of 25.3%–a 5.5% benefit penalty on top of the 19.8% wage penalty.
• Policy priorities should include an array of reforms directed toward all part-time jobs, not just its incumbents, to address the large and apparently growing inequity in both wages and in benefits. Reforms could specifically promote more pay parity and income-earning opportunities for workers with relatively shorter weekly hours, specifically for those who work part time but prefer to work longer or full-time hours.

Introduction and overview: Part-time working—why should we care?

Part-time work is an essential component of the labor market for both employers and employees. Working part time can be both a blessing and a curse for workers. It is more of a blessing if a part-time job provides the incumbent worker with the number of work hours and schedule that meets their needs or preferences for working, without unduly sacrificing other aspects. Indeed, part-time positions originated to integrate those who might otherwise prefer to be entirely out of the labor force. It is more of a curse when the job provides chronically fewer than preferred hours, schedules that fluctuate so much that they create rather than resolve time conflicts with other commitments and, our focus in this paper, reduced wages and benefits for those whose hours are shorter, even if seemingly preferred. Employers benefit from the partial commitment as well, to cover or extend their office, shop, or opening hours; receive human capital that complements their full-time work force; and have buffer stocks of employees to cushion their labor demand for unforeseen cyclical fluctuations. Employers also benefit from their short-term cost savings.

Part-time employment constituted just under 17% (16.9%) of the work force in 2019, a bit higher than the 16% rates witnessed in the pre-recession 2000s, although lower than the spike of up to 20% after the recession (BLS 2020a; BLS 2020b). About one in six (17.1%) of part-time workers explicitly prefers a full-time workweek (i.e., the reasons they give for working part time are categorized by the BLS as “economic reasons,” which includes “slack work or business conditions” and “could only find part-time work”). The number of people working in part-time jobs in the U.S. economy who explicitly prefer to work full-time hours in 2019 was about 4.3 million. This number has declined since the start of the recovery in 2009 from more than 9 million workers but remains above the 4 million observed before the Great Recession;  in percentage terms, part-timers who explicitly prefer full-time work declined from over 6% of the overall workforce to nearly 3% (BLS 2020a; BLS 2020b; Valletta, Bengali, and van der List 2020). Moreover, part-time working for what the BLS considers “noneconomic” reasons (which others sometimes label “voluntary” part-time work) has been increasing in number, and remains consistently greater than 20 million (Dunn 2018; BLS 2020a; BLS 2020b). While not traditionally counted among those explicitly preferring full-time work, many of these “voluntary” part-time workers also are constrained by the inadequate systems of child care and support for the disabled and elderly, effectively forcing the “choice” of part-time working to fulfill family responsibilities.

Part-time working, and its associated wage and benefit penalties and frequent underemployment, is about 17 times as common as the attention-getting “gig”/on-demand platform-based jobs (Appelbaum and Rho 2018).1 Given that part-time working remains so prevalent, not only with a cyclical element but with an apparent structural change, part-time work conditions matter more greatly than ever (Kroll 2011; Golden 2016; Glauber 2017; Valletta 2018; Borowczyk-Martins and Lalé 2019; Bell and Blanchflower 2019).2

Furthermore, “involuntary” part-time work is more widespread than conventional measures show. A forthcoming report from the Center for Law and Social Policy (Golden and Kim 2020) creates a more complete picture than BLS measures of “involuntary” part-time working, for three reasons. One is because the former captures part-timers who want to work more hours, but not necessarily full time. A second is because part-time workers who hold multiple jobs to piece together full-time (35 or more) hours are actually not counted as part-time workers by BLS. Third and finally, because working parents who take part-time jobs because of “child care problems,” which might include a lack of affordability or availability, are actually not counted as involuntary part-time workers. The data published in the upcoming CLASP report provides a more accurate analysis of what it calls “underemployment”—workers who desire more hours—finding that the share of total employed that were part-time and underemployed is double the rate suggested by BLS using the CPS data.

Because part-time work is here to stay, it is crucial to provide a fresh look at the relative wage and benefit rates of part-time work vis-à-vis full-time work, the extent of the existing “wage penalty” for working part time, and the causes of such a penalty. How much of this wage disadvantage reflects characteristics of how part-time workers are treated versus their personal attributes? Which workers face bigger (or no) penalties? Have wage gaps between part-time and full-time jobs decreased or increased over time? Are penalties different for people who say they work part time for noneconomic reasons such as child care issues and family or personal obligations (which we consider “reasons of choice under constraint”) than for those who explicitly say they would prefer full-time working (i.e., they say they work part time for economic reasons such as slack work or the inability to find full-time work)? Do penalties differ between those whose hours are closer to the full-time workweek vs. those with only very short weekly hours? In addition to wage rate gaps, what are the differences in various benefits coverage for part-time jobs versus full-time jobs, so that we can assess a “full compensation” penalty?

The part-time penalty consists of three main elements—hourly wage rates, nonwage benefit and social insurance coverages, and inadequacy and volatility of work hours (i.e., “schedule variability”). Though this report focuses on the compensation penalties, Lambert, Fugiel, and Henly (2015); Schneider and Harknett (2019) and McCrate, Lambert, and Henly (2019) show workweek and schedule variability as a third aspect of part-time workers’ work condition disadvantage.3 This paper explores the current wage and benefits penalties associated with part-time work, and differences by type of worker, as well as by their reason for working only a number of hours associated with part-time jobs.4 The size and distribution of these wage penalties should inform public policy measures to address existing or growing wage and benefit gaps of part-time jobs and their incumbents.5

As we seek to answer these questions, we build on the existing body of research that confirms that part-time wage and benefit penalties matter. We take a special look at the roughly one in six part-time workers who works fewer than 35 hours per workweek either because of business conditions or slack work, or because they cannot find a full-time job (2019 data from BLS 2020a). Our analyses confirm what past research has indicated: that these part-time workers for economic reasons suffer not only from shortened hours (akin to the adverse effects experienced by the unemployed), but also from a large pay rate per-hour penalty just for being part time (Glauber 2013; Zukin and Van Horn 2015; Horemans, Marx, and Nolan 2016; Mousteri, Daly, and Delaney 2020).6 Studies have also shown that such underemployment tends to disproportionately burden certain labor force subgroups—males, youth, Hispanics, immigrants and also blue-collar job holders (Kler, Potia, and Shankar 2017; Young and Mattingly 2016; Wilkins and Wooden 2011). The median income for families in which women work part time for economic reasons is far lower than for women ostensibly working more “voluntarily” part time (i.e., for noneconomic reasons (Glauber 2013)). (Contrary to common practice, we avoid labeling people who work part time for noneconomic reasons as those working “voluntarily” part time because someone who works part time to deal with child care issues or family or personal obligations is likely facing constraints that restrict their choices.) The proportion of part-time workers who are the “primary earners” in their households has risen over time.7 These part-time primary earners appear to face a relatively higher risk of poverty and be more likely to not have health insurance.8

The structure of the paper is as follows. It begins with a condensed review of the existing literature and descriptive evidence on the meaning and measurement of part-time compensation differentials. It then explains how we replicated and updated a systematic analysis of the part-time wage penalty that was definitive but used data from 1995 to 2002. In brief, as we explain, we pool the cross-sectional data from the U.S. Current Population Survey (CPS) Outgoing Rotation Group (ORG) files from 2003 through 2018 to form a large data set with more than 1.7 million observations. Three estimates of the part-time wage gap are constructed—a raw estimate, one adjusted partially (just for workers’ demographic characteristics and education), and a third adding adjustment fully, including for workers’ industry sector and occupation of employment. Following the methodology discussion is a section presenting key findings. As we discuss in more detail, the results show that the size of the wage penalty not only is substantial, but it has increased in size since the period ending in the early 2000s. The size of the wage penalties by race/ethnicity, gender, reason for working part time, and number of weekly hours are reported. In addition, the potential gulf in employee benefits coverage between part-time and full-time jobs then is estimated in order to complete the picture of the potential full compensation—wage and benefit—disadvantage for those working part time.

Literature review: Conventional versus alternative explanations of the part-time wage differential

Why might wage rates per hour be lower for part-time workers relative to full-time workers? The part-time hourly wage penalty reflects a combination of possible factors (Messenger and Ray 2015). Labor economic theory suggests that there may be lower human capital among part-time job incumbents, such as skills and experience, as compared with full-timers (Montgomery 1988). This would reduce part-time workers’ relative wages. In addition, part-time workers’ fixed costs, on a per-hour basis, may be relatively higher than per-hour costs of full-time workers. Thus, a wage differential found for part-time workers might reflect a traditional, equilibrium-compensating wage differential in hourly wages for part-time work (Blau and Kahn 2017; Goldin 2014; Friesen 1997)—although this would discount the gap as a pure penalty. Workers can be heterogeneous not only in skills, but also in preferences and job search. If workers prefer shorter hours, then “part-time wage differentials can result from differences in labor supply” factors (Hirsch 2005). In addition, a part-time wage differential can arise if workers are willing to take lower-paid part-time jobs as a way of queuing for higher-paying, full-time jobs (Hirsch 2005).9 Finally, to the extent that a part-time job provides a job amenity, e.g., schedule flexibility, the wage payment could be reduced and still attract and retain labor. Workers might choose part-time employment at least in part to comply with the role(s) or identity to which they adhere, perhaps at stages in their life cycle, working part time to better integrate the competing claims on their time made by their different roles (Russo 2012), thus they would be “willing to accept low wages” (Hirsch 2005).10 Moreover, in cases when the fixed costs per hour worked are higher for part-time workers, their wage rates might be adjusted downward, as an equalization of all labor costs. A wage differential for part-time workers can arise when workers are not fungible (homogeneous) and the employers have preferences regarding how they schedule hours among workers.11

On the other hand, part-time working might be more productive per hour if there are fatigue effects in the quantity of output (if not quality) over the course of a workday or workweek.12 The higher the skill level of employees, the higher might be both the administrative costs and their relative productivity rate per hour. Higher productivity per hour, and thus higher marginal revenue product for an hour of part-time work, would reduce the wage penalty and might even create a wage premium.13 Thus, differences in preferred hours are not a sufficient condition to produce a wage penalty for all part-time jobs, if part-time workers have identical skills and create no fixed labor costs to employers—wages would equalize as employers create a mix of jobs only to reflect the preferences of employees. For example, part-time work might command a premium if these two part-time positions generate greater productivity than one full-time job sufficient to more than overcome the fixed costs. In addition, there may be a compensating wage differential necessarily developed to recruit into and retain workers in part-time positions, given the other adverse working conditions, in particular, the fewer or outright lack of employee benefits, as well as undesirable schedule times or variability.

Thus, hourly wage rates for part-timers compared with otherwise comparable full-timers might reflect either a negative wage penalty or a positive pay premium. However, this also depends on whether employers share the financial benefits—the income from greater relative productivity or lower compensation costs per hour derived from hiring part-time workers—with the workers themselves in the form of a wage boost. Certain part-time workers indeed generate such gains (i.e., “rents”) for their employers, either from their relatively higher productivity per hour or relatively lower wage rates paid (Garnero, Kampelmann, and Rycx 2014). Thus, depending on the bargaining power of employers or employees, there may be a wage premium for some and a wage penalty for others (Jepsen et al. 2005; O’Dorchai, Plasman, and Rycx 2007).

While the more conventional explanations of the penalty dominate much of the economic theory and testing of the wage differential between full-time and part-time workers, valid alternative explanations of the size of the penalty involves labor market power, job downgrading, and outright discrimination. When labor market conditions are not very tight or employers have some monopsony power, they may be more able to exploit the vulnerabilities of workers with more limited options—those who need jobs that provide some income but allow time for family or personal reasons.14 Moreover, polarization (i.e., dualism) in labor markets suggests that certain jobs, including many part time, are structured simply to contain short-run labor costs and disconnect from full-time, regular positions (Tilly 1996; Howell and Kalleberg 2019; Fernández-Kranz and Rodríguez-Planas 2011; Benton, Kim, and Wilmers 2018). Thus, the larger the gap between part-time workers and otherwise comparable full-time workers, the more it reflects how employers may treat incumbents as second-class citizens, unworthy of the full value of their productivity.

The “gross” or “raw” wage gap—a simple comparison of part-time and full-time hourly wages —typically is considered as the average wage differential between part-time and full-time workers in a given sample. The size of the penalty or premium is an empirical issue. There is mixed evidence, with quite a wide range of estimates. Much of the research starts by estimating the “unadjusted” or “raw” wage difference between part-time and full-time jobs or work per hour. This is an important first estimate because it relates most directly to workers’ choices in the labor market regarding hours of work and to consequences of those choices for their income. Estimations typically then adjust this raw differential for demographic and human capital factors such as age, experience in the labor market, education, etc., to get an “adjusted” penalty (or premium). This typically lessens the size of the penalty, by controlling for the additional experience and education that full-time workers have compared with part-time workers, on average (Baffoe-Bonnie 2004). In addition, full-time workers are more likely to have better benefits, like pensions, and be represented by unions (Bishow 2015; BLS 2019).

Previous research notes at least some pay penalties, but considerable variation in the size of same. Virtually all research indicates the adjustments to control for these differences in worker and job characteristics considerably reduce the national wage differential between full-time and part-time workers, given the substantial variation across regions and industries in full-time versus part-time composition. Studies within specific industries and occupations suggest there are part-time penalties, but these are much reduced or quite small when controlling for schooling, experience, occupation, and establishment size.15 In the United States, the raw wage penalty for part-time working men was as high as a 67% (meaning men working part time made as much as 67% less than men working full time), while among women, this was on the order of about 22% (Bardasi and Gornick 2008; O’Dorchai, Plasman, and Rycx 2007). The size of the penalty in the United States generally gets reduced by about 10% when fully adjusted with controls (Fallick 1999). A sizable average part-time wage penalty of 21%–26% for men and 19% for women—was found using earlier cross-sectional data (Blank 1990, 1998).16 With data from 1995–2002, Hirsch (2005) intended to update and reestimate this. Without any controls for demographic and work characteristics in the full sample for the raw wage penalty, there was a pay gap of 49% among men and 26% for women. Adding these controls, there was a 37% penalty for men and about 20% for women.17 With the full battery of typical control variables (personal and location variables, industry, and occupation), the part-time wage penalty was 10% for women and 22% for men (or 9 and 19 log points difference, respectively) (Hirsch 2005). This estimate is fairly consistent with other North American data, which found a 12% pay penalty with controls for personal and job characteristics included (Bardasi and Gornick 2008).18

There may be some nuanced, important differences by hours of work, even among part-time workers, in proximity to a country’s full-time workweek.19 Indeed, in the United States, the penalties found for working shorter hours per week or per year may just mirror the flipside—the pay rate premium earned for those who work longer than standard full-time hours (Blau and Kahn 2017; Goldin 2014; Cha and Weeden 2014; Bertrand, Goldin, and Katz 2010).20 Thus, the wage penalty may be smaller for those part-timers who work nearer the full-time workweek threshold.21 Indeed, recent changes in the representation of gender and parents who are working part time is associated with a decline in the gender wage gap among parents and in the motherhood wage penalty, but also with an increase in the fatherhood wage premium (Preston and Yu 2015; Weeden, Cha, and Bucca 2016; Yu and Kuo 2017). The size of a wage penalty might be smaller for those groups that have a relatively higher preference for working part time—mothers of young children, students, retirees, etc.

No known previous study has focused on the degree of voluntariness of taking or holding a part-time job, which may be associated with different compensating differentials or some of the other reasons for a penalty. The degree of voluntariness may play a role, explaining why the penalty may be larger for those who are less likely to prefer part-time working, e.g., men. In addition, a part-time pay premium could reflect a combination of several possible sources—the lack of employee benefits (so cash in lieu), the variability of hours and thus weekly earnings among hourly self-employed people, the lower job security provided by part-time positions.22A penalty also may be smaller, if not become an outright premium, for those compensated as salaried as opposed to hourly paid. Moreover, the size of a penalty or premium might vary by industry sector. Finally, the institutions within a country help shape the existence and size of the penalty or premium (Blau and Kahn 2013; McGinnity and McManus 2007).23

New estimates of the wage and compensation penalties: Methodology

The Bureau of Labor Statistics’ Current Population Survey (CPS) is a monthly survey of households in the United States. One-fourth of the employed adults (age 16 and older) in the survey’s “Basic” monthly sample—a subgroup often referred to as the “Outgoing Rotation Group” (ORG)—are asked to answer a detailed set of questions about their earnings from work. Our empirical strategy is to replicate what Hirsch (2005) had generated, using updated CPS–ORG data, from 2003 through 2018.24

The part-time wage penalty may be measured in several ways. We compare the hourly earnings of those who usually work what is considered part-time hours with hourly earnings of those whose hours are defined as full time. Part-time workers in the CPS are defined as those who worked one to 34 hours as their “usual” work hours (or during the reference, last week). These workers are subdivided into two groups as classified by the BLS: those working “part time for economic reasons” and those working “part time for noneconomic reasons.” The part-time-for-economic-reasons group includes survey respondents who said they work part time due to “slack work or unfavorable business conditions”or “an inability to find full-time work.”25 Those who usually work less than 35 hours for what the BLS calls “noneconomic reasons” are those who say they work part time because of “child care problems,” “other family/personal obligations,” “health/medical limitations,” “school/training,” “retired/Social Security limit on earnings,” “full-time workweek is less than 35 hours,” and “other for non-economic reasons.” Those who work part time for noneconomic reasons often are considered to be “voluntary” part-time workers (even though these workers’ choices are constrained by existing policies and institutions, such as the lack of resources for child care or care for family members who are older or who have a disability). Workers typically are considered to be working part time “involuntarily” when they indicate they are willing, able, and available to work full-time hours, but either had to settle for working part-time hours, or had their hours reduced by their employer (from greater than to less than 35 hours).26 Herein, we will rely on the BLS’s “economic” versus “noneconomic” reasons for working part-time hours, rather than the commonly inferred “involuntary” versus “voluntary” terminology.

The total sample size applied here, pooled within the period 2003–2018, is 1,756,419 individual observations. The sample consists of hourly and non-hourly wage earners, ages 16 and older, in the 2003–2018 EPI extracts of the CPS-ORG. Observations with allocated hourly wages or weekly earnings are excluded, as are all observations with hourly wages less than $2.00 or more than $150.00 per hour (as in Hirsch (2005)). All standard errors are clustered by state.

Demographic controls include race, gender, and education dummies, and a quintic polynomial in age. Industry and occupation controls are dummies for Census recodes of major industry and occupation categories. The key independent variable is the part-time work status of the individual. We use the Basic CPS hourly earnings question, even though employed persons in the ORG are asked about hours per week. We define “part time” by using the “usual hours at your main job,” as Hirsch (2005) does.27 For workers with varying hours, last week’s hours are used for the 35-hour cutoff (in one’s primary job). The dependent variable is the log of the wage rate (average hourly earnings) for a worker. Hourly wages are defined first as the straight time wage for nontipped workers (observations with allocated values are dropped); when that value does not exist, hourly wages are weekly earnings divided by usual hours (observations with allocated values for either weekly earnings or usual hours are dropped); for workers whose “hours vary,” weekly earnings divided by last week’s hours (observations with allocated values for either weekly earnings or last week’s hours are dropped).

All multivariate regressions use logarithm of the hourly wage as the dependent variable and are weighted using the ORG sample weights. The regressions are on the same dependent variable with the same controls and same hierarchical approach. First the models are run with the entire sample of all workers, with no controls, except for the 15 years and 51 state fixed effects. Then, sequentially adding controls, first the set of demographic and work characteristics, and then adding industry and occupation controls. We break down the part-time penalty by types of workers by race and gender, and the type of part-time work (e.g., noneconomic and economic reasons).

Part-time wage penalty empirical tests: Findings with the latest data, 2003–2018

We test for the following questions to determine the extent to which the estimated size of the part-time wage penalty is different:

• In size as it was in the earlier period, ending in 2002, as a raw or adjusted wage gap.
• By the noneconomic versus economic motivations for working part-time hours.
• By race and gender and its combinations, although part-time work is disproportionately female.
• In size to a potential add-on penalty of reduced access (coverage) regarding nonwage benefits for part-time workers.

Our empirical procedure is to conduct a three-step process estimating the size of the wage penalty for part-time workers:

• The “raw” wage gap in wage levels, with no controls for individual, state, or year fixed effects excluded and then included. The “raw” wage penalty is expected to be largest.
• The “partially adjusted” penalty, the above model and controlling for all personal and demographic characteristics, education, and location. The penalty is contrasted between shorter versus longer part-time hours per week, and economic versus noneconomic reasons for working part-time weekly hours.
• The “fully adjusted” wage penalty is estimated first without, then with, controls for both industry and occupation of the worker. Effects of the industry of employment are expected to be higher in certain industries, perhaps where part-time jobs are more prevalent.

The unadjusted wage penalty for part-time work

Part-time jobs during the period 2003 to 2018 averaged 52.4% less wages per hour compared with earnings from full-time jobs. When factoring in just the effects of location (states) and state of the economy in subperiods (year), the “raw” wage penalty is 53.1% (see Table 1). This represents a substantial size reduction in absolute earnings per hour, suggesting that part-time workers earn less than 50 cents per hour on the dollar earned by their full-time worker counterparts. To put this in perspective, the order of magnitude is more than twice the size of the raw gender gap in the United States (Blau and Kahn 2017; Yu and Kuo 2017; Weeden, Cha, and Bucca 2016; Goldin 2014; Matteazzi, Pailhé, and Solaz 2014; Leslie et al. 2012; Harkness and Waldfogel 2003). Furthermore, this represents a substantial increase in the size of the unadjusted wage penalty from 1995–2002, which was on the order of 33% (between the 46% found for men and 22% for women (Hirsch 2005)).

Adjusted pay penalties—partial, by demographic and education characteristics of workers

While the raw wage penalty for working part time is a massive one, how much of this represents different qualities of part-time and full-time workers, such as their age (a proxy for work experience) or education levels (a proxy for skills brought to a job)? Because of the many different possible characteristics of workers observable in the CPS, we next measure the adjusted wage penalty for working part time versus full time. Controlling for workers’ demographic and “human capital” (i.e., 16 educational levels) characteristics is arguably a more meaningful measure of the penalty experienced by a given worker for part-time work, and is the most common, accepted way of measuring it with large, representative surveys in the United States and other countries.28 The “partially adjusted wage penalty” estimates control for the “observable” differences among workers in their personal/demographic and education features, but also their location.29

As discussed above, the “raw” wage penalty is 52.4% and remains comparable when adding state and year controls. The partially adjusted wage penalty, controlling for workers’ demographic characteristics and education level, is 29.3% (see Table 1). So, the inclusion of demographic and education controls “knocks down” the size of the wage penalty for usually working part-time hours, as expected, but this partially adjusted wage penalty remains substantial. This means that otherwise comparable workers who usually work part-time hours earn almost 30% less than their full-time working counterparts. This is markedly higher than the 24% (18% for women, 33% for men) wage differential found for the 1995–2002 era.

The fully adjusted wage penalty, which controls also for the worker’s industry and occupation in which they are employed, is 19.8%. This suggests that part-time workers get paid about 20% less than otherwise comparable full-timers simply because they are in part-time jobs, independent of whatever occupation and industry they work in. Thus, we infer that about one-third of the only partially adjusted wage gap is attributable to part-time workers being employed in certain lower-paying sectors or job types. Nevertheless, two-thirds of the wage gap is not explained by their industry or occupation of employment. In the earlier period, “measurable” characteristics accounted for 60% of the raw wage penalty (Hirsch 2005). The fully adjusted wage penalty for part-time workers is markedly higher recently—about 20% compared with 16% in the earlier, 1995–2002 period. The increase is surprising since the skills required of part-time workers actually rose between 2007 and 2017 (Dangermond, Monaco, and Smyth 2019).

It is interesting to note that the part-time wage penalty is on par with the gender and racial wage penalties in the U.S. labor market. Female workers are paid 22.6% less than male workers with similar demographic characteristics and education levels and black workers are paid 14.9% less than white workers with similar demographic characteristics and education levels (Gould 2020).

Table 1

Part-time wage penalties, by reason for part-time work

There are differences in the part-time wage penalties based on the reason a worker works part time. The CPS asks employed persons who report “usually” working fewer than 35 hours a week, “What is your main reason for working part time?” As noted in the methodology section, the BLS divides the many reasons that workers give into “economic” and “noneconomic” reasons. (Note that the survey does not ask whether those who give noneconomic reasons would prefer full-time work were it not for these noneconomic reasons.) The main two reasons within the “part-time for economic reasons” category are those working part time because of “slack work or business conditions” and because the respondent “could only find part-time work.” Another economic reason, though cited much less often, is “seasonal work or between jobs.” Other reasons are characterized by the BLS as “part-time for noneconomic reasons.”30 Those working part time for noneconomic reasons include workers, disproportionately women, who seek part-time work more by choice, but under the constraint that they might have little access to any supports for child care, sick leaves, and other social or family obligations that, if supported more, would help enable them to work full-time hours. Thus, if one works part-time hours on a regular basis because of “child care problems” or “other family/personal obligations,” then BLS considers that one works part time “for noneconomic reasons.”

The results in Table 1 show that those working part time for economic reasons suffer a greater wage penalty. When working fewer than 35 hours for economic reasons, such as “slack work or business conditions,” the fully adjusted wage penalty is 22.3%. However, those working part time because they only have been able to find part-time work, there is a considerably higher penalty, at 29.5%. In contrast, those working part time for noneconomic reasons face a wage penalty of 18.3%, smaller in size than that faced by economic part-time workers. Thus, there is a gradation apparent: The greater the employer role in determining the part-time status of the work, the larger the wage penalty. This means workers who work part time but want full-time work not only are “hours-constrained” underemployed, but also suffer from even lower relative hourly earnings than part-time workers overall. This finding is not consistent with a compensating wage differential theory, which would imply that those working shorter hours as a personal choice should be more willing to sacrifice pay. Those who are part time for economic reasons, in post-recession years, increasingly make up a larger share of those who settle for part-time jobs in lieu of full-time jobs, rising to constitute one-third of the total among all (10) reasons provided for working fewer than 35 hours, i.e., part time (Golden 2016).

Part-time wage penalties by race and by gender

Within the 19.8%, fully adjusted wage gap for all part-time workers, there are notable differences by workers’ race or ethnicity, as shown in Table 2. For white workers, the penalty is 20.7%, a tick higher than the overall average, on par with the 20.2% penalty for black workers. The wage gap is 14.2% for Hispanic workers, or about three-fourths of the average overall. The similar size of the part-time wage group across groups suggests that the penalty for part-time working appears to be due to the part-time job itself, experienced by all incumbents across racial/ethnic groups, with only slight differences in size.

Table 2 breaks down the overall and race results by gender. Women experience a substantial wage penalty for working part-time hours of just under 16%. For men, it is substantially larger; the wage penalty is greater than 25%. Again, these differentials are somewhat greater than those found in the earlier period, which were 11% for women and 22% for men (Hirsch 2005).

Table 2

While smaller in size, the scope and the impact of working part time is greater for women than men, even though the actual size of the part-time wage penalty is larger for men than women. This is because—though not shown in the table—women are twice as likely to work part time as men—22.8% of all female workers worked part time in 2019, compared with 11.8% of all male workers. Even starker, there are 73% more women part-time workers than men part-time workers (16.1 million part-time women versus 9.3 million part-time men (BLS 2020a)).

Indeed, findings (unreported here) regarding the size of the wage penalty by the length of workweeks (also Hirsch 2005), reveal that the part-time penalty is, in large part, more of a penalty for fewer work hours. When broken out by subranges of weekly hours, there appears to be an hours gradient to the part-time wage penalty. Working 20 or fewer hours has the largest penalty, although not that much larger than working 20–29 hours, but noticeably larger than in the 30–34 hours range. However, even when working more than 35 but less than 39 hours, there also is some penalty vis-à-vis those usually working 40. Thus, there appears to be an hours-related wage penalty within part-time jobs.31 Moreover, if the Bureau of Labor Statistics definition of what constitutes “full time” (working 35 hours or more) was changed to the more legal and normative “standard” workweek of 40 hours, the impact of the wage penalty would be more widespread, given how many millions of workers work 35–39 hours.

Table 3

Table 3 shows the gender and race distribution of part-time workers, by reason. By gender, it shows that women make up a greater share of those who work part-time hours generally, both for noneconomic and economic reasons. Women make up 63.3% of part-time workers, even though women make up just 47.0% of those “at work.” Women clearly are disproportionately working part time and so a much larger share of women are affected by the part-time pay penalty.

Hispanic women and black women both make up a disproportionate share of those working part time (both for noneconomic and economic reasons). By race/ethnicity alone, black and Hispanic workers make up a disproportionate share of those working part time for economic reasons: Hispanics constitute 26.5% of all those working part time for economic reasons, in contrast to being only 17.6% of all those at work. Black workers constitute 16.7% of all those working part time for economic reasons while they are only 12.5% of all those at work. Broken by gender and race, black men and women and Hispanic men women all disproportionately work part time for economic reasons.32 But in summary, women of color appear to bear a disproportionate brunt of the part-time earnings penalty because they make up a disproportionate share of those working part time for any reason.

Differentials in employee benefits

The results so far focus on the hourly wage penalty faced by part-time workers. However, part-time workers also receive less in such benefits as retirement and health care because they frequently are excluded from such plans. Analysis of National Compensation Survey 2013 data showed that part-time workers had far less access to benefit plans than full-timers did (Bishow 2015; BLS 2015). For instance, only 37% of part-time workers had access to the employer’s retirement plan, far less than the 74% of full-time workers who did. Similarly, part-time workers had access to health care plans only 24% of the time, while full-time workers had access to health care plans 85% of the time. Part-time workers also were excluded from holiday, sick leave, and vacation plans. Access to benefits depends on the scheduled number of weekly work hours, not only whether the responding establishment reports the job as full time or part time (Bishow 2015).33

The challenge is how to incorporate analysis of these benefit gaps along with wage penalties, because the monthly survey data source (CPS) used to estimate wage penalties does not have benefit data. The only data available are from BLS’s Employer Costs for Employee Compensation series, in the National Compensation Survey, which provides breakdowns of wages and benefits separately for full-time and part-time workers (for major occupation categories). Unfortunately, these data do not allow us to control directly for differences in education, experience, or industry; however, some of these factors will be reflected in the occupation differences (i.e., workers in a similar occupation will have similar education levels).

Table 4 provides an analysis of the full compensation—both wages and benefits—for all private-sector workers and for two general occupational categories (blue-collar and service occupations). “Blue collar” includes “production, transportation, and material moving” occupations, and “service occupations” includes a variety of mostly low-wage occupations such as health care support occupations, food preparation and serving-related occupations, building and grounds cleaning and maintenance occupations, and personal care and service occupations, along with protective service occupations (firefighters, police, corrections officers).

Table 4

The analysis is focused on estimating the degree to which the full compensation penalty (incorporating both wages and benefits) is larger than that for wages only. To do so, the analysis adopts W-2 wages, a measure of wages that mirrors that used in the analysis of CPS data above. “W-2 wages” includes the BLS category of direct wages, but adds costs for paid leave and supplemental pay (because these categories are embedded in the CPS definition of wages). Nonwage benefits include insurance, retirement, and payroll taxes paid by the employer.

In the private sector, nonwage benefits make up 20.1% of full-time workers’ compensation, but account for only 16.4% of part-time workers’ compensation. As Table 4 shows, this implies that for every dollar of wages, there is 25.2 cents for benefits for full-time workers, but only 19.7 cents per dollar for part-time workers. This implies, in turn, that even if part-time and full-time workers had equivalent wages, there would be a compensation penalty of 5.5 percentage points. Thus, we can add another 5.5 percentage points to the estimated wage penalty to obtain the full compensation penalty for part-time jobs. Moreover, there is an even bigger benefits penalty, 8.3 percentage points, for those in low-wage service occupations. However, there is no apparent add-on benefits penalty among workers in the group of blue-collar jobs.34

Implications of the findings for policies to address the penalties associated with working part time

Working part-time hours clearly involves a willing sacrifice of income, sometimes an acceptable trade-off for those workers who prefer less-than-full-time work, and the flexibility that part-time jobs potentially provide compared with a full-time commitment to work or the workforce.

However, having significantly reduced per-hour compensation for the same work characteristics, hurts part-time workers, whether they are working part-time hours for either the economic or noneconomic reasons. The hourly wage penalty for working part time, in the recent U.S. labor market, is a 20% reduction in earnings per hour, even after one’s education, experience, occupation, and industry are taken into account. The part-time workers’ relative wage gap is thus on par with observed gender and racial wage gaps in the United States, and is similarly persistent and inequitable. Indeed, the wage penalty is measurably higher now than it was a decade and a half ago when Hirsch (2005) did his analysis with the same CPS data. In addition, the over 4 million U.S. workers in part-time jobs who prefer to work full-time hours (at least 35 weekly) (BLS 2020a) pay an even stiffer penalty. Even those working part time for various noneconomic reasons—which includes those who likely would prefer full-time work if they did not have such constraints as a lack of support for parenting, health issues, and the need to obtain more education—pay a penalty of over 18%.

Furthermore, part-time workers have less access to various employee benefits, suffering an additional 5.5 percentage-point benefits penalty, in the private sector, in addition to their wage penalty. These substantial compensation consequences likely reflect underlying structural and institutional factors in the U.S. economy that could and should be addressed, with a range of policy innovations. Listed below are several policies that we would need to adopt to address the part-time wage and benefits penalties and some of the key legislative efforts under way to bring them to fruition.

• Compensation parity for part-time jobs and workers. A codified measure to ensure rights for part-time workers would need to include provisions for wage fairness and pro-rated benefit coverage. Pay parity for part-time work is a basic, accepted precept of the International Labour Organization (ILO)’s Part-Time Work Convention, 1994 (No. 175)—the globally accepted standard for providing proportional parity for part-time workers. It recognizes “the economic importance of part-time work, the need for employment policies to take into account the role of part-time work in facilitating additional employment opportunities, and the need to ensure protection for part-time workers in the areas of access to employment, working conditions and social security” (Preamble), relative to “comparable full-time workers” (who have the same type of employment relationship; are engaged in the same or a similar type of work or occupation; and are employed in the same establishment) (Article 1). This standard articulates that “national law and practice shall be taken to ensure that part-time workers do not, solely because they work part time, receive a basic wage which, calculated proportionately on an hourly, performance-related, or piece-rate basis, is lower than the basic wage of comparable full-time workers.” (Article 5). “These conditions may be determined in proportion to hours of work, contributions or earnings.” (Article 6). It extends this proportional parity in pay norm to statutory social security schemes that are based on occupational activity, “so that part-time workers enjoy conditions equivalent to those of comparable full-time workers” (Article 6). Finally, it promotes that measures be taken to ensure that part-time workers receive conditions equivalent to those of comparable full-time workers for maternity leave, paid annual leave, paid public holidays, and sick leave—provided in proportion to hours of work or earnings (Article 7). The Netherlands (where 75% of women employed work fewer than 35 hours per week) has been at the forefront of creating pro-rata equivalence for part-time workers, particularly regarding salary levels and, where reasonable, also for employee benefits (Visser et al. 2004). In the United States, San Francisco’s Formula Retail Employee Rights Ordinances have such parity for part-time workers (San Francisco Office of Labor Standards Enforcement 2020, see Section 3300G.5 ).

• Access to hours for part-time workers. Work schedules that often do not provide as many hours as they want or need are a significant challenge faced by many part-time workers. The Part-Time Workers Bill of Rights Act to be introduced by Sen. Elizabeth Warren (D-Mass.) and Rep. Jan Schakowsky (D-Ill.) would address that challenge by requiring that large employers offer available hours first to current, available, qualified part-time employees before hiring new employees or temporary or subcontract workers. Some local jurisdictions are already offering such protections. Seattle’s Secure Scheduling Ordinance, adopted in 2017, provides “Access to hours” which ensures that, before new employees are hired, an employer must post notice for current employees of available hours for three days and offer the job or work to qualified current employee(s). In San Jose, California, the Opportunity to Work Ordinance requires, without specifying the number of hours for the period, that employers first offer available additional hours of work to its existing part-time workforce (who in the employer’s good faith and reasonable judgment have the skills and experience to perform the work) before hiring (sub)contractors, temps, or new part-time workers. The employer also must use a transparent and nondiscriminatory process to distribute the hours of work among those existing employees. Employers are not obliged to allocate those hours to existing employees in the event the additional hours would result in premium-owed overtime hours (The Center for Popular Democracy and Working Partnerships USA 2016). In addition to Seattle and San Jose, several cities such as Chicago; Emeryville, California;  New York City; Philadelphia; and San Francisco have introduced or passed fair workweek laws that include “access to hours” provisions.

• Control over work schedules and protections from volatile scheduling practices. Lower pay for part-time work is compounded when people do not know or control their own hours or have enough advance notice when their schedules are set or changed. Legislation to help ensure that lower-wage employees are provided with more certainty about their work schedules, hours, and income has been proposed in the U.S. Congress and proposed or passed in many statehouses and city councils across the United States. The national Schedules That Work Act of 2019 (STWA) and the local and state measures contain provisions that would diminish the income and pay disadvantages experienced by incumbents of part-time jobs. The bills generally permit employees to request changes to or stability in their work schedules without fear of retaliation, and ensure that employers consider these requests. The measures also require employers to provide a minimum advance notice of schedules, typically between seven to 14 days, that will make hours more predictable and stable for all the hourly employees in the industries covered. The provisions in fair workweek laws for New York City, the state of Oregon, San Francisco, Seattle, and elsewhere include some requirement for “predictability pay”—if a worker’s posted schedule is altered or their shift length or hours are cut, the employee is owed at least some pay for that. In certain cases, the employee is owed just an hour or two hours’ pay; in other cases, hours cuts made within 24 hours of the shift start time, employees are owed pay for no less than half the hours of the originally scheduled shift. Similarly, reporting pay requirements, which predate the proposed scheduling ordinances (CLASP, Retail Action Project, and Women Employed 2014; Ben-Ishai 2016), require a minimum payment for those showing up to work and having one’s hours eliminated or cut. All of these measures would clearly mitigate the pay suppression experienced by workers in part-time positions, not only for those who work part time for economic reasons—where the pay gap is more egregious—but for those working part time for noneconomic reasons as well, who also deserve such protections. Because part-time workers are far more likely to be given unfavor­able work schedules or face greater schedule volatility (Zukin and Van Horn 2015; Ruan and Reichman 2014; Alexander and Haley-Lock 2015; Schneider and Harknett 2019), other provisions of the STWA and local ordinances—such as prohibition of on-call work and “clopening” (being scheduled to close the business one night and be back to open the business the next morning)—would improve dimensions of part-time workers’ well-being less directly associated with pay. Similarly part-time workers would benefit from the “right to request” modifications in hours (and schedules) in the STWA and in such laws in cities and two states (New Hampshire and Vermont): Under these provisions part-time employees could expressly request additional work hours. Moreover, a minimum hours standard for part-time workers could guarantee a certain number of hours per week (such as 24 in France) to workers when hired, unless they prefer otherwise (Peck and Traub 2011). Indeed, all EU member states by 2022 will have to comply with the European Commission’s Directive for Transparency and Predictability in Work, which will incorporate elements similar to these ordinances, including “good faith estimates” of hours and schedules upon hiring of employees (European Commission 2019).

• A lower overtime pay threshold of hours for hourly paid part-time workers: Under federal law, almost all hourly workers are automatically eligible for overtime pay—1.5 times the regular rate of pay for any hours over 40 hours in a week. A lower threshold for part-time workers to be owed overtime pay—such as beyond 35 hours— would surely help address the part-time pay gap. Indeed, the proportion of part-time workers whose actual weekly hours exceeded 40 were a nontrivial 4%, and likewise, a far-greater proportion likely have weekly hours of 35 or more, given that part-time workers are more than twice as likely to report working irregular shift times.35

• Provisions allowing part-time workers to continue receiving unemployment insurance benefits while working part-time hours, for both “economic” and “noneconomic” reasons: Eligibility for partial unemployment insurance (UI) should be extended to not only those taking part-time work in lieu of finding full-time jobs, but also to anyone who seeks to reduce his or her own work schedule for compelling reasons, including personal health and child care responsibilities. UI eligibility for individuals who voluntary quit for “good cause” should be extended to workers who are forced to quit due to their erratic schedules (Ben-Ishai and McHugh 2016). The federal government should enact a minimum eligibility standard for UI benefits, as long as the work being sought is for at least 20 hours per week.36 Currently, in 28 states and the District of Columbia employees can qualify for receiving  partial unemployment insurance as “short-time compensation” (STC) payments. They are eligible if their employer (not the employees themselves) initiated cuts in their workdays or shift lengths to part-time workweeks (i.e., “work sharing”) in lieu of instituting layoffs among a group of five or more employees.

• Paid time off: Paid sick, vacation, and personal time off are available to a far lower share of workers at the bottom of the income scale, especially those in part-time jobs. National minimum paid sick time, vacation, and personal time laws are another tool that would help mitigate the income penalties part-time workers face. Having greater access to prorated paid time off may induce many workers to remain in their part-time jobs so as to best combine work with caregiving and/or schooling activities, rather than quitting for a different job or leaving the labor force. The national FAMILY Act would, if enacted, create a national family and medical leave insurance program that would apply coverage to part-time workers (National Partnership for Women & Families 2019).

Acknowledgments

The author thanks Larry Mishel and Ben Zipperer of EPI for their assistance with data and reviews of this report.

About the author

Lonnie Golden is a professor of economics and labor-employment relations at Pennsylvania State University, Abington College. He is an affiliate with the Project for Middle Class Renewal at the University of Illinois at Urbana-Champaign and the Employment Instability, Family Well-being and Social Policy Network (EINet) at the University of Chicago. He holds a Ph.D. in economics from the University of Illinois at Urbana-Champaign. His research has centered on the labor market and hours of work—specifically, the economic and noneconomic determinants of hours, including legal, organizational, and individual preferences, and their effects on employment and well-being, including work-life and worker happiness. He is coeditor of the books Working Time: International Trends, Theory and Policy Perspectives (Routledge Press) and Nonstandard Work: The Nature and Challenges of Changing Employment Arrangements (Cornell University Press), and author of many research articles that have appeared in such journals as Industrial Relations, Monthly Labor Review, Cambridge Journal of Economics, and Journal of Marriage and Family.

Endnotes

1. According to Appelbaum and Rho, “despite all the hype, gig work is an extremely small share of employment. Just 1.6 million workers—1.0 percent of total employment—were engaged in electronically mediated work in 2017.” In 2017, the total number of part-time workers was nearly 28 million (BLS 2020b).

2. The level of part-time jobs, in a state, is not significantly associated with the cost of health benefits, so the structural change involved is not mainly health care costs (Valletta, Bengali, and Van der List 2020).

3. Human capital investment such as training could be a fourth and job insecurity a fifth inherent disadvantage, leading to long-run effects on earnings trajectories (e.g., Ferber and Waldfogel 1998; Green and Ferber 2005; Wolf 2014; Paul 2016; Messenger and Ray 2015; Pedulla 2016; Kyyrä, Arranz, and García-Serrano 2017) and their job satisfaction (e.g., Wheatley 2016). Voluntary part-time working has a positive effect on longer-term earnings for women.

4. See Mishel 2013.

5. As of the end of 2019, no national legislation concerning part-time work had been introduced in the United States since H.R. 3682, the Part-Time and Temporary Workers Protection Act of 1996, 104th Congress (1995–1996), sponsored by Rep. Patricia Schroeder (D-Colo.).

6. Past CPS data confirm that those classified as involuntary part-time workers indeed work part time “involuntarily” (Stratton 1996), because involuntary part-time work tracks other indicators of underemployment (Li and McCully 2016).

7. Part-time workers who are primary earners increased from 1970, making up almost four in 10 of all part-time workers (Shaefer 2009).

8. A preference for working part time is high, particularly among mothers with children, including those who work full time and those not employed who prefer to work. Mothers in the bottom half of the income scale are more likely to prefer full-time work (Wang, Parker, and Taylor 2013).

9. This implies an “occupational crowding model” at work, where there not only is an efficiency wage leading to higher pay for full-time work, but an enlarged supply of workers with preferences for fewer than full-time hours (e.g., mothers and students). The labor demand side provides a foundation regarding why employers may favor creation of more jobs with part-time hours, or fewer in favor of more full-time positions. Employer preferences regarding the ratio of full-time and part-time jobs will depend on the ratio of fixed labor costs to the hourly wage rate, a variable cost (Zeytinoglu 1992; Montgomery and Cosgrove 1995; Lettau 1997; Barrett and Doiron 2001; Hamermesh and Stancanelli 2015; Golden 2015a; Elsayed, de Grip, and Fouarge. 2016). This would lead employers to curb the ratio of part-time to full-time jobs. A lower variable cost of wage rates, alternatively, might lead employers to hire more part-time workers, if their total compensation per hour worked is sufficiently less than that of full-time workers (Carré and Tilly 2012). On the other hand, the total administrative cost of having two part-time workers rather than one full-time worker to oversee may be higher on a per-unit basis for part-time jobs, incentivizing employers to hire fewer part-time workers.

10. To wit, across virtually all countries part-time working corresponds closely to the female share of the labor force. For more direct indicators of “schedule flexibility,” see Golden 2009 and Berg et al. 2014.

11. Hirsch (2005) uses college towns to illustrate where students are diverse in skills but care very much about which hours of the day are scheduled.

12. At least in medium-skilled service-sector work (Collewet and Sauermann 2017).

13. Indeed, Dutch firms with a large part-time employment share are relatively more productive—a 10% increase in the part-time share is associated with almost 5% higher productivity (Jepsen et al. 2005).

14. Ransom and Oaxaca (2010) find that workers who have lower labor supply elasticities get paid lower when firms have some monopsony power.

15. With panel data and the ability to control for potential individual heterogeneity among part-time and full-time workers, using individual-fixed effects models, the wage penalty estimates, not surprisingly, are lower; see Hirsch 2005 and Booth and Wood 2008.

16. Alternative methods to control for “unmeasured skill differences” to account for the potential self-selection (endogeneity) into part-time status typically find a reduced penalty size, particularly for women. One study found a 25% wage penalty for men who cut their workweek from 40 to 20 hours at retirement ages, but no such effect was noted among women (Aaronson and French 2004).

17. Studies from outside the United States show a pay penalty—in the United Kingdom, as high as 22% to 26%. About half of the pay gap, 13% among women, is “explained” by worker characteristics, but the remaining 3% to 10% (by gender) is unexplained (Manning and Petrongolo 2008). In several European countries, part-time jobs are flexible but insecure—analysis of labor market transitions in Denmark, France, Italy, the Netherlands, and Spain finds that being employed part time (mostly women) leaves one at higher risk of unemployment (Blázquez and Carcedo 2014; Anxo et al. 2007). However, wage differences between part-time and full-time workers are small in Norway (Hardoy and Schøne 2006), suggesting there is little systematic difference between part-time and full-time workers regarding the selection process or in earnings capacity, which they attribute to the Norwegian labor market providing more equal rights for part-time workers, strict rules against the discrimination of part-time workers, and a generous family policy enabling women to combine work and family life. The case of Norway suggests the importance of an institutional setting characterized by relatively strong employment protection that includes part-time workers. Partly as a consequence of this, a large proportion of Norwegian women are working part time. Similarly, with panel data on German workers, estimating a wage equation (using a random effects model), capturing the employment history and dynamic choice of employment status, controlling for the institutional context, finds that working part time with a relatively small number of weekly hours has a large causal effect on current wages. In contrast, more part-time work does not reduce current wages, although it leads to negative longer-term wage effects (Paul 2016). A study of women’s part-time work and wage penalties, using fixed-effects estimation, finds the smallest penalties for part-time employment where female labor force participation rates are lowest (McGinnity and McManus 2007).

18. Within occupations, one study finds almost a 9% wage penalty among workers in child care establishments, only a 7% gap among teacher aides and no more than 0% among teachers or among nurses, once instrumental variables or random effects estimations are conducted (Montgomery and Cosgrove 1995; MacPherson and Hirsch 1995). In caregiving jobs, being able to arrange part-time work is negatively associated with wages; i.e., care workers, on balance, trade off wages for this type of job flexibility (Smith and Folbre 2016). There may be changes over time. For example, in pharmaceutical occupations, the pay penalty has been shrinking, attributable to the reorganizing in that industry (Goldin and Katz 2016). There may be similar penalties for related forms of nonstandard jobs. The wage penalty associated with job outsourcing ranged from 4% to 7% for janitors and from 8% to 24% for security guards (with similar findings on health benefits), and were not a reflection of their lower hours (nor skill differences nor compensating differentials for higher benefits).

19. In particular, the share of female part-time workers is associated with wage penalties (whereas male part-time workers received a pay premium when working more than 25 hours). This is interpreted to reflect women’s different prime motive for reducing working hours and the types of part-time jobs available to them, or more to accommodate domestic constraints by downgrading to more flexible jobs. In Belgium, longer-hours part-time workers were more productive per hour than those at a much shorter weekly hours level (Garnero, Kampelmann, and Rycx 2014). In Germany (Wolf 2014), accounting for all available observed as well as time-constant unobserved individual characteristics yields a wage reduction for part-time workers of about 10%, with part-time men subject to higher wage penalties than women.

20. To the degree part-time work actually offers incumbents greater flexibility, there is an exponential return to greater current hours of work in high-paying occupations (Goldin 2014).

21. See Booth and Wood 2008 and Baffoe-Bonnie and Gyapong 2018 for the sensitivity of wage differential estimates to the definition of the number of weekly hours that is considered working full time.

22. Among Australia’s “casual” labor contracts, part-time workers explicitly lack long-term job security and social insurance security protections (Campbell, Whitehouse, and Baxter 2009). This lack of benefits explains the entire pay premium found for workers working part time there and in South Africa (Rodgers 2004; Posel and Muller 2008; Booth and Wood 2008). However, when controlling for unobserved individual heterogeneity (fixed effects) using panel data, part-time working men and women in Australia (Booth and Wood 2008) and in Germany (Wolf 2014) typically earn an hourly pay premium relative to those in full-time jobs.

23. See Booth and Wood 2008, Baffoe-Bonnie and Gyapong 2018 for the sensitivity of wage differential estimates to the definition of full time.

24. The matching is accomplished using IPUMS identifiers, which results in slightly different sample sizes than what Hirsch used.

25. We do not focus on the small number of respondents who say they work part time because of “seasonal declines” in demand or because their “job ended or started” during the reference week.

26. This group working part time for noneconomic reasons excludes the over 7.7 million who usually work full time but worked one to 34 hours in the last week because of vacations, holidays, weather, family obligations, or “other reasons” (according to 2019 data from BLS 2020a). An alternative way to count the number of workers part time for economic reasons who worked from one to 34 hours in the last week (whether they “usually work full time” or “usually work part time”) because of “economic reasons” is the universe of individuals who were “at work” in the reference week. Respondents who said they were not “at work” or were “absent,” but have a job, are counted as “employed.” Thus, part time for economic reasons is likely undercounted (Golden 2016).

27. Hirsch used the Basic CPS rather than ORG “usual” hours question. We substitute the answer regarding “usual hours” in the ORG with the same question in the Basic CPS to observe consistency. We also substitute the actual hours worked in the previous week being fewer than 35 and contrast. Finally, we used the “usually work part time” question as a dummy variable to contrast to “usual hours” being fewer or more than 35.

28. Controls for age show there is a significant positive effect of age on wages, but little influence of the exponentials. That is to say, earnings rise with age but neither more nor less than proportionally. In unreported results, the size of the penalty for working “usual part time” is contrasted briefly with measuring part time with workers’ “actual” hours last week being shorter than 35. The latter display somewhat lower pay penalties, which can be attributed to “actual” hours, including many full-time workers who worked fewer than 35 hours the previous week because of an absence.

29. Part-time employment appears in all major industry classifications. However, it is proportionately higher in some: private household services, leisure/hospitality, retail/wholesale trade, services-other, and education/health. Are pay penalties consistent across sectors or higher in some sectors, particularly where part-time work is more common? Unreported results show that among 50 different “intermediate” industry types, 49 have pay penalties. The variation in the partially adjusted pay penalty ranges up to 50% (with a small pay premium in only one outlier), although most fall in the 15% to 40% range. The pay penalty is above average in retail trade at 32%. Within the retail sector, working in clothing stores brings a sizably higher pay penalty, but somewhat lower in restaurants, where earnings include tips. In several industries, the pay penalty is above that of retail—more than 49% in rental and leasing services, at 46% in motion picture and sound recording and in other information services, 45% in internet publishing and broadcasting (though sample size is not large), 44% in petroleum and coal, 38% in beverage/tobacco products, 36% in publishing, and 35% in miscellaneous/nonspecified manufacturing. The sole exception to a penalty in part-time workers’ pay is in hospitals, where there is a slight pay premium of 3% (and only a small 3% pay penalty for those employed in private households). However, in health care industries other than hospitals, there is somewhat of a penalty of 6%. It suggests there is something unique about working part time in hospitals versus other health services. Even in hospitals, among those working one to 19 hours, the premium is zero. The lower penalties in certain sectors might reflect greater wage compression generally in those industries, in contrast to a wider pay disparity in other industries, particularly outside of health care.

30. Workers are provided three separate chances in the CPS to demonstrate that their part-time hours truly are “involuntary” (see Golden 2016).

31. This also suggests full-time work likely is better conceived of 40 or more hours, when it comes to pay, since working 35 to 39 hours appears to be more of a hybrid between full-time and part-time working, not entirely resembling full-time work at 40 hours or greater.

32. The totals by race and ethnicity in the table do not add up to 100% because the categories are not mutually exclusive, i.e., white includes Hispanic white workers and black includes Hispanic black workers.

33. Several other national surveys reinforce the large disparities between full-time and part-time workers in a wide range of employee benefits, or access to them. This includes parental leaves, paid sick time, paid vacation and personal time, and other perks (Kosar, van der Klaauw, and Zafar 2017; FRB 2016; AEI-Brookings-Urban Institute 2018; NWLC 2017; Glynn et al. 2016; Fronstin 2013; and Milli, Xia, and Min 2016).

34. See Bivens et al. 2017, which shows the union advantage in benefits, and supports (unreported) findings that unionized part-time workers have a 15.6% wage premium, higher than the overall average wage premium of 13.2%.

35. This policy is supported by both voluntary and involuntary part-time workers (Zukin and Van Horn 2015); see Golden 2009, 2015b.

36. See Stettner, Cassidy, and Wentworth 2016; Golden 2016; Ben-Ishai 2016; Glauber 2013; McKay 2017; Messenger and Ghosheh 2013; and NCSL 2019.

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Amy DeBisschop
Acting Director of the Division of Regulations, Legislation, and Interpretation
Wage and Hour Division
U.S. Department of Labor
Room S-3502
200 Constitution Avenue NW
Washington, DC 20210

Re: Comments on Regulatory Information Number (RIN) 1235-AA24: Regular Rate Under the Fair Labor Standards Act

Dear Ms. DeBisschop:

The Economic Policy Institute (EPI) submits these comments in response to the Department of Labor’s proposed rule, “Regular Rate Under the Fair Labor Standards Act.” EPI is a nonprofit, nonpartisan think tank created in 1986 to include the needs of low- and middle-income workers in economic policy discussions. EPI conducts research and analysis on the economic status of working America, proposes public policies that protect and improve the economic conditions of low- and middle-income workers, and assesses policies with respect to how well they further those goals.

EPI makes three points concerning this proposal.

1. The Fair Labor Standards Act (FLSA) requires employers to pay covered, nonexempt employees an overtime rate of 1.5 times their “regular rate of pay” for hours worked in excess of 40 in a workweek. It defines “regular rate of pay” broadly to include “all remuneration for employment paid to, or on behalf of, the employee” with the exception of a small number of specific exclusions, including “payments made for occasional periods when no work is performed due to vacation, holiday, illness, failure of the employer to provide sufficient work, or other similar cause; reasonable payments for traveling expenses, or other expenses, incurred by an employee in the furtherance of his employer’s interests and properly reimbursable by the employer; and other similar payments to an employee which are not made as compensation for his hours of employment.” The Department is proposing to add employer-provided tuition payments and reimbursement plans to the list of examples of “other similar payments” that may be excluded from the regular rate.

However, the Department’s current proposal lacks an analysis of whether a tuition program primarily benefits the employee or mutually benefits the employer and the employee. There are a wide variety of scenarios under which employers offer tuition benefits: employers may offer tuition benefits for discrete professional development courses, or broad reimbursement for any type of general education course, or retroactive limited educational loan repayment. They may specify the coursework that employees must pursue to be eligible for tuition payment, or require enrollment in a particular institution. EPI recommends either removing tuition benefits from the proposed revisions or setting forth factors to help determine when a tuition benefit is functioning like compensation for work. Such factors might include whether the employer has limited the institutions, subject matter, or courses that may be reimbursed or whether the benefit is contingent upon the employee’s perceived seriousness about a career with the company or maintenance of a certain GPA.

2. “Call-back pay”—additional compensation for calling an employee back to work without prearrangement to perform extra work after the employee’s scheduled hours have ended—can be excluded from the regular rate if the payments are “infrequent and sporadic.” The Department is proposing to remove the restriction that in order to be excluded from the regular rate, call-back pay must be “infrequent and sporadic.” The Department should withdraw this proposal and allow the language in the existing regulations to remain. When call-back payments are not infrequent and sporadic, then they are essentially compensation for work that is chronically irregular, and must be included in the regular rate.

This question is of increasing importance as a large share of employees, particularly low-wage hourly employees, regularly experience significant changes in their work schedule. For example, a national survey of early-career adults found that over a third (38 percent) know their work schedule only one week in advance or less.1 As such, in broadly excluding call-back payments or payments similar to call-back pay from the regular rate without any reference to the regularity of such payments, DOL will be creating an exception of real significance for certain categories of employees.

3. The FLSA permits employers to exclude from the regular rate certain premium payments for work in excess of—or outside of—specified daily or weekly standard work periods or for work on certain special days like weekends or holidays. Moreover, this extra compensation may be credited toward the overtime payments required by the Act. This premium pay is unique in that it is the only type of compensation that is excludable from the regular rate and also creditable toward overtime compensation.

While the FLSA does not require premium pay to be paid pursuant to a written contract in order to be excluded from the regular rate, the FLSA clearly requires that such premiums be paid pursuant to a legitimate, established agreement or policy so as not to create a means for employers to artificially lower the regular rate and avoid their full statutory overtime obligations. The Department is proposing to cut any reference to an employment agreement or contract to avoid any confusion that premium pay can only be excluded under written contracts or agreements. But instead of cutting these references as proposed, the Department should add language, such as “contract, handbook, policy, or explicit agreement or understanding.” This would clarify that even if premium pay need not be paid pursuant to a formal written contract, some form of prior agreement or understanding must exist between the employee and employer if the employer is to properly exclude premium pay from an employee’s regular rate and use it to take a credit against overtime obligations.

Thank you for the opportunity to submit comments on the NPRM. Please do not hesitate to contact me at 202- 533-2560 if you have questions.

Sincerely,

Heidi Shierholz
Senior Economist and Director of Policy

Economic Policy Institute

1. Susan J. Lambert, Peter J. Fugiel, and Julia R. Henly, Precarious Work Schedules Among Early-Career Employees in the US: A National Snapshot, Research brief issued by EINet at the University of Chicago, August 2014.

The Honorable Gregorio Kilili Camacho Sablan
Ranking Member, Subcommittee on Health, Employment, Labor, and Pensions
Committee on Education & the Workforce
U.S. House of Representatives
2176 Rayburn House Office Building

Dear Chairman Walberg, Ranking Member Sablan, and Members of the Committee:

We write on behalf of the Economic Policy Institute Policy Center to express our strong opposition to H.R. 4219, the so-called “Workflex in the 21st Century Act.” EPI is a nonprofit, nonpartisan research organization founded to center the needs of low- and middle-income workers in policy discussions. This misleadingly named bill does not provide any of the arrangements, rights, or modern protections that its title promises workers.

This bill doesn’t give employees any new rights to flexibility

This proposed legislation does not actually give employees any new rights to flexibility in their work schedules that are not already available under existing law. The Fair Labor Standards Act (FLSA) already allows for all of the flexible working arrangements that the so-called “Workflex” bill says employers can give their employees. For example, employers can already provide workers with flexible scheduling, defined in the bill as “an arrangement under which an employee’s regular work schedule is altered,” and with predictable scheduling, when an employer gives employees their schedules with “reasonable advanced notice,” or with teleworking arrangements. Nothing in current law is stopping employers from offering those flexible work scheduling options to employees today (though it is also well-documented that a lack of federal protections for workers against the epidemic of volatile scheduling has real consequences).

The only new working arrangement the “Workflex” bill adds is not an employee right, but an employer right—to avoid paying overtime as required for hours over 40 hours per week. The law currently requires employers to pay non-exempt employees overtime pay (time-and-a-half) for any hours worked over 40 per week. The “Workflex” bill’s “biweekly work program” would instead allow employers to avoid paying overtime pay unless an employee worked more than 80 hours in a two week period, and would permit employers to schedule workers for up to 60 hours per week with no overtime pay, as long as the workers only work 20 hours the next week in the 2- week period. But how does a 60 hour/20 hour bi-weekly schedule—without any overtime pay—promote “flexibility” for working people? How does it help a working parent to work 12 hour days one week, and 4 hour days the next? And, again, if any worker did actually want this, employers could already give them that schedule under the FLSA, provided that they pay overtime for the hours an employee works over 40 during the first week. In sum, the only new work scheduling option the “Workflex” bill provides is allowing employers the option of no longer paying overtime pay for overtime work.

This bill undermines state and local labor standards

This bill would also give employers a new right to avoid their obligations under state and local paid sick days and paid family leave laws.

EPI has documented how state legislatures widely use preemption—passing laws at the state level to nullify local ordinances—to undermine the stronger labor standards passed at the local level. This bill simply spreads that tactic to the federal level, under the guise of promoting flexibility.

As of June 2018, 10 states and 32 localities have already won hard-fought victories establishing requirements for workers to have access to paid sick days. This bill would reverse those gains in one fell swoop, by giving employers a free pass to ignore any state and local laws that attempt to raise the bar on paid leave protections, so long as they can claim to offer some minimal standard of paid time off (while maintaining full control over when and how employees could even use that time).

While a federal law requiring employers to allow workers to earn much-needed paid sick days and paid family leave would be a big step forward, it should not be at the expense of protections like overtime pay or avoidance of local and state labor protections that may go above the federal floor.

Rep. Walters’s fact sheet from the introduction of H.R. 4219 claims (without substantiation) that state and local paid leave mandates cause burdens on employers that contribute to wage stagnation and decreased investment in the workforce. Wage stagnation, of course, has been a well-documented issue facing American workers since long before any recently enacted state/local paid leave laws. Further, inequality in access to paid leave exacerbates inequality in total compensation (wages and benefits), and paid leave mandates are a crucial remedy. Moreover, the consequences for working people of the lack of a federal standard for paid sick days are also well-researched. But the fact sheet also points out that the workflex options outlined in the bill are voluntary—employers would not be required to adopt any of these provisions if it were to pass. So why is the legislation needed? If it would not provide any new rights or protections to workers, why are the bill’s proponents not just encouraging employers to adopt some of the good models therein on their own, as high-road practices for retaining a happy workforce?

In conclusion, H.R. 4219 follows a trend of bills introduced in this Congress that claim to offer flexibility, innovation, and improvements in work-life balance, but behind the curtain are just handing even more control over employees’ time to employers. Just as the “comp time” bill(H.R. 1180) that passed out of this very Committee in 2017 would threaten employees’ rights to overtime pay, this so-called “workflex” bill would threaten the rights that so many workers have gained at the state and local level to no longer have to choose between putting food on the table and taking care of their health.

Members of Congress and organizations who sincerely want to expand access to paid sick time and schedules that actually work for working people should ignore the Workflex in the 21st Century Act, and lend their support instead to H.R. 1516 (The Healthy Families Act) and H.R. 2942 (The Schedules That Work Act. Both of these bills would raise the floor on the federal standard, and respect the rights of states and localities to go above and beyond in protecting their workers. It is worth questioning why H.R. 4219, if it represents the gains in work- life balance that employees demand for themselves and their families, does not appear to have a single worker-interest or family-interest group speaking out in support.

Sincerely,

Celine McNicholas
Director of Labor Law and Policy

Samantha Sanders
Director of Government Relations

Sources/References:

• Worker rights preemption in the US: A map of the campaign to suppress worker rights in the states (Economic Policy Institute)
• Work sick or lose pay?: The high cost of being sick when you don’t get paid sick days (Economic Policy Institute)

• Current Paid Sick Days Laws (National Partnership for Women and Families)
• ‘ Fair workweek’ laws help more than 1.8 million workers (Economic Policy Institute)

There is growing recognition that unpredictable, unstable, and often insufficient work hours are a key problem facing many U.S. workers, particularly those in low-wage industries. Volatile hours not only mean volatile incomes, but add to the strain working families face as they try to plan ahead for child care or juggle schedules in order to take classes, hold down a second job, or pursue other career opportunities.

In response to these concerns, several state and local governments have recently (between 2014 and 2017) enacted “fair workweek” laws. Five cities and one state have passed comprehensive fair workweek laws, which address a wide range of concerns faced by workers. These laws provide workers with greater stability, predictability, and flexibility in their work schedules; in many cases, they also require employers to give part-time staff opportunities to increase their hours before adding new staff. These comprehensive laws primarily apply to retail and fast-food workers—who are more likely than other workers to be subject to volatile work hours. The nearly 740,000 workers protected by these comprehensive fair workweek laws include an estimated 327,000 workers in New York City; 175,000 in San José; 172,000 in the state of Oregon; 40,000 in Seattle; 23,000 in San Francisco; and 2,500 in Emeryville, California.

In addition to these comprehensive fair workweek laws, New Hampshire, Vermont, and San Francisco have passed “right-to-request” statutes—which grant all or most private-sector workers the right to request scheduling accommodations. While these fair workweek laws are more limited in scope, they apply to a broader segment of the workforce: Over a million workers now enjoy increased workplace flexibility because of right-to-request laws.

This report describes the fair workweek laws that have been passed in these eight jurisdictions, and presents data on how many workers are protected by these laws.

Introduction

Employers in some industries have increasingly adopted scheduling practices that leave workers in desperate need of additional work yet hampered in their ability to actually seek supplemental work elsewhere or find a new job altogether. Aided by new technology that allows businesses to track sales and customer flows with precise detail, some employers now use algorithms to automatically set workers’ schedules based on predicted customer traffic, often on an hourly basis. Schedules are provided—and frequently changed—with little to no advance notice, sometimes requiring employees to remain “on call” to come to work at the drop of a hat. Many workers are required or pressured to maintain “open availability” for all hours the store is open, giving them little input into the days and times they will work. Workers’ schedules are often inconsistent from week to week, and some businesses require staff to call in at the beginning of each week—or even at the beginning of each day—to obtain their schedules. Many people are assigned fewer work hours than they would like, involuntarily working part time when they would prefer to work full time. Others are required to work long hours (with or without overtime pay), sometimes on short notice. These practices effectively shift more of the risk and costs of doing business from firms onto their employees.1

Irregular and unpredictable schedules result in a host of serious problems for working people and their families. They create volatile incomes, adding an additional barrier for families trying to manage their budgets and plan for the future. They also make it difficult for workers to explore other job opportunities. As explained in Golden 2015, irregular and unpredictable schedules can lead to increased work−family conflict for affected workers. And Morsy and Rothstein (2015) found that children whose parents work nonstandard work schedules are more likely to have lower cognitive and behavioral outcomes.

In response to harmful scheduling practices, five cities and three states have recently enacted “fair workweek” laws to protect employees. These laws ensure that workers’ time is respected and appropriately valued. A growing body of research has also found that increasing predictability, stability, and flexibility of worker schedules can lead to higher productivity and increased sales for retail stores (Williams et al. 2018; Ton 2012), so such laws can also benefit employers and the greater economy.

The state of Oregon has passed a comprehensive statewide fair workweek law, and the cities of Seattle, New York City, San Francisco, San José, and Emeryville, California, have all enacted comprehensive protections at the local level. Each policy is slightly different in its specifics, but the policies generally include provisions such as advance notice of work schedules, additional compensation for unexpected schedule changes or “on-call” hours, the right to accept or decline added or lengthened shifts, mandatory “rest periods” between shifts, and the right to request scheduling accommodations. These comprehensive fair workweek laws apply primarily to people working in chain retail stores and in fast-food restaurants but, in some cases, extend beyond those industries.

In addition, Vermont, New Hampshire, and San Francisco have enacted “right-to-request” laws—more specific fair workweek laws that focus on the right to request scheduling accommodations; these laws give all or most private-sector workers in these jurisdictions the right to a protected voice in their work hours.

The details of these laws—the specific protections provided and which workers are covered—are described in the sections below.

Impact of recently passed comprehensive fair workweek laws

While it is too early to measure the full impact of these protections, we can estimate the number of people who now enjoy greater legal protection against erratic scheduling practices because of comprehensive fair workweek laws. As shown in Table 1, these fair workweek laws now cover nearly 740,000 workers in the five cities and one state where they have been enacted thus far. (This is likely a conservative estimate, as explained in the methodological discussions below.) The largest impact is in New York City, where approximately 265,000 retail workers and 62,000 fast-food workers have gained additional protections under the law. In San José, roughly 175,000 private-sector workers are covered under the law. Coverage levels for the other localities are listed in Table 1.

Table 1

City of San Francisco: Formula Retail Employee Rights Ordinances (March 2016)

San Francisco’s Predictable Scheduling and Fair Treatment for Formula Retail Employees and Hours and Retention Protections for Formula Retail Employees Ordinances (known collectively as the Formula Retail Employee Rights Ordinances [FREROs]) went into effect on March 1, 2016 (San Francisco OLSE n.d. “FREROs”). These ordinances require employers to provide employees with an estimate of weekly work hours prior to start of employment, two weeks’ notice of schedules, and compensation for shifts changed with less than seven days’ notice, with additional compensation for last-minute schedule changes and on-call shifts. The laws also guarantee “part-time parity,” which prohibits discrimination in wages, promotion opportunities, and access to time off on the basis of part-time status. The ordinances apply to employees at chain retail establishments with at least 40 locations worldwide and at least 20 employees in San Francisco, including subcontracted building services workers.2

An estimated 23,000 workers in San Francisco are impacted by these two ordinances (Table 1). The number of workers impacted was calculated by the Center for Popular Democracy using data acquired from public officials through a public records request.

City of San José: Opportunity to Work Ordinance (March 2017)

San José’s Opportunity to Work Ordinance went into effect on March 13, 2017 (San José OEA n.d.). The ordinance requires employers to offer additional hours to existing, qualified part-time employees before hiring more employees, including subcontractors or temporary staffing services. The ordinance applies to hourly employees at businesses with 36 or more employees worldwide.

To determine the number of workers impacted by San José’s Opportunity to Work Ordinance, we first identify total employment in the city of San José from the Census Bureau’s 2016 five-year American Community Survey (ACS); total citywide employment is shown in Table 2, column 1. We then adjust that total by the private-sector share of total employment in the San José-Sunnyvale-Santa Clara, CA metropolitan statistical area (MSA) (column 2), as reported in the 2016 Quarterly Census of Employment and Wages (QCEW) from the Bureau of Labor Statistics (BLS). Because the ordinance applies only to firms with 36 or more employees, we then adjust the count by the share of private employment at firms with over 50 employees for the San José-Sunnyvale-Santa Clara, CA MSA (column 3) from the Census Bureau’s Quarterly Workforce Indicators (QWI) data for 2016. Finally, we multiply the worker count by the national share of workers who are paid on an hourly basis (column 4), as reported in the BLS 2017 Current Population Survey, to get our final estimate of 174,786 (column 5). We round our estimate to 175,000 in Table 1. Note that because our threshold for firm size (in column 3) is larger than is specified in the ordinance (because of limitations of available data), our estimate is likely an undercount. Further, since the law applies to establishments with 36 or more employees worldwide and we are using firms with 50 or more employees in San José-Sunnyvale-Santa Clara, CA MSA, we are likely further underestimating the number of workers impacted.

Table 2

City of Emeryville, California: Fair Workweek Ordinance (July 2017)

Emeryville’s Fair Workweek Ordinance went into effect on July 1, 2017 (City of Emeryville n.d.; Emeryville City Council 2016). It requires employers to provide employees with an estimate of average weekly work hours prior to start of employment, two weeks’ notice of schedules, and compensation when the employer makes changes to the posted schedule, and it allows employees to decline last-minute shift additions. Employers must also offer additional hours to existing employees before hiring new staff. The law guarantees employees 11 hours’ rest period between shifts and a protected right to request scheduling accommodations. This ordinance applies to retail firms with 56 or more employees globally and to fast-food firms that employ 56 or more people globally and 20 or more people in Emeryville.

The impact analysis for Emeryville’s Fair Workweek Ordinance is based on city government estimates (City of Emeryville 2016). These estimates indicate that approximately 2,500 workers are impacted (Table 1).

City of Seattle: Secure Scheduling Ordinance (July 2017)

Seattle’s Secure Scheduling Ordinance went into effect on July 1, 2017 (Seattle Office of Labor Standards n.d.). It requires employers to provide employees with an estimate of average weekly hours prior to start of employment and to periodically update the estimate. Employers must provide two weeks’ notice of schedules and compensation when the employer makes changes to the posted schedule and must allow employees to decline last-minute shift additions. Employers must offer additional hours to existing employees before hiring new staff. The ordinance also guarantees 10 hours of rest between shifts. Employees have a protected right to provide input into their work schedules without retaliation; employers have to evaluate and respond to work schedule requests. If the requests are based on accommodating caregiving obligations, education, a second job, or the employee’s own health needs, the employer must provide a bona fide reason for rejecting the request. This ordinance applies to hourly employees of retail businesses, fast-food establishments, and some sit-down restaurants, with 500 or more employees worldwide.

To determine the number of people impacted by Seattle’s Secure Scheduling Ordinance (Table 3), we first calculate the total number of workers in the retail and fast-food industries in the city of Seattle using 2015 and 2016 data from the Puget Sound Regional Council (PSRC 2017). PSRC provides data on the number of workers in the accommodation and food services industries in Seattle. In order to estimate the subset of these workers who are employed in fast food, we multiply the total number of workers in the accommodation and food service industries in Seattle by the share of accommodation and food service workers that work in fast-food restaurants, calculated at the county level using QCEW data from the Bureau of Labor Statistics. The resulting total industry employment numbers are recorded in Table 3, column 1. We then multiply by the share of workers in the retail trade and accommodation and food service industries that work in firms with 500 or more employees, using 2016 QWI data at the Seattle-Tacoma-Bellevue, WA MSA level. Finally, we multiply by the share of workers who are nonsupervisory in each industry, calculated at the national level using 2016 Current Employment Statistics (CES) survey data, to produce our estimate of the total covered workforce, 39,860. We round this number to 40,000 in Table 1. Since the law applies to establishments with 500 or more employees worldwide and we are using firms with 500 or more employees in the MSA, we are likely underestimating the number of workers impacted.

Table 3

State of Oregon: Fair Work Week Act (August 2017)

Oregon’s Fair Work Week Act was enacted on August 8, 2017 (Oregon House Democrats 2017). This law requires employers to provide employees with an estimate of work hours prior to their start of employment and two weeks’ notice of schedules (phasing in from one week on the effective date to two weeks a year later). It also mandates compensation for changes to the posted schedule and protects employees from retaliation when they request scheduling accommodations. The act prohibits last-minute shift additions without the employee’s consent and gives employees the right to 10 hours of rest between shifts. Oregon’s law applies to hourly employees of retail, hospitality, and food service firms with over 500 employees worldwide.

To determine the number of people affected by Oregon’s Fair Work Week Act (Table 4), we take the number of workers in the retail trade and accommodation and food service industries in Oregon, as reported in the QCEW for 2016, and multiply by the share of each industry’s workforce in firms with 500 or more employees nationwide from the QWI data. We then multiply by the national share of workers who are nonsupervisory in each industry, calculated at the national level using 2016 Current Employment Statistics data, for a final estimate of 171,582. We round this number to 172,000 in Table 1. Since the law applies to establishments with 500 or more employees worldwide and we are using the share of firms with 500 or more employees nationwide, we are likely underestimating the number of workers impacted.

Table 4

New York City: Fair Workweek Law (November 2017)

New York City’s Fair Workweek Law went into effect on November 26, 2017 (NYC DCA 2017a, 2017b). It requires fast-food employers to provide employees with an estimate of weekly hours, days, and times of work prior to their start of employment and two weeks’ notice of schedules. It also mandates compensation for changes to the posted schedule and guarantees 11 hours’ rest between shifts. Employers must also offer additional hours to existing employees before hiring new employees. It applies to employees at fast-food chains with at least 30 locations in the U.S. who perform any of the following tasks: customer service, cooking, food or drink preparation, delivery, security, stocking supplies or equipment, cleaning, and routine maintenance. The Fair Workweek Law also requires retail employers to provide employees with 72 hours advance notice of schedules, and it forbids last-minute shift additions without the employee’s consent, last-minute shift cancellations, and on-call shifts. This law applies to retail employees of firms with 20 or more employees in New York City.

To determine the number of people impacted by New York City’s Fair Workweek Law (Table 5), we first calculate the total New York City employment in retail trade and fast food from the 2016 QCEW (column 1). For retail trade, we multiply by the share of employment with 20 or more employees (column 2), according to the 2016 QWI data for the New York City MSA, to get an estimate of 264,567 retail workers covered. For fast food, we multiply that by the share of workers in that industry who are nonsupervisory (column 3), calculated at the national level using 2016 CES data, to get an estimate of 62,396 fast-food workers covered. Because the legislation impacts all retail trade employees at firms with 20 or more employees, we do not adjust by the nonsupervisory share of employment for retail trade employees. Our total estimate of the number of workers covered under New York City’s Fair Workweek Law is 326,963. We round this number to 327,000 in Table 1.

Table 5

Impact of recently passed right-to-request laws

Vermont, New Hampshire, and San Francisco have enacted fair workweek laws known as “right-to-request” laws, which protect the right of all workers to have a voice in their schedules. At a minimum, these laws prohibit retaliation against workers who request flexibility in their work hours or work location. In some cases, employers are also required to respond to requests in writing.

While we cannot measure all aspects of the economic impact of these protections, we can estimate the number of people who now enjoy greater legal protections when requesting flexible scheduling because of these laws. As shown in Table 6, these fair workweek laws now cover more than 1 million workers in the two states and one city where they have been enacted thus far. (This is likely a conservative estimate, as explained in the methodological discussions below.) The largest impact is in New Hampshire, where approximately 614,000 workers have gained additional protections under the law. Coverage levels for all localities are listed in Table 6.

Table 6

San Francisco: Family Friendly Workplace Ordinance (January 2014)

San Francisco’s Family Friendly Workplace Ordinance went into effect on January 1, 2014 (San Francisco OLSE n.d. “FFWO”). When an employee requests flexibility to care for a dependent, this law requires the employer to meet with them within three weeks and then respond to the request in writing within three weeks of the meeting. If the employer denies the request, it must be in writing and based on a bona fide business reason, and the employer must allow the employee to seek reconsideration. The law also prohibits retaliation against employees who request flexibility. The law covers all private-sector employees in businesses with at least 20 employees worldwide.

To determine the number of people impacted by San Francisco’s Family Friendly Workplace Ordinance (Table 7), we first calculate the city’s total employment using American Community Survey (ACS) five-year estimates for 2012–2016. We then multiply that by the private-sector share of total employment in the San Francisco-Oakland-Hayward, CA MSA from the 2016 QCEW. We then multiply by the share of employment in these industries in firms with 20 or more employees, according to the 2014–2016 QWI data for the San Francisco-Oakland-Hayward, CA MSA. Finally, we multiply that by the national share of workers who are hourly from the 2017 Current Population Survey, to get our estimate of 177,372 total covered workers. We round our estimate to 177,000 in Table 6. Since the law applies to establishments with 20 or more employees worldwide and we are using firms with 20 or more employees in San Francisco-Oakland-Hayward, CA MSA, we are likely underestimating the number of workers impacted.

Table 7

Vermont: Flexible Working Arrangements Statute (January 2014)

Vermont’s Flexible Working Arrangements Statute went into effect on January 1, 2014 (Vermont General Assembly n.d.). This statute requires employers to consider employees’ requests for flexible schedules in good faith at least twice per calendar year. Employers must notify employees of their decision and must put their denial in writing if the request was made in writing. The statute also prohibits retaliation against employees who request flexibility. This law applies to all private-sector employees in Vermont.

To determine the number of people impacted by Vermont’s Flexible Working Arrangements Statute, we simply use the number of total private-sector employees for 2016 from QWI, which is 299,116. We round this number to 299,000 in Table 6.

New Hampshire: Act Relative to Flexible Working Arrangements in Employment (September 2016)

New Hampshire’s Act Relative to Flexible Working Arrangements in Employment (SB416) went into effect on September 1, 2016 (New Hampshire General Court n.d.). This statute requires employers to consider employees’ requests for flexible schedules in good faith at least twice per calendar year. Employers must notify employees of their decision in writing and provide a reason if the request is denied. The statute also prohibits retaliation against employees who request flexibility. This law applies to all private-sector employees in New Hampshire, except for nonprofit, agricultural, seasonal, and domestic work employees.3

To determine the number of people impacted by the New Hampshire right-to-request law, we simply use the number of total private-sector employees for 2016 from QWI, excluding the nonprofit, agriculture, and private household industries, and excluding 3 percent4 of employees in the following seasonal industries: scenic and sightseeing transportation; performing arts, spectator sports, and related industries; museums, historical sites, and similar institutions; and amusement, gambling, and recreation industries. The total number of covered workers is 614,199. We round this to 614,000 in Table 6.

Conclusion

Lawmakers in other states and cities are working to enact fair workweek protections similar to those enacted by these state and local governments. The Chicago Fair Workweek Ordinance, which was introduced to the Chicago City Council in June 2017, would require all employers in Chicago to give advance notice of schedules to their employees and would require that these employees be compensated for any last-minute schedule changes (Chicago Office of the City Clerk 2017). In Philadelphia, city council members are considering a fair workweek ordinance similar to the comprehensive fair workweek laws passed in Seattle and Oregon (Lozano 2018). If these laws are enacted, they will ensure that even more workers have predictable, stable, and healthier work schedules—and, in some cases, increased opportunities to work full time.

In the same way that campaigns for higher minimum wages, paid sick days, and paid family and medical leave have highlighted the need to update labor standards to reflect today’s economy, we hope and expect that lawmakers in more jurisdictions will also recognize that stable, predictable, and adequate work hours are essential to ensuring that workers, families, businesses, and communities can thrive.

Endnotes

1. For greater detail on these practices, see CPD 2018.

2. Because of data limitations, exact numbers of subcontracted building service workers are not included and the estimate of San Francisco workers impacted is therefore likely underestimated.

3. Nonprofit, agricultural, domestic, and seasonal workers are excluded under the definition of “employee” in Chapter 275, Section 36, of the New Hampshire Labor Code.

4. Three percent is the estimated share of workers in these industries who are seasonal employees.

References

Bureau of Labor Statistics. Various years. Current Employment Statistics (CES) [public data series]. Data from the CES are available through the CES National Databases and through series reports.

Bureau of Labor Statistics. Various years. Current Population Survey (CPS) [public data series]. Aggregate data from basic monthly CPS microdata are available through three primary channels: as Historical ‘A’ Tables released with the BLS Employment Situation Summary, through the Labor Force Statistics database, and through series reports.

Bureau of Labor Statistics. Various years. Quarterly Census of Employment and Wages (QCEW) [public data series]. Data from the QCEW are available through the QCEW Databases and through series reports.

Center for Popular Democracy (CPD). 2018. A Fair Workweek: Good for Businesses and Workers (fact sheet). March 2018.

Chicago Office of the City Clerk. 2017. Amendment of Municipal Code by Adding New Chapter Entitled “The Chicago Fair Workweek Ordinance.” Document no. O2017-4947. Introduced June 28, 2017.

City of Emeryville. 2016. “Attachment 2: Covered Employer Lists.” Fair Workweek Ordinance – First Reading. File # ID-2016-607. Emeryville City Council agenda for October 18, 2016.

City of Emeryville. n.d. “Fair Workweek Ordinance” (web page). City of Emeryville website. Accessed April 12, 2018.

Emeryville City Council. 2016. Ordinance No. 16—An Ordinance of the City Council of the City of Emeryville Adding Chapter 39 to Title 5 of the Emeryville Municipal Code, “Fair Workweek Employment Standards,” and Amending Sections 3-1.108 and 3-1.141 of Chapter 1 of Title 3 of the Emeryville Municipal Code, “Business Taxes.” Passed and adopted November 1, 2016.

Golden, Lonnie. 2015. Irregular Work Scheduling and Its Consequences. Economic Policy Institute Briefing Paper no. 394, April 9, 2015.

Lozano, Alicia Victoria. 2018. “Philadelphia Hopes to Become Next Major City to Pass Fair Workweek Legislation.” NBC10 website, June 14, 2018.

Morsy, Leila, and Richard Rothstein. 2015. Parents’ Non-Standard Work Schedules Make Adequate Childrearing Difficult: Reforming Labor Market Practices Can Improve Children’s Cognitive and Behavioral Outcomes. Economic Policy Institute Issue Brief no. 400, August 6, 2015.

New Hampshire General Court. n.d. “New Hampshire Senate Bill 416” (web page). LegiScan website. Accessed May 3, 2018.

NYC Department of Consumer Affairs (NYC DCA). 2017a. Important Information for Fast Food Employers/Workers: NYC’s Fair Workweek & Fast Food Deductions Laws. November 2017.

NYC Department of Consumer Affairs (NYC DCA). 2017b. Important Information for Retail Employers/Workers: NYC’s Fair Workweek Law. November 2017.

Oregon House Democrats. 2017. “Oregon Passes Bill Giving Workers a Fair Work Week: SB 828 Requires Large Employers to Provide More Notice, Predictability of Schedules” (press release). June 29, 2017.

Puget Sound Regional Council (PSRC). 2017. “2015 Covered Employment Estimates by Jurisdiction”; “2015 Covered Employment Estimates by Census Tract”; “2016 Covered Employment Estimates by Jurisdiction”; and “2016 Covered Employment Estimates by Census Tract” (Excel files). Downloadable from https://www.psrc.org/covered-employment-estimates. Last updated October 2017.

San Francisco Office of Labor Standards Enforcement (San Francisco OLSE). n.d. “Family Friendly Workplace Ordinance” (“FFWO”) (web page). City and County of San Francisco website. Accessed May 3, 2018.

San Francisco Office of Labor Standards Enforcement (San Francisco OLSE). n.d. “Formula Retail Employee Rights Ordinances” (“FREROs”) (web page). City and County of San Francisco website. Accessed April 10, 2018.

San José Office of Equality Assurance (San José OEA). n.d. “Opportunity to Work” (web page). City of San José website. Accessed April 10, 2018.

Seattle Office of Labor Standards. n.d. “Secure Scheduling Ordinance” (web page). City of Seattle website. Accessed April 10, 2018.

Ton, Zeynep. 2012. “Why ‘Good Jobs’ Are Good for Retailers.” Harvard Business Review, January–February 2012.

U.S. Census Bureau. Various years. Quarterly Workforce Indicators (QWI) [data series]. Data accessed via the QWI Explorer data tool.

U.S. Census Bureau. Various years. American Community Survey (ACS) [public data series]. Data accessed via the Factfinder database.

Vermont General Assembly. n.d. “21 V.S.A. § 309. Flexible Working Arrangements” (web page). Vermont Statutes Online. Accessed May 3, 2018.

Williams, Joan C., Susan J. Lambert, Saravanan Kesavan, Peter J. Fugiel, Lori Ann Ospina, Erin Devorah Rapoport, Meghan Jarpe, Dylan Bellisle, Pradeep Pendem, Lisa McCorkell, and Sarah Adler-Milstein. 2018. Stable Scheduling Increases Productivity and Sales: The Stable Scheduling Study. University of California Hasting College of the Law, University of Chicago School of Social Service Administration, and UNC Kenan-Flagler Business School.

• Between 1979 and 2016, more men have exited the labor market and more women have entered the labor market, narrowing but not closing the gender gap in hours worked per year. In 1979, only 6.3 percent of prime-age men did not work at all over the course of a year (were nonearners), but that number nearly doubled to 11.9 percent in 2016. The share of prime-age women who did not work declined from 29.8 percent in 1979 to 19.4 percent in 1999, then rose to 24.1 percent by 2016.
• Black men are working fewer hours (down 15.7 percent) than black men in 1979, and fewer hours than white and Hispanic men now, but mostly because they have a much harder time getting into and staying in the labor market. Among prime-age men, black men were almost twice as likely to be nonearners in 2016 (21.1 percent) as in 1979 (12.8 percent). In 2016 black men were roughly twice as likely to be nonearners as white men (10.4 percent) and Hispanic men (11.1 percent).
• Black men with less education are particularly disconnected from the labor market. The share of black men without any college education who did not work at all in a given year began climbing in the mid-1990s, and currently, about a quarter (25.3 percent) of black men with a high school diploma and nearly 50 percent (49.1 percent) of those with less than a high school diploma are nonearners.
• Black women work as much as white women but lose more hours when the economy slows down. In 2016, employed white and black women worked roughly equivalent hours (1,853 and 1,845 hours, respectively). But black women lose more hours when the economy slows down. Indeed, prior to the Great Recession, employed black women worked as many as or more hours than employed white women. A majority of black women who did not work in 2016 (45.0 percent) were out of work “involuntarily” due to factors like illness, disability, or inability to find work, compared with 27.7 percent of white women.
• Among prime-age women, Hispanic women are by far the most likely to be nonearners. In 2016, 31.4 percent of Hispanic women were nonearners, compared with 22.2 percent of black women and 21.5 percent of white women. Hispanic women were more likely to be out of work to care for family and home (23.4 percent reported that reason for being out of work) than black women (7.9 percent) or white women (12.1 percent).

• When prime-age adults are able to get into the labor market, they work equally hard. One of the main reasons why prime-age adults of different racial, ethnic, and gender groups have such a wide variation in annual work hours is that some groups are much less likely to get into and stay in the workforce at all, be it by choice or other barriers. When we look at just prime-age adults who are working, there is less variation across racial and ethnic groups, both in the average number of hours worked in a given year and in changes in hours over time.

• Prime-age adults who typically earn the least and work the fewest hours have increased their work hours the most since 1979. From 1979 to 2016, the bottom fifth of all prime-age wage earners increased annual hours by 24.3 percent (to 1,688.5 hours), compared with 9.4 percent among the middle fifth (to 2,044.7 hours) and 3.6 percent among the top fifth (to 2,047.2 hours).

Recent years have seen much written about trends in labor force participation. This report digs deeper into participation across demographic and economic characteristics of workers, but also adds a new dimension to this discussion—trends in working hours by those who did manage to find work. We hope these findings will provide the evidentiary base for policymakers to address the problem of non-participation, as well as to make sure all workers are able to find as much work as they want.

Introduction

Between 1979 and 2016, average annual earnings of prime-age workers (workers ages 25 to 54) grew by 30.2 percent after inflation. This average increase, however, disguises how varied are the experiences of different groups of workers and also what proportion of wage growth is attributable to increased work hours versus increased hourly pay. Annual earnings go up when workers earn more per hour, work more hours in a year, or some combination of both. It is a well-documented fact that hourly wages of the vast majority of workers have stagnated over the last several decades as the economic gains of increased productivity have disproportionately gone to the highest earners (Bivens and Mishel 2015; Mishel and Kroeger 2016). Among the top fifth of earners, however, rising hourly wages account for nearly 88 percent of the growth in annual earnings between 1979 and 2016, compared with just 25 percent among the bottom fifth of earners.1

For most workers then, annual earnings growth has been driven by their ability to work more hours. As our analysis will show, those who typically earn the least and work the fewest hours have actually increased their work hours the most since 1979. Unfortunately, with a fixed number of hours in a day and little control over work schedules, there are limits to how far workers can boost their annual pay by working longer hours.

While patterns of increased work hours discussed in this report track closely with slow wage growth for those who remain in the labor market, there is another part of the story—the growing number of prime-age adults who have become disconnected from work. Every month the Bureau of Labor Statistics uses Current Population Survey data to calculate the share of the working-age population (age 16 and older) that is employed or looking for a job. In October 2017, this labor force participation rate was 62.7 percent, 4.6 percentage points below the high of 67.3 percent in 2000. This downward trend in labor force participation is not just a function of an aging population entering retirement. It is also apparent among prime-age adults, although the trends vary greatly between men and women. Since 1965, labor force participation for prime-age men has fallen every year, with a total decline of 8.2 percentage points as of October 2017. This drop for prime-age men has been particularly striking for black men and for those with no more than a high school diploma (Council of Economic Advisers 2014, 2016). Suggested reasons for the decline in labor force participation among prime-age men range from a rise in serious health conditions that are a barrier to work and the emerging opioid crisis (Krueger 2017), to technological advancements that result in younger men (under age 30) allocating less time to work and more time to leisure activities like playing video games (Aguiar et al. 2017). Labor force participation rates for prime-age women did not plateau until the late 1990s, after steady increases following World War II. However, since 2007 their participation has declined at nearly the same rate as men’s (Council of Economic Advisers 2014). This similarity in trends over the past decade would seem to argue against gender-specific causes as being most salient over this time.

This report provides a detailed demographic analysis of trends in labor market disconnection and annual work hours by gender, race, ethnicity, and wage quintile in order to identify how much hours have changed for different groups of workers and the means by which those changes have occurred. Since workers would need to have earned some wages over the course of a year to be assigned to a wage quintile, the level of detail our analysis requires excludes prime-age workers who are disconnected from the labor market and do not work at all over the course of a year. In order to capture this group, we introduce a measure of labor market disconnection that differs from the BLS labor force participation rate. Specifically, we examine data on the percentage of nonearners—prime-age adults who report not working any hours or earning any wages over the course of an entire year—and impute zero hours for them in the calculation of average annual hours for all prime-age adults by race, ethnicity, and gender. We also summarize how nonearners’ reported reasons for not working vary by race, ethnicity, and gender.

This sort of descriptive analysis is critical to understanding how work has changed over time, including how different groups of workers have contributed and responded to those changes by adjusting their work hours and participation. Together our dataset provides a basis to more effectively evaluate how many and what groups of workers are less than fully employed or completely disconnected from the labor market. We also present results that challenge the notion that a lack of effort or personal responsibility is to blame for low-income status and persistent racial disparities in economic outcomes.

Our analysis of annual work hours is based on data from the Annual Social and Economic Supplement to the Current Population Survey (CPS ASEC). Our sample includes adults between the ages of 25 and 54, also referred to as prime-age adults. We calculate both unconditional and conditional averages of annual hours, weeks worked per year, and hours worked per week. The unconditional averages tell us how work hours have changed over time as a result of both changing hours among those who are working and changes in the share of nonearners. Nonearners are defined as those who reported zero work hours and zero wages during the previous year. The share of prime-age adults who are nonearners in a given year is used as a measure of labor market disconnection. The conditional averages focus only on the subset of adults who reported positive work hours and positive wages during the year. Since the demand for labor, and thus work hours, is cyclical, we observe trends across peak years of the business cycle (1979, 1989, 2007), the five-year period of strong economic growth during the late 1990s (1995 to 2000), and the three most recent years of the current economic recovery for which data is available (2014, 2015, and 2016). We also report data for the year before and the year after each of these dates to get a sense of near-term changes around economic peaks and how they vary for each of the demographic groups.

General trends in average annual work hours among prime-age adults

On average, prime-age adults worked 7.8 percent more hours per year in 2016 than in 1979, but there is lots of heterogeneity in the experiences of different workers—both in hours worked per year and in changes over time—based on gender, race, ethnicity, and level of pay.

Prime-age adults in 2016 are working more hours per year than in 1979 because women are working more hours

As shown in Table 1, average annual work hours increased 7.8 percent among all prime-age adults from 1979 to 2016. On average, increased work hours among prime-age women accounts for all of the growth in total work hours, since the average hours worked by prime-age men declined. The decline in prime-age men’s work hours is largely due to the rise in the share of prime-age men who are not working. Though not shown in Table 1, in 1979, only 6.3 percent of prime-age men were nonearners, but that number nearly doubled to 11.9 percent in 2016. Over the same period, prime-age working men (earners) only increased annual work hours by 0.8 percent. This lack of growth in work hours among men who are employed partly reflects the fact that the average prime-age male worker was already working roughly 2,000 hours per year in 1979, a level consistent with working full-time year-round, and leaving little room to increase hours further. On the other hand, the average working woman worked well under 2,000 hours per year in 1979, and since then, women’s work hours have grown substantially. Though women remain more likely to be nonearners than men, the share of women not working declined from 29.8 percent in 1979 to 24.1 percent in 2016 (not shown in Table 1). Working women have increased hours by an average of 21.2 percent over this same period.

Table 1

The last two columns of Table 1 show whether annual work hours of given groups changed more because of a change in the number of weeks worked per year or because of a change in hours worked per week.2 The average number of weeks worked might rise as labor markets tighten and make it easier for workers to find new jobs when separations from employment occur. Average weeks worked will also rise as more people move from being out of the labor force to working. Average weekly hours might rise as a result of working more hours on an existing job, taking on multiple jobs, or as more people move from part-time to full-time employment. As lower unemployment and increased labor force participation increase the average number of weeks worked, there will also be a positive effect on the average number of hours worked per week. Since the Bureau of Labor Statistics began reporting data on multiple job holders in 1994, the percent of workers with more than one job peaked at 6.2 percent in 1995 and 1996, but has been trending downward since. Beginning in 2000, however, prime-age women have been more likely to be multiple job holders than prime-age men (Wilson 2015).

Increased labor force participation and more hours for working women contribute to growth in hours worked by women

Fifty-seven percent of the growth in women’s annual work hours is due to increased weeks worked, and 43 percent is due to increased hours worked per week. The increase in weeks worked per year among prime-age women is a combination of working women working more weeks and more women entering the labor force. As Table 1 shows, between 1979 and 2016, the average number of weeks worked per year among all prime-age women grew by 21.9 percent while the number of weeks worked among working women grew by 12.7 percent. During this time, hours worked per week were also increasing among all prime-age women (up 16.3 percent), as well as among the subset of women workers only (up 7.6 percent).

The results are basically reversed for men. Among prime-age men, 66 percent of the decline in annual work hours is the result of men working fewer hours per week, while 34 percent of the decline is attributable to fewer weeks worked per year.3 Men’s weekly hours are declining both as a result of fewer hours among working men and as a result of the growing share of nonearners. As Table 1 shows, between 1979 and 2016, men’s weekly hours declined 1.1 percent among working men only, and declined 8.5 percent among all prime-age men. Even with the decline in weekly hours, prime-age working men consistently worked an average of over 40 hours per week throughout the period we observe. While the growing number of men exiting work over this time also shows up in reduced weeks worked per year among prime-age men (down 4.5 percent), those who remain in the workforce increased the number of weeks worked in a year by 1.9 percent.

Most of the increase in work hours actually occurred between 1979 and 2000

The total change in annual work hours between 1979 and 2016 actually takes place in two phases with 2000 serving as a dividing line. Most of the growth in women’s work hours occurred between 1979 and 2000 while men’s work hours remained relatively flat over those years. After 2000, all groups of prime-age men and women lose ground on annual hours, but the decline among men is most pronounced. In fact, the longer term decline in prime-age men’s work hours is almost entirely a post-2000 phenomenon.

Given the exceptionally tight labor market in 1999 and 2000, we might expect annual hours to peak in those years at really low levels of unemployment, and then decline in subsequent years as the unemployment rate rises. For example, the average annual unemployment rate in 2000 was 4 percent compared with 4.6 percent in 2007. After peaking at nearly 10 percent in 2010 (in the aftermath of the Great Recession), the unemployment rate had fallen to 4.9 percent by 2016 (Bureau of Labor Statistics 2017). The effect of the tight labor market during the late 1990s is most apparent from the increase in hours worked by black men and women. As shown in Figure A, between 1995 and 1999, annual work hours increased 15.5 percent among black men and 22.0 percent among black women, compared with 1.3 percent among white men and 5.8 percent among white women.

Figure A

A more complete accounting of the relatively weaker post-2000 labor market, however, suggests that higher rates of unemployment, the sharp upward trend in the shares of prime-age nonearners, and earners working fewer hours per week all contribute to the decline in annual work hours.

Earlier we presented data on the labor force participation rate, showing that the rate has dropped more for prime-age men than for prime-age women. Many observers track the employment-to-population ratio (EPOP) as another way to gauge the health of the labor market. The EPOP measures the share of the working-age population that is currently employed. Figure B shows that prime-age EPOPs for black, Hispanic, and white men have been lower since 2000, but dropped well below recent historic norms during the Great Recession and have yet to fully recover.

Figure B

While white women increased their work hours the most from 1979 to 2016, black women started out ahead

In addition to large differences in work hours trends by gender, there is also wide variation by race and ethnicity, both within and across genders, from 1979 to 2016. Table 2 disaggregates the data on work hours by gender, race, and ethnicity. While annual work hours increased among all groups of prime-age women between 1979 and 2016, the largest overall increase in annual hours occurred among Hispanic women (up 51.6 percent), followed by white women (up 50.8 percent), then black women (up 38.8 percent). It is important to note that one reason for the smaller increase in average annual hours among black women is that they were already working more hours per year relative to white and Hispanic women. But as we will later show, black women also lose more hours when the economy slows down.

Table 2

Latinas received the largest boost to annual hours resulting from increased weeks worked. This is the result of more Hispanic women entering the labor force as those who are working maintain employment for more weeks.

Black men started off with fewer work hours and fell further behind

Table 2 also shows that annual work hours declined among all groups of prime-age men, but declined most among black men (down 15.7 percent), followed by white men (down 10.5 percent), then Hispanic men (down 7.6 percent). The greater loss of hours among prime-age black men is especially troubling because unlike black women, they started with many fewer hours than prime-age white and Hispanic men.

Black men are working fewer hours primarily because they are working fewer weeks (suggesting less steady employment), while Hispanic men are working fewer hours because they are losing weekly hours, suggesting less full-time employment).

While all groups of prime-age men lost work hours, the losses did not eliminate the gap in annual work hours by race and ethnicity: white men still work more hours than black and Hispanic men.

Among earners only, annual work hours are similar for all racial and ethnic groups by gender, which shows that labor market disconnection explains most of the overall disparities

The bottom panel of Table 2 shows trends in work hours among just those with any employment in a given year (specifically, the subset of adults who reported positive work hours and positive wages during the year). While prime-age black men in general (earners and nonearners) lost the most work hours from 1979 to 2016, among earners, African American men actually increased work hours more than white men from 1979 to 2016. In 2016, employed white men worked an average of 2,155 hours (up 1.6 percent since 1979), compared with 2,047 hours (up 4.2 percent) for employed Hispanic men and 1,983 hours (up 3.7 percent) for employed black men. These racial and ethnic differences in the average number of hours employed men work in a year are small compared with the racial and ethnic work hour differences among all prime-age men.

The racial and ethnic differences among employed women are even smaller. In 2016, employed white women worked an average of 1,854 hours (up 23.2 percent), compared with 1,845 hours (up 14.1 percent) for employed black women and 1,796 (up 19.1 percent) for employed Hispanic women. Therefore, differences in labor market disconnection, rather than differences in the number of hours or how much workers changed their hours over time, play a bigger role in explaining racial and ethnic disparities in overall work hours and work hour trends among all prime-age adults. These results are illustrated in Figure C for men and Figure D for women. These graphs track annual work hours for three-year periods centered on peak business cycle years as well as the 1995–2000 economic boom.

Figure C

Figure D

Trends in labor market disconnection

As noted in the previous section, if employed men and women of different races and ethnicities are all working similar hours, but on average, persons of different genders, races, and ethnicities are not working similar hours, then the differences among the latter groups must be attributable to labor market disconnection. This section delves more deeply into trends in labor market disconnection.

As groups connect or disconnect from the labor market, their average work hours rise or fall

Comparing Figures C and D with Figure E, we see that the timing and rate at which average annual work hours rise and fall among different groups of workers is also consistent with trends in the share of nonearners. For example, the rise of annual work hours of all prime-age black, Hispanic, and white women from 1979 to 2000, as shown in the dotted lines in Figure D, is consistent with the decline in the share of prime-age women who were nonearners between 1979 and 2000. Likewise, the decline in annual work hours of all prime-age black, Hispanic, and white women after 2000 tracks the rise in the share of female nonearners after 2000, as shown in Figure E.

Figure E

As more women are moving into the labor market, more men are moving out

As shown in Figure E, the share of prime-age women who were nonearners fell between 1979 and 2000, but rose after 2000. However the share of prime-age men who were nonearners rose gradually between 1979 and 2000, and then rose notably faster after 2000, especially among black men.

Figure E also shows that for both genders (though less so for white women), the share of nonearners grew rapidly between 2007 and 2010, the years immediately following the Great Recession, and has slowly fallen since.

The business cycle has a greater effect on patterns of labor market disconnection and work hours of black women than of white and Hispanic women

While the work hours trends and labor market disconnection for black and white women in Figures D and E follow similar trends, the greater cyclicality of work hours and labor market disconnection among African American women (which also afflicts African American men) contributed to less overall growth in annual work hours of all prime-age black women between 1979 and 2016 as seen in Table 2. This can also be seen in Figure D: while the increase in work hours for white women follows a smoother upward path, for black women, there are clearly more “bumps” in the series as periods of increased hours are followed by a noticeable loss of work hours before rising again.

Prime-age men are working fewer hours because they have become more disconnected from the labor force

The growing number of prime-age men who have become disconnected from the labor force, not working at all over the course of an entire year, is a major contributor to the downward trend in average annual hours worked among all prime-age men. For the three groups of men shown in Figure E, the share of nonearners rose gradually between 1979 and 2000, but notably faster after 2000. This growth in the share of prime-age men who were nonearners shown in Figure E is consistent with the sharp decline in annual hours of all men (not earners only) after 2000, as shown in Figure C. This is especially true for prime-age black men.

The most disconnected groups by gender are Hispanic women and black men

Figure E also shows that rates of labor market disconnection within genders varies by race and ethnicity, and these differences have generally persisted over time. Hispanic women are by far most likely to be nonearners. Black men are consistently more likely to be nonearners than their white and Hispanic counterparts, but this gap began widening after 1999. While labor market disconnection among prime-age white and Hispanic men never gets anywhere near the rates for women, the share of black men who are nonearners rose to levels more consistent with the shares of black and white women beginning in 1993. As a result, the number of average annual hours worked by prime-age black men is much lower than the average hours worked by prime-age white and Hispanic men, as shown earlier in Figure C. Figure D illustrates that the same is true for prime-age Hispanic women compared with white and black women.

Black men without a high school diploma are most disconnected

Figure F compares rates of labor market disconnection among black men with different levels of education. Those with a high school diploma or less are most likely to be disconnected and have experienced the sharpest rise in labor market disconnection. For example, while less than 7 percent of black men with a high school diploma but no further education were disconnected from work in 1979, by 2016, that share had grown to more than 25 percent (25.3 percent). Among those without a high school diploma, the share who are disconnected has gone from less than 20 percent in 1979 to nearly 50 percent (49.1 percent) in 2016. These trends represent the experiences of a large share of prime-age black men. In 2016, nearly half of prime-age black men had no more than a high school education: 35.5 percent had a high school diploma and 9.2 percent had not earned a high school diploma).4

Figure F

The rise of mass incarceration among this particular demographic is surely an important influence on growing labor market disconnection among black men, but it is difficult to precisely estimate the effect with the available data.5 Estimates suggest that mass incarceration and related felony convictions have reduced employment rates for men nationally by nearly 2 percentage points, with reductions of 2.7 to 6.9 percentage points for men without a high school diploma and reductions of 2.3 to 5.3 percentage points for African American men (Schmitt and Warner 2011). Even one year after being released from prison or jail, nearly 60 percent of people with criminal records are not employed in the formal labor market (Petersilia 2000). In fact, Pager and Western (2009) show that being black reduces the chances that a job applicant with a criminal record is called back for another interview or offered a job by almost 50 percent relative to white job applicants.

Reasons for labor market disconnection

In addition to different rates of labor market disconnection, prime-age black, white, and Hispanic men and women also give different reasons for not working over the course of an entire year. Figures G–L show for each racial/ethnic and gender group the share that are working and, if they are not working, the share who cite a given reason for not working. For a closer examination of the data for not working, users can click on the “Working” box under each graph to temporarily remove the working population from the graph.

Figure G

Figure H

Figure I

Most out-of-work men, and most out-of-work black women, are out of work involuntarily

Among all groups of prime-age men (Figures G–I), the most commonly reported reason for being out of work is illness or disability and this accounts for a growing percentage of all groups of prime-age men over time. For black men, the second most commonly reported reason for being out of work was that they were unable to find work. By contrast, the second most common reason white men report for not working is going to school, and the second most common reason Hispanic men report for not working is taking care of family. Assuming that illness or disability, or inability to find work, are circumstances largely out of an individual’s control, men who cite these two reasons can be said to be out of work involuntarily. In 2016, more than two-thirds (68.3 percent) of prime-age black men who did not work at all were out of work involuntarily, compared with 59.1 percent of nonworking white men and 55.8 percent of nonworking Hispanic men.

Among all prime-age women (Figures J–L), Hispanic (23.4 percent) and white (12.1 percent) women most commonly reported taking care of home or family as the reason they were not working in 2016, compared with just 7.9 percent of black women. While caring for home or family remains the most common reason white women don’t work, the shares of white and black women who are out of work to care for children declined by more than half between 1979 and 2016. As more prime-age women have entered the workforce, a growing share report illness or disability as their main reason for not working. In 2016, most black women who didn’t work reported illness or disability as the reason, accounting for 8.4 percent of all prime-age black women, up from 7.7 percent in 1979. Nearly a majority of black women who did not work in 2016 (45.0 percent) were out of work “involuntarily” due to factors like illness or disability or the inability to find work, while this is less so the case among Hispanic (14.8 percent) and white (27.7 percent) women who did not work.

Given the high cost of childcare, caring for children may be more of a constraint rather than a pure choice for some women, and could also be considered an involuntary absence from work. Therefore, although there is a significant amount of variation in the reasons black, white, and Hispanic women report for not working, there may be less of a difference across groups in terms of being out of work “involuntarily,” but we are not able to directly observe this from the data.

The reasons for labor market disconnection have changed for some groups since 2000

There is some evidence that the reasons for labor market disconnection have changed for some groups since 2000. For example, as more prime-age black men become nonearners after 2000, the share out of work due to illness or disability barely changes (see Figure H). Instead, there is more growth in men reporting other reasons for being out of work, including taking care of family, going to school, and an inability to find work, especially after 2007. In 1999, only 1 percent of all prime-age black men reported inability to find a job as their reason for not working, compared with more than four times that in 2008 and later years.

The post–Great Recession increase in the share of black men reporting that they are disconnected from the labor force because they can’t find a job is consistent with basic monthly Current Population Survey data showing an increase in the share of men working part time for economic reasons (someone working part time for economic reasons is someone who wants and is available for full-time work but is only working part time). This share has also grown since 2000, particularly among black and Hispanic men. In 2016, one in four black and Hispanic men working part time was doing so for economic reasons (25.1 and 26.5 percent, respectively), much higher than the share of white men (14.8 percent). These percentages are well above the numbers for each group in 2000, when only 12.6 percent of black men, 15.9 percent of Hispanic men, and 5.9 percent of white men reported working part time for economic reasons. While this may be related to structural changes in the types of jobs available (Golden 2016), the bottom line is that these men would likely be working more hours if more were available.

Figure J

Figure K

Figure L

Trends in work hours among prime-age earners by wage quintile, gender, race, and ethnicity

In the last section we showed that changing rates of labor market disconnection among prime-age adults had a major influence on disparate trends in overall average annual work hours by gender, race, and ethnicity. When we consider employed, wage-earning men and women of different races and ethnicities, work hours are more similar. In this section, we focus on the set of wage earners to further disaggregate trends in annual work hours by wage quintile.

We use the distribution of all earners to define the wage quintiles used to compare annual work hours overall and by race and ethnicity. The earning distribution of all male earners is used to make comparisons among men by race and ethnicity and likewise the earnings distribution of all women is used to make comparisons among women by race and ethnicity.6

More than half of black and Hispanic workers earn less than the median wage

Our analysis of the wage distribution of workers in our data shows that in 2016, 49.5 percent of black men and 53.2 percent of Hispanic men were among the bottom 40 percent of male wage earners, compared with just 29.9 percent of white men. The bottom 40 percent of female earners includes 40.2 percent of black women, and 48.6 percent of Hispanic women, but just 27.8 percent of white women. Overall, trends for the bottom 40 percent explain the experiences of more than half of black (54 percent) and Hispanic (57.2 percent) workers, compared with 40.1 percent of white workers.

The lowest earners, who had worked the fewest hours, increased their work hours the most from 1979 to 2016—except for white and black men

Table 3 reports average annual work hours as well as the percent change in annual hours, weeks worked, and weekly hours between 1979 and 2016 by wage quintile, gender, race, and ethnicity. While there are some exceptions, these results can generally be summarized by the fact that most of the growth in work hours occurred among the lowest earners who also worked relatively fewer hours than higher-wage earners. In other words, groups with the most growth in annual work hours were those working less than full-time full-year, or less than 2,000 hours per year. As we climb the pay ladder, the increase in work hours diminishes. For example, as shown in Panel A of Table 3, the bottom fifth of all prime-age wage earners increased annual hours by 24.3 percent, compared with 9.4 percent among the middle fifth and 3.6 percent among the top fifth. Our analysis of the underlying data for Table 3 tells us that at least two-thirds of the increase in annual hours among low- and middle-wage earners was the result of increased weeks worked as opposed to more weekly hours, suggesting that these workers are maintaining employment for more weeks. On the other hand, half of the increase for high-wage earners was due to increased weekly hours and the other half was due to increased weeks worked.

Table 3

White, black, and Hispanic women in the bottom fifth of female earners increased annual work hours by more than higher earning women

The average changes in annual work hours across wage quintiles mask distinct patterns that vary by gender, race, and ethnicity. Although all groups of women in the bottom fifth increased annual work hours by more than higher earning women, the growth in work hours was most skewed among black women. As shown in Panel B of Table 3, black women’s annual work hours grew 22.3 percent in the bottom fifth, but only 4.3 percent in the top fifth. By comparison, white women’s work hours increased 36.6 percent in the bottom fifth and 19.4 percent in the top fifth, and Hispanic women saw an increase of 31.3 percent in the bottom fifth and 17.0 percent in the top fifth.

While higher earning black women experienced much less growth in weekly hours than whites or Latinas, they started out working more hours in 1979—a pattern that holds across every wage quintile. For example, black women in the top fifth of female earners worked an average of 1,770 annual hours in 1979, compared to 1,593 annual hours for white women and 1,551 annual hours for Hispanic women in the top fifth. Among the middle fifth of female earners, Hispanic women (14.9 percent) increased annual hours less than white (23.6 percent) or black (16.1 percent) middle-wage earners from 1979 to 2016. Black and Hispanic women in all wage quintiles increased annual hours primarily by working more weeks per year, as did white women in the bottom and second fifths of female wage earners, while white women in the middle through top fifths increased annual hours with a more even mix of increased weeks and increased weekly hours at similar rates.

The largest increases in men’s work hours were among Hispanic men in the bottom fifth, black men in the middle fifth and white men in the top fifth

Men’s annual work hours also changed from 1979 to 2016 but on a smaller scale than did women’s work hours, and with more growth among high-earning white men and less growth among high-earning black and Hispanic men, as shown in Panel C of Table 3. For whites, the highest male earners experienced the most growth in annual hours, while the middle fifth of black men and the bottom fifth of Hispanic men increased hours the most within those respective groups. For example, the bottom fifth of prime-age white men lost hours (down 3.1 percent) between 1979 and 2016 while average annual work hours increased 4.2 percent in the top fifth. This is in contrast with an increase of 4.1 percent among black men in the bottom fifth, 4.5 percent in the middle fifth and 3.1 percent in the top fifth. Work hours of Hispanic men grew more among the lowest earners than the highest earners, by 7.6 percent and 4.9 percent, respectively. Growth in annual work hours of the middle fifth of white men (2.3 percent) and Hispanic men (1.1 percent) was notably lower than growth in annual work hours of middle-wage black men (4.5 percent).

All low-wage-earning men worked fewer hours per week in 2016 than in 1979

All low-wage-earning men worked fewer hours per week in 2016 than in 1979. Black and Hispanic men compensated for the decline in weekly hours by increasing the number of weeks worked per year enough to result in a net gain in annual hours worked. Low-wage white men also increased weeks worked, but not enough to compensate for the loss in weekly hours. Middle-wage Hispanic men also lost weekly hours over this time and increased annual hours entirely by increasing weeks worked. Middle-wage black men increased annual hours mainly by working more weeks (73 percent of the total increase in annual hours). Among the highest earners, increased weekly hours accounted for the majority of increased annual hours for white (87 percent) and Hispanic (86 percent) men. For black men in the top fifth of male earners, an increase in weekly hours more than offset a slight decline in weeks worked.

Black men are working fewer annual average hours than white men at all wage levels, but are also more likely to be low earners (who typically work fewer hours)

In our earlier discussion, we focused on the change in annual work hours between 1979 and 2016 and how the magnitude and direction of that change varied by race, ethnicity, gender, and wage quintile. Here, we discuss whether these changes had any effect on the number of hours worked in a given year by one group relative to another. While groups that started out with fewer hours typically increased annual work hours by more than those who started with more hours, in most cases, this did not eliminate the relative differences in the number of hours worked. In other words, groups that started out with fewer hours were not able to close the “hours gap” by working more hours. For example, in almost every wage quintile, white men consistently work more hours than black and Hispanic men. The one exception in our data is in the bottom quintile of men where Hispanic men went from working fewer hours than white men in 1979 to more hours by 2016.

Given the overrepresentation of black and Hispanic workers among lower earners, these relative differences in the number of annual hours worked annually by race, ethnicity, and wage quintile also help us to better understand average differences in annual work hours by race and ethnicity alone. In other words, we may be seeing certain patterns among black and Hispanic men that are a function of the fact that black and Hispanic male workers are more likely to be low-wage workers. Therefore, racial and ethnic disparities in average annual work hours among prime-age male wage earners result both from the overrepresentation of black and Hispanic men among lower-wage earners (who typically work fewer hours) and the fact that white men work more hours than black men and Hispanic men at nearly every level of pay.

Black and Hispanic women are more likely to be low earners than white women, but black women work more hours at lower wage levels

Black and Hispanic women are also overrepresented among low-wage-earning women, but racial and ethnic disparities in work hours among prime-age women are much smaller than among prime-age men and tend to favor black women. One reason that black women work similar or more hours on average as white women, in spite of being overrepresented among lower-wage workers (who work fewer hours than higher-wage workers), is because lower-wage black women work more hours than their white female counterparts. In fact, in 2016, average annual work hours for black and Hispanic women in the bottom 40 percent of female earners were higher than those of white women in the bottom 40 percent.

Family structure and gender differences in annual work hours

As with working in the formal labor market, caring for home and family requires a large commitment of time. Working parents, in particular, must make important decisions about the tradeoffs between time spent working outside of the home and time spent on care responsibilities. The persistence of gender differences in annual work hours is a reflection of the gender norms that influence how women and men allocate their time differently between the labor market and care responsibilities. These decisions are also influenced by economic circumstances that vary by race and ethnicity.

Women still work fewer hours each year than men, but it’s increasingly because they are working fewer hours per week, not because they are exiting the labor force during the year

Although women increased work hours by more than men from 1979 to 2016, thus narrowing gender differences in work hours, prime-age women continue to work fewer hours than prime-age men. Over time, as women’s labor force participation has increased, gender differences in annual hours have become more a function of women working fewer hours per week than men and less a function of women working fewer weeks per year. These gender differences in annual hours worked are evident for each of the racial and ethnic groups and for every wage quintile. The smallest gender difference in annual hours worked is between black men and black women and reflects the fact that black men work fewer hours on average than white or Hispanic men, while black women work about as many hours as white women and more than Hispanic women.

Responsibilities for child care limit the number of hours worked by custodial parents, but disproportionately so for mothers

Given the large share of prime-age women who reported not working because of home and family responsibilities in 2016, it seems plausible that care responsibilities could also affect gender differences in work hours among prime-age earners. A comparison of gender differences in annual work hours of adult earners without children with gender differences in annual work hours of earners who are parents (married or single) supports this explanation. Parents are identified in the data based on having children of their own in the household. While the category of adults without children could also include parents who don’t live with their children, our comparison is concerned with how having the primary responsibility of caring for children affects work hours. We find that among wage earners, the work hours of men and women are in fact most similar among adults without children.

As shown in Table 4, on average, in 2016 prime-age male earners without children worked 5.8 percent more hours per week than prime-age female earners without children. The difference for single parents was 12.0 percent while married prime-age fathers worked 21.2 percent more hours per week than married prime-age mothers. Among the wage earners represented in this table, married fathers by far work the most hours per year relative to other men, while women without children work more hours than mothers. Taken together, these patterns show that responsibilities for child care limit the number of hours worked by custodial parents, but disproportionately so among women. Single fathers work fewer hours than married fathers who have a spouse to assist with child care and men who have no child care responsibilities. However, working mothers, regardless of marital status, work fewer hours than women with no child care responsibilities.

Table 4

Smaller gender gaps in work hours among black parents suggest that black women have less flexibility to reduce work hours to care for a family

Gender differences among single parents and adults without children are smaller than gender gaps among married parents for all racial and ethnic groups. Among married parents, the work hours of black men and women are most similar. For example, as shown in Table 4, married white fathers work 23.5 percent more hours per year than married white mothers, but the gaps for married black and Hispanic parents are just 15.7 percent and 18.9 percent, respectively. The relatively smaller gender difference in hours worked by married black parents reflects the fact that married black mothers work more hours than any other group of working mothers (married or single), but also the fact that married black fathers work many fewer hours than married white fathers. Given that black workers persistently earn less than whites, when both parents are working, black women may feel they have less flexibility in reducing hours because they need to sustain their contribution to the financial needs of the family. Married Hispanic fathers and mothers both work fewer hours than their married black and white counterparts.

Smaller gender gaps in work hours among high-wage workers suggest that higher earning women with family care responsibilities have more flexibility to maintain work hours

As shown in Table 3, if we compare the difference in hours worked between men and women in the bottom fifth to the difference in the top fifth, gender differences in average annual work hours are smaller among higher-wage workers. This suggests that higher earning women are more likely to work in jobs that have similar hours to higher earning men, and these higher paying jobs also provide more financial resources to hire caregivers rather than reduce work hours to meet family care responsibilities.

The data challenge the notion that a lack of effort or personal responsibility is to blame for low-income status and persistent racial disparities in economic outcomes

The analyses presented in this report depict a divided workforce, with different classes of workers: Those who are consistently working full time and earning wages at or above the median; those who earn below the median and are working more than they used to—when they can get jobs—but are still working less than full time; and those who face barriers that keep them out of the workforce full time.

• The lowest earners, who were working the least hours in 1979, increased their work hours more than higher-wage earners from 1979 to 2016.
• Low- and middle-wage earners are working more annual hours primarily because they are getting into and staying in the labor force for longer during a given year. But they still don’t get as many hours as high-wage earners. Black and Hispanic workers are overrepresented among these low- and middle-wage earners (the shares of black and Hispanic workers in the low-to middle-wage categories are greater than their shares of the workforce overall).
• Once black men get into the labor market, the number of hours they work each year is closer to their white and Hispanic peers than overall averages would suggest.
• Prior to the most recent recession and subsequent recovery, employed black women worked as many hours as employed white women or more.
• Black men are more likely [than white and Hispanic men] to be out of the labor force (21.1 percent of black prime-age men were “nonearners” in 2016), but the majority (68.3 percent) of nonworking prime-age black men are out of work involuntarily—due to illness, disability, or inability to find work—as are a majority of nonworking white (59.1 percent) and Hispanic (55.8 percent) men.
• A majority of black women who did not work in 2016 (45.0 percent) were out of work “involuntarily” due to factors like illness, disability, or inability to find work, while this is less so the case among Hispanic (14.8 percent) and white (27.7 percent) women who did not work.
• In 2016, one in four black men and one in four Hispanic men working part time was doing so involuntarily, i.e., because of economic reasons (25.1 and 26.5 percent, respectively). In comparison only 14.8 percent of white men were stuck working part time when they would rather be working full time.
• Whereas married white fathers work 23.5 percent more hours per year than married white mothers, married black fathers work just 15.7 percent more than married black mothers. This smaller gender gap for married black parents suggests that married black women with children may have less flexibility in reducing hours given the expense of caring for a family and the higher rates of unemployment and lower hourly wages of black men and women.

Conclusion

While American workers are united around the desire to secure a comfortable standard of living for themselves and their families through work, opportunities to do so are not universally available. This report highlights trends in annual work hours among prime-age workers between 1979 and 2016, and it shows that those opportunities have become fractured along the lines of gender, race, and class (as measured by wage quintile). As wage inequality has grown over the last four decades, we observe two very different responses when it comes to work hours. On one hand, workers are working many more hours a year, perhaps in part to compensate for tepid, and in some instances declining, hourly wage growth. On the other hand, a growing number of workers have become disconnected from the labor force, which we measure as not working at all over the course of an entire year. This is true even among prime-age workers who we expect to have a high degree of attachment to the labor market. Our results also point to ways in which social and economic policy have contributed to this bifurcation by lowering barriers to employment for some while increasing barriers for others. For example, the rise in prime-age women’s labor force participation since 1979 stands in direct contrast to the decline in labor force participation among prime-age men, particularly among African American men with a high school diploma or less.

Together these data provide a basis to more effectively evaluate how many and what groups of workers are less than fully employed or completely disconnected from the labor market and for what reasons. The data in this report also challenges the notion that a lack of effort or personal responsibility is to blame for low-income status and persistent racial disparities in earnings. The fact that African Americans quickly boosted their work hours when unemployment fell (known in economics terms as an “elastic response” to falling unemployment), particularly in the late 1990s, shows that boosting economic opportunities will draw in many willing and able workers. Instead of lecturing to workers being failed by the economy, policymakers need to chart a new policy direction that addresses current economic and social realities in a way that allows all workers to make optimal choices about how they spend their time.

About the authors

Valerie Rawlston Wilson is director of the Economic Policy Institute’s Program on Race, Ethnicity, and the Economy (PREE), a nationally recognized source for expert reports and policy analyses on the economic condition of America’s people of color. Prior to joining EPI, Wilson was an economist and vice president of research at the National Urban League Washington Bureau, where she was responsible for planning and directing the bureau’s research agenda. She has written extensively on various issues impacting economic inequality in the United States—including employment and training, income and wealth disparities, access to higher education, and social insurance—and has also appeared in print, television, and radio media. She has a Ph.D. in economics from the University of North Carolina at Chapel Hill.

Janelle Jones is an economic analyst for the Economic Policy Institute and works on a variety of labor market topics within EPI’s Program on Race, Ethnicity, and the Economy and the Economic Analysis and Research Network (EARN). She was previously a research associate at the Center for Economic and Policy Research (CEPR), where she worked on topics including racial inequality, unemployment, job quality, and unions. Her research has been cited in The New Yorker, The Economist, Harper’s, The Washington Post, The Review of Black Political Economy, and other publications. She also worked as an economist at the Bureau of Economic Analysis. She has an M.A. in applied economics from Illinois State University.

Endnotes

1. Average annual earnings data in this paragraph are from the authors’ calculations based on analysis of Current Population Survey Annual Social and Economic Supplement microdata. Average annual earnings calculated as the product of average annual hours worked times the real average hourly wage. Wages deflated by the Consumer Price Index for all Urban Consumers Research Series (CPI-U-RS).

2. In order to perform this decomposition we calculate annual hours as the product of average annual weeks worked and average hours worked per week, rather than use the reported measure of annual hours worked in the CPS ASEC data.

3. This could be related to a shift from industries or occupations with longer work weeks, or a general shift to shorter work weeks across all industries or occupations. In a forthcoming report, we plan to explore patterns in average annual hours by industry and occupation and how these patterns contribute to the trends in hours worked across different demographic groups observed in this report.

4. EPI analysis of Current Population Survey Outgoing Rotation Group data.

5. The CPS data are likely overstating male, and especially black male, employment rates in a given year and understating the decline over time. First, mass incarceration masks part of the increase in non-employment for men, especially black men, because the CPS excludes the prison and jail population. Second, undercounting of non-employed men, especially young men, and black men in the CPS—and independent of the mechanical issue of the institutionalized population—may lead the CPS to overstate male, young male, and black male employment rates. What is more this bias appears to be getting worse over time (Schmitt and Baker, 2006a and 2006b).

6. For example, this means that white, black, and Latino men are placed in the wage quintiles based on the population of male earners as a whole, not in the wage quintiles based on only white men, only black men, and only Latino men.

References

Aguiar, Mark, Mark Bils, Kerwin Kofi Charles, and Erik Hurst. 2017. “Leisure Luxuries and the Labor Supply of Young Men.” NBER Working Paper 23552: 37-42.

Bivens, Josh, and Lawrence Mishel. 2015. Understanding the Historic Divergence between Productivity and a Typical Worker’s Pay: Why It Matters and Why It’s Real. Economic Policy Institute report.

Bureau of Labor Statistics. 2017. Labor Force Statistics from the Current Population Survey, Series ID LNS14000000. Accessed February 2017.

Council of Economic Advisers. 2014. The Labor Force Participation Rate since 2007: Causes and Policy Implications. Executive Office of the President of the United States.

Council of Economic Advisers. 2016. The Long-Term Decline in Prime-Age Male Labor Force Participation. Executive Office of the President of the United States.

Current Population Survey Annual Social and Economic Supplement microdata. Various years. Survey conducted by the Bureau of the Census for the Bureau of Labor Statistics [machine-readable microdata file]. Washington, DC: U.S. Census Bureau.

Current Population Survey basic monthly microdata. Various years. Survey conducted by the Bureau of the Census for the Bureau of Labor Statistics [machine-readable microdata file]. http://www.bls.census.gov/ftp/cps_ftp.html#cpsbasic.

Golden, Lonnie. 2016. Still Falling Short on Hours and Pay: Part-Time Work Becoming New Normal. Economic Policy Institute.

Krueger, Alan. 2017. Where Have All the Workers Gone? An Inquiry into the Decline of the U.S. Labor Force Participation Rate. Brookings Institution.

Mishel, Lawrence, and Teresa Kroeger. 2016. “Strong Across-the-Board Wage Growth in 2015 for Both Bottom 90 Percent and Top 1.0 Percent.” Working Economics (Economic Policy Institute blog), October 27.

Pager, Devah, and Bruce Western. 2009. Investigating Prisoner Reentry: The Impact of Conviction Status on the Employment Prospects of Young Men. National Criminal Justice Reference Service.

Petersilia, Joan. 2000. “When Prisoners Return to the Community: Political, Economic and Social Consequences.” Sentencing & Corrections no. 9, November.

Schmitt, John, and Dean Baker. 2006a. Missing Inaction: Evidence of Undercounting of Non-Workers in the Current Population Survey. Center for Economic and Policy Research.

Schmitt, John, and Dean Baker. 2006b. The Impact of Undercounting in the Current Population Survey. Center for Economic and Policy Research.

Schmitt, John, and Kris Warner. 2011. “Ex-offenders and the Labor Market.” Working USA: The Journal of Labor and Society vol. 14, no. 1, 98–99.

Wilson, Valerie. 2015. “Women Are More Likely to Work Multiple Jobs than Men.” Economic Snapshot, Economic Policy Institute.

On August 28, 2017, low-wage workers in St. Louis, Missouri, became the latest victims of state preemption laws. “Preemption” in this context refers to a situation in which a state law is enacted to block a local ordinance from taking effect—or dismantle an existing ordinance. In this case, St. Louis had raised its minimum wage above the state minimum—but was then forced to lower it back down when the Missouri state legislature preempted the local ordinance.

Ironically, state preemption of labor standards has historically been used for good: to ensure that minimum labor standards are applied statewide. It is only in recent years that it has been so frequently used to take earnings and protections away from workers.

This report looks at the rising use of preemption by state legislatures to undercut local labor standards. It provides an overview of five key areas of labor and employment policy affected by preemption—including minimum wage, paid leave, fair work scheduling, prevailing wage, and project labor agreements—and details the extent and impact of such preemption practices throughout the United States. Finally, it presents ways local governments can push back against state preemption in their efforts to raise the living standards of their residents.

Introduction

In 2015, the City of St. Louis passed an ordinance establishing a minimum wage that was higher than Missouri’s statewide minimum wage.1 In the bill’s preamble, the City’s leaders explained the need for a wage increase for the working people of St. Louis:

WHEREAS, the defining issues of our time include the increase in income inequality, the growing gap between rich and poor, and the obstacles preventing people from rising into the middle class; and . . .

WHEREAS, low-wage workers in the St. Louis region struggle to meet their most basic needs and to provide their children a stable foundation, a safe dwelling, and an opportunity to obtain a high-quality education; and . . .

WHEREAS, minimum wage laws promote the general welfare, health, and prosperity of the City of St. Louis by ensuring that workers can better support and care for their families and fully participate in the community[.]

In 2015, Missouri’s state minimum wage was $7.65 per hour. By passing its local ordinance, St. Louis sought to raise it to $8.25 for many employees working within the city limits, with scheduled increases to $9 in 2016, $10 on January 1, 2017, and $11 on January 1, 2018. Meanwhile, the state’s minimum wage barely budged, rising to just $7.70 during that same time period (and rising only because of an automatic index to rise with inflation).

The city’s minimum wage ordinance did not go into effect until 2017, because an employer group sued the city and had it tied up in litigation for two years. The Missouri Supreme Court upheld the city’s minimum wage increase and, on May 5, 2017, low-wage workers within the city limits finally got their first raise, to $10 per hour.2

But on May 22, 2017, the Republican-dominated Missouri state legislature passed a preemption law that prohibits cities from establishing a minimum wage higher than the state’s.3 When Missouri’s law went into effect on August 28, 2017, St. Louis’s $10 minimum wage sunk back down to the state’s $7.70 per hour. By nullifying St. Louis’s ordinance, state lawmakers have potentially undone raises for the roughly 31,000 workers in St. Louis who had received a raise to $10 when the city’s ordinance took effect in May. With this action, the state lawmakers have also blocked additional scheduled raises for those same 31,000 workers plus another 7,000 workers who would have received a pay increase when the city’s minimum wage was scheduled to rise to $11 in January, 2018—that’s a total of 38,000 workers affected by the state’s decision to preempt St. Louis’s minimum wage law.4 Because of the state representatives’ actions, it’s now unclear if any of St. Louis’s low-income workers will receive the pay increase their local elected officials intended to give them.

State preemption of local government labor standards is on the rise

St. Louis’s struggle to give the low-income workers in its city a pay raise is not an isolated story. Since the 2010 midterm elections, when Republicans began to gain control over an increasing number of state legislatures, states have been using “preemption laws” to strike down local government efforts to improve the working conditions of their residents.5 Preemption laws allow state governments to supersede any city or county laws the state does not agree with. Now that the Republican Party controls 33 governorships and has majority representation in both chambers of most state legislatures, conservative state legislators have increasingly used preemption laws to strike down local government efforts to increase the quality of life for working people in their municipalities.6 In fact, many states are stripping away an entire package of basic labor and employment rights from workers in cities, including the ability for workers to earn paid sick days, work under fair shift-scheduling practices, and earn prevailing wages in safe, stable conditions on local government-funded construction projects.

This paper examines the rise of state preemption in five key areas of local innovation in labor and employment laws: 1) minimum wage; 2) paid leave; 3) fair work schedules; 4) prevailing wages; and 5) project labor agreements.

In 2016 and in the first half of 2017 alone, state legislatures significantly increased their use of preemption laws as a tool to strip local governments of their authority to enact ordinances improving workers’ lives, Figure A shows which states passed such preemption laws during 2016 and the first half of 2017.

Figure A

How state preemption of local government works

In law, the term “preemption” refers to situations in which a law passed by a higher government authority supersedes a law passed by a lower one. So, a law passed by a state legislature (or a provision of the state Constitution) supersedes an ordinance passed by a local government, such as a city council. In these situations, when a statewide law conflicts with a local ordinance or rule, the statewide law prevails.

In general, states either follow Dillon’s Rule—which grants only narrow governing authority to cities—or Home Rule—which grants broad governing authority to cities. Whether a state follows Dillon’s Rule or Home Rule is defined in the state constitution and/or by statute enacted by the legislature.7

Dillon’s Rule

Dillon’s Rule, named for Iowa Supreme Court Justice John F. Dillon more than 100 years ago, is a method of interpreting state constitutions so that the scope of local government power is very narrow. In states that follow Dillon’s Rule, a municipal corporation generally possesses only those powers that (1) the state has granted in express words; (2) that are necessarily or fairly implied in or incident to the powers expressly granted; and (3) that are essential and indispensable to the municipal governance. If there is any doubt concerning a whether a municipal corporation possesses a certain governing power, courts in Dillon’s Rule states will generally find in favor of the state.8

Home Rule

Home Rule provisions in state constitutions enhance the power of local governments to regulate their own affairs. Home Rule provisions give cities the power to draft their own charters and determine for themselves which responsibilities they wish to assume and which powers to exercise.9

In the labor and employment field, states have always used preemption laws to establish state dominance over local governments, but historically these laws were used to set minimum statewide standards that established a floor on workers’ rights that no local government could lower.10 Recent state preemption laws are different; conservative state legislatures are now using preemption to eliminate the authority of a lower level of government to regulate a certain issue.11 In practice, these laws are being used to strip authority from local governments who seek to increase protections for workers; the laws do so by prohibiting these local governments from increasing their labor/employment standards above the state floor.

State legislatures’ dramatic shift in the use of preemption to forbid local governments from enhancing protections for workers above the state level has resulted in actually lowering labor and employment standards in some cases. And in other cases, state legislatures have used preemption to prevent their local governments from improving workers’ wages or benefits in the first place.

State preemption of local minimum wage laws

Pay for the vast majority of America’s workers has been stagnant for decades. America’s workers are working more productively, and have more education than ever, but they are barely keeping up with the rising cost of living—as an enormous and ever-increasing share of income growth goes to corporate profits, executive pay, and pay of earners at the highest end of the income distribution. Reversing this trend of ever-expanding income inequality requires policies that will strengthen wage growth for ordinary workers.

One of the simplest ways to accelerate wage growth for low- and moderate-wage workers is to raise minimum wages. Unfortunately, the federal minimum wage has not increased since 2009. Since then, the purchasing power of the federal minimum wage has fallen as inflation has slowly eroded its value. In 2017, the federal minimum wage of $7.25 was worth 12 percent less than when it was last raised in 2009, after adjusting for inflation, and is 27 percent below its peak value in 1968.17 Since national policymakers have failed to preserve this basic labor standard, a parent working full time does not earn enough at the minimum wage to live above the federal poverty line.18

As of July 2017, twenty-nine states (and Washington, D.C.) have instituted a minimum wage higher than the federal level, but 21 states remain at the federal floor of $7.25 an hour. Workers in those 21 states make up 39.2 percent of the nonfarm workforce.19 While waiting for state and federal governments to act, local governments (such as cities and counties) have increasingly taken action to raise minimum wages on their own. Before 2012, only five localities had enacted their own local minimum wage laws, but as of 2017, forty counties and cities have done so.20

Republican-dominated state governments have met this local action with fierce resistance and have increasingly passed preemption laws to ban local governments from raising their minimum wages.21 At least 25 states have passed laws taking away local authority to enact minimum wage ordinances, and state legislatures’ efforts to block local minimum wage increases is on the rise: more than half of these states have enacted their preemption laws since 2013 (see Figure B).22

Figure B

State preemption of local paid leave laws

Paid leave (which includes sick and family medical leave) is a fundamental need for workers who become ill, have a family member who becomes ill, or have a new child.

Without paid sick days, workers lose money when they need to take time off during an illness, causing millions of workers to have little choice but to go to work while sick. The ability to earn paid sick leave is also contributing to the widening compensation gap in the United States. Higher-wage workers have much greater access to paid sick days than lower-wage workers do: 87 percent of private-sector workers in the highest-earning 10 percent have the ability to earn paid sick days, compared with only 27 percent of private-sector workers in the lowest-earning 10 percent.31 And for low-wage workers, having to take off a couple of days for an illness can lead to significant financial consequences, such as not having enough monthly income for groceries, gas, and auto insurance.32

Without paid family leave, millions of workers are also forced to choose between their paychecks and caring for a new child or an ill family member. At some point, nearly every worker will need to take time away from the job to care for a seriously ill family member, new child, or aging parent, but only 13 percent of workers in the U.S. have access to paid family leave through their employers.33

There is no federal law that provides workers with the right to earn paid leave—the federal Family Medical Leave Act simply allows workers to take up to 12 weeks of unpaid leave.34 In the absence of federal action, seven states have passed paid sick days laws, and five states (and the District of Columbia) have passed paid family leave laws.35 Local governments, however, have taken up the cause of providing workers with this fundamental need: at least 30 cities and two counties have enacted their own paid leave ordinances in various forms.36

But state governments have begun blocking local government efforts to give workers the opportunity to earn paid time off—at least 20 states have passed paid leave preemption laws (see Figure C).

Figure C

State preemption of local fair scheduling laws

For hourly workers, not knowing when they will be scheduled to work each week makes scheduling the rest of the obligations in their lives challenging. An estimated 17 percent of the workforce face unfair and unpredictable scheduling practices.37 Not having predictable work hours undermines workers’ ability to budget for basic expenses, arrange for child care, continue their education, or maintain a second job to make ends meet.38

Currently, there is no federal law governing unpredictable scheduling practices. The Schedules That Work Act, reintroduced in 2017 by Senator Elizabeth Warren (D-Mass.) and Representative Rosa DeLauro (D-Conn.), would address schedule predictability on a national level by, among other things, giving workers the right to request more stable schedules and advance notice of working hours, with protections against employer retaliation for doing so.39 While waiting for the federal government to act, four cities and two states have passed various forms of fair work schedules legislation.40

But in the last few years, as local governments have begun to innovate in the arena of fair scheduling, state governments have stripped local governments’ abilities to do so—at least nine states have passed work scheduling preemption laws since 2015 (see Figure D).

Figure D

State preemption of local prevailing wages and project labor agreements

Prevailing wages and project labor agreements help ensure workers are treated fairly and paid a living wage while performing jobs under government contracts.

Prevailing wage laws require contractors to bid and pay at least the average wage in their locality when working on public construction contracts. Without prevailing wage requirements, contractors can opt to reduce their workers’ wages to win bids on government contracts, rather than competing on the basis of efficiency and management skills, materials costs, or the productivity of their workforce. Even after taking into account cost-of-living differences, median wages are almost 7 percent lower in states where there is no prevailing wage law.41

Project labor agreements (PLAs) are a type of contract used in the construction industry to set the terms and conditions of employment on major projects such as roads, bridges, and power grids. PLAs can help keep projects on task—saving local governments time and money—by coordinating large numbers of individual contractors and their workforces. Both union and nonunion employers can enter into PLAs when bidding for city contracts, and PLAs can include provisions that seek to improve conditions on the worksite (e.g., health and safety rules) and provide benefits to the community, e.g., by including jobs and training opportunities for disadvantaged workers and support for small or minority-owned businesses.42

But in the last few years, state governments have stripped local governments’ abilities to award projects funded with their own local government funds to bidders who pay prevailing wages or participate in project labor agreements. At least 12 states have passed prevailing wage or PLA preemption laws. See Figure E.

Figure E

Local governments should be allowed to improve labor and employment standards for their own residents

A common argument conservative state legislators use in favor of preemption is that they want to maintain “uniformity” of labor regulations and avoid a “patchwork” of different laws throughout the state. For example, a corporate-backed lobbying group, the American Legislative Exchange Council (ALEC), drafted a model law called the “Living Wage Mandate Preemption Act” with sample legislative language that proclaims “private enterprises in this state must be allowed to function in a uniform environment with respect to mandated wage rates.”43 The 2017 Arkansas minimum wage and “employment benefits” preemption law prohibiting local governments from raising their labor standards was clearly influenced by ALEC’s model—it stated that “allowing localities to mandate employer-provided benefits would create a patchwork of local regulations” that would burden businesses.44

But ALEC easily discards its patchwork argument when seeking to push local labor standards down. When it comes to implementing local legislation to weaken labor rights, groups such as ALEC affirmatively advocate in favor of local labor ordinances.45 Such ordinances—misleadingly labeled “right to work”—don’t create opportunities or improve conditions for workers, but rather act to undermine unions’ collective bargaining power. Indeed, ALEC published its model “Local Right to Work Ordinance” in 2015, arguing for cities and counties to adopt local right-to-work ordinances that are different from the statewide standard.46

Moreover, businesses have long operated under rules that differ across cities and counties. Cities and counties throughout the nation have local rules that businesses have successfully operated under—including rules that regulate zoning, business licenses, construction permits, and other local concerns. Businesses have also successfully adapted to differing local labor and employment standards. For example, cities and counties have long used different living wage standards, requiring businesses that contract with them to pay various wage rates in different localities, including Baltimore’s living wage law passed in 1994 and Los Angeles’s living wage proposal passed in 1997.47 And businesses in multistate regions have also successfully adapted to varying minimum wages across close geographic areas—for example, the Washington, D.C., metropolitan area includes Virginia with a $7.25 minimum wage, Maryland at $8.75, and Washington, D.C. at $12.50. The corporate-backed lobbying groups’ complaints that businesses need uniform statewide labor standards in order to be successful is belied by the decades of experience proving otherwise.

It is also important to note that there are racial and economic class undertones in the debate over labor and employment preemption laws. For example, when Alabama State Representative David Faulkner introduced the “Alabama Uniform Minimum Wage and Right-To-Work Act,”48 the law was perceived to target Birmingham, the only city in Alabama to have raised its minimum wage above the federal floor (which the state follows).49 Alabama’s preemption law blocked approximately 65,000 workers in Birmingham from receiving a raise to $10.10 by 2017, as Birmingham’s local elected officials had intended.50 Faulkner resides in the town of Mountain Brook, which is 97 percent white and one of the wealthiest communities in the country, while Birmingham is 73 percent African American and 30 percent of its residents live in poverty.51 The NAACP filed a lawsuit charging Alabama with “racial animus” in using preemption to overturn the Birmingham wage raise, which had been passed by a majority black city council and would have benefited the 40,000 lowest-paid workers in the city—most of whom are black.52 A federal judge in Birmingham dismissed the suit in February 2017.53 The case is now on appeal to the 11th Circuit.

In Missouri, State Representative Jason Chipman (R) sponsored the minimum wage preemption law that nullified St. Louis’s minimum wage increase. Chipman represents a district southwest of St. Louis that is more than 90 percent white and where the federal poverty rate is approximately 19 percent.54 It is a wealthier part of the state overall than the City of St. Louis, which has a poverty rate of 25.5 percent and where nearly half the population is African American.55 Chipman said, “These are supposed to be entry-level jobs,” adding, “We understand there are people who rely on these jobs who are not entry-level-type people, but you can’t legislate by the exception.”56 Presumably when Chipman refers to “entry-level-type people,” he means workers who don’t “rely on these jobs” to pay the rent, buy groceries, and support families. But Representative Chipman is wrong about the 38,000 St. Louis minimum wage workers whose pay the city wanted to increase. They are not “entry-level-type people.” The overwhelming majority (over 90 percent) are adults, age 20 or older. The majority of these workers work full time, and more than one in four of the minimum wage workers affected have children.57

Strategies for fighting back: How local governments can improve labor and employment standards in the face of state resistance

While the ultimate goal is to repeal state laws that block local government efforts to raise labor standards, there are steps local governments can take to improve labor and employment standards in their localities even where the state has largely blocked their efforts.

While many cities in states with preemption laws are prohibited from raising the minimum wage for private-sector workers, they can still raise the minimum wage for the city’s own employees in most cases. The Indianapolis City Council (which also represents Marion County) has discussed the idea of raising the wages for city-county workers, both to ensure city-county workers are paid a living wage and in the hope that private-sector employers will follow suit.58

Another step local governments can take to raise local labor standards is through their local contracting authorities, similar to how the Obama administration raised wages to $10.20 per hour for workers on certain federally contracted projects.59 In 2014, Chicago Mayor Rahm Emanuel implemented an executive order requiring that all contractors and subcontractors who work with the city pay their workers a minimum of $13 an hour.60 And in July 2017 San Diego’s City Council passed an ordinance requiring city contractors and consultants to pay their employees equally, regardless of gender or ethnicity.61

Conclusion

What this whole preemption debate boils down to is this: America’s workers need better jobs and better opportunities. Local governments are taking action to help the workers in their cities by raising labor standards to include higher wages and the ability to earn paid leave to recover from illness or care for family members. But conservative state legislatures are increasingly taking those advances away from the working people who need them most.

If state legislators desire uniform labor and employment standards across their states, rather than undoing the higher standards that cities and counties are implementing for themselves, they should simply raise the statewide standards to match. America’s working people deserve better, and these reforms are long overdue.

Appendix

The following tables summarize state preemption activity by state and year. Table A1 shows which states have passed preemption laws recently—during 2016 and the first half of 2017. Table A2 provides a comprehensive history of state preemption activity since 1997. Most of this activity occurred between 2011 and 2017.

Table A1

Table A2

Endnotes

1. City of St. Louis Ordinance No. 70078 (May 29, 2015).

2. Cooperative Home Care, Inc., et al., v. City of St. Louis, Missouri, No. SC95401 (Slip. Op. M.O. Feb. 28, 2017).

3. Missouri House Bill Nos. 1194 & 1193 (99th General Assembly, 2017).

4. David Cooper, “State Lawmakers in Missouri Just Undercut Wages for 38,000 Workers in St. Louis,” Working Economics (Economic Policy Institute blog), July 14, 2017; see also Marni von Wilpert, “Missouri’s New Preemption Law Cheats 38,000 Workers out of a Raise,” Working Economics (Economic Policy Institute blog), July 14, 2017.

5. See, for example, Yuki Noguchi, “As Cities Raise Minimum Wages, Many States Are Rolling Them Back,” All Things Considered (NPR), July 18, 2017; Emily Badger, “Blue Cities Want to Make Their Own Rules. Red States Won’t Let Them,” New York Times, July 6, 2017; Dave Jamieson, “Republican Lawmakers Take a Raise Away from St. Louis Workers,” Huffington Post, July 9, 2017.

6. Emily Warren, When States Interfere with City-Level Innovation: Preemption and Implications for Cities, 21st Century Cities Initiative, Johns Hopkins University, December 2016.

7. National League of Cities, Cities 101—Delegation of Power [fact sheet], December 13, 2016.

8. § 4:11.Delegation of powers by legislature—Municipal powers under Dillon’s Rule, 2 McQuillin Mun. Corp. § 4:11 (3d ed.); see also National League of Cities, City Rights in an Era of Preemption: A State-by-State Analysis, February 2017.

9. Rick Su, “Have Cities Abandoned Home Rule?,” Fordham Urban Law Journal vol. 44 (April 2017), 181, 191; § 1:44.Public local corporations—Cities, towns and villages—Home rule—Definition, 1 McQuillin Mun. Corp. § 1:44 (3d ed.).

10. Lori Riverstone-Newell, “The Rise of State Preemption Laws in Response to Local Policy Innovation,” Publis: The Journal of Federalism vol. 47, no. 3 (July 2017), 403–4.

11. National Policy & Legal Analysis Network to Prevent Childhood Obesity, “Preemption by Any Other Name,” [fact sheet], developed in partnership with the Public Health Law Center at William Mitchell College of Law, 2010.

12. Claire Zillman, “The Paid Sick Leave Battle Continues, State by State,” Fortune, February 11, 2015.

13. State of Wisconsin Department of Workforce Development, “Wisconsin Family and Medical Leave Act” [informational webpage].

14. Mike Carson, “Gov. Robert Bentley Signs Bill to Block City Minimum Wages, Voiding Birmingham Ordinance,” Al.com, February 25, 2016. Alabama does not have a state-level minimum wage, so employers follow the federal minimum of $7.25 an hour, which was last raised in 2009.

15. Jeremy Pelzer, “Gov. John Kasich Signs Bill Blocking Cleveland’s $15 Minimum Wage Proposal,” Cleveland.com, December 19, 2016.

16. Leila Atassi, “Special Election for Phased-in $15 Minimum Wage Proposal Set for May 2 in Cleveland,” Cleveland.com, September 12, 2016.

17. David Cooper, Another Year of Congressional Inaction Has Further Eroded the Federal Minimum Wage, Economic Policy Institute, July 24, 2017.

18. David Cooper, Another Year of Congressional Inaction Has Further Eroded the Federal Minimum Wage, Economic Policy Institute, July 24, 2017.

19. Janelle Jones and David Cooper, State Minimum Wage Increases Helped 4.3 Million Workers, but Federal Inaction Has Left Many More Behind, Economic Policy Institute, January 9, 2017.

20. U.C. Berkeley Labor Center, Inventory of US City and County Minimum Wage Ordinances.

21. Matthew Sheffield, “Republicans in Several States Are Lowering the Minimum Wage—Yes, You Read That Right,” Salon, July 9, 2017; Emily Badger, “Blue Cities Want to Make Their Own Rules. Red States Won’t Let Them,” New York Times, July 6, 2017.

22. EPI analysis of preemption laws in all 50 U.S. states; see also National Employment Law Project, “Fighting Preemption: The Movement for Higher Wages Must Oppose State Efforts to Block Local Minimum Wage Laws,” July 2017; Richard Schragger, State Preemption Of Local Laws: Preliminary Review Of Substantive Areas, Snapshot as of March 2017, prepared for the Legal Effort to Address Preemption (LEAP) Project, May 2017.

23. While St. Louis passed the local minimum wage ordinance in 2015, low-wage workers within the city limits did not get their first raise (to $10 per hour) until May 5, 2017, because a group of employers sued the city and had the local ordinance tied up in litigation for nearly two years. The Missouri Supreme Court found in favor of the City. Cooperative Home Care, Inc., et al., v. City of St. Louis, Missouri, No. SC95401 (Slip. Op. M.O. Feb. 28, 2017).

24. David Cooper, “State Lawmakers in Missouri Just Undercut Wages for 38,000 Workers in St. Louis,” Working Economics (Economic Policy Institute blog), July 14, 2017.

25. Diane Stafford, “Higher Minimum Wage Gets KC Voters’ Support; Attention Turns to Statewide Campaign,” Kansas City Star, August 8, 2017.

26. Stephen Gruber-Miller, “County Supervisors Give Final Approval to Wage Increase,” Des Moines Register, September 10, 2015.

27. Linn County Minimum Wage Ordinance, April 9, 2016.

28. Kevin Hardy, “How Polk County’s New Minimum Wage Affects You,” Des Moines Register, October 12, 2016.

29. “Minimum Wage” [informational webpage], Linn County, Iowa, website.

30. EPI analysis of American Community Survey microdata, 2015.

31. Elise Gould and Jessica Schieder, Work Sick or Lose Pay? The High Cost of Being Sick When You Don’t Get Paid Sick Days, Economic Policy Institute, June 28, 2017.

32. Elise Gould and Jessica Schieder, Work Sick or Lose Pay? The High Cost of Being Sick When You Don’t Get Paid Sick Days, Economic Policy Institute, June 28, 2017.

33. National Partnership for Working Families, Paid Family and Medical Leave: An Overview [fact sheet], March 2015.

34. United States Department of Labor, “Family Medical Leave Act,” dol.gov (accessed August 23, 2017).

35. Arizona, California, Connecticut, Massachusetts, Oregon, Vermont, and Washington have enacted paid sick days laws; see National Partnership for Working Families, Current Paid Sick Days Laws, November 9, 2016. In addition to the District of Columbia, California, New Jersey, New York, Rhode Island, and Washington have enacted family leave laws; see National Partnership for Working Families, State Paid Family Leave Insurance Laws, July 2017.

36. National Partnership for Working Families, Current Paid Sick Days Laws, November 9, 2016.

37. Lonnie Golden, Irregular Work Scheduling and Its Consequences, Economic Policy Institute, April 9, 2015.

38. Heather Boushey and Bridget Ansel, Working by the Hour: The Economic Consequences of Unpredictable Scheduling Practices, Washington Center for Equitable Growth, September 6, 2016.

39. Schedules That Work Act, S. 1386 / H.R. 2942, 115th Congress (2017).

40. The cities of Emeryville, San Francisco, and San Jose, California; Seattle, Washington; and the states of New Hampshire and Oregon, have enacted fair scheduling legislation; see National Women’s Law Center, Summary of Fair Scheduling Legislation, January 2017. In 2016, New Hampshire enacted a law protecting workers’ rights to request a flexible work schedule; see An Act Relative to Flexible Working Arrangements in Employment, SB416 Gen. Court, Reg. Sess. (NH 2016) (passed June 10, 2016). In 2017, Oregon enacted its Fair Work Week statute; see An Act Relating to Employee Work Schedules, SB 828 Reg. Sess. (OR 2017) (effective date, August 8, 2017).

41. Ross Eisenbrey and Teresa Kroeger, Repealing Prevailing Wage Laws Hurts Construction Workers, Working Economics (Economic Policy Institute blog), March 24, 2017.

42. Matthew M. Bodah and Dale Belman, Building Better: A Look at Best Practices for the Design of Project Labor Agreements, Economic Policy Institute, August 12, 2010.

43. American Legislative Exchange Council (ALEC), Living Wage Mandate Preemption Act, January 28, 2013.

44. An Act to Prohibit Political Subdivisions of the State from Requiring More Than Federal or State Requirements from Employers, SB 688, Gen. Assemb. Reg. Sess. (AR 2017) (passed March 28, 2017).

45. Shaila Dewan, “Foes of Unions Try Their Luck in County Laws,” New York Times, December 18, 2014.

46. American Legislative Exchange Council (ALEC), Local Right to Work Ordinance, January 9, 2015.

47. Jared Bernstein, “The Living Wage Movement: Pointing the Way Toward the High Road,” EPI Viewpoints, March 4, 2002.

48. HB174, Reg. Sess. (AL 2016) (passed on February 25, 2016).

49. See Karim Lakhani, “Birmingham & The Impact of Race on State Preemption Laws” OnLabor, April 3, 2017.

50. EPI analysis of American Community Survey microdata, 2015.

51. Dave Jamieson, “How Republicans Are Blocking Local Minimum Wage Hikes,” Huffington Post, February 25, 2016; Joe B. Crowe, “Mountain Brook One of Wealthiest Communities in U.S.,” Al.com, December 30, 2008.

52. Zachary Roth, “Suit Claims Racial Discrimination by Alabama on Minimum Wage,” MSNBC.com, April 28, 2016.

53. Associated Press, “Federal Judge Dismisses Birmingham Minimum Wage Lawsuit,” WIAT.com, February 2, 2017.

54. Marni von Wilpert, “Missouri’s New Preemption Law Cheats 38,000 Workers out of a Raise,” Working Economics (Economic Policy Institute blog), July 14, 2017; U.S. Census Bureau, “QuickFacts” statistics for St. Louis city, Missouri (County); Phelps County, Missouri; Crawford County, Missouri; UNITED STATES [data table], accessed August 25, 2017 at census.gov.

55. Marni von Wilpert, “Missouri’s New Preemption Law Cheats 38,000 Workers out of a Raise,” Working Economics (Economic Policy Institute blog), July 14, 2017; U.S. Census Bureau, “QuickFacts” statistics for St. Louis city, Missouri (County); Phelps County, Missouri; Crawford County, Missouri; UNITED STATES [data table], accessed August 25, 2017 at census.gov.

56. Dave Jamieson, “Republican Lawmakers Take a Raise Away from St. Louis Workers,” Huffington Post, July 9, 2017.

57. David Cooper, “State Lawmakers in Missouri Just Undercut Wages for 38,000 Workers in St. Louis” Working Economics (Economic Policy Institute blog), July 14, 2017.

58. Howard Monroe, “Indy Council Looking to Raise Minimum Wage for City Workers,” wishtv.com, May 8, 2017.

59. See Department of Labor, Wage and Hour Division, “Final Rule: Executive Order 13658, Establishing a Minimum Wage for Contractors,” 79 Fed. Reg. 60634 (October 7, 2014).

60. Bill Ruthhart, “Emanuel Takes Page from Obama’s Book on Minimum Wage,” Chicago Tribune, September 3, 2014.

61. David Garrick, “San Diego Approves Equal Pay Law to Address Persistent Gender Gap,” San Diego Union Tribune, July 31, 2017.

Good afternoon Council President Berliner and members of the Committee.

My name is Marni von Wilpert. I serve as an Associate Labor Counsel at the Economic Policy Institute. EPI is a think tank that studies the economy and how government policies affect the lives and well-being of America’s workers. EPI believes that every working person deserves a good, safe job with fair pay, affordable health care, and retirement security.

I am here today to speak in support of Bill 46-15 and its establishment of a 30-hour minimum work week for certain building maintenance workers.

Since the economy began to recover from the Great Recession, many workers have desired to regain full-time jobs, but end up working only part-time because those are the only positions they can find. Involuntary part-time work among building maintenance workers means that they are not offered enough hours to earn a decent living, and they are being denied access to health insurance.

Often, part-time workers are faced with volatility in their schedules and their weekly income. Irregular schedules that fluctuate from week to week make it nearly impossible for part-time workers to plan for child care or educational opportunities. And unstable hours lead to unstable earnings. For hourly workers, volatile earnings make it harder to meet their regular financial responsibilities like housing, food, childcare, and transportation. Research has shown that nearly half of working people with volatile monthly earnings cite their irregular work hours as the cause of this hardship.

Data from the Census Bureau’s American Community Survey, which provides the most detailed picture of local employment available, shows that building maintenance employers have choices in how they schedule work in this sector.

Table 1

Looking at the data, it is apparent that the two largest metropolitan areas listed above, New York and Chicago, have nearly eighty percent or more of their janitors working for at least thirty hours each week. In contrast, in Montgomery County there is a smaller share of janitors and building cleaners working 30+ hours than these other metropolitan areas, except in Washington DC, which passed a 30-hour minimum work week law in

2016 to resolve this exact problem. In Montgomery County, janitors and building cleaners are less likely than all workers in Montgomery County to work more than 35 hours (63.9% compared to 65.8%). And more than 40% of janitors and building cleaners in Montgomery County work less than 40 hours. Source: American Community Survey.

These comparisons show that there are differing scheduling options available to employers in the building maintenance industry, but that employers in most of these metropolitan areas provide longer work weeks to the overwhelming majority of workers.

Moreover, a report by real estate economist Hugh Kelly, PhD, CRE found that the labor costs affected by this legislation make up a small fraction of real estate operating costs. He found that the average janitorial and payroll benefit costs per square foot of sampled buildings were not more than 20% of operating expenses. Real estate taxes, utility costs and repair and maintenance expenses each constituted higher costs for building owners. See Hugh F. Kelly, “Report on Montgomery County Better Jobs Act,” July 23, 2015.

In addition, Bill 46-15’s requirement that employers provide a minimum work week of 30 hours for each employee is integral to building maintenance workers’ ability to earn a decent living in the County. In 2015, Montgomery County’s poverty rate was 7.5% compared to 14.2% nationally. However, poverty for part time workers is more than 6 times higher within the County than it is for full time workers (9.9% compared to 1.5%).

Montgomery County’s minimum wage increased to $11.50 from $10.75 on July 1, 2017. The US poverty threshold for a family of four in 2017 is $24,600 (https://aspe.hhs.gov/poverty-guidelines). In order to earn that income at the current Montgomery County minimum wage of $11.50, a worker would need to work 41 hours per week.

In addition, EPI’s Family Budget Calculator measures the income an individual or a family needs in order to attain a secure yet modest standard of living – basically, earning enough to make ends meet, but with nothing left over for much else, such as savings. Compared with the federal poverty line, EPI’s family budgets provide a more accurate and complete measure of economic security in America. For a two-parent, two-child family in the Maryland suburbs of Washington, DC, it costs $6,611 per month($79,330 per year) to secure a decent yet modest standard of living.

Raising the minimum wage is an important step to help Montgomery County’s workers. But providing workers the opportunity to work enough hours to earn a decent living and obtain health care is also vital to ensure that building maintenance jobs are good jobs that support Montgomery County’s workers and their families.