AN ORDINANCE relating to employment in Seattle; adding a new chapter 14.15 to the Seattle Municipal Code; establishing minimum wage standards and for the provision of paid sick, holiday and vacation time; prescribing penalties, remedies and enforcement procedures; and requesting a post- implementation assessment from the Seattle Office for Civil Rights.
WHEREAS, workers working in and producing goods for the city of Seattle need a livable wage to take care of themselves and their family members and other dependents; and
WHEREAS, many workers may not currently enjoy adequate pay for work performed or paid sick, holiday and vacation days;
BE IT ORDAINED BY THE CITY OF SEATTLE AS FOLLOWS:
Section 1. The City Council makes the following findings:
Low paid workers are a burden for the local economy, being forced to buy and thereby promote low quality goods, and to rely on government support to survive.
When workers are paid inadequately, they are more likely to suffer from stress, poorer physical and mental health, are more likely to suffer family problems, succumb to depression and violence, and to make poor life choices.
Workers with adverse diurnal schedules, long hours, and inadequate rest periods are more likely to suffer from stress, fatigue, poor health, inattention at work, leading to greater workplace injury.
Family economic security is at risk for workers who lack adequate pay and paid time off to care for themselves, their children, or other family members and dependents.
Workers receiving low pay are more likely to lack the resources to properly educate their children and send them to college, jeopardizing the future for all of us.
Victims of domestic violence, sexual assault and stalking who are inadequately paid are less able to receive medical treatment, participate in legal proceedings and obtain other necessary services. In addition, without good wages, domestic violence victims are less able to maintain the financial independence necessary to leave abusive situations, achieve safety, and minimize physical and emotional injuries.
The lowest paid workers spend the highest portion of their income into the local economy. Raising the minimum wage will allow more people to choose better quality goods and make better economic choices. Raising the minimum wage is the most cost effective method to promote the local economy.
Raising the minimum wage will reduce the cost of government by increasing economic activity, increasing tax revenues and reducing dependence on government services for the poor.
Raising the minimum wage will enhance the safety, health and welfare of the people of the City of Seattle by increasing family resources for better nutrition, reducing the amount worker illness, thereby reducing the exposure of co-workers and members of the public to infectious diseases, and reducing the exposure of children at schools and day cares to infectious diseases; resulting in a healthier and more productive workforce, better health for older family members and children, enhanced public health and improved family economic security.
Raising the minimum wage, providing rest breaks and paid time off will promote health, physical and mental, reduce stress, and enhance workplace safety.
Raising the minimum wage will provide the economic resources to families to educate their children and send them to college, enhancing the quality of future citizens and workers, creating a better future socially, politically and economically for the City of Seattle and the region.
Raising the minimum wage will enable victims of domestic violence, sexual assault and stalking, their family members, and others to participate in legal proceedings, receive medical treatment, or obtain other necessary services. Raising the minimum wage will enable victims to maintain the financial independence necessary to leave abusive situations, achieve safety, and minimize physical and emotional injuries.
Discouraging the purchase of cheaper products made by workers receiving substandard pay and encouraging the purchase of products manufactured and transported by workers receiving fair wages will not only help to support the local economy but also encourage fair labor practices everywhere.
Through the collective bargaining process, employers and represented workers can develop alternative means of meeting the policy goals underlying the fair pay and paid leave requirements established by this ordinance.
To safeguard the public welfare, health, safety, and prosperity of the city of Seattle, all persons working in our community must have adequate wages and paid time off. Raising the minimum wage will ensure a more productive workforce, benefiting employers, workers, families, and the community as a whole now and in the future.
Section 2. A new Chapter 14.15 “Minimum Wage” is added to Title 14 of the Seattle Municipal Code as follows:
14.15.010. Declaration of necessity and police power.
Whereas the establishment of a minimum wage for employees is a subject of vital and imminent concern to the people of this city and requires appropriate action by the council to establish minimum standards of employment within the City of Seattle, therefore the council declares that, in its considered judgment, the health, safety, and general welfare of the citizens of this city require the enactment of this measure, and exercising its police power, the council endeavors by this chapter to establish a minimum wage for employees of this city to encourage livable employment opportunities within the city. The provisions of this chapter are enacted in the exercise of the police power of the city for the purpose of protecting the immediate and future health, safety, and welfare of the people of this city.
“Director” means the Director of the Office for Civil Rights. “Employ” means to permit to work. “Employer” includes any individual, partnership, association, corporation, business trust, doing any business with or within the City of Seattle and employing five or more persons during any year’s time, or any person or group of persons acting directly or indirectly in the interest of such an employer. Organizations of any nature owned or controlled by the same entity shall be treated as a single employer for the purposes of counting the number of employees or the higest compensation. “Owner” means any entity or person with an ownership, beneficiary or controlling interest in an employing organization. “Employee” includes any individual employed by an employer but shall not include: Any individual engaged in the activities of an educational, charitable, religious, state or local governmental body or agency, or nonprofit organization where the employer-employee relationship does not in fact exist and where the services are rendered to such organizations voluntarily and gratuitously. If the individual receives only reimbursement for out-of-pocket expenses, an employer-employee relationship is deemed not to exist for the purpose of this section; Any individual employed full time by any state or local governmental body or agency who also provides voluntary services but only with regard to the provision of the voluntary services; Any vendor, carrier, or delivery person selling or distributing newspapers or other merchandise on the street, to offices, to businesses, or from house to house on a commission basis and any freelance news correspondent or writer who, using his or her own equipment, chooses to submit material for publication for free or a fee when such material is published; Individuals and “independent” contractors paid by the piece, foot, pound, basket, trip, and so forth, provided that their average net total income after all required deductions and expenses is consistently, demonstrably and significantly greater than the total compensation that would be owed to them according to the requirements of this chapter; Children or grandchildren of the owners of the employing business; Members of a producers’ cooperative who share the ownership, control, and benefits of their business according to their democratic decision. “Occupation” means any occupation, service, trade, business, industry, or branch or group of industries or employment or class of employment in which employees are gainfully employed. “Wage” means compensation due to an employee by reason of employment, payable in legal tender of the United States or checks on banks convertible into cash on demand at full face value, net after all required deductions, charges, or allowances, and not counting tips or gratuities. “Day” shall mean the eight hour period from 8:00am to 4:00pm. “Evening” shall mean the eight hour period from 4:00pm to midnight. “Night” shall mean the eight hour period from midnight to 8:00am. “Holiday” shall include the period from 4:00pm every Friday to 8:00am the following Monday and all time from 4:00pm the day before any national, state, county or City of Seattle holiday until 8:00am the day after. “Week” shall mean any contiguous 168-hour period. “Year” shall mean any contiguous 365 days (366 days if February 29 can be included in the year period).
14.15.030. Minimum hourly wage.
Beginning April 1, 2014, every employer shall pay each of his or her employees wages at a rate not less than the sum of:
for every hour, or portion thereof, of work performed, the larger of: fifteen dollars per hour; ten percent of the effective hourly rate of the total compensation package of the highest paid employee or owner; a shift premium of five dollars per hour for all work performed during the evening and ten dollars per hour for all work performed during the night. If the shift begins before 6:00am, the entire shift shall be paid with night premium; a holiday premium of ten dollars per hour for all work performed during holidays; an overtime premium of ten dollars per hour for any work performed in excess of forty hours during any week. The start and end time of an overtime week shall be chosen to maximize overtime premium. If an employee works for two or more employers for a total of more than forty hours during any week, even though not more than forty hours for any single employer, the employers shall pay and share the payment of the required total overtime premium pay in proportion to the total hours worked for each employer during that week.
On September 30, 2014, and on the last working day of each following September, the director or his or her designee shall calculate adjusted minimum wage and premium rates to maintain employee purchasing power by increasing the current year’s minimum wage and premium rates to adjust for the cumulative inflation as of the first of that September since September 1, 2013. The adjusted rates shall be calculated to the nearest dollar using the consumer price index for urban wage earners and clerical workers, CPI-W, or a successor index, for the twelve months prior to each September 1st as calculated by the United States department of labor. Each set of adjusted rates calculated under this section shall take effect on the following January 1st. The rates, once adjusted, shall never be lowered.
14.15.040. Paid rest periods.
Employees shall enjoy a paid fifteen-minute rest period and/or a paid fifteen-minute wash-up period and/or early-dismissal toward the end of each two hours of paid work. The break area may be on or off premises. The break area shall have available healthy refreshment. Time to and from break area shall not be counted as part of the fifteen-minutes break time. Break time not taken shall be paid as overtime (regardless of total hours) on the next higher-paid shift (day as evening, evening or night as night) by the employer for whom the break time was surrendered.
14.15.050. Sick leave.
Sick leave, as authorized in SMC Chapter 14.16 and elsewhere by federal, state and local law, shall be paid per sick day (seven days per week), at one-seventh of the employee’s recent weekly earnings (including shift, holiday, and overtime premium, and including prior sick pay, holiday and vacation) based on the highest average over the one to ten weeks ending immediately before the onset of illness.
14.15.060. Holiday pay.
On each holiday, employees shall receive from each employer holiday pay equal to one half of one percent of their total earnings (including sick leave, holiday, and vacation) during the immediately preceding year (beginning with last year’s same holiday (or same date if new holiday this year) and ending the day before the holiday). The holiday pay shall be paid, whether the holiday is worked or not, in addition to any pay for work performed on the holiday.
14.15.070. Vacation pay.
Each week, on the day of week of his or her original first day worked, the employee shall receive vacation pay equal to one-twentieth of one percent of total pay since the beginning of his or her employment up until yesterday midnight. Vacation pay shall be paid to the employee whether the employee takes vacation time or not, whether the employee continues in employment or not. Vacation pay after termination of employment shall continue as retirement pension pay. There shall be no age requirement for the receipt of continuing vacation and retirement pension pay. Employers shall deposit sufficient funds with the city of Seattle to guarantee adequate funding of these pensions according to guidelines established by the director.
14.15.080. Timely payment.
Wages, sick leave, holiday and vacation pay are due and payable at the end of each shift worked or at the end of each sick day, holiday, or week. Employers may calculate and make payroll according to any reasonable and convenient schedule, however employers shall pay penalty interest of one percent per month on withheld wages up to the date that payment is made. Employers holding pay for longer than one week shall provide payroll advances approximating pay owed before pay day upon request of the employee.
14.15.090. Office for Civil Rights, Labor and Industries Section.
The City of Seattle shall establish, within the Office for Civil Rights, a Labor and Industries Section with the mission of investigating Seattle businesses, enforcing the requirements of this chapter, and administering vacation and retirement pension pay. The Labor and Industries Section shall develop and publish any additional regulations necessary or appropriate for the enforcement of the provisions of this chapter. The Labor and Industries Section shall develop and support an on-line application that will allow employers and employees to enter hours worked and breaks taken, and calculate minimum pay according to the requirements of this chapter. The application shall allow entry of actual wages paid (which may be higher than the requirements of this chapter), sick days claimed, and shall calculate minimum sick leave pay, holiday pay and vacation/retirement pension pay according to the requirements of this chapter, based on actual wages paid, and allow entry of any higher amounts actually paid. The application shall maintain a running balance of wages owed and calculate interest from the date owed to the date paid. The Labor and Industries Section shall collect and safely invest sufficient funds to guarantee the payment of vacation and pensions for retired and separated employees. These funds shall be sufficient to guarantee these pensions in the event of business closure or bankruptcy. The Labor and Industries Section shall monitor, investigating as required, employers doing business in the City of Seattle, and ensure that the requirements of this chapter are met. The Labor and Industries Section shall research the manufacture and transportation of goods sold in the City of Seattle. Where the Labor and Industries Section shall learn that the requirements of this chapter are not being met by firms manufacturing or transporting those products, the Labor and Industries Section shall recommend an appropriate additional sales tax on those products for the purpose of recovering unpaid wages on behalf of the underpaid employees.
14.15.100. Investigation. Services of federal and state agencies. Employer’s records.
The director or his or her designated representatives may investigate and gather data regarding the wages, hours, and other conditions and practices of employment in any industry subject to this chapter, and may enter and inspect such places and such records (and make such transcriptions thereof), question such employees, and investigate such facts, conditions, practices, or matters as he or she may deem necessary or appropriate to determine whether any person has violated any provision of this chapter, or which may aid in the enforcement of the provisions of this chapter. With the consent and cooperation of federal and state agencies charged with the administration of federal and state labor laws, the director may, for the purpose of carrying out his or her functions and duties under this chapter, utilize the services of federal and state agencies and their employees and, notwithstanding any other provision of law, may reimburse such federal and state agencies and their employees for services rendered for such purposes. Every employer subject to any provision of this chapter or of any order issued under this chapter shall make, keep, and preserve such records of the persons employed by him or her and of the wages, hours, evidence of payment, and of other conditions and practices of employment, and shall preserve such records for such periods of time, and shall make reports therefrom to the director as he or she shall prescribe by regulation as necessary or appropriate for the enforcement of the provisions of this chapter or the regulations thereunder. In the event of any shortcoming in the employer’s records, the employee’s records, recollections, or reasonable estimates shall be considered factual.
14.15.110. Industrial homework.
The director is authorized to make such regulations regulating, restricting, or prohibiting industrial homework as are necessary or appropriate to prevent the circumvention or evasion of and to safeguard the minimum wage rate prescribed in this chapter.
14.15.120. Records of employer. Contents. Inspection. Sworn statement.
Every employer subject to any provision of this chapter or of any regulation issued under this chapter shall make, and keep in or about the premises wherein any employee is employed, a record of the name, address, and occupation of each of his or her employees, the rate of pay, and the amount paid each pay period to each such employee, the hours worked each day and each work week by such employee, and such other information as the director shall prescribe by regulation as necessary or appropriate for the enforcement of the provisions of this chapter or of the regulations thereunder. Such records shall be open for inspection or transcription by the director or his or her authorized representative at any reasonable time. Every such employer shall furnish to the director or to his or her authorized representative on demand a sworn statement of such records and information upon forms prescribed or approved by the director.
14.15.130. Payment of wages less than chapter requirements. Employer’s responsibility. Assignment of wage claim.
Any employer who pays any employee less than wages to which such employee is entitled under or by virtue of this chapter, shall be liable to such employee affected for the full amount of such wage rate, less any amount actually paid to such employee by the employer, and for costs and such reasonable attorney’s fees as may be allowed by the court. Any agreement between such employee and the employer to work for less than such wage rate shall be no defense to such action. At the written request of any employee paid less than the wages to which he or she is entitled under or by virtue of this chapter, the director may take an assignment under this chapter of such wage claim in trust for the assigning employee and may bring any legal action necessary to collect such claim, and the employer shall be required to pay the costs and such reasonable attorney’s fees as may be allowed by the court. Any employee complaining of payment of wages less than chapter requirements, unauthorized deductions, or wages withheld or not timely paid, shall be immune from any adverse consequences of investigation of his or her claims, including but not limited to, his or her legal status, work authorization, and immigration status. The City of Seattle shall do everything within its power to protect the employee from such consequences. The director shall investigate wages paid by companies manufacturing and shipping products sold in the City of Seattle. Where the director finds any of these companies to be paying their employees wages less than required by this chapter, the director shall assign a wage claim on behalf of those employees, and, with the Seattle department of revenue, impose an additional sales tax on those products for the purpose of recovering the wage claim assignment.
14.15.140. Prohibited acts of employer. Penalty.
Any employer who hinders or delays the director or his or her authorized representatives in the performance of his or her duties in the enforcement of this chapter, or refuses to admit the director or his or her authorized representatives to any place of employment, or fails to make, keep, and preserve any records as required under the provisions of this chapter, or falsifies any such record, or refuses to make any such record accessible to the director or his or her authorized representatives upon demand, or refuses to furnish a sworn statement of such record or any other information required for the proper enforcement of this chapter to the director or his or her authorized representatives upon demand, or pays or agrees to pay wages at a rate less than the rate applicable under this chapter, or otherwise violates any provision of this chapter or of any regulation issued under this chapter shall be deemed in violation of this chapter and shall, upon conviction therefor, be guilty of a gross misdemeanor. Any employer who discharges or in any other manner discriminates against any employee because such employee has made any complaint to his or her employer, to the director, or his or her authorized representatives that he or she has not been paid wages in accordance with the provisions of this chapter, or that the employer has violated any provision of this chapter, or because such employee has caused to be instituted or is about to cause to be instituted any proceeding under or related to this chapter, or because such employee has testified or is about to testify in any such proceeding shall be deemed in violation of this chapter and shall, upon conviction therefor, be guilty of a gross misdemeanor. Affected employee(s) shall be reinstated with back pay for time lost based on their highest prior weekly earnings.
14.15.150. Collective bargaining not impaired.
Nothing in this chapter shall be deemed to interfere with, impede, or in any way diminish the right of employees to bargain collectively with their employers through representatives of their own choosing in order to establish wages or other conditions of work in excess of the applicable minimum under the provisions of this chapter.
14.15.160. Chapter establishes minimum standards and is supplementary to other laws. More favorable standards unaffected.
This chapter establishes a minimum standard for wages and working conditions of all employees of organizations doing business with or within the City of Seattle, and is in addition to and supplementary to any other federal, state, or local law or ordinance, or any rule or regulation issued thereunder. Any standards relating to wages, hours, or other working conditions established by any applicable federal, state, or local law or ordinance, or any rule or regulation issued thereunder, which are more favorable to employees than the minimum standards applicable under this chapter, or any rule or regulation issued hereunder, shall not be affected by this chapter and such other laws, or rules or regulations, shall be in full force and effect and may be enforced as provided by law.
14.15.170. Service charges. Tips. Gratuities.
An employer that imposes an automatic service charge related to food, beverages, entertainment, or porterage provided to a customer must disclose in an itemized receipt and in any menu provided to the customer the percentage of the automatic service charge that is paid or is payable directly to the employee or employees serving the customer. For purposes of this section: “Employee” means a nonmanagerial, nonsupervisory worker, including but not limited to servers, busers, dishwashers, banquet attendants, banquet captains, bartenders, barbacks, chauffeurs and porters. “Employer” means employers as defined in 14.15.020 that provide food, beverages, entertainment, personal transportation or porterage, including but not limited to restaurants, catering houses, convention centers, taxis, limousines, and overnight accommodations. “Service charge” means a separately designated amount collected by employers from customers that is for services provided by employees, or is described in such a way that customers might reasonably believe that the amounts are for such services. Service charges include but are not limited to charges designated on receipts as a “service charge,” “gratuity,” “delivery charge,” or “porterage charge.” Service charges are in addition to hourly wages paid or payable to the employee or employees serving the customer. All service charges, tips, and gratuities, whether automatically imposed by the employer or voluntarily offered by the customer, whether paid in cash or by any other means, whether separated or paid together with any other payment, shall be given in full to or divided among the appropriate employee(s), in addition to their wages, and shall not be counted toward satisfying the wage requirements of this chapter.
If any provision of this chapter, or the application thereof to any person or circumstances, is held invalid, the remainder of the chapter and the application thereof to other persons or circumstances shall not be affected thereby.
14.15.190. Short title.
This chapter may be known and cited as the “Seattle Minimum Wage Act.”
14.15.200. Effective date. April 1, 2014.
This 2014 act is necessary for the immediate preservation of the public peace, health, and safety, the support of Seattle city government and its existing public institutions, and shall take effect April 1, 2014.
Section 3. Consistent with the duties established for the Seattle Human Rights Commission in Section 2 of this ordinance, subsection 3.14.931.E of the Seattle Municipal Code, last amended by ordinance 118392, is amended as follows:
3.14.931. Seattle Human Rights Commission – Duties.
Hear appeals and hearings as set forth in Chapters 14.04 , 14.08 , 14.15 , and 14.16 of the Seattle Municipal Code.
Section 4. Eighteen months after the effective date of this ordinance, the Seattle Office for Civil Rights and the Seattle Office of City Auditor will provide Council with a written evaluation of the impacts this ordinance has had on employees and employers. This evaluation will include an assessment of patterns and practices relating to shift swapping, available statistics on physical and emotional health of workers, children, and families, use of explicit waivers of the requirements of this ordinance in collective bargaining agreements, and of complaints and enforcement actions.
Section 5. This ordinance shall take effect on April 1, 2014.
Section 6. Severability. The several provisions of this ordinance are declared to be separate and severable and an order of any court of competent jurisdiction holding invalid any clause, sentence, paragraph, subdivision, section, or portion of this ordinance, or holding invalid the application thereof to any person or circumstance, shall not affect the validity of the remainder of this ordinance or the validity of its application to other persons or circumstances.
Passed by the City Council the ____ day of ________________________, 2014, and signed by me in open session in authentication of its passage this
_____ day of ___________________, 2014.
_________________________________ Sally J. Clark, Council President
Approved by me this ____ day of _____________________, 2014.
_________________________________ Ed Murray, Mayor
Filed by me this ____ day of __________________________, 2014.
___________________________________ Monica Martinez Simmons, City Clerk