MILPITAS — In an effort to help prevent wage theft and other labor law violations on construction projects in the city, the Milpitas City Council is taking novel steps to hold developers more accountable for their practices.
The council, in a unanimous decision on Jan. 5, voted to create a “responsible construction ordinance” that will require developers and builders seeking to get a project approved to sign an acknowledgement upfront that they are required to comply with the state Labor Code.
And, after being pushed to go further with their rules by local advocates, the city council added a portion to the ordinance that also will state the developers, contractors, or subcontractors must not have any unpaid wage theft judgements against them in order to get a green light from the city to go forth with a project.
And, at the completion of a project, the ordinance also will require developers, contractors, and subcontractors to certify that they have complied with some specific state labor law requirements; namely that employees were given “advance notice of the employer’s pay practices,” and that all workers on the job received “itemized pay statements showing compliance with state wage and hour laws.”
It would also require a second certification from those involved in the project that they have no unpaid wage theft judgements against them
The city would not issue permits to allow occupancy of the new construction unless these certifications are provided, or if the city is shown any information from the state or others that the builders did not comply with state laws, city staff said.
“At the end of the day it’s about equity, it’s about leveling the playing field,” Councilman Anthony Phan said at the meeting of the new ordinance. Phan brought forth the idea for the ordinance last year.
The new rules will apply to any new construction projects in the city larger than 15,000 square feet that are not already “subject to prevailing wage requirements and/or does not have a valid Project Labor or Community Workforce Agreement,” city staff reports said.
While the bulk of the requirements Milpitas approved are modeled after a similar ordinance in place since 2017 in Morgan Hill, Milpitas City Attorney Chris Diaz said at the Jan. 5 meeting the requirement that contractors have no unpaid wage theft judgements against them is “new and novel” and not something he was aware of other cities having approved.
Several people who supported the new rules brought up a high profile example of wage theft and human trafficking from 2017, when authorities said more than a dozen immigrant workers were being held in captivity in a Hayward warehouse and being forced to work on the Silvery Towers high rises in San Jose without pay.
“Because of Silvery Towers, human trafficking, and rampant wage theft, this ordinance is critical,” said Ruth Silver-Taube, an adjunct law professor at Santa Clara University and coordinator of the Santa Clara County Wage Theft Coalition.
Dennis Martin of the Building Industry Association of the Bay Area, however, pushed back against the ordinance.
“(Building Industry Association of the Bay Area) opposes any wage theft or so-called responsible construction ordnance. These are bad solutions seeking essentially non-existent problems because wage theft is not rampant throughout the construction industry,” he said.
Phan said in his view construction workers are “very prone” to being exploited on the job, and the protections aim to help them and the industry at large.
“Making sure everybody plays by the rules, making sure folks aren’t being cheated. That construction workers aren’t being cheated, and builders aren’t being cheated by their subcontractors, by bad actors, their competitors in the industry. That’s not the kind of market that we want to really reward,” Phan said.
“Because everybody is trying to make a living here.”
