A Montgomery County Council committee approved a bill on Monday that a union says is needed because of its employees’ unstable working environment, but that many local business groups are calling anti-business.
The Displaced Service Workers bill, backed by a national union that supports service workers, SEIU 32BJ, forces companies that end their contract with a service contractor to retain and pay the contractor’s employees for 90 days after the contract ends.
Councilwoman Valerie Ervin, who first introduced the bill in May, said it would offer a transition for service workers of contracting companies, who she said must deal with sudden unemployment after being let go by their employer with little or no notice.
It attempts to correct what council members called “bad actors” in building ownership, who switch from one contractor to the next in an attempt to lower costs, rather than because of poor work.
“All our service sector workers are asking for is a temporary modest control that would provide a more level playing field,” said Ervin (D-Dist. 5) of Silver Spring.
The bill, approved by the Health and Human Services Committee on Monday, is sponsored by Ervin and four other council members.
Councilman George Leventhal, who chairs the committee, argued against the bill Monday, his thoughts also mirroring those of some business groups.
“This bill is an unprecedented involvement of county government in private hiring decisions,” Leventhal (D-At large) of Takoma Park said Monday.
The law would apply to all county companies with more than 20 employees that award contracts to building service employees such as janitors or security officers, food service workers or nonprofessional health care workers, to work in private schools, health care facilities such as hospitals, institutions such as museums or arenas, apartment complexes or commercial or office buildings of more than 75,000 square feet.
The bill was scheduled to be heard by the full committee Tuesday, but council President Roger Berliner took it off the agenda. The bill will not be voted upon until September; the council is in recess in August.
Opposing groups include the Chambers of Commerce for Montgomery County, Silver Spring, Bethesda-Chevy Chase and Germantown-Gaithersburg, and the Apartment and Office Building Association of Metropolitan Washington, a local nonprofit trade association of apartment complex and building owners and managers.
The association’s members reject the assertion that building owners switch contractors solely to “wring out savings,” said Shaun Pharr, the association’s senior vice president.
Often, it is the performance of the work force that is causing the company to switch, he said. The bill tampers with business practices, turning “competitive bidding on its head,” he said.
But Julie Karant, spokeswoman for SEIU 32BJ, said many businesses are in support of the law.
Business Service Management Inc., which does business both in Washington, D.C., and Maryland, wrote in testimony that the law still allows the flexibility for the company to make personnel decisions to stay competitive.
“[It] allows us to compete on the quality of our services without hurting employees — something all responsible contractors are pleased to do,” wrote Geen C. Nguyen, president of the company.
The employer would be required to retain all of the contractor’s employees for all 90 days other than those in managerial or administrative positions, who earn more than $30 an hour, or work less than 10 hours per week. For all retained, union contracts still would apply.
The only reason the employer would not have to hire all the employees would be if it proves that few service employees are required to perform the work. In that case, the employees with the most seniority must be retained — a point Leventhal argued to be removed in an amendment.
If a worker is let go during those 90 days, it must be for “just cause,” according to the bill. After 90 days, the employer could choose whether to retain the service workers.
County Executive Isiah Leggett offered support for the bill, stating it will help protect service sector workers and their families, while also ensuring that the business environment remains competitive.
The District passed similar legislation about 18 years ago.
Leggett, Ervin and union leaders said the legislation has not caused any disruption to contracting, private or government business.
Andy Shulman, the chair-elect of the Greater Bethesda-Chevy Chase Chamber of Commerce, said that just because no businesses in D.C. issued complaints about the law doesn’t mean they didn’t have any.
Shulman previously worked for a commercial realty company in the District.
He and Leventhal argued that if the county passed this bill, other low-wage workers, such as movie-theater workers and busboys, may argue they deserve the same accommodations.
“Where does it end?” Shulman asked after the meeting Monday. “It is a slippery slope we are stepping onto.”