This story was updated on Sept. 18, 2012.
Over the opposition of business leaders, the Montgomery County Council on Tuesday narrowly passed legislation that would force many companies that win private and public contracts to retain the employees of the previous contractors for 90 days.
The bill passed 5-4 and included an amendment proposed by Council Member George Leventhal (D-At large) of Takoma Park, who voted against the bill. The amendment deletes a provision that would have forced new contractors to retain employees based on seniority.
The legislation “does not protect jobs and, more importantly, it doesn’t create net new jobs,” Georgette Godwin, president and CEO of the Montgomery County Chamber of Commerce, had said in a previous meeting. “We need job creationism, not favoritism.”
The law is the first of its kind in Maryland, although similar laws exist in Washington, D.C., San Francisco, Los Angeles, Providence, R.I., and New York City, according to county memos. The state legislature considered a similar bill this year, but it did not get out of committee.
The law applies to not only many contracts awarded by Montgomery County, but to private service contracts that provide security, janitorial, building maintenance, food preparation and nonprofessional health care services in facilities that include office buildings of more than 75,000 square feet, apartment complexes with more than 30 units, hospitals, private schools and cultural institutions. It does not apply to certain businesses, such as restaurants.
Leaders of local chambers of commerce, including Montgomery County, Greater Bethesda-Chevy Chase, Gaithersburg-Germantown and Greater Silver Spring, opposed the bill, as did the Apartment and Office Building Association of Metropolitan Washington.
“One of the biggest reasons that businesses change contractors is that the quality of the work does not meet expectations,” Marilyn Balcombe, president and CEO of the Gaithersburg-Germantown Chamber of Commerce, said Monday. “This bill requires the new contractor to retain the old contractor’s employees who may have been the very reason for the change.”
In Washington and other cities with similar laws, there have been no major disruptions, Jaime Contreras, capital area director of Service Employees International Union Local 32BJ, said during a public hearing in June. The union local represents about 18,000 property service workers in Maryland, Washington and Northern Virginia, including more than 2,000 in Montgomery County.
“It has been in effect for over 17 years in Washington, D.C., which remains one of the strongest commercial real estate markets in the nation,” Contreras said. “It would not overburden the county. It’s the right thing to do.”
The bill would result in favoring one group of employees as opposed to another and limit competitiveness in the marketplace, Godwin said during the same hearing in June.
The bill had five co-sponsors on the nine-member council. The council’s Health and Human Services committee on July 30 recommended approval of the legislation by a 2-1 vote.