Living Wage Act of 2006
The Living Wage Act of 2006 is Title I of the “Way to Work Amendment Act of 2006”, D.C. Law 16-118 (D.C. Official Code §2-220.01 to .11), which became effective June 8, 2006. Recipients of new contracts or government assistance (grant, loan or tax increment financing) shall pay affiliated employees and subcontractors who perform services under the contracts or assistance no less than the current living wage of $11.75 per hour.
Living Wage Act of 2006 Requirements
For contracts for services in the amount of $100,000 or more, unless specifically included, the Act:
- Requires contractors to pay their affiliated employees and to pay their affiliated subcontractors no less than the current “Living Wage”
- Requires contractors to include in subcontracts for $15,000 or more a provision requiring the subcontractor to pay its employees performing under that contract no less than the current “Living Wage”
- Requires contractors to provide a copy of the “Living Wage Act of 2006 Fact Sheet” to each employee and subcontractor performing under that contract
- Requires contractors to post a copy of the “Living Wage Act of 2006 Notice” in a conspicuous place in its place of business
- Require contractors to include in subcontracts for $15,000 or more a provision requiring the subcontractor to post the “Living Wage Act of 2006 Notice” in a conspicuous place in its place of business
- Requires contractors to maintain their payroll records for at least three years from the date of payroll
- Requires contractors to include in subcontracts for $15,000 or more a provision requiring the
subcontractor to maintain its payroll records under that contract for at least three years from the date of payroll
For government assistance in the amount of $100,000 or more, unless specifically included, the Act:
- Requires recipients to pay their affiliated employees and to pay their affiliated subcontractors no less than the current “Living Wage”
- Requires recipients to include in subcontracts for $50,000 or more a provision requiring the subcontractor to pay its employees performing under that government assistance no less than the current “Living Wage”
- Requires recipients to provide a copy of the “Living Wage Act of 2006 Fact Sheet” to each employee and subcontractor performing under the assistance
- Requires recipients to post a copy of the “Living Wage Act of 2006 Notice” in a conspicuous place in its place of business
- Requires recipients to include in subcontracts for $50,000 or more a provision requiring the subcontractor to post the “Living Wage Act of 2006 Notice” in a conspicuous place in its place of business
- Requires recipients to maintain their payroll records for at least three years from the date of payroll
- Requires recipients to include in subcontracts of $50,000 or more a provision requiring the subcontractor to maintain its payroll records under the contract for at least three years from the date of payroll
What is the Living Wage?
- The current living wage rate is $11.75. The living wage rate will be posted on the websites of the Department of Employment Services (DOES) and the Office of Contracting and Procurement (OCP) www.ocp.dc.gov.
- DOES will adjust the rate annually and publish the rate not later than March 1 of each year, starting in 2008.
- The next rate adjustment will be effective January 1, 2008.
Except as specifically excluded, the Act applies to all District contracts for services in the amount of $100,000 or more and subcontracts under those contracts in the amount of $15,000 or more.
The contractor and subcontractor are required to pay their affiliated employees under these contracts and subcontracts no less than the living wage rate, regardless of whether health care benefits are provided.
 
Living Wage Act of 2006 Exemptions:
The following contracts and agreements are exempt from the Living Wage Act of 2006:
- Contracts or other agreements that are subject to higher wage level determinations required by federal law
- Existing and future collective bargaining agreements, provided that the future agreements result in the employee being paid no less than the established living wage rate
- Contracts for regulated utilities, such as electricity, telephone, water
- Contracts for services needed immediately to prevent or to respond to a disaster or eminent threat to public health or safety declared by the Mayor
- Contracts or other agreements that provide trainees with additional services, including case management and job readiness services, provided that the trainees do not replace employees subject to the Act
- Employees under 22 years of age employed during a school vacation period, or enrolled as full-time students working less than 25 hours per week
- Tenants or retail establishments that occupy property constructed or improved by government assistance
- Employees of nonprofit organizations that employ no more than 50 people and are tax exempt pursuant to Section 501 (c )(3) of the Internal Revenue Code
- Medicaid provider agreements for direct care services if the direct care is not provided through a licensed home care agency, community residence facility, or group home for mentally retarded persons as those terms are defined in section 2 of D.C. Law 5-48 (D.C. Official Code §44-501)*
- Contracts or other agreements between managed care organizations and the Health Care Safety Net Administration or the Medicaid Assistance Administration to provide health services
*Published rulemaking and state plan revisions required before living wage applies.
Monitoring and Enforcement
Question: Who monitors whether a contractor is paying the living wage?
Answer: DOES and DC Office of Contracts and Procurement (OCP) share monitoring responsibilities.
Q: If I learn that a contractor is not paying the living wage, who do I contact?
A: Contact DOES.
Q: What are the enforcement mechanisms?
A: The CO should issue a cure notice to the contractor. Failure to pay the living wage could result in termination of the contract for default. In addition, the employee may bring a complaint against their employer under the Wage-Hour law.
Waiver
Mayor Anthony A. Williams may exempt a contractor or subcontractor from the requirements of the Act, subject to approval of the Council.
Recipients must demonstrate that the provisions of the Act will pose a significant financial hardship on them.
Frequently Asked Questions
Q: Does the Act apply to small purchases?
A: The Act applies to all contracts for services for $100,000 or more unless specifically exempted.
Q: If the contract amount for the base period is less than $100,000, but the amount of the option period is $100,000 or more, is the contractor subject to living wage clause?
A: Yes, the contractor will be subject to the living wage during the option period.
Q: What do I do if the living wage changes before I exercise an option?
A: The contract specialist does not need to modify the contract each time the rate changes. Once the contract is modified to add the living wage rate provision, the contractor must pay the current living wage rate. The living wage rate may change from year to year starting in 2008.
Q: Where can I find the living wage?
A: You can visit the DOES website and the OCP website at www.ocp.gov
Q: When is the Act effective?
A: The Act became effective on June 8, 2006 for all new contracts for services and option periods going forward. It will not be applied to existing contracts until an option is exercised. Current solicitations for services should be amended to include the new provision.
Q: Will equitable adjustments to existing contracts be necessary for option periods if the Act applies?
A: Yes, if justified.
Q: Does the Act apply to procurements from federal schedules?
A: No.
Q: Does the Act apply to DC Supply Schedule agreements?
A: Yes, for contracts for services.
Q: Will the Act be incorporated in the master contracts?
A: Yes, when options are exercised.
Q: Does the Act apply to Council of Government agreements
A: Yes, to the extent practicable
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