NS ORD-1997-013 Living Wage Ordinance

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3 A Report Examining a Living Wage Ordinance for Orange County, North Carolina Background and Report In February 1997, the Orange County Greens requested that the Orange County Commissioners develop a living wage ordinance for the County. The Board of County Commissioners directed the County Manager and the Economic Development Commission to develop a report on the appropriate nature, scope and practical implementation of a living wage ordinance. This report provides a brief history of living wage ordinances. It then discusses options for application of the ordinance and poses seven clarifying questions that the Board of County Commissioners must address. Next, four methods for establishing a specific living wage level are provided. Finally, management, enforcement, and impact are examined. History In 1906 Catholic priest Father John A. Ryan, in his book A Living Wage,first articulated the concept of a"living wage". The current movement began in the early 1990's with Father San Lupico of Baltimore, who began noticing increasing numbers of working poor at his soup kitchen. He and others formed a coalition of church-based organizations called Baltimoreans United in Leadership Development(BUILD). Together with the American Federation of State, County, and Municipal Employees and an organization of low-wage workers called the Solidarity Sponsoring Committee, they began work toward Baltimore's adoption of the nation's first living wage ordinance in 1994. Appendix 1 is a copy of the Baltimore living wage ordinance. Religious organizations, labor unions, and community activists have continued to promote the concept in many other cities and states. In most cases,the local push to enact a living wage ordinance has been prompted by local government downsizing and, more specifically, the growing trend toward privatization. As cities attempt to control costs, many have contracted with private businesses to perform work previously completed by local government employees. Workers in privatized jobs usually receive lower wages and benefits, are temporary employees, and are not unionized. The national trend that has most contributed to the living wage movement is the declining buying power of the Federal Minimum Wage. In 1970, the federally defined poverty level for a family of three was $3100, and the minimum wage worker's annual earnings were $3200. As can be seen in Chart 1, the minimum wage has failed to keep up with inflation. A full-time worker in a family of three, earning minimum wage, now earns well below the Federal poverty level. The current minimum wage is $4.75 per hour. Beginning September 1, 1997,the Federal Minimum Wage will increase an additional 8.4 percent to $5.15 per hour.