It evoked mixed reactions from the start: After Mayor Mitch Landrieu unveiled his policy on local hiring requirements for city projects in September, some contractors rushed to decry it, while labor activists largely praised it.
But this past week, when the Landrieu administration unveiled more details about its plans to enforce the ordinance, both groups at a public hearing were perturbed.
The ordinance, which the City Council approved in October, requires businesses in 2016 to funnel 30 percent of all work hours on applicable city contracts to New Orleans residents and 10 percent of such hours to “disadvantaged local workers,” defined as local residents with incomes equal to or less than half of the New Orleans-area median income, plus those who face other employment obstacles.
Those goals will increase by 5 percent each year until 2020, with the ultimate goal of sending at least half of the work hours to locals and 30 percent to disadvantaged locals.
The policy applies to any city contract worth more than $150,000 that’s related to the construction, alteration or demolition of a public building. It also covers any cooperative endeavor agreement between the city and a party receiving tax incentives for economic development projects valued at more than $150,000.
To ensure the administration doesn’t violate federal rules that ban hiring preferences on some federally funded projects, the city will evaluate those projects on a case-by-case basis.
The ordinance was billed as a partial solution to a host of city problems, most notably violent crime. Labor activists and other supporters said it ultimately would help more local workers reach the middle class instead of turning to criminal activity.
But contractors, expressing reservations early on, said it could force them to fire employees who live in other parishes, run afoul of federal law and make it easier for out-of-state businesses to stomp out local competition because the policy applies only to businesses that employ in-state residents.
Also, while the policy requires contractors to make a “good faith effort” to reach the participation goals, critics on the other side said it doesn’t do enough to explain what that means.
The package of rules presented at a Wednesday hearing provides a number of clarifications, including:
What constitutes a “good faith effort”: It says contractors must request and contact workers from the city’s “first-source database,” a list of city-vetted locals and disadvantaged locals available for hire. If those workers are unavailable or unqualified, contractors must advertise job vacancies with local union halls, in publications and at the job site. They also must inform their subcontractors of the local hiring goals and use applicable registered apprenticeship programs.
Ways the city will track progress: Even before a contract is awarded, a contractor must submit a “local-hire plan” that outlines how the program’s goals will be met or attests that the goals already have been met. It also must include the number of workers needed for a project. After the award, a firm must provide evidence of its efforts to find local workers and tell the city which locals ultimately got jobs.
Consequences when goals aren’t met: If a contractor, ahead of the bid award, fails to pledge a “good faith effort,” submit a local hiring plan or tell the city how much manpower is needed, the contractor’s bid may be judged nonresponsive and rejected. After an award, if the chosen contractor fails to use city-recommended workers, that could be deemed to constitute a “material breach” of contract and result in a contract termination. Continued failure to meet local hiring goals “may be considered in future procurement and contract determinations,” the rules state.
How data will be publicized: First-source database information — such as local workers’ names, skills or work history — “may be subject to public record,” meaning available for public review, the rules state. Sharing such data would let the public verify official statistics about the program’s success.
Limits on the city’s authority: The rules provide an assurance that, outside of the stated local hiring goal, the city won’t force a contractor to hire any particular candidate or an unqualified candidate.
The new specifications only further agitated some contractors, who came armed with fresh complaints about having to use union halls and the city’s definition of a “qualified worker.” They also revived their past concern about being forced to fire suburban residents.
On the other hand, some workers, who had been congratulatory of the ordinance, said the rules don’t go far enough and lack teeth. They said the city should ban inquiries about applicants’ criminal records early on in the hiring process and should have stricter consequences for contractors who fail to hire locals.
Landrieu staffers listened to both sides’ concerns. At some point, the administration will release a final version of the rules, officials said, though it’s not clear if they will be subject to a council vote. Typically, the council votes on ordinances, while the administration issues regulations that implement the laws.
Landrieu has pledged to start implementing the program in January.
The mandate for using union hiring halls seemed to most irk Angela Latino-Geier, president of the Associated Builders and Contractors New Orleans/Bayou Chapter, who said it would open up non-unionized businesses to union intervention. “We are not against the unions, but we are for free enterprise,” Latino-Geier said.
She and others also said city-recommended workers might be less skilled than those whom businesses would hire independently.
Though concerns also were voiced about the effects on out-of-parish workers, city officials have insisted the rules won’t force firms to fire current employees.
On the other side of the debate, Stand With Dignity organizer Alfred Marshall argued for tougher consequences. “There’s no clear enforcement for the contractors,” he said. Particularly worrisome for him and others was the use of the word “may” instead of “shall” in the language about repercussions.
His group distributed an alternative proposal calling for more detailed examples of “good faith efforts,” tougher penalties for contractors who don’t make such efforts and a ban on job applications that ask about criminal histories.
Despite criticism from the packed room’s dominant voices, some of those present appeared pleased with the document.
Robert “Tiger” Hammond, of the South East Louisiana Building & Construction Trades Council and the AFL-CIO, said the city was on the right track.
“This is not only a good start, but it’s a step in the right direction, and we can move forward and it will be a document that we can live with,” he said.
Follow Jessica Williams on Twitter, @jwilliamsNOLA.