Companies doing business with Nassau County can expect to undergo added scrutiny when applying for an exemption to the county law requiring them to pay workers a living wage, under changes announced Wednesday.
According to the new rules signed by Nassau County Executive Laura Curran, the administration will have the right to deny a waiver application to the living wage law for a company that is a subsidiary of a larger, parent organization.
"It was easy for companies to appear smaller than they actually were — to form a subsidiary — and avoid having to pay their workers a living wage," Curran said during an announcement in Mineola. "Closing the loophole today expands the review process to include these related entities so they have to disclose exactly how big the whole company is."
The county's Living Wage Law, enacted in 2007, ensures certain protections for the employees at companies awarded county contracts.
The current living wage is $16.41 an hour without health benefits or $14.27 per hour with health benefits. On July 31, the rate will increase by a percentage equal to the change in the New York Metropolitan Area All Urban Index (NY CPI-U) as set by the Bureau of Labor Statistics of the U.S. Department of Labor (CPI).
Under state law, workers must be paid a minimum wage of $11.10 per hour, rising to $11.80 on Dec. 31. The minimum wage will increase to $15 an hour for Long Island and Westchester County employees at the end of 2021.
In order to be eligible for a waiver to the living wage law, companies need to prove the highest earner at the company is not making more than six times the salary of the lowest paid person in the company or that compliance with the living wage would result in a more than 10 percent increase in the companies overall budget.
The county executive's office grants about 10 waiver requests annually. Administration officials said they were unable to estimate about how many companies try to game the system.
"The majority of contractors have always played by the rules but now we get to make sure that all of our contractors are paying workers delivering critical services to residents fairly," said county Comptroller Jack Schnirman, who said the new rules are the latest in tightening the county contracting process.