Attorney General's Opinion
Attorney General, Richard Blumenthal
April 10, 2006
Acting Commissioner of Labor
As you know, Section 31-57f of the Connecticut General Statutes provides for the payment of a standard wage rate to certain service workers employed by contractors of the state or its agents. On
There has been uncertainty as to whether the contractor has a responsibility to absorb the cost of these increases, or alternatively the state agency must pay the contractor the increased costs. Your agency has concluded that the responsibility to pay for the standard wage increases ultimately lies with the state agencies. We agree with your agency's conclusion and are issuing this opinion to clarify the responsibilities and obligations of contractors and the State and its agents in adhering to section 31-57f of the Connecticut General Statutes A specific statute Section 31-57f (hereinafter "the statute")1 applies to employers
Conn. Gen. Stat. §31-571(b) requires employers to pay their nonsupervisory employees an hourly rate that is not less than the standard wage rate established by the Labor Commissioner. Subsection (e) of the statute provides that the Labor Commissioner must determine the standard wage rate for each covered job classification by referring to the federal Service Contract Act of 1965. The standard wage rate shall be equal to the minimum hourly rate for service workers set forth in the federal Register of Wage Determinations under the Service Contract Act plus a thirty percent surcharge to cover the cost of benefits, if none are offered to the employees Conn. Gen. Stat. § 31-57f(e).
Employers must keep detailed records documenting their compliance with the requirements of Conn. Gen. Stat § 31-57f, and the Labor Commissioner and his staff may conduct inspections and hold hearings to investigate complaints of nonpayment of the standard rate of wages. Conn. Gen. Stat § 31-57f(h) and (j). Employers who violate the statute may incur civil penalties.
subsequent opinion letter, dated
The Department of Labor has informed us that it believes that the legislative policy goal of providing fair wages to employees, as set forth in Conn. Gen. Stat. § 31-57f, will not be achieved if employers subject to the provisions of Section 31-57f are required to pay their employees increases in the standard wage, without being reimbursed for such increases by the state agency with which they contract. If such employers are placed at an unfair economic disadvantage because of these state mandated wage increases, the jobs of the employees Section 31-51f seeks to benefit will be endangered, defeating the purpose of the statute. The Department of Labor has determined, therefore, that the increased standard wage rate should be paid by the state agency to the contractors in order to ensure that the workers receive their wages.
The Department of Labor has also informed us that numerous state agencies, including the Department of Public Works, the Department of Transportation, the Connecticut State Universities, and the University of Connecticut Health Center have agreed to pay increases in standard wages and associated costs to their contractors, who, in turn, paid the employees the back wages they were due.
The contracts between the state agencies and the contractors involved in this matter provide further important information about this question. We have reviewed a number of contracts between state contractors and state agencies, including the Department of Public Works, the University of Connecticut Health Center and
In light of these considerations, we agree with the Department's interpretation of Conn. Gen Stat. §31-57f. "[T]he practical construction placed on the statute by the agency, if reasonable is highly persuasive." Ottochian v. Freedom of Information Commission, 221
The legislature itself was concerned that the worker benefits set forth in Section 31-57f not disadvantage employers who provided such benefits, specifically directing that "employers with employees covered by collective bargaining agreements which call for wages and benefits that are reasonably related to the standard rate shall not be economically disadvantaged in the bidding process."
For the foregoing reasons, we conclude and advise you that pursuant to Conn Gen. Stat § 31-57f, any increase in the standard wage rate promulgated by you, based on a formula established by the TT S Department of Labor, along with associated direct costs, such as increased payroll taxes, is the responsibility of the contracting state agency. Further, we recommend that procedures be established and regulations be adopted pursuant to subsection (1) of the statute in order to notify the contracting parties of any increases in the standard wage, and to facilitate compliance with the statute Contract amendments to existing contracts should be executed to formalize this requirement and all new
contracts should require state agencies to reimburse employers for increases in the standard wage, subject to audit by the agency.
Very truly yours,
Assistant Attorney General
1 The Statute provides in relevant part as follows:
(a) As used in this section: (1) "Required employer" means any provider of food, building, property or equipment services or maintenance listed in this subdivision whose rate of reimbursement or compensation is determined by contract or. agreement with the state or any state agent: (A) Building, property or equipment service companies: (B) management companies providing property management services; and (C) companies providing food preparation of service, or both; (2) "state agent" means any state official, state employee or other person authorized to enter into a contract or agreement on behalf of the state; (.3) "person" means one or more individuals, partnerships, associations, corporations, business trusts, legal representatives or organized groups of persons; and (4) "building, property or equipment service" means any janitorial, cleaning, maintenance or related service.
(b) On and after
(i) This section shall not apply to contracts, agreements or grants which do not exceed forty-nine thousand nine hundred ninety-nine dollars per annum.
(l)The Labor Commissioner may adopt regulations, in accordance with chapter 54, [FN1] to carry out the provisions of this section.
(m) The provisions of this section and any regulation adopted pursuant to subsection (1) of this section shall not apply to any contract or agreement entered into before