A pending Denver City Council vote on a labor-backed “workforce retention” ordinance is getting delayed, the chief council sponsor said today.
Councilman Chris Nevitt said the legislation is now headed back to committee for a fuller discussion. The council was scheduled to consider granting initial approval Monday.
“My view is that so far, the public debate and discussion has added more heat than light,” Nevitt said. “And I want people to be more comfortable as we move forward. The additional time also will allow the mayor to re-engage in a more constructive way than he has recently.”
The proposed ordinance would require winning bidders on city service contracts to keep for at least 90 days the previous employees of the former contract holder.
The legislation has ended up pitting labor leaders against business leaders. Union officials and downtown business leaders have weighed in and lobbied the mayor and council intensely.
The delay followed a recent defection by a former key supporter of the legislation, Councilman Michael Hancock.
Hancock had supported the measure and a week ago voted to move it out of committee to the full council. He said he asked Nevitt to delay a vote on the measure and may want it to be amended before he supports it again.
Hancock said he was reconsidering his earlier stance because he was worried about how unemployment costs would be handled when a contract changes hands. A new firm could end up seeing its unemployment taxes go up because of the legislation, Hancock said. He fears the new firm would end up becoming responsible for the unemployment of any of the previous contract holder’s workers.
“It’s a serious issue, and it really made me step back and look at it,” Hancock said. “It would increase costs.”
Business leaders consider Hancock a potential key vote, partly because Denver International Airport — where many of the contracts at issue are in effect — is in his council district.
Nevitt said a majority of the council still supports the legislation. But Hancock may be needed if Denver Mayor John Hickenlooper vetoes the legislation. If a veto occurs, nine of the 13 council members would be required to override it.
Hickenlooper this week urged Nevitt to sideline the issue, which the mayor characterized as a divisive distraction during a slumping economy.
Officials with the Service Employees International Union are scheduled to meet with the mayor Friday to discuss the issue further.
Supporters contend the proposal will provide protection to the working class and will reduce training and recruitment costs for the firms taking over contracts. Detractors say it will increase costs and bureaucracy and will end up defeating the purpose of competitive bidding.
Nevitt disputed that unemployment costs would rise and said they actually will decrease. Businesses pay taxes to finance the unemployment system, with those taxes increasing based on the number of unemployment claims filed by the firm’s workers. Nevitt said that under current law, many employees could be thrown into the unemployment system if a contract changes hands and their previous employer would be responsible.
Under the proposed ordinance, the new firm may end up inheriting those workers, but Nevitt doubts the new firm would fire them at the end of the 90 days. Nevitt said that because the new firm is likely to keep the workers, it won’t see an increase in unemployment costs.
Christopher N. Osher: 303-954-1747 or cosher@denverpost.com
