Relates to labor performed under certain public work contracts

Summary of specific provisions

Section 1: Amends subdivision 5 of section 220 of the Labor Law by adding a new paragraph m which defines the term "job order contract" and requires that such contracts be filed with the Department of Labor and expressly state that all work performed under the contract applies to section 220 of the Labor Law.

Section 2: Amends the State Finance Law by adding a new section 148 which specifies requirements and limitations on job order contracts. Certain requirements will be removed if the public owner requires inclusion of a project labor agreement to ensure that proper wages and classifications are utilized under the contract. Clarifies that the regulation of Job Order contracting does not apply to Superstorm Sandy or other State disaster clean up projects.

Section 3: Amends the General Municipal Law by adding a new section 103-h which specifies requirements and limitations on job order contracts. Certain requirements will be removed if the public owner requires inclusion of a project labor agreement to ensure that proper wages and classifications are utilized under the contract. Clarifies that the regulation of Job Order contracting does not apply to Superstorm Sandy or other State disaster clean up projects.

Section 4: Effective date.

Existing law

Currently there is no provision of New York State Law that specifically mentions job order contracting.

Justification

A job order contract ("JOC") is an indefinite quantity contract for the-performance of construction, renovation, alteration and repair tasks. A JOC is generally a multi-year contract that includes a base year with multiple renewal options. A contractor bidding for a JOC does not submit a fixed dollar figure as a contract. Rather, a contractor submits an adjustment factor, known as a "multiplier," which is a percentage above or below prices for tasks that are set forth in a unit price book. For example, a bid of 1.25 indicates that the bidder would perform work at 125% of the price for each task in the unit price book that the bidder performs.. The bidder who submits the lowest "multiplier" is awarded the JOC. The bidders are bidding on a range of tasks that may or may not be performed over the course of the contract.

Because of the indefinite nature of these contracts, many contractors are unable to bid on such a complicated process. Those that do submit bids, do not know the specifics of the work they will perform and, therefore, cannot properly ascertain how much the project will cost them. If the unit bid is too low and they turn out to be underpaid, cost-saving measures could become necessary; corners might be cut on these projects which would negate the very purpose of public work.

It is has been wall founded by New York courts that imprecise bid specifications violate the competitive bidding law because they frustrate bidders' ability to set the lowest possible bid and discourage persons from bidding (Matter of Sagamore Auto Body v County of Nassau, 104 A.D.2d 818, 821, 2nd Dept 1964).

Job order contracting is traditionally appropriate for small construction projects and this legislation would properly regulate the practice as such.

Prior legislative history

S.5149-F of 2012. Passed Senate, Died in Assembly Codes S.5149-B of 2011: Died on Senate Floor Calendar

Fiscal implications

Because this legislation would allow for the continuing procurement of all job order contracting so long as the public owner meets certain standards in the bidding process, the sponsor does not anticipate a fiscal impact beyond increased revenue from violations of the prevailing wage laws that will be easier to ascertain based on the reporting requirements in this bill.

Effective date

This act shall take effect immediately and apply to all job order contracts solicited or renewed on or after such effective date.