Enacts the "make a living wage act"

Section 2 amends the labor law by adding a new article 19-d to establish the "Make A Living Wage Recognition Program."

Section 3 sets the effective date

Justification

In March of 2008, Just Economics WNC, a small non-profit in Western North Carolina launched a program to identify and promote local employers that paid a Living Wage. It has succeeded in bringing in hundreds of businesses to be a part of their initiative.

In New York State, the Tompkins County Workers Center has worked with over 100 employers through their own initiative to work with businesses to raise wages. In January of 2015, the Council for Economic Justice announced their own living wage employer program to highlight businesses and non-profits in the City of Buffalo and Western New York that are helping their workers to make a living.

New York State has the opportunity to be the first state in the nation to adopt a living wage employer recognition program.

The Make a Living Wage Recognition Program aims to reward employers who are truly paying wages that help workers to make a living. It will provide employers with tools and incentives to increase wages so that workers can make a living wage. It will connect consumers with employers that are providing wages that allow their employees to make a living.

The program would do this by establishing a living wage standard in every county. Local municipalities would also have the option to adopt higher living wage standard than their respective county. For employers, it is a fantastic way to inform consumers that they are committed to a just and sustainable local economy. Consumers can know that these businesses truly value their employees and in turn reward them with their business.

This program also helps taxpayers by encouraging more businesses to pay their workers a true living wages. When more New Yorkers can make a living, it reduces the need for public assistance.

The Make A Living Wage Employer Recognition Program uses the Universal Living Wage Formula to calculate the living wage standard for every county. It is based on the idea that a person who works full-time (40 hours per week) should be able to afford a one bedroom apartment along with other expenses.

The general consensus amongst economists is that no person should be spending more than 30% to 35% of their gross income on housing. According to the United States Department of Housing and Urban Development(HUD), 30% of a person's gross income is the should be spent on housing. The Universal Living Wage Formula is based on the true local cost of housing using HUD's Fair Market Rents.

This formula is simple, represents local needs, and is easy to calculate for individuals and employers. For the MTA region, the formula uses 35% of a person's gross income for housing given the much higher cost of housing within that area of the state. This formula ties the wage rate to the true cost of housing because affordable housing is a significant concern across New York State.

The Make A Living Wage Recognition Program bases the living wage standard off of a four year average of HUD's Fair Market Rents to account for volatility. A four year average helps stabilize housing market volatility while also being accurate to increases in the cost of living.

This is how the standard would be calculated for a county using Erie County as the example:

Fair Market Rent for One Bedroom Apartment

2016-$618 2015-$617 2014-$570 2013-$591 $2396/4=$599 (4 year average of Fair Market Rent)

$599/30%-Monthly Expenses

$1,996= Monthly Expenses

Monthly Expenses x 12 = Annual Expenses

$1,996 x 12= $23,789 (Annual Expenses)

$23,952 (Annual Expenses)/ 2080 (40 hours a week for 52 weeks a year)= Hourly Living Wage

$11.50 (Rounded to Nearest Nickel)= Hourly Living Wage

The Make A Living Wage Standard in each county can be reduced for an employer if they offer quality health insurance coverage. It can be further reduced if an employer offers other living benefits such as food and/or transportation.

Living Wage Employer Recognition has proven to be an effective and innovative approach that promotes collaboration between workers and employers to address income inequality. New York State should partner with consumers and businesses in this new way to help more New Yorkers truly be able to make a living for themselves and their families.

Prior legislative history

This is a New Bill.

Fiscal implications

None for the State. The application fees for the program would provide the funding.

Effective date

This act shall take effect on the first of January next succeeding the date on which it shall have become a law.