Lawmakers said the legislation, sponsored by Sen. Eric Schneiderman, D-Manhattan, closes a loophole in the state’s labor law that requires state agencies to pay the standardized rate for service workers, but currently exempts the public utilities.
Handymen, janitors, groundskeepers, cooks and other workers providing basic services for the utility companies would be subject to prevailing wage, which is an hourly rate set by the state Department of Labor on a county-by-county basis for individual service occupations.
The bill also establishes criminal penalties for those caught underpaying service workers, ranging from a class A misdemeanor for cutting workers up to $25,000 short, to a class E felony for amounts in excess of $500,000.
The measure has yet to pass the state Assembly.
National Grid, a utility company that supplies power across much of the state, launched an ad campaign Tuesday speaking out against the bill, saying it could lead to higher utility bills. “The likelihood is high that our costs would increase,” said William Flynn, vice president of government relations for National Grid. “Typically, if our costs increase, being a regulated utility, our customers’ cost would increase as well, and that’s what we’re concerned with.”
New York State Electric & Gas and Rochester Gas & Electric, which are owned by the same parent company, issued a statement saying the bill “would put upward pressure on energy prices without providing any benefit to consumers.”
Sen. Jeff Klein, D-Bronx, who helped move the bill to the Senate floor, called the utility companies’ argument “utter nonsense.” “I think we have to stop going down the road of anything we do to help workers, especially during tough economic times, is somehow going to be passed on to the consumer,” Klein said.
The bill passed 33-28 in the Senate in a largely partisan vote, with Sen. Frank Padavan, R-Queens, the only Republican voting in favor of the legislation. “Everyone knows that the whole issue of prevailing rate increases tremendously the cost of doing business in New York state,” said Sen. Thomas Libous, R-Binghamton, Broome County. “If you speak with any business, they’ll tell you that you can’t afford to do business anymore. We’re losing jobs, and we can’t afford to lose any more jobs.”
According to the state Labor Department, a building painter in western New York and the Southern Tier would make between $22 and $25 per hour at prevailing wage. Downstate, including Westchester and Rockland counties, the same painters would make between $35 and $39. Officials from the Service Employees International Union praised the passage of the bill, claiming that in some cases workers are making about minimum wage.
The bill will have to be passed by the Assembly and signed by Gov. David Paterson before becoming law.