CHAPTER 12Q: HEALTH CARE ACCOUNTABILITY
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Sec. 12Q.1. Title.
Sec. 12Q.2. Definitions.
Sec. 12Q.2.1. Agency.
Sec. 12Q.2.2. Agency Director.
Sec. 12Q.2.3. City.
Sec. 12Q.2.4. Contract.
Sec. 12Q.2.5. Contract Amendment.
Sec. 12Q.2.6. Contracting Department.
Sec. 12Q.2.7. Contracting Parties.
Sec. 12Q.2.8. Contractor.
Sec. 12Q.2.9. Covered Employee.
Sec. 12Q.2.10. Effective Date.
Sec. 12Q.2.11. Employee.
Sec. 12Q.2.12. Health Director.
Sec. 12Q.2.13. Lease.
Sec. 12Q.2.14. Lease Amendment.
Sec. 12Q.2.15. Nonprofit Corporation.
Sec. 12Q.2.16. Week.
Sec. 12Q.2.17. Subcontract.
Sec. 12Q.2.18. Subcontractor.
Sec. 12Q.2.19. Sublease.
Sec. 12Q.2.20. Subtenant.
Sec. 12Q.2.21. Tenant.
Sec. 12Q.3. Health Care Accountability Components.
Sec. 12Q.4. Contractual Obligations.
Sec. 12Q.5. Administration and Enforcement.
Sec. 12Q.5.1. Additional Contract Requirements; Liquidated Damages.
Sec. 12Q.5.2. Investigation and Determination of Violations.
Sec. 12Q.6. Waivers by the Agency Director.
Sec. 12Q.7. Special Waiver by the Public Utilities Commission.
Sec. 12Q.8. Waiver Through Collective Bargaining.
Sec. 12Q.9. Preemption.
Sec. 12Q.10. Effective Date.
Sec. 12Q.11. Period of Suspension.
Sec. 12Q.12. Severability.
*SEC. 12Q.1. TITLE.*
This Chapter shall be known as the "San Francisco Health Care
Accountability Ordinance."
(Added by Ord. 116-01, File No. 010848, App. 5/31/2001)
*SEC. 12Q.2. DEFINITIONS.*
As used in this Chapter, the following capitalized terms shall have
the meanings set forth in the following provisions.
(Added by Ord. 116-01, File No. 010848, App. 5/31/2001)
*SEC. 12Q.2.1. AGENCY.*
"Agency" shall mean the Office of Labor Standards Enforcement.
(Added by Ord. 116-01, File No. 010848, App. 5/31/2001; Ord. 49-06,
File No. 051908, App. 3/24/2006)
*SEC. 12Q.2.2. AGENCY DIRECTOR.*
"Agency Director" shall mean the Director of the Office of Labor
Standards Enforcement or his or her designee.
(Added by Ord. 116-01, File No. 010848, App. 5/31/2001; Ord. 49-06,
File No. 051908, App. 3/24/2006)
*SEC. 12Q.2.3. CITY.*
"City" shall mean the City and County of San Francisco.
(Added by Ord. 116-01, File No. 010848, App. 5/31/2001)
*SEC. 12Q.2.4. CONTRACT.*
(a) "Contract" shall mean an agreement between a Contracting
Department and any person or entity that provides for public works
or public improvements to be purchased, or for services to be
performed, at the expense of the City. The term "Contract" also
means an agreement between a Tenant or Subtenant and any person or
entity to perform services on property covered by a Lease. The term
"Contract" includes "Contract Amendment."
(b) Notwithstanding the foregoing, the term "Contract" does not
include the following:
(1) Agreements for a duration of less than one (1) year. Contracting
Departments and Tenants and Subtenants are prohibited from entering
into multiple contracts of short duration with the proposed
Contractor in order to evade the requirements of this Chapter;
(2) Agreements for the purchase or lease of goods, or for
guarantees, warranties, shipping, delivery, installation or
maintenance of such goods. Where an agreement is for the purchase or
lease of both goods and other services, the agreement shall not be
deemed a "Contract" if a preponderance of the contract amount is for
goods;
(3) Agreements entered into pursuant to settlement of legal
proceedings;
(4) Agreements for urgent or specialized advice, consultation or
litigation services for the City Attorney's Office where the City
Attorney finds that it would be in the best interests of the City
not to include the requirements of this Chapter;
(5) Agreements with any person or entity if the amount of the
agreement is less than $25,000 (in the case of a for-profit entity
or person) or less than $50,000 (in the case of a Nonprofit
Corporation). However, if the Contracting Party has multiple
agreements with the City in a given fiscal year (which agreements
would be considered "Contracts" under this Chapter except that the
individual dollar amounts are below the thresholds set forth in the
preceding sentence) and the cumulative amount of such agreements is
$75,000 or more, the provisions of this Chapter shall apply to each
such agreement from the date on which the triggering Contract is
executed;
(6) Agreements for the investment, management or use of trust assets
where compliance would violate the fiduciary duties of the trustee;
(7) Agreements executed prior to the Effective Date (unless and
until a Contract Amendment is executed);
(8) Agreements executed after the Effective Date (unless and until a
Contract Amendment is entered into) pursuant to, and within the
scope of, bid packages or requests for proposals advertised and made
available to the public prior to the Effective Date, unless the bid
packages or requests for proposals are materially amended on or
after the Effective Date;
(9) Agreements involving the expenditure by the City of special
funds or other non-General Fund revenues to the extent that
application of this Chapter would require the City to use General
Fund monies to supplement the special funds or other non-General
Fund revenues to maintain the current level of services;
(10) Agreements that require the expenditure of grant funds awarded
to the City by another entity. If a Contract is funded both by grant
funds and non-grant funds, the entire Contract is exempt; provided
that, if the use of the grant funds is severable from the non-grant
funds, the Contract is exempt only with respect to the use of the
grant funds;
(11) Agreements pursuant to which the City awards a grant to a
Nonprofit Corporation;
(12) Agreements with a public entity, unless the public entity is
the San Francisco Redevelopment Agency, the San Francisco LAFCO, the
San Francisco Transportation Authority, the San Francisco Parking
Authority or the San Francisco Health Authority;
(13) Agreements for employee benefits to be provided to City
employees, where the Director of Human Resources finds that no
person or entity is willing to comply with this Chapter and is
capable of providing the required employee benefits;
(14) Agreements for the investment, management or use of City monies
where the Treasurer finds that requiring compliance with this
Chapter will violate the Treasurer's fiduciary duties and for the
investment of retirement, health or other funds held in trust
pursuant to Charter, statute, ordinance or MOU where the official or
officials responsible for investing or managing such funds find that
requiring compliance with this Chapter will violate their fiduciary
duties;
(15) Loan agreements and agreements made in connection with loans or
grants under which the City, as creditor or grantor, is providing
funds to be used by the debtor or grantee to
(A) Acquire an interest in real property on which residential
improvements for low- or moderate-income households will be
constructed;
(B) Construct improvements owned or leased by the debtor or grantee,
on condition that residents of the improvements qualify as low- or
moderate-income households; or
(C) Rehabilitate improvements owned or leased by the debtor or
grantee; and
(16) Agreements between a Tenant or Subtenant and a Contractor to
perform services on property covered by a Lease if the Contractor
does not provide such services on a regular and on-going basis. For
purposes of this exemption, if employees of the Contractor I and any
Subcontractors cumulatively work on the Lease property less than 130
days within a 12-month period, the agreement shall not be considered
regular and on-going.
(Added by Ord. 116-01, File No. 010848, App. 5/31/2001)
*SEC. 12Q.2.5. CONTRACT AMENDMENT.*
(a) "Contract Amendment" shall mean a modification to an agreement
which extends the term, increases the total amount of payments due
from the City (except where such increase is due solely to cost of
living adjustments), or modifies the scope of services to be
performed by the Contractor; provided that the resulting agreement
falls within the definition of "Contract."
(b) Notwithstanding the foregoing, "Contract Amendment" does not
include a onetime extension of the term of a Contract for up to 6
months, or a construction change order, modification or amendment to
a Contract executed by the City for its benefit (as determined by
the Agency Director).
(Added by Ord. 116-01, File No. 010848, App. 5/31/2001)
*SEC. 12Q.2.6. CONTRACTING DEPARTMENT.*
"Contracting Department" shall mean the City department, office,
board, commission or other City agency that enters into the
applicable Contract or Lease on behalf of the City.
(Added by Ord. 116-01, File No. 010848, App. 5/31/2001)
*SEC. 12Q.2.7. CONTRACTING PARTIES.*
"Contracting Parties" shall mean Contractors, Subcontractors,
Tenants, and Subtenants.
(Added by Ord. 116-01, File No. 010848, App. 5/31/2001)
*SEC. 12Q.2.8. CONTRACTOR.*
"Contractor" shall mean the person or entity that enters into a
Contract with the City. The term "Contractor" also means any person
or entity that enters into a Contract with a Tenant or Subtenant to
perform services on property covered by a Lease.
(Added by Ord. 116-01, File No. 010848, App. 5/31/2001)
*SEC. 12Q.2.9. COVERED EMPLOYEE.*
(a) "Covered Employee" shall mean:
(1) An Employee of a Contractor or Subcontractor who works on a City
Contract or Subcontract for 20 hours or more per Week:
(A) Within the geographic boundaries of the City; or
(B) On real property owned or controlled by the City, but outside
the geographic boundaries of the City; or
(C) Elsewhere in the United States; and
(2) An Employee of a Tenant or Subtenant who works 20 hours or more
per Week on property that is covered by a Lease or Sublease; and
(3) An Employee of a Contractor or Subcontractor that has a Contract
or Subcontract to perform services on property covered by a Lease or
Sublease if the Employee works 20 hours or more per Week on the
property.
(4) A Contractor or Subcontractor may not divide an employee's time
between working on a City contract and working on other duties with
the intent of reducing the number of Covered Employees working on
the Contract to evade compliance with this Chapter. Such action
shall constitute a violation of this Chapter. Beginning on July 1,
2002, the number of hours an employee must work per Week in order to
be considered a "Covered Employee" pursuant to this Subsection
(a)(1), (2) and (3) shall be 15 or more.
(b) Notwithstanding the foregoing, the term "Covered Employee" does
not include the following:
(1) Any Employee (A) under the age of eighteen (18) who is a
student, provided that the Employee does not replace, displace or
lower the wage or benefits of any existing position or Employee, or
(B) who is (i) a temporary Employee hired for a time-limited period,
and (ii) for that period is receiving academic credit or completing
mandatory hours for professional licensure or certification, and
(iii) the Employee does not replace, displace or lower the wage or
benefits of an existing position or Employee; or
(2) Any Employee employed as a trainee in a bona fide training
program consistent with Federal law, which training program enables
the Employee to advance into a permanent position, provided that the
Employee does not replace, displace or lower the wage or benefits of
any existing position or Employee; or
(3) Any Employee that the Contracting Party is required to pay no
less than the "prevailing rate of wage" in accordance with Section
A7.204 of Appendix A to the City's Charter or any provision of the
San Francisco Administrative Code; or
(4) Any disabled Employee who:
(A) Is covered by a current sub-minimum wage certificate issued to
the employer by the U.S. Department of Labor; or
(B) Would be covered by such a certificate but for the fact that the
employer is paying a wage equal to or higher than the minimum wage.
(5) Any Employee of a Nonprofit Corporation who is a temporary
employee, hired on an hourly or per diem basis to replace a regular
employee during a temporary absence from the workplace.
(Added by Ord. 116-01, File No. 010848, App. 5/31/2001; Ord. 49-06,
File No. 051908, App. 3/24/2006)
*SEC. 12Q.2.10. EFFECTIVE DATE.*
"Effective Date" shall mean the applicable effective date specified
in Section 12Q.9 of this Chapter.
(Added by Ord. 116-01, File No. 010848, App. 5/31/2001)
*SEC. 12Q.2.11. EMPLOYEE.*
"Employee" shall mean any person who is employed by a Contracting
Party, including part-time and temporary employees.
(Added by Ord. 116-01, File No. 010848, App. 5/31/2001)
*SEC. 12Q.2.12. HEALTH DIRECTOR.*
"Health Director" shall mean the Director of the Department of
Public Health.
(Added by Ord. 116-01, File No. 010848, App. 5/31/2001)
*SEC. 12Q.2.13. LEASE.*
(a) "Lease" shall mean a written agreement (including, without
limitation, any lease, concession or license) in which the City
gives to another party the exclusive use of City Property for a term
exceeding twenty-nine (29) consecutive days in any calendar year,
whether by single or cumulative instruments. "City Property" means
real property that is owned by the City or of which the City has
exclusive use, if such property is located within the City or is
under the jurisdiction of the San Francisco Airport Commission. If
cumulative instruments cause the term of the agreement to exceed
twenty-nine (29) consecutive days, the agreement in question shall
be subject to this Chapter only on and after the effective date of
the instrument which causes the term to exceed twenty-nine (29)
consecutive days. For the purposes of this definition and the
definition of Sublease, "exclusive use" means the right to use or
occupy real property to the exclusion of others, subject to the
rights reserved by the party granting such exclusive use. "Lease"
includes "Lease Amendment."
(b) Notwithstanding the foregoing, the term "Lease" does not include
the following:
(1) Agreements granting a franchise or easement;
(2) Agreements with a public entity, unless the public entity is the
San Francisco Redevelopment Agency, the San Francisco LAFCO, the San
Francisco Transportation Authority, the San Francisco Parking
Authority or the San Francisco Health Authority;
(3) Agreements entered into pursuant to settlement of legal
proceedings;
(4) Revocable at-will use or encroachment permits for the use of or
encroachment on City Property, regardless of the ultimate duration
of such permits;
(5) Street excavation, street construction or street use permits or
other regulatory permits;
(6) Agreements for the use of a City right-of-way, including
circumstances where a contracting utility has the power of eminent
domain;
(7) Agreements governing the use of City Property under the
jurisdiction of the Recreation and Park Department primarily for
recreational activities.
(Added by Ord. 116-01, File No. 010848, App. 5/31/2001)
*SEC. 12Q.2.14. LEASE AMENDMENT.*
(a) "Lease Amendment" shall mean a modification to a Lease that
extends the term or materially changes any other provision of the
Lease.
(b) Notwithstanding the foregoing, "Lease Amendment" does not
include a one-time extension of the term of a Lease for up to 6
months, or relocation of the leased premises at the request of the
City for its benefit or convenience (as determined by the Agency
Director).
(Added by Ord. 116-01, File No. 010848, App. 5/31/2001)
*SEC. 12Q.2.15. NONPROFIT CORPORATION.*
"Nonprofit Corporation" shall mean a nonprofit corporation, duly
organized, validly existing and in good standing under the laws of
the jurisdiction of its incorporation and (if a foreign corporation)
in good standing under the laws of the State of California, which
corporation has established and maintains valid nonprofit status
under Section 501(c)(3) of the United States Internal Revenue Code
of 1986, as amended, and all rules and regulations promulgated under
such Section.
(Added by Ord. 116-01, File No. 010848, App. 5/31/2001)
*SEC. 12Q.2.16. WEEK.*
"Week" shall mean a consecutive seven-day period. If the Contracting
Party's regular pay period is other than a seven-day period, the
number of hours worked by an employee during a seven-day Week for
purposes of this Chapter; shall be calculated by adjusting the
number of hours actually worked during the Contracting Party's
regular pay period to determine the average over a seven-day Week.
However, such period of averaging shall not exceed a duration of one
month.
(Added by Ord. 116-01, File No. 010848, App. 5/31/2001)
*SEC. 12Q.2.17. SUBCONTRACT.*
(a) "Subcontract" shall mean an agreement between a Contractor and a
person or entity pursuant to which the person or entity agrees to
perform all or a portion of the services covered by a Contract.
(b) Notwithstanding the foregoing, the term "Subcontract" does not
include:
(1) Agreements for the purchase or lease of goods, or for
guarantees, warranties, shipping, delivery, installation or
maintenance of such goods. When an agreement is for the purchase or
lease of both goods and other services, the agreement shall not be
deemed a "Subcontract" if a preponderance of the Contract amount is
for goods;
(2) Agreements with a public entity, unless the public entity is the
San Francisco Redevelopment Agency, the San Francisco LAFCO, the San
Francisco Transportation Authority, the San Francisco Parking
Authority or the San Francisco Health Authority.
(Added by Ord. 116-01, File No. 010848, App. 5/31/2001)
*SEC. 12Q.2.18. SUBCONTRACTOR.*
"Subcontractor" shall mean a person or entity that enters into a
Subcontract.
(Added by Ord. 116-01, File No. 010848, App. 5/31/2001)
*SEC. 12Q.2.19. SUBLEASE.*
(a) "Sublease" shall mean any agreement with any person or entity
for the exclusive right to occupy or use all or any portion of City
Property covered by a Lease.
(b) Notwithstanding the foregoing, the term "Sublease" does not
include each of the circumstances set forth in Section 12Q.2.13(b)
that constitutes an exclusion from the definition of "Lease."
(Added by Ord. 116-01, File No. 010848, App. 5/31/2001)
*SEC. 12Q.2.20. SUBTENANT.*
"Subtenant" shall mean a person or entity that enters into a Sublease.
(Added by Ord. 116-01, File No. 010848, App. 5/31/2001)
*SEC. 12Q.2.21. TENANT.*
"Tenant" shall mean the person or entity that enters into a Lease
with the City.
(Added by Ord. 116-01, File No. 010848, App. 5/31/2001)
*SEC. 12Q.3. COMPONENTS.*
(a) With respect to each Covered Employee who either resides in San
Francisco (regardless of where the Covered Employee provides
services) or provides services covered by this Chapter in San
Francisco, each Contracting Party shall do one of the following, at
the Contracting Party's option:
(1) Offer to the Covered Employee health plan benefits that meet
minimum standards prepared by the Health Director and approved by
the Health Commission. The minimum standards shall provide for a
maximum period for each Covered Employee's health benefits to become
effective, no later than the first of the month that begins after 30
days from the start of employment on a covered Contract,
Subcontract, Lease or Sublease. The Health Commission shall review
such standards at least once every two years to ensure that the
standards stay current with State and Federal regulations and
existing health benefits practices; or
(2) For each Week in which the Covered Employee works the applicable
minimum number of hours set forth in Section 12Q.2.9(a) (definition
of "Covered Employee"), pay to the City $2.00 per hour for each hour
the Covered Employee is employed by the Contracting Party on the
Contract or Subcontract or on property covered by a Lease, but not
to exceed $80 in any Week. The City shall appropriate money received
pursuant to this Subsection (a)(2) for the use of the Department of
Public Health. The Department of Public Health shall use the monies
appropriated for staffing and other resources to provide medical
care for the uninsured. The Health Commission may increase this
hourly rate and Weekly maximum in accordance with either the Bureau
of Labor Statistics Consumer Price Index for Medical Care in the San
Francisco Bay Area or the increase in average Health Maintenance
Organization (HMO) premiums in California, depending on which the
Health Commission determines better reflects the cost of providing
health care in the Bay Area; provided, however, the Health
Commission shall take this action no more than once a year and any
adjustments in such hourly rate or Weekly maximum must be approved
by the Board of Supervisors by resolution; or
(3) Participate in a health benefits program developed by the Health
Director in consultation with the Agency. The Health Director shall
obtain Health Commission approval of the program before implementing
it. The Health Director shall seek such approval within twelve (12)
months after this Chapter is finally approved. Prior to
implementation of the health benefits program provided in this
Subsection (a)(3), each Contracting Party shall comply with
Subsection (a)(1) or (a)(2). After the Health Director implements
the program, in addition to the options provided in Subsections
(a)(1) and (a)(2), Contracting Parties may satisfy their obligations
under this Chapter by complying with the requirements of the health
benefits program. In developing the program, the Health Director
shall (i) attempt to make health coverage available for uninsured
Covered Employees and, if feasible, any other person employed by a
Contracting Party who works less than 20 hours per week on a City
contract, or other uninsured City residents; (ii) use public health
facilities to the maximum extent practicable; (iii) make the program
economically viable; and (iv) provide a mechanism for funding which
relies, as much as possible, on contributions by participating
employers and employees.
(b) With respect to each Covered Employee who does not reside in San
Francisco, but who provides services covered by this Chapter at the
San Francisco Airport or at the San Bruno Jail, each Contracting
Party shall do one of the options set forth in Subsection (a), at
the Contracting Party's option.
(c) With respect to each Covered Employee who does not reside in San
Francisco, and does not provide services covered by this Chapter in
San Francisco, at the San Francisco Airport or at the San Bruno
Jail, each Contracting Party shall do one of the following, at the
Contracting Party's option:
(1) Offer to the Covered Employee health plan benefits that meet
minimum standards prepared by the Health Director and approved by
the Health Commission pursuant to Subsection 12Q.3(a)(1) above; or
(2) For each Week in which the Covered Employee works the applicable
minimum number of hours set forth in Section 12Q.2.9(a) (definition
of "Covered Employee"), pay to the Covered Employee an additional
$2.00 per hour for each hour the Covered Employee is employed by the
Contracting Party on the Contract or Subcontract or on property
covered by a Lease, but not to exceed $80 in any Week, to enable the
employee to obtain health insurance coverage. This represents the
City's current estimate of the average cost of obtaining individual
health insurance benefits. The Health Commission may increase this
hourly rate and Weekly maximum in accordance with either the Bureau
of Labor Statistics Consumer Price Index for Medical Care in the San
Francisco Bay Area or the increase in average Health Maintenance
Organization (HMO) premiums in California, depending on which the
Health Commission determines better reflects the cost of providing
health care in the Bay Area; provided, however, the Health
Commission shall take this action no more than once a year and any
adjustments in such hourly rate or Weekly maximum must be approved
by the Board of Supervisors by resolution.
(d) When preparing proposed budgets and requests for supplemental
appropriations for contract services, City departments that
regularly enter into agreements for the provision of services by
nonprofit corporations shall transmit with their proposal a written
confirmation that the department has considered in its calculation
the costs that the nonprofit corporations calculate that they will
incur in complying with the Health Care Accountability Ordinance.
(e) Notwithstanding the above, if, at the time a Contract,
Subcontract, Lease or Sublease is executed, the Contracting Party
has 20 or fewer employees (or, in the case of a Nonprofit
Corporation, 50 or fewer employees), including any employees the
Contracting Party plans to hire to implement the Contract,
Subcontract, Lease or Sublease, the Contracting Party shall not be
obligated to provide the Health Care Accountability Components set
forth in this Section 12Q.3 to its Covered Employees. In determining
the number of employees had by a Contracting Party, all employees of
all entities that own or control the Contracting Party and that the
Contracting Party owns or controls, shall be included.
(Added by Ord. 116-01, File No. 010848, App. 5/31/2001; Ord. 49-06,
File No. 051908, App. 3/24/2006)
*SEC. 12Q.4. CONTRACTUAL OBLIGATIONS.*
(a) Each Contracting Party that enters into a Contract, Subcontract,
Lease, or Sublease shall agree:
(1) To comply with the requirements of this Chapter, including the
requirement to choose and perform one of the Health Care
Accountability Components set forth in Section 120.3;
(2) To comply with regulations adopted by the Agency pursuant to
this Chapter;
(3) To maintain employee and payroll records in compliance with the
California Labor Code and Industrial Welfare Commission orders,
including the number of hours each employee has worked on the City
Contract or Subcontract. If the Contracting Party fails to maintain
records that accurately reflect the number of hours each employee
has worked on the City Contract or Subcontract, it shall be presumed
that any employee who has worked on a City Contract or Subcontract
is a Covered Employee as defined in Section 12Q.2.9.
(4) To provide information and reports to the City in accordance
with any reporting standards promulgated by the Agency in
consultation with the Director of Health;
(5) To provide the City with access to pertinent payroll records
relating to the number of employees employed and terms of medical
coverage after receiving a written request to do so and being
provided at least ten (10) business days to respond;
(6) To allow the City to inspect Contracting Parties' job sites and
have access to Contracting Parties' employees in order to monitor
and determine compliance with this Chapter;
(7) To cooperate with the Agency when it conducts audits;
(8) To include in every Contract, Subcontract, Lease, or Sublease
subject to this Chapter provisions requiring compliance with this
Chapter, consistent with any directives or standards adopted by the
Agency;
(9) To notify the Contracting Department promptly of any
Subcontractors performing services covered by this Chapter and
certify to the Contracting Department that it has notified the
Subcontractors of their obligations under this Chapter; and
(10) To represent and warrant that it is not an entity that was set
up, or is being used, for the purpose of evading the intent of this
Chapter.
(b) A Contracting Party shall not discharge, reduce in compensation,
or otherwise discriminate against any Employee for notifying the
City regarding the Contracting Party's noncompliance or anticipated
noncompliance with this Chapter, for opposing any practice
proscribed by this Chapter, for participating in proceedings related
to this Chapter, or for seeking to assert or enforce any rights
under this Chapter by any lawful means.
(Added by Ord. 116-01, File No. 010848, App. 5/31/2001; Ord. 49-06,
File No. 051908, App. 3/24/2006)
*SEC. 12Q.5. ADMINISTRATION AND ENFORCEMENT.*
(a) The Agency, in consultation with the Department of Public
Health, shall promulgate regulations for the interpretation and
administration of this Chapter, which regulations shall be adopted
only after public hearing. The regulations shall establish
procedures for monitoring Contractors, receiving and investigating
complaints, and providing administrative hearings to determine
whether a Contractor has breached a Contract, Subcontract, Lease or
Sublease based on the requirements of this Chapter.
(b) The Agency shall monitor Contracting Parties for compliance and
investigate complaints of violations. The Agency, in consultation
with the City Attorney, shall develop contractual provisions for use
by Contracting Departments designed to enable the City to pursue the
remedies set forth in this Section against every person or entity
required to comply with this Chapter.
(c) The Agency, in consultation with the Department of Public
Health, may conduct audits of Contracting Parties, although such
audits shall be conducted through an examination of records at a
mutually agreed upon time and location within ten (10) days of
written notice.
(d) The Agency and the Department of Public Health shall provide an
annual joint report to the Board of Supervisors on compliance with
this Chapter. Such report shall include cumulative information
regarding the number of waivers granted pursuant to this Chapter.
(e) A Covered Employee may report to the Agency in writing any
alleged violation of this Chapter by a Contracting Party or other
person or entity subject to this Chapter. The Agency shall
investigate any such report. If the Agency determines that any
person or entity has violated this Chapter, the Agency shall notify
the Contracting Department of its, findings. In order to ensure
compliance with this Chapter and to enhance the monitoring
activities of the Agency, the City encourages reporting by Covered
Employees pursuant to this Subsection. The Agency shall keep
confidential the Covered Employee's name and other identifying
information, to the maximum extent permitted by applicable law.
(f) In addition to any other rights or remedies available to the
City under the terms of any agreement of a Contracting Party or
under applicable law, the City shall have the following rights:
(1) The right, at the discretion of the Agency, to charge the
Contracting Party for any amounts that the Contracting Party should
have paid to the City for hours worked by Covered Employees pursuant
to Section 12Q.3(a)(2) and (b), or to Covered Employees pursuant to
Section 12Q.3(c)(2), together with simple annual interest of 10% on
such amount from the date payment was due;
(2) The right, at the discretion of the Agency, to assess liquidated
damages as provided in Section 12Q.5.1 and 12Q.5.2;
(3) The right, at the discretion of the Agency, to set off all or
any portion of the amount that a Contracting Party is required to
pay to the City pursuant to preceding Subsections (g)(1) and (2)
against amounts due to a Contracting Party;
(4) The right, at the discretion of the Contracting Department, to
terminate the Contract or Lease in whole or in part;
(5) The right, at the discretion of either the Contracting
Department or the Agency, to bar a Contracting Party from entering
into future Contracts or Leases with the City for three (3) years.
(6) The right to bring a civil action against the Contractor to
pursue the remedies provided by this Chapter and other applicable
law. The prevailing party shall be entitled to all costs and
expenses, including reasonable attorney's fees.
(g) Each Contractor shall be responsible for its Subcontractors with
respect to compliance with this Chapter. If a Subcontractor fails to
comply, the City may pursue the remedies set forth in this Section
against the Contractor based on the Subcontractor's failure to
comply, provided that the Contracting Department has first provided
the Contractor with notice and an opportunity to obtain a cure of
the violation.
(h) Each Tenant shall be responsible for each Subtenant, Contractor
and Subcontractor performing services on property covered by the
Tenant's Lease, with respect to compliance with this Chapter. If any
Subtenant, Contractor or Subcontractor fails to comply, the City may
pursue the remedies set forth in this Section against the Tenant
based on the Subtenant's, Contractor's or Subcontractor's failure to
comply, provided that the Contracting Department has first provided
the Tenant with notice and an opportunity to obtain a cure of the
violation.
(i) Each of the rights set forth in this Section 12Q.5 shall be
exercisable individually or in combination with any other rights or
remedies available to the City. Any amounts realized by the City
pursuant to this Section shall be used first to cover the costs of
enforcing this Chapter and thereafter appropriated for the use of
the Department of Public Health.
(j) The Agency may compromise and settle unlitigated claims against
Contracting Parties for violations of contractual provisions
required by this Chapter.
(k) All Contracting Parties and Contracting Departments shall
cooperate fully with the Agency in connection with any investigation
of an alleged violation of this Chapter or with any inspection
conducted by the Agency.
(l) When this Chapter authorizes the Agency to charge interest (not
to exceed 10%), in determining whether to charge the interest, the
Agency shall give due consideration to the size of the Contractor's
business, the Contractor's good faith, the gravity of the violation,
and the history of previous violations.
(Added by Ord. 116-01, File No. 010848, App. 5/31/2001; Ord. 49-06,
File No. 051908, App. 3/24/2006)
*SEC. 12Q.5.1. ADDITIONAL CONTRACT REQUIREMENTS; LIQUIDATED DAMAGES.*
Every Contract, Contract Amendment, Lease and Lease Amendment
entered after January 1, 2006 shall contain provisions in which the
Contracting Party agrees:
(1) To be liable to the City for liquidated damages as provided in
this Section;
(2) To be subject to the procedures governing enforcement of a
breach of the terms of a Contract, Contract Amendment, Lease or
Lease Amendment which terms are required by this Chapter, as set
forth in Section 12Q.5.2;
(3) That the commitment of Contracting Parties to comply with the
requirements of this Chapter is a material element of the City's
consideration for the agreement and that the failure of a
Contracting Party to comply will cause significant and substantial
harm to the City and the public, which is extremely difficult to
determine or quantify, and that the liquidated damages set forth in
this Section are reasonable amounts to pay for the harm caused by
the Contracting Party's non-compliance;
(4) That for failure to comply with the requirements of this
Chapter, the Agency may require the Contracting Party to pay the
City liquidated damages of up to one hundred dollars ($100) for each
one-week pay period for each employee for whom the Contracting Party
has either not offered health plan benefits or made payments as
required by Section 12Q.3. The Agency shall adjust this amount
proportionately for Contracting Parties that use a pay period other
than one week;
(5) That for any failure to provide reports to the City or access to
pertinent records, or any failure to cooperate with any audit,
inspection or investigation conducted by the Agency, the Agency may
require the Contracting Party to pay the City liquidated damages of
up to one thousand dollars ($1000); and
(6) That while liquidated damages in the maximum amounts set forth
in this Section are a reasonable estimate of the harm caused by the
Contracting Party's non-compliance with contractual provisions
required by this Chapter, the Agency may determine that less than
the full amount is warranted depending on the circumstances of each
case. The Agency shall give due consideration to the following
factors in determining the amount of liquidated damages: the size of
the Contracting Party's business, the Contracting Party's good
faith, the gravity of the violation, the history of previous
violations, the failure to comply with record-keeping, reporting and
anti-retaliation requirements, and the extent to which the
imposition of liquidated damages would undermine the purpose of this
Chapter by imposing unreasonable financial burdens on the
Contracting Party, thereby restricting its ability to fulfill its
obligations under this Chapter.
(Added by Ord. 49-06, File No. 051908, App. 3/24/2006)
*SEC. 12Q.5.2. INVESTIGATION AND DETERMINATION OF VIOLATIONS.*
(a) Determination of Violation. Upon determining that a Contracting
Party may have violated the terms of a Contract, Contract Amendment,
Lease or Lease Amendment required under this Chapter, the Agency
shall send written notice to the Contracting Party of the possible
violation and of the Contracting Party's right to respond to the
Agency's initial determination by submitting pertinent documents and
other information. The written notice shall also notify the
Contracting Party that the Agency is authorized to direct the
Controller to withhold payment otherwise due to the Contracting
Party pursuant to the provisions of Subsection (d). If after
providing the Contracting Party with a reasonable opportunity to
respond to the allegations the Agency makes a final determination
that a violation has occurred, the Agency shall provide a written
notice of violation to the Contracting Party.
(b) Right to Appeal. The Contracting Party may appeal the Agency's
final determination. The Contracting Party must file an appeal with
the Agency in writing, specifying the basis for contesting the
determination, no later than 15 days after the date of the notice of
determination. Failure to file an appeal in writing with the
Controller within 15 days shall cause the Agency's determination to
be deemed a final administrative decision by the City.
(c) Administrative Hearing.
(1) Within 15 days after the Agency receives an appeal, the
Controller shall appoint a hearing officer and shall notify the
Agency and the Contracting Party.
(2) The hearing officer shall promptly set a date for a hearing. The
hearing shall commence within 45 days of the notification of the
appointment of the hearing officer and conclude within 75 days of
such notification unless all parties agree to an extended period.
(3) The Agency shall have the burden of producing evidence that the
Contracting Party has violated the requirements of this Chapter and
the burden of proving the violation.
(d) Hearing Officer's Decision.
(1) Within 30 days of the conclusion of the hearing, the hearing
officer shall issue a written decision affirming, modifying, or
vacating the Agency's determination. If the hearing officer vacates
the Agency's determination in its entirety, that decision shall also
vacate any assessment of liquidated damages. If the hearing officer
affirms the Agency's determination, the hearing officer shall issue
a decision upholding the Agency's determination, including the
amount of the liquidated damages assessed by the Agency. With
respect to liquidated damages, the hearing officer's jurisdiction to
modify the Agency's assessment is limited and the following
procedures apply. If the hearing officer modifies the Agency's
determination, the hearing officer shall transmit the decision to
the Agency, which shall within five business days modify the
assessment of liquidated damages consistent with the hearing
officer's decision based on the criteria set forth in Section
12.Q.5.1(6) and transmit the modified assessment to the hearing
officer. Upon receiving the modified assessment from the Agency, the
hearing officer shall within three business days issue a final
decision, which shall include the amount of the liquidated damages
assessment as modified by the Agency.
(2) The hearing officer's decision shall consist of findings and a
determination, which shall be final. The Contracting Party may seek
review of the hearing officer's decision only by filing in the San
Francisco Superior Court a petition for a writ of mandate under
California Code of Civil Procedure, section 1094.5, as may be
amended from time to time.
(3) The failure of the Controller or hearing officer to comply with
the time requirements of this Section shall not cause the Controller
or the hearing officer to lose jurisdiction over an appeal from the
Agency's determination filed under this Section.
(4) Upon the hearing officer's decision affirming or modifying the
Agency's determination, the Contracting Party shall take the
corrective action, including the payment of liquidated damages, if
any, within 14 days of receiving the hearing officer's decision.
When a Contracting Party fails to take corrective action within the
time required by the provisions of this Section, the City may
immediately pursue all available remedies against the Contracting
Party.
(e) Withholding of Payments by Controller.
(1) When the Agency sends notice to a Contracting Party of its final
determination that the Contracting Party has violated the
requirements of this Chapter and of the Contracting Party's right of
appeal to the Controller, the Agency may direct the Contracting
Department and the Controller to deduct from the payments otherwise
due to the Contracting Party the amounts that the Agency has
determined the Contracting Party must pay to the City under Section
12Q.3(a)(2) and as liquidated damages. The Controller, in issuing
any warrant for any such payment, shall deduct the amounts specified
by the Agency.
(2) The Controller shall withhold these funds until (A) the hearing
officer issues a decision finding that the Contracting Party does
not owe all or a portion of the amount withheld, in which case the
Controller shall release funds to the Contracting Party consistent
with the hearing officer's decision or (B) the Contracting Party
consents to the use of the funds to pay the City the amounts that
the Agency or hearing officer found due. As to any funds being
withheld for which neither (A) nor (B) applies, the Controller shall
retain the funds until the hearing officer's decision is no longer
subject to judicial review, at which time the Controller shall
distribute amounts owed under Section 12Q.3(a)(2) in the appropriate
account for the use of the Department of Public Health and amounts
due as liquidated damages in the General Fund, provided that this
action is consistent with any final determination of a court of
competent jurisdiction. Notwithstanding the provisions of this
subsection, the Agency may authorize the release of payments
withheld from the Contracting Party under this Section if the Agency
determines that the continued withholding of funds imposes a
substantial risk of endangering public health or safety, interfering
with a service or project that is essential to the City, or having
an unreasonable adverse financial impact on the City.
(Added by Ord. 49-06, File No. 051908, App. 3/24/2006)
*SEC. 12Q.6. WAIVERS BY THE AGENCY DIRECTOR.*
(a) The Agency Director or designee, in consultation with the
Department of Public Health, shall waive the requirements of this
Chapter when the Contracting Department has provided justification
to the Agency Director, and the Agency Director has found that one
of the following circumstances exists:
(1) The needed service, project or property arrangement under the
Contract or Lease is available only from a sole source;
(2) Pursuant to Chapter 6 or 21 of the Administrative Code, the
Contract or Lease is necessary to respond to an emergency that
endangers the public health or safety;
(3) There are no qualified responsive bidders or prospective vendors
or tenants that comply with the requirements of this Chapter and the
agreement is for a service, lease or project that is essential to
the City or the public;
(4) The public interest warrants the granting of a waiver because
application of this Chapter would constitute an adverse impact on
services or an unreasonable adverse financial impact on the City; or
(5) (A) The services to be purchased are available under a bulk
purchasing arrangement with a federal, state or local governmental
entity;
(B) Purchase under such arrangement will substantially reduce the
City's cost of purchasing such services; and
(C) Purchase under such an arrangement is in the best interest of
the City or the public.
(b) Each waiver shall be effective for the duration of the Contract
or Lease. Subsequent waivers may be requested and either granted or
denied.
(Added by Ord. 116-01, File No. 010848, App. 5/31/2001; Ord. 49-06,
File No. 051908, App. 3/24/2006)
*SEC. 12Q.7. SPECIAL WAIVER BY THE PUBLIC UTILITIES COMMISSION.*
The General Manager of the Public Utilities Commission may waive the
requirements of this Chapter where the Contractor or Subcontractor
is providing to or on behalf of the San Francisco Public Utilities
Commission services relating to:
(a) The provision, conveyance or transmission of wholesale or bulk
water, electricity or natural gas; or
(b) Ancillary requirements such as spinning reserve, voltage
control, or loading scheduling, as required for ensuring reliable
services in accordance with good utility practice; provided, however:
(1) The purchase of such services may not practically be
accomplished through the City's standard competitive bidding
procedures; and
(2) The Contractor or Subcontractor is not providing direct, retail
services to end users within the geographic boundaries of the City.
(Added by Ord. 116-01, File No. 010848, App. 5/31/2001)
*SEC. 12Q.8. WAIVER THROUGH COLLECTIVE BARGAINING.*
All or any portion of the applicable requirements of this Chapter
may be waived in a bona fide collective bargaining agreement,
provided that such waiver is explicitly set forth in such agreement
in clear and unambiguous terms.
(Added by Ord. 49-06, File No. 051908, App. 3/24/2006)
*SEC. 12Q.9. PREEMPTION.*
Nothing in this Chapter shall be interpreted or applied so as to
create any power or duty in conflict with any Federal or State law.
(Added by Ord. 116-01, File No. 010848, App. 5/31/2001; Renumbered
by Ord. 49-06, File No. 051908, App. 3/24/2006)
*SEC. 12Q.10. EFFECTIVE DATE.*
This Chapter shall become effective, and its requirements shall be
included in all covered Contracts, Subcontracts, Leases and
Subleases, 30 days after it is adopted or July 1, 2001, whichever
occurs later. This Chapter is intended to have prospective effect only.
(Added by Ord. 116-01, File No. 010848, App. 5/31/2001; Renumbered
by Ord. 49-06, File No. 051908, App. 3/24/2006)
*SEC. 12Q.11. PERIOD OF SUSPENSION.*
Contracting Parties shall not be required to provide any of the
Health Care Accountability Components provided in Section 12Q.3 to
their Covered Employees until such time as the Health Director has
prepared, and the Health Commission has approved, minimum standards
for health plan benefits pursuant to Section 12Q.3(a)(1). The Health
Director and Health Commission shall proceed promptly to take these
actions. From the date upon which the Health Commission approves
such minimum standards forward, Contracting Parties shall provide
the Health Care Accountability Components set forth in Section 12Q.3
to their Covered Employees.
(Added by Ord. 116-01, File No. 010848, App. 5/31/2001; Renumbered
by Ord. 49-06, File No. 051908, App. 3/24/2006)
*SEC. 12Q.12. SEVERABILITY.*
If any part or provision of this Chapter, or the application of this
Chapter to any person, location or circumstance, is enjoined or held
invalid by a court of law, the remainder of this Chapter, including
the application of such part or provisions to other persons,
locations or circumstances, shall not be affected by such action and
shall continue in full force and effect. To this end, the provisions
of this Chapter are severable. Further, to the extent Section
12Q.3(a)(2) may be enjoined or held invalid by a court of law, the
Contracting Party may alternatively comply in accordance with
Section 12Q.3(c)(2).
(Added by Ord. 116-01, File No. 010848, App. 5/31/2001; Renumbered
by Ord. 49-06, File No. 051908, App. 3/24/2006)