Fighting For Focused Hiring
Opportunities When Different Funding
Sources Require Different Tactics
National Association of Workforce Boards 2012 Forum:
Dialogue for Workforce Excellence
Fighting For Focused Hiring
Different types of hiring preferences are allowed when projects are
funded by local, state or federal dollars. A clear understanding of
regulations that govern each funding source is needed to ensure
your unemployed benefit from public projects of all kinds.
• Blake Konczal, Executive Director of the Fresno Regional
Workforce Investment Board
• Kenneth Price, General Counsel for the Fresno Regional
Workforce Investment Board and Partner with Baker, Manock &
Jensen, Fresno, CA
• Paul Bauer, Vice Chair of the Fresno Regional Workforce
Investment Board and Partner with Walter & Wilhelm Law Group,
Fresno, CA
Why Advocate for Focused Hiring?
Transparency and Accessibility
Case Study: Construction of federal prison in Mendota, CA
Mendota, CA to Maricopa County, AZ: 612 miles; 10 hours, 15 minutes
Why Advocate for Focused Hiring?
“Reasonable” Job Set Asides
Case Study: Solar Farm Projects in Fresno County, CA
“Where Reasonable” =
3 Local Hires for 200 Jobs
Why Advocate for Focused Hiring in
Public Infrastructure Projects?
Capitalizing on a hidden industrial sector
• The Central California Workforce Collaborative recently learned that
there are $36.61 in major infrastructure expenditures scheduled for
2010-2020 in Central California alone.
Project Category
Cost (billions)
Transportation (not rail)
Percent
$10.45
28.6%
Rail Transit (including high speed rail)
$6.09
16.6%
Infrastructure (including water and wastewater
$7.53
20.6%
Building/community assets
$3.15
8.6%
Broadband
$0.13
0.4%
Energy
$9.26
25.3%
TOTAL
$36.61
100%
$36,610,000,000.00!
What Types Of Focused Hiring Preferences Can
Local Workforce Investment Boards Utilize?
Follow the Money!
$ Local
$ State
$ Federal
Legal Concerns For Targeted Unemployed Worker
Proposals When Federal Money Is Involved
Constitutional Concerns
• Privileges and Immunities Clause
• Equal Protection
• Dormant Commerce Clause
U.S. Department of Transportation
• Prohibits local geographic preferences
Case Law
Creative Solutions to Legal Challenges
Hiring Preferences – Learning the Lingo
• “Local Hire” Examples
• “Focused/Targeted Hiring” Examples
Privileges & Immunities Clause
• The biggest hurdle for local hire initiatives
• Citizens have a fundamental right to engage in
commerce, i.e. to find work
Privileges and Immunities Clause
The Privileges and Immunities Clause prohibits a state from
"abridg[ing] the privileges and immunities of citizens of the
United States." U.S. Const. amend. XIV, § 1, cl. 2. In other
words, a state may not discriminate against persons based on
their state citizenship.
•
The Current Test:
Whether the “offender” (states, cities, other agencies) (1)
has violated a right that is fundamental to national unity;
and (2) had a substantial reason for doing so.
Toomer v. Witsell (1948)
Questionable Constitutional Challenges
Equal Protection
• Denial to any person the equal protection
under the laws
Dormant Commerce Clause
• States may not impose burdens on
interstate commerce
Federal Regulations
•
Different agencies, different interpretations
•
The “nemesis” of local hire: USDOT
•
Public works projects funded by grants from the U.S. Department of
Transportation must comply with Title 49, Section 18.36 of the Code
of Federal Regulations: “Grantees and sub grantees will conduct
procurements in a manner that prohibits the use of statutorily or
administratively imposed in-State or local geographical preferences
in the evaluation of bids or proposals.”
•
The Federal Transit Administration recently provided guidance to the
San Francisco Municipal Transportation Agency that paragraph (c)(2)
Prohibited SFMTA’s attempt to include local hire provisions in its
contracts for the construction of the Central Subway Project.
Case Law
Permissible:
• Contractor may first contact local employment
office to determine if qualified resident workers
are available. (State v. Antonich)
• Cities may grant preference to local area and
out-of-state workers. (City of Cleveland v. Ohio)
Impermissible:
• Must be a resident of state to engage in trade.
(New Hampshire v. Piper)
•
In state residents pay no or reduced fee for
licenses. (Toomer v. Witsell; Mullaney v. Anderson)
Labor Preferences
Contractor Communications (Labor Demand Intelligence)
Unions Open Apprenticeships Based on Information
Unions send Journeymen & Apprentices to Jobs with
Contractors
Union Members from outside are brought in for
excess demand
Move to Open Union positions to Non-Union Members
Case Study: California High Speed Rail
Initial Question: How do we ensure that our local unemployed are
placed into jobs for one of the largest public infrastructure
projects in the United States?
• At the time our recommendations were conceived, Fresno
County unemployment rate was 16.7%. The national
unemployment rate was 9.3%.
• California High Speed Rail is funded through a mix of
state ($9.95 billion) and federal ($3.5 billion) money.
Creative Solutions
• “Targeted Unemployed Worker” Hiring Criteria
o California and Federal definition: (1) unemployed, and (2)
reside in Targeted Employment Areas, i.e. “an area which, at
the time of investment, is a rural area which has experienced
unemployment of at least 150% of the national average rate.”
 No in-State or Local Geographic Preference
o Percentage of all hours worked by construction apprentices
shall be performed by “Targeted Unemployed Workers.”
Creative Solutions
• “First Source” Transparency Requirements
a. Prime contracts required to notify “Authorized Referral Entities”
of job openings, especially entry-level job openings, and
collaborate on candidate interviews, recruitment, and retention
b. A mandate that prime contractors maintain at least one physical
office for hiring purposes somewhere within the first phase
construction zone
c. Share a roster of all job titles to be hired with approximate
numbers within one month of contracting
d. Provide hiring criteria for job titles
e. To the extent that jobs will be drawn from organized labor, that
hiring criteria be reflective of union apprenticeship requirements
When Drafting A Hiring Preference Consider:
1) The preference should be worded to reflect a
legitimate interest (i.e. encouraging industry, reducing
unemployment, etc.)
2) Target specific workers rather than impacting everyone
3) Establish preferences over quotas (good faith efforts)
4) Base decisions on good data
Questions?