TRANSITION EMPLOYMENT REQUIREMENTS

SF-LABOR pt. DIVISION II: CITY CONTRACTOR EMPLOYEE PROVISIONS, art. 109

in effect

SF Labor and Employment Code § 109.1 PURPOSE AND SCOPE.

SEC. 109.1. PURPOSE AND SCOPE. (a) The City has an important proprietary interest in maintaining the stability of the workforce engaged by a Contractor or Subcontractor under a Covered Contract. Turnover of experienced workers resulting from a change in the City’s Contractor jeopardizes the quality, efficiency, and cost-effectiveness of service provided to the City under the successor Contract. Accordingly, all Covered Contracts shall impose the obligations of this Article 109 on the Contractor and Subcontractor. (b) Article 109 does not apply to any Covered Project, unless that Covered Project also qualifies as a Covered Contract. (Added by Ord. 296-24, File No. 240985, App. 12/19/2024, Eff. 1/19/2025, Oper. 2/19/2025)

SF Labor and Employment Code § 109.2 SUBMISSION OF EMPLOYEE INFORMATION.

SEC. 109.2. SUBMISSION OF EMPLOYEE INFORMATION. (a) Where the Contracting Officer has given notice that a Covered Contract will be bid, or where a Contractor has given notice of termination, upon giving or receiving such notice, as the case may be, the Contractor (“ending Contractor”) shall, within 10 days thereafter, provide to the Contracting Officer and the Purchaser, for each Employee who worked at least 15 hours per week for the ending Contractor, the name, date of hire, number of hours and months worked in total for the employer, wage rate, and employment occupation classification. This provision shall also apply to the subcontractors of the ending Contractor. (b) Where a Subcontractor has been terminated prior to the termination or ending of the Contract, the Subcontractor shall for the purposes of this Section 109.2 be deemed an ending Contractor. (c) All requests for bids for Covered Contracts shall include the information listed above for Employees and shall notify prospective bidders about the Transition Employment requirements of this Article 109. (Added by Ord. 296-24, File No. 240985, App. 12/19/2024, Eff. 1/19/2025, Oper. 2/19/2025)

SF Labor and Employment Code § 109.3 EMPLOYEE RETENTION.

SEC. 109.3. EMPLOYEE RETENTION. A successor Contractor shall retain, for a six-month transition employment period, Employees who have worked at least 15 hours per week for the ending Contractor or its Subcontractors for the preceding 12 months and have been employed by the ending Contractor or its Subcontractors, if any, for the preceding 12 months under the Covered Contract, providing that just cause does not exist to terminate such Employee. The ending Contractor’s Employees who worked at least 15 hours per week shall be employed by the Successor Contractor in order of their seniority with the ending Contractor within their job classification, and shall be paid the Prevailing Rate of Wages to which they were entitled when employed by the ending Contractor. This requirement shall be stated by the City in all initial bid packages involving a Covered Contract. (Added by Ord. 296-24, File No. 240985, App. 12/19/2024, Eff. 1/19/2025, Oper. 2/19/2025)

SF Labor and Employment Code § 109.4 INSTANCES WHERE FEWER EMPLOYEES ARE REQUIRED.

SEC. 109.4. INSTANCES WHERE FEWER EMPLOYEES ARE REQUIRED. If at any time a successor Contractor determines that fewer Employees are required to perform the new Contact1 than were required by the ending Contractor (and Subcontractors, if any), the successor Contractor shall retain Employees by seniority within job classification. (Added by Ord. 296-24, File No. 240985, App. 12/19/2024, Eff. 1/19/2025, Oper. 2/19/2025) CODIFICATION NOTE 1. So in Ord. 296-24.

SF Labor and Employment Code § 109.5 PREFERENTIAL HIRING LIST.

SEC. 109.5. PREFERENTIAL HIRING LIST. During such six-month period the successor Contractor (or Subcontractor, where applicable) shall maintain a preferential hiring list of eligible covered Employees not retained by the successor Contractor (or Subcontractor) from which the successor Contractor (or Subcontractor) shall hire additional Employees if the need arises. (Added by Ord. 296-24, File No. 240985, App. 12/19/2024, Eff. 1/19/2025, Oper. 2/19/2025)

SF Labor and Employment Code § 109.6 RESTRICTION ON DISCHARGING EMPLOYEES.

SEC. 109.6. RESTRICTION ON DISCHARGING EMPLOYEES. During the six-month transition employment period, the successor Contractor (or Subcontractor, where applicable) shall not discharge without cause an Employee retained pursuant to Article 109. “Cause,” for this purpose, shall include, but not be limited to, the Employee’s conduct while in the employ of the ending Contractor or Subcontractor that contributed to any decision to terminate the Contract or subcontract for fraud or poor performance, excluding permissible union-related activity. (Added by Ord. 296-24, File No. 240985, App. 12/19/2024, Eff. 1/19/2025, Oper. 2/19/2025)

SF Labor and Employment Code § 109.7 PERFORMANCE REVIEWS.

SEC. 109.7. PERFORMANCE REVIEWS. At the end of the six-month transition employment period, a successor Contractor (or Subcontractor, where applicable) shall perform a written performance evaluation for each Employee retained pursuant to this Article 109. If the Employee’s performance during such six-month period is satisfactory, the successor Contractor (or Subcontractor) shall offer the Employee continued employment under the terms and conditions established by the successor Contractor (or Subcontractor) or as required by law. (Added by Ord. 296-24, File No. 240985, App. 12/19/2024, Eff. 1/19/2025, Oper. 2/19/2025)

SF Labor and Employment Code § 109.8 CONTRACTUAL PROVISIONS.

SEC. 109.8. CONTRACTUAL PROVISIONS. All Covered Contracts subject to this Article 109 shall include a provision in which the Contractor agrees to require any Subcontractor to comply with the obligation imposed by this Article 109. (Added by Ord. 296-24, File No. 240985, App. 12/19/2024, Eff. 1/19/2025, Oper. 2/19/2025)

SF Labor and Employment Code § 109.9 SUCCESSOR'S PRIOR EMPLOYEES.

SEC. 109.9. SUCCESSOR'S PRIOR EMPLOYEES. Notwithstanding the provisions of this Article 109, a successor Contractor or Subcontractor may replace an Employee otherwise entitled to be retained with a person employed by the Contractor or Subcontractor continuously for 12 months prior to the commencement of the successor Contract or Subcontract in a capacity similar to that proposed under the successor Contract or Subcontract. This provision shall apply only where the existing Employee of the successor Contractor or Subcontractor would otherwise be laid off work as a result of the award of the successor Contract. (Added by Ord. 296-24, File No. 240985, App. 12/19/2024, Eff. 1/19/2025, Oper. 2/19/2025)

SF Labor and Employment Code § 109.10 NO SUCCESSOR.

SEC. 109.10. NO SUCCESSOR. The retention requirements of this Article 109 shall not apply where there is no successor Contractor or Subcontractor. For example, where a Contract is for services over a single day, week, or month for a discrete, nonrepeating event, there is no successor and the retention requirements described herein are inapplicable. (Added by Ord. 296-24, File No. 240985, App. 12/19/2024, Eff. 1/19/2025, Oper. 2/19/2025)

SF Labor and Employment Code § 109.11 DEFINITION OF EMPLOYEE.

SEC. 109.11. DEFINITION OF EMPLOYEE. For the purposes of this Article 109 on Transition Employment Requirements only, the term “Employee” shall include any person who performs work under a Covered Contract, but shall not include an individual who serves in a managerial, supervisory, or confidential capacity, including those individuals who would be defined as such under the Fair Labor Standards Act, 29 U.S.C. § 201, et seq., as may be amended from time to time. (Added by Ord. 296-24, File No. 240985, App. 12/19/2024, Eff. 1/19/2025, Oper. 2/19/2025)

SF Labor and Employment Code § 109.12 ENFORCEMENT.

SEC. 109.12. ENFORCEMENT. (a) Definitions. For the purpose of Sections 109.12 and 109.13, “Agency” means the Office of Labor Standards Enforcement or any successor department or office. (b) Implementation. The Agency shall be authorized to coordinate implementation and enforcement of this Article 109 and may promulgate appropriate rules for such purposes. Any rules promulgated by the Agency shall have the force and effect of law and may be relied on by employers, employees, and other persons to determine their rights and responsibilities under this Article. Any rules may establish procedures for ensuring fair, efficient, and cost-effective implementation of this Article, including supplementary procedures for helping to inform employees of their rights under this Article, for monitoring contractor, subcontractor, and awarding authority compliance with this Article, and for providing administrative hearings to determine whether a contractor, subcontractor, awarding authority, or other person has violated the requirements of this Article. (c) Administrative Enforcement. (1) The Agency is authorized to take appropriate steps to enforce this Article 109. The Agency may investigate any possible violations of this Article by an awarding authority, a successor Contractor, or a successor Contractor’s Subcontractor. Where the Agency has reason to believe that a violation has occurred, it may order any appropriate temporary or interim relief to mitigate the violation or maintain the status quo pending completion of a full investigation or hearing. (2) Where the Agency determines that a violation has occurred, it may issue a Determination of Violation and order any appropriate relief including, but not limited to, back pay, including the value of benefits, for each day during which the violation continues, which shall be calculated at a rate of compensation not less than the higher of: (A) The average regular rate of pay received by the Employee during the last three years of the Employee’s employment in the same job classification; or (B) The final regular rate received by the Employee. (3) Where the Agency determines that a violation has occurred, it may also authorize the payment of an additional sum as an administrative penalty to each Employee or person whose rights under this Article 109 were violated. If any backpay is ordered, the dollar amount of the backpay multiplied by three, or $250, whichever amount is greater, shall be included in the administrative penalty paid to the Employee. In addition, if a violation of this Article 109 resulted in other harm to the Employee or any other person, or otherwise violated the rights of Employees or other persons, this administrative penalty shall also include $50 to each Employee or person whose rights under this Article were violated for each day or portion thereof that the violation occurred or continued. (4) Where prompt compliance is not forthcoming, the Agency may take any appropriate enforcement action to secure compliance, including initiating a civil action pursuant to Section 109.12(d) and/or, except where prohibited by State or federal law, requesting that City agencies or departments revoke or suspend any registration certificates, permits, or licenses held or requested by the violator until such time as the violation is remedied. In order to compensate the City for the costs of investigating and remedying the violation, the Agency may also order the violator to pay to the City a sum of not more than $50 for each day or portion thereof and for each Employee or person as to whom the violation occurred or continued. Such funds shall be allocated to the Agency and used to offset the costs of implementing and enforcing this Article 109. (5) The remedies and penalties provided under subsections (c)(2) through (c)(4) are cumulative. (6) An Employee or other person may report to the Agency any suspected violation of this Article 109. The Agency shall encourage reporting pursuant to this subsection (c)(5) by keeping confidential, to the maximum extent permitted by applicable laws, the name and other identifying information of the Employee or person reporting the violation; provided, however, that with the authorization of such person, the Agency may disclose their name and identifying information as necessary to enforce this Article or for other appropriate purposes. (7) The Determination of Violation shall provide notice of the right to appeal the determination to the Controller in accordance with Section 109.13, and that failure to do so within 15 days shall result in the determination becoming a final administrative decision. (8) The Determination of Violation shall specify a reasonable time period for payment of any relief ordered. The Agency may award interest on all amounts due and unpaid at the expiration of such time period at the rate of interest specified in subdivision (b) of Section 3289 of the California Civil Code, as may be amended from time to time. (9) The Agency may require that remedies and penalties due and owing to a person whose rights under this Article 109 were violated be paid directly to the City for disbursement to the person. The Controller shall hold these funds in escrow for the person. The Agency shall make best efforts to distribute such funds. In the event such funds are unclaimed for a period of three years, the Controller may undertake administrative procedures for escheat of unclaimed funds under California Government Code Sections 50050 et seq., as may be amended from time to time. Subject to the budgetary and fiscal provisions of the Charter, such escheated funds shall be dedicated to the enforcement of this Article 109 or other laws the Agency enforces. (d) Civil Enforcement. (1) The City Attorney or an Employee who, in violation of this Article 109, was not retained by a successor Contractor or its Subcontractor may bring an action in the Superior Court of the State of California against the successor Contractor and, where applicable, the successor Contractor’s Subcontractor, and an Employee may be awarded back pay, including the value of benefits, for each day during which the violation continues, which shall be calculated at a rate of compensation not less than the higher of: (A) The average regular rate of pay received by the Employee during the last three years of the Employee’s employment in the same occupation classification; or (B) The final regular rate received by the Employee. (2) If the City Attorney or the Employee is the prevailing party in any such legal action, the Court shall award reasonable attorneys’ fees and costs as part of the costs recoverable. (e) Interest. In any administrative or civil action brought under this Article 109 , the Agency or court, as the case may be, shall award interest on all amounts due and unpaid at the rate of interest specified in subdivision (b) of Section 3289 of the California Civil Code, as amended from time to time. (Added by Ord. 296-24, File No. 240985, App. 12/19/2024, Eff. 1/19/2025, Oper. 2/19/2025)

SF Labor and Employment Code § 109.13 APPEAL PROCEDURE.

SEC. 109.13. APPEAL PROCEDURE. (a) A person subject to a Determination of Violation of this Article 109 may file an appeal (“Appeal”) in accordance with the following procedures: (1) The person (“Appellant”) shall file the Appeal with the Controller and serve a copy on the Agency. The Appeal shall be filed in writing within 15 days of the date of service of the Determination of Violation, and shall specify the basis for the Appeal and shall request that the Controller appoint a hearing officer to hear and decide the Appeal. Failure to submit a timely written Appeal shall constitute concession, and the Determination of Violation shall be deemed the final administrative decision upon expiration of the 15-day period. Further, failure to submit a timely, written Appeal shall constitute a failure to exhaust administrative remedies, which shall serve as a complete defense to any petition or claim brought against the City regarding the Determination of Violation. (2) Following the filing of the Appeal and service of a copy on the Agency, the Agency shall promptly afford the Appellant an opportunity to meet and confer in good faith regarding possible resolution of the Determination of Violation. (3) Within 30 days of receiving an Appeal, the Controller shall appoint an impartial hearing officer who is not part of the Agency and immediately notify the Agency and Appellant of the appointment. (4) The hearing officer shall promptly set a date for a hearing. The hearing shall commence within 45 days of the date of the Controller’s notice of appointment of the hearing officer, and conclude within 75 days of such notice; provided, however, that the hearing officer may extend these time limits for good cause. (5) The hearing officer shall conduct a fair and impartial evidentiary hearing. The Appellant shall have the burden of proving by a preponderance of the evidence that the Agency erred in its Determination of Violation, and/or the relief ordered therein. (6) Within 30 days of the conclusion of the hearing, the hearing officer shall issue a written decision affirming, modifying, or dismissing the Determination of Violation. The hearing officer’s decision shall be the final administrative decision. The decision shall consist of findings, a determination, any relief ordered, a reasonable time period for payment of any relief ordered, and notice to the Appellant of the right to appeal by filing a petition for a writ of mandate as described in subsection (a)(7), and that failure to file a timely Appeal shall result in the final administrative decision becoming enforceable as a judgment by the Superior Court. (7) The Appellant may appeal the final administrative decision only by filing in San Francisco Superior Court a petition for a writ of mandate under California Code of Civil Procedure, Section 1094.5 et seq., as applicable, and as may be amended from time to time. (b) Where an Appellant fails to comply with a final administrative decision within the time period required therein, the Agency may take any appropriate enforcement action to secure compliance, including referring the action to the City Attorney to seek enforcement of the final administrative decision in Superior Court and, except where prohibited by State or federal law, requesting that City agencies or departments revoke or suspend any registration certificates, permits, or licenses held or requested by the Appellant until such time as the violation is remedied. (Added by Ord. 296-24, File No. 240985, App. 12/19/2024, Eff. 1/19/2025, Oper. 2/19/2025)

SF Labor and Employment Code § 109.14 NO PRIVATE RIGHT OF ACTION.

SEC. 109.14. NO PRIVATE RIGHT OF ACTION. This Article is not intended to create a private right of action against the City. (Added by Ord. 296-24, File No. 240985, App. 12/19/2024, Eff. 1/19/2025, Oper. 2/19/2025)

Source: City and County of San Francisco, Charter and Municipal Codes (American Legal Publishing, codelibrary.amlegal.com)URL: https://codelibrary.amlegal.com/codes/san_francisco/latest/sf_laboremployment/0-0-0-6777Fetched: 11/1/2026