Living Wage Ordinance Employers

FAQs for Employers

Skip to questions specific to nonprofits

How do I know if I am required to pay a living wage under the Bloomington Living Wage Ordinance (LWO)?

Whether the LWO applies to you depends on a number of factors, including the amount of money you've received from the City, the nature of the contract, the number of employees you have and whether your organization is for profit or not-for-profit. If you have questions, you may contact the Contract Compliance Officer at 812-349-3429 or human.rights@bloomington.in.gov.

I'm covered. What do I have to do?

You have to pay covered employees at least the living wage. For 2022, it's $14.01 an hour, of which up to $2.10 (15%) may be in the form of health insurance available to the covered employee. Beginning in 2023, it will be $15.29 an hour, and up to $2.29 of that amount may be in the form of health insurance available to the covered employee. You have to complete a LWO certification form which is available on the website or from the Contract Compliance Officer.

I've looked at the ordinance, but I'm not sure if I have enough employees to be covered by the LWO. I employ only five people, but our parent organization employs more than 100. Which workforce population count is used to determine if we are covered by the LWO?

The Contract Compliance Officer will look at the following factors when determining which entity is in fact the employer: interrelationship of operations, common management, centralized control of labor relations, common ownership/financial control. Contact the officer at human.rights@bloomington.in.gov or 812-349-3429 if you have questions.

Are there ways my organization can be exempted from the LWO?

The Ordinance allows for several types of waivers, all of which must be endorsed by the Mayor and forwarded to the Common Council for action in the form of a resolution.

1. A General Waiver may be granted when applying the LWO to a particular form of Assistance (contract/subcontract/subsidy) is found by Corporation Counsel to violate a specific state or federal law or provision.

2. A Special Waiver may be granted where payment of a Living Wage is shown to
   a. significantly curtail the services provided by the employer;
   b. have an adverse financial impact on the City of Bloomington; or
   c. not be in the best interest of the City.

   The Common Council must find that the costs of the payment of the Living Wage outweigh its benefits.

3. A Hardship Waiver for Not-for-Profits may be granted where payment of a Living Wage would cause a demonstrated harm to services and the Common Council finds that the harm outweighs the benefits of the LWO.
4. A Hardship Waiver for Recipients of Tax Abatements may be granted where the estimated tax deductions associated with the tax abatement are significantly higher than the eventual tax deductions available to the recipient, and the disparity results in undue hardship.
5. An Emergency Waiver may be granted, without need for consideration by the Common Council, where an emergency is declared by the Mayor or Common Council.

How do I apply for a waiver for my organization?

If you feel your organization qualifies for one of the waivers listed above, contact the Director of Economic Development at crowleya@bloomington.in.gov, who will work with you and with the City Legal Department to review your request.

I don't likely qualify for a waiver, and I already pay more than the living wage. I just don't want the City to audit my books, and I don't want my competitors to know how much I pay my employees.

As a rule, the City will not audit the books of Covered Employers in the absence of a complaint. If audits are necessary, the City will review the employer's pay records at the place of employment, rather than have documents filed with the City. Only Covered Employees may file a complaint; a competitor won't be able to file a complaint just to discover your wages.

But I don't want to fill out all of the required payroll paperwork.

The City has prepared a one-page certification form for Covered Employers to use. Click here for a copy. We do our best to make sure that compliance with the LWO is as simple as possible, and we welcome your suggestions for improving the process.

Do I have to file the certification form?

You must file the form with the City's Compliance Officer in the first quarter of the year following that in which the living wage ordinance applies. For example, if you have a contract that is covered by the LWO in January, 2022, you must file the form by no later than March 31, 2023.

FAQs for Nonprofits

What is the phase-in for nonprofits?

The living wage ordinance (LWO) says that not-for-profit covered employers are not obligated to pay the full amount of the living wage in the first two years they receive assistance from the City. During those first two years, which don't have to be consecutive, they are required to reduce the gap between their wages and the living wage by fifteen percent at the beginning of the first year and by thirty-five percent at the beginning of the second year. (BMC 2.28.030 (d).) They will have to reduce the gap each year at the same time that the wage is likely to be increasing, which may be a bit complicated.

Example: The 2021 living wage was $13.29 an hour. Good Works Agency received a grant that is large enough to trigger the LWO and currently paid their covered employees $10.00 an hour. During the first year, they have to reduce that gap by fifteen percent. The gap between $10.00 (Good Works Agency's current pay) and the 2021 living wage ($13.29) is $3.29. Fifteen percent of $3.29 is 49 cents, so the agency needs to pay covered employees at least $10.49 an hour. They receive a similar grant the next year. During the second year, they have to reduce the gap by at least 35%, but the living wage was $14.01 by then. The gap between $10.49 and $14.01 is $3.52, and they have to reduce that by at least 35%, or by $1.23. Thus, in 2022, they had to be paying covered employees at least $11.72 an hour. Again, up to 15% of this amount may be in the form of health insurance. By the third year of receiving a subsidy, they will have to pay the full living wage, whatever that may be at that time.

The two-year phase-in period for nonprofits began on January 1, 2008.

What social services grants are covered?

CDBG, Jack Hopkins Social Services Funds and any awards under any new social service programs the Bloomington Common Council determines will be subject to the LWO. (BMC 2.28.020(b)(4).) Covered subsidies are defined as "authorization or approval of grants for the operation of social service agency programs." The LWO does not cover subsidies for initiatives unrelated to operating programs, such as construction and equipment. It does not cover grants for physical improvement under CDBG. Nor does it cover grants for equipment, such as refrigerators, computers, loading docks, etc., under Jack Hopkins.

How large does the award to a social service agency have to be for the LWO to be triggered?

$25,000. (BMC 2.28.020(b)(5).) If, say, Good Works Agency received $10,000 from CDBG and $15,000 from Jack Hopkins in one calendar year, and both of these grants are for the operation of social service agency programs, the agency would be covered by the LWO once the $25,000 threshold has been reached. Good Works Agency's obligation to pay the living wage applies only to the second grant that triggered the applicability of the ordinance. Whether these two grants are in the same calendar year or not is determined by the date the contract is signed.

Does the LWO apply to all social service agencies that receive a large enough subsidy to be covered?

No. The agency has to have at least 15 employees to be covered. (BMC 2.28.020(c)(7)(b).) The LWO does not apply to smaller social service agencies. If the LWO would apply to a subsidy but for the small size of the agency, the agency needs to complete a LWO exemption certification. This exemption form is available on-line|file:3238] or from the contract compliance officer.

We have some full-time and some part-time employees as well as work study students and volunteers. Who do we count determining if we have 15 or more employees?

You count just about any one who works for you for pay, whether they are full-time or part-time. But you don't count volunteers or work study students.

Are all of the covered agency's employees covered by the LWO?

No. Only the employees who are performing work operating the covered program are covered by the LWO.

If a covered employee works ten hours a week on an LWO-covered program and 30 hours a week on other programs, does the agency have to pay that employee the living wage for ten hours a week or 40 hours a week?

The LWO covers only work done under the City-subsidized program, so the agency has to pay that employee the living wage (or a sliding scale version of it as described above) only for ten hours a week.

What if a covered employer contracts with another party for the operation of the social service program which is covered by the LWO? Is the subcontractor obligated to pay a living wage?

Yes. If a covered employer contracts with another party for the purpose of operating a social service program which is covered by the LWO, then the LWO would apply to the subcontractor's employees operating the program. (BMC 2.28.020(a)(1)(C).)

What if an agency believes that it cannot afford to pay the living wage?

If an agency believes that payment of the living wage would cause a demonstrated harm to the agency's services, the agency may apply for a hardship waiver. An application for such waiver must be both endorsed by the Mayor and presented to the Common Council. The Council must find that the harm to the agency's services outweighs the benefits of the LWO before a hardship waiver will be granted. (BMC 2.28.070(d).)

How long is the agency required to pay covered employees the living wage?

From the date the award is received until the end of the fiscal year of the program. (BMC 2.28.020(b)(6).) In this context, "program" refers to the City's program - Jack Hopkins and CDBG programs - and not to the agency's programs. For the purposes of CDBG, the program year is June 1, the date of receipt, to May 31, the end of the fiscal year of the program. In the past, the City has not formally defined the fiscal year of the Jack Hopkins program, but began to do so in 2007. Both the receipt date and the end of the fiscal year will be spelled out in the Funding Agreement.

What does the recipient agency that is covered by the ordinance have to do to comply?

Three things: pay the covered employees at least the applicable living wage. Post a notice, available on-line or from the contract compliance officer, 812-349-3429, about the LWO in a conspicuous location in the workplace. Complete and return a certification form, found on previous page and also available from the contract compliance officer, that says the agency is complying with the LWO.

What should an agency do if it doesn't know if it's covered by the Living Wage Ordinance?

Completing the LWO Flow Chart should answer the question. The contract compliance officer is glad to talk to agency representatives as well.