On April 11, 2023, the San Jose City Council directed staff to develop a Responsible Construction Ordinance (RCO) to address wage theft in private construction. While crafting this ordinance, City staff met with representatives from the South Bay Labor Council, Santa Clara County Wage Theft Coalition, Working Partnerships USA, and the Santa Clara and San Benito Counties Building Trades Council. However, outreach to the business community was not done until December 7, 2023.

The RCO was introduced during a San Jose City Council Meeting on December 12, 2023. It explored the possibility of “withholding the certificate of occupancy when an owner or contractor [has] any unpaid final wage theft judgment; and exempt certain projects that consist of less than 15,000 square feet of new construction or remodeling, are subject to prevailing wage requirements under state law, or are subject to a project labor agreement or community workforce agreement.”. During the meeting, Mayor Mahan urged staff to do more outreach to the business community and relevant stakeholders, and suggested delaying the vote until this outreach was done. Therefore, the item was deferred to a City Council Meeting on January 23, 2024.

Further outreach to the business community and relevant stakeholders was done on December 20, 2023 and January 3, 2024 with 20+ members of NAIOP SV and relevant stakeholders attending the meetings and expressing their concerns. During the second outreach session, an attorney from Devcon Construction, Chris Hersey, prepared a redline and presented it to city staff.

On January 23, 2024, City Council 2 voted unanimously in favor of staff’s recommendation to “limit the unpaid final wage theft judgements to final judgments that can be confirmed by the contractor through the California Labor Commissioner’s portal” along with additional modifications to the proposed ordinance from December 12, 2023 as a result of the outreach sessions to the business community and relevant stakeholders. 

The modified Responsible Construction Ordinance will be brought back to a City Council meeting for review on June 18th.