Paying employees a “living wage” is gaining traction in Texas, U.S.

There are varying definitions of the term “living wage.” It is generally used to identify the wage needed to cover the basic costs of living without the need for government or other charity support programs. One of the most widely used living wage calculators describes the living wage as “the wage needed to cover basic family expenses of food, child care, insurance premiums, health care, housing, transportation, and other necessities, plus all relevant taxes.”
 
The living wage is in the news in part because of some high-profile efforts to raise the pay of low-wage employees.

  • President Obama has proposed raising the federal minimum wage from $7.25 to $9.00 and indexing it to inflation thereafter. He also signed an executive order establishing a wage of $10.10 for all workers employed by federal contractors.
  • In April 2015, Gravity Payments, a small credit card company in Seattle gained national attention when the company’s CEO, Dan Price, announced the minimum salary of every employee would be increased to $70,000 per year. Price slashed his own pay in an effort to raise the standard of living of his employees.
These actions, along with the increased grassroots efforts of advocacy organizations, has helped bring the “living wage” issue to the fore across the United States and in Texas.

How a living wage differs from the minimum wage

The minimum wage is the lowest wage permitted by law or contract. The cost of living is not generally a consideration in setting it.
 
The federal government first established a national minimum wage of $.25 per hour in 1938. Since then, the minimum wage has not kept up with inflation. The last increase was in 2009 to the current rate of $7.25 an hour which provides an annual income of only $14,500 for a full-time worker. Twenty-nine states other than Texas have minimum wage laws requiring a state minimum wage higher than the federally mandated minimum wage.
 
Efforts in the Texas Legislature to raise the statewide minimum wage from the $7.25 federal requirement have been unsuccessful. In the most recent legislative session, House Joint Resolution 26, which proposed a constitutional amendment raising the state minimum wage to $10.10 per hour, was soundly defeated by a vote of 92 to 50. Other bills attempting to raise the minimum wage were left pending in committee.
 
In addition to the Texas Legislature’s refusal to increase the state minimum wage, the Legislature passed a minimum wage preemption law in 2003. This law prohibits local governments (cities, counties, school boards, etc.) from passing minimum wage ordinances which would require other employers to pay a wage higher than the federal minimum wage. More than a dozen other states have a similar law restricting local control of minimum wage laws.
 
Within these minimum wage constraints, some local governments have taken limited actions in support of higher wages by mandating a living wage for their employees and the employees of government contractors. These ordinances are referred to as living wage laws. Whereas minimum wage laws require a minimum hourly pay rate to any employee—whether public or private sector—living wage laws apply only to those employees who work for the local government or a government contractor

History of the living wage movement

The first living wage ordinance in the United States was passed in Baltimore more than 20 years ago. Since then, approximately 140 other local governments across the United States have adopted a living wage ordinance. Most local living wage ordinances apply to city and county governments located primarily in the Northeast, Midwest, and West.
 
Some school districts have also implemented living wage ordinances. This past summer, school districts in Los Angeles, California ($15 per hour) and Denver, Colorado ($12 per hour) passed living wage policies for school employees.  
The living wage movement has been less successful in Texas than in other parts of the country. The first living wage in Texas was adopted by Hidalgo County (McAllen-Edinburg-Mission) in 1999. The living wage movement in Texas then stalled.
 
Fast-forward to 2015, and momentum for the living wage is growing in Texas and across the nation. Within the past year, the following Texas local governments have either increased their existing living wage, adopted a living wage for the first time, or begun formal discussion and analysis of a living wage: 
  • Bexar County has increased the living wage to $13 per hour for county employees effective Oct. 1, 2015.
  • The city of San Antonio has discussed a potential increase to their existing living wage to $13 per hour effective Jan 1, 2016.
  • Dallas County does not have a formal policy but does not pay county employees less than $10.50 per hour. Leaders did not follow through on a proposal to set a living wage for county contractor employees, but will consider the wages contractors pay when evaluating contracts.
  • The city of Dallas has set its lowest wage at $10.62 per hour. Leaders discussed but backed off a proposal to set a new “wage floor” of $10.37 per hour for the employees of city contractors.
  • The city of Austin passed a three percent pay increase for all employees and established a minimum wage of $13.03 per hour for city employees.
  • El Paso County has increased its living wage to $10 per hour.
  • The city of El Paso has increased its living wage to $10.35 per hour. 
Houston ISD, the largest school district in the state, recently raised the lowest wage it pays to employees to $10. In so doing, Houston ISD became the first large employer in Houston to implement a higher minimum wage (the district does not refer to the increase as a living wage) for all its employees. The increase will cost the district about $4 million and will affect approximately 1,400 employees who previously earned between $7.80 and $10.

What is the living wage rate in Texas?

The living wage is calculated based on the actual cost of living in each local community. Therefore, there is no consensus on a statewide living wage because the cost of living varies widely across the state. Additionally, the living wage varies depending on family size, and various living wage calculators make different assumptions about what are considered essential basic needs.
 
Three of the most widely used living wage calculators provide significantly different living wage rates in Texas, with a range of nearly $5 per hour. To be as consistent as possible when comparing living wage rates using each tool, the following rates are for a single individual with no dependents. The living wage would be significantly higher if dependents (children, nonworking spouses) were included.
  • In the least expensive rural areas of the state, the living wage rate ranges from $9.40 per hour to $12.66 per hour.
  • In the most expensive county and metropolitan area of the state (Travis County/Austin), the living wage ranges from $10.97 per hour to $14.38 per hour.

Various calculations of the living wage for a single person in Texas

Calculators Living wage calculator—MIT Texas Family Budget Estimator—CPPP Family Budget Calculator—EPI
Lowest cost of living in Texas $9.40 $11.54 $12.66
Highest cost of living in Texas $10.97 $14.09 $14.38

Living wage considerations

Proponents generally offer the following arguments in support of implementing a living wage.
  • Poverty and inequality would be reduced.
  • A stronger middle class is a key to a stronger local economy.
  • Employee absenteeism and turnover rates will decrease.
  • Employee morale and productivity will improve.
  • Workers will become less reliant on costly social services.
  • Local governments should demonstrate a greater social responsibility to the community.
Opponents generally provide the following arguments against implementing a living wage.
  • There is no consensus on the standard hourly rate for the living wage; therefore it is impossible to set a rate accurately.
  • It will cost taxpayers more and potentially cause a loss in overall employment opportunity.
  • Payroll costs increase, not only for the lowest paid employees but also because of the ripple effect caused by having to pay workers in higher level jobs more to prevent wage compression.
Planning for the implementation of a new living wage is not a simple task. Agreements must be reached about the wage rate, what it will cost, how to preserve the pay structure at all levels, whether government contractors should be affected, whether an inflationary index should be applied, and how to get support from taxpayers.
 
There is neither a requirement nor a prohibition for any local government to adopt a living wage. While there are multiple pros and cons to consider, a district’s adoption of a living wage is a board decision that requires careful consideration and involves many stakeholder groups. Although living wages have not been widely adopted in Texas yet, expect the movement to grow and be discussed and debated by more policymakers in the future.

Paperless HR departments valued by private, school HR professionals

Private HR departments are increasingly going paperless, noting that the move improves efficiency, which, in turn, increases worker productivity. They’ve done it by turning to computer-based systems to store and manage documents and track employee information.
 
The Society for Human Resource Management (SHRM) conducted the informal survey at its annual summer conference. The HR professionals polled said that more than 50 percent of their HR files were digital. As a result, they spend 35 percent less time than they used to on administrative paperwork.
 
“This survey is a strong indicator that paperless HR document practices work and forward-thinking HR departments who have adopted digital practices are more efficient and have greater ability to direct HR resources to programs that matter, instead of wasting time on paperwork, Archive Systems CEO Gordon Rapkin said to SHRM Online in an interview.

Texas school HR departments stop pushing paper

A few Texas school HR departments are taking on the challenge of going paperless. One is Frisco ISD. The district was featured in a story in the March issue of HR Exchange for its electronic onboarding process. Its HR department is now an almost completely paperless operation.
 
Bob Allen, Frisco ISD’s director of business applications and process, said that all HR departments have to receive some documents, such as I-9 Forms, on paper. Those documents are scanned into the district’s electronic repository for long-term storage and the originals are returned or destroyed.
 
Allen outlined the important benefits Frisco ISD has seen from going paperless:
  • Efficiency within HR and across the district. “There is incredible value in not having to manage and maintain paper HR folders (in addition to the cost of paper, printing, filing, and storing)," Allen said.
  • Documents can no longer be lost or misfiled and can be retrieved by anyone with appropriate security access within seconds to respond to inquiries.
  • Multiple departments that require access to specific documents can be immediately notified via a workflow, and that workflow can automatically integrate data into multiple systems.
  • The electronic onboarding process has been immeasurably improved, keeping new employees informed and allowing the district to detect everything from missing documents to upcoming certification renewal requirements.

Focusing on the process 

“I have not spoken with any district that doesn’t feel that going paperless would be valuable to them,” Allen said. “It’s a matter of balancing priorities, workloads, resources, and finances.” Most districts focus primarily on copying the documents to an electronic format. Their effort “…stops short of integration and business process change,” Allen said. He is an advocate of the latter.
 
Frisco ISD is one of a handful of district HR departments that have taken paperless a step further by using an electronic content management system (ECM) to provide electronic imaging and workflow systems integration. It provides HR with an “end-to-end” solution, using technology to complete hiring, onboarding, and long-term management tasks. With integration, HR departments can operate at reduced staffing levels.
 
Another challenge districts face is devoting the time required to scan their existing HR documents into an integrated system. With all the paperwork HR used to collect, it can seem like an insurmountable task. Allen said that can be overcome with a good plan that organizes the scanning task over an extended period.
 
For districts that don’t have someone like Allen to shepherd them through the process, he recommends finding the best technology consultant they can to help them identify and overcome their challenges. Smaller districts could work together on an HR technology project to get the most bang for their buck.

What happens when principals make teacher retention decisions?

When personnel costs make up more than 60 percent of total expenditures, school districts faced with budget shortfalls are sometimes forced to turn to layoffs as a cost saving strategy. In 2008, this was not uncommon among school districts across the country.
 
When you hear about teacher layoffs or a reduction in force (RIF), you typically think about the implementation of inverse-seniority policies. Using accounting terminology, the teachers that are the last in will be the first out (LIFO). But is this the best approach when the goal is to improve student performance and retain quality staff? How would the layoff process differ if principals were given the authority to use their own discretion when faced with the need to cut staff?
 
Matthew A. Kraft of Brown University examined data from layoffs in the Charlotte-Mecklenburg district of Charlotte, North Carolina, in the 2008‒09 and 2009‒10 school years to determine the implications of a RIF when principals were given a say in who would be laid off. The district identified candidates based on five general criteria: duplicative positions, enrollment trends, job performance, job qualifications, and length of service. However, the school board also granted the superintendent discretionary authority to make exceptions.
 
An analysis of the teachers laid off during this time period revealed some interesting results. More than 1,000 teaching positions were eliminated during the two-year period. Teachers with less seniority made up 84 percent of teacher layoffs. The other end of the experience spectrum also made the top of the list: Retire-rehires and teachers with more than 30 years of experience were also more likely to be let go.

However, when principals’ ratings of teachers was taken into consideration, 58 percent of teachers who received a “below standard” rating on any evaluation category were let go. Unlicensed and late-hired teachers also had a high probability of being laid off.
 
Kraft did not stop there. He also examined the changes in student achievement based on the characteristics of teachers being laid off. The teacher characteristics were based on their evaluation scores as well as the value they added to students’ scores on standardized tests for mathematics and English. Teacher seniority did not show a correlation with student achievement the following year. However, as one would guess, mathematics achievement decreased more in grades that lost an effective teacher compared to grades that lost an ineffective teacher.
 
While length of service was taken into consideration by the district, including performance data and allowing principals the discretion to determine who to lay off proved beneficial in this case. The findings from the study show the importance of prioritizing performance over seniority when districts are forced to lay teachers off to save money.

Fewer college grads apply for TFA corps, but diversity is growing

Teach For America (TFA), the well-known nonprofit organization that trains top college graduates to teach and sends them into low-performing, hard-to-staff schools in an effort to improve student outcomes, has seen a drop in its applicants for the second straight year. More than 44,000 graduates applied to be corps members for 2015‒16, down from a high of 57,000 applications the previous year.
 
Fewer applications results in a smaller TFA teaching corps because the organization accepts 15 percent of its applicants. This year’s class will have 4,100 members, down from 5,300 in 2014‒15 school year. TFA attributes part of the drop to scaled-back recruitment efforts in the past two years. “…It just felt irresponsible to continue [to recruit] so aggressively when we were getting enough applications,” said TFA’s Co-CEO Villanueva Beard. The drop could also be attributed to:

  • Public criticism of TFA from some TFA alumni and corps members
  • A rebounding economy with an abundance of job opportunities for high-performers
  • Negative media reports about the difficulty of teaching today and teacher quality
  • A drop in applicants for all types of teacher prep programs around the country
While corps numbers are down this year, demand from school districts remains high. TFA is taking steps to reverse the downward trend in applications, including reaching out to prospective corps members much earlier—as college freshman and sophomores—to make them aware of what TFA does.

Good news on diversity

In 2014, TFA announced that it would welcome its most diverse group of corps members in the organization’s history. TFA set a goal to become more diverse a few years ago to better mirror the student populations of schools that its corps members generally serve.
 
In addition to recruiting at colleges and universities with high minority student enrollment, TFA also began recruiting graduate school students and people with professional experience. With regard to the 2014‒15 class, 50 percent identified as people of color (compared to 20 percent of teachers nationwide):
  • Twenty-two percent were African American
  • Thirteen percent were Hispanic
  • Six percent identify as Asian American or Pacific Islander
  • One percent were Native American
In 2015‒16, less than half of TFA’s new corps members are white, and 31 percent are the first in their families to graduate from college.
—“Teach For America Sees Another Big Drop in Accepted Corps Members,” by Rebecca Klein, The Huffington Post, Aug. 11, 2015.

Don’t miss the opportunity to attend the Human Capital Symposium

Texas schools will soon be facing decisions about how to make the state’s new model teacher evaluation or similar models work effectively for them and how to include student growth measures.
 
The Human Capital Symposium, sponsored by Texas Center for Educator Effectiveness (TxCEE—housed at ESC 18), TASB HR Services, and TASPA, will feature panel discussions with six districts that are experienced with implementing new models for teacher evaluation, compensation, and professional development. It takes place Oct. 27 and 28, 2015, at the San Marcos Embassy Suites.
 
While each district model is somewhat unique, all human capital systems have commonalities, such as collaborative coaching, more robust observation methods, training appraisers more effectively, incorporating objective student growth measures, rewarding effective teaching, engaging stakeholders, and managing data.
 
Participating districts will be large and small including Austin, Dallas, Houston, Lytle, Pharr-San Juan-Alamo, and Anderson-Shiro ISDs.
 
Panel discussion topics will include:

  • New evaluation models for teachers and principal
  • Student growth measures
  • Making a new system work in your district
  • Building capacity and sustainability
  • Implementing an effective professional development system
  • Rewarding talent through compensation
  • Building successful school leaders
  • Getting ready to launch a new human capital management system
  • Getting your educators to buy in
To register, go to the ESC 18 Website and click on “Workshop System” on the lefthand menu. Click “User Account” and set up your own record to register.  Register for Session ID 123902.

HR Extras

Texas Education Human Resources Day is right around the corner

Governor Greg Abbott has declared Wednesday, Oct. 14, 2015, Texas Education Human Resources Day (TEHRD). This is the sixth year school district leaders and the public have been encouraged to acknowledge the hard work of all human resource department staff members.
 
TASB HR Services has e-mailed customizable certificates of appreciation and a sample board resolution to superintendents’ secretaries and district public relations staff members in an effort to help district leaders honor their HR departments. We’ve also posted the certificate and board resolution online, along with the Governor’s proclamation.
 
The Texas Association of School Personnel Administrators (TASPA) spearheaded the effort to set aside one day each year to recognize the contributions of school HR departments.
 
TASB HR Services Director Cindy Clegg encourages school leaders to acknowledge the work of their HR departments. “The focus of the future will be on finding, developing, and retaining talented educators—which is more challenging today because our teacher shortage is growing,” Clegg said. “HR leaders can have a tremendous impact on cultivating a strategy for success and should be recognized for the important role they play. From creating first impressions through the final exit, HR can influence every employee in a school district.”

TEA posts FAQ on educator certification exam retakes

The Texas Education Agency has posted a list of frequently asked questions on the rules for retakes of educator certification exams. A new law limits educators taking certification exam to five attempts on each exam (the initial attempt plus four retakes). If a prospective teacher does not pass an exam after five attempts, he or she would not be allowed to take the exam again unless the State Board for Educator Certification (SBEC) waives the limit for good cause. Waiver rules will be made by SBEC and are expected to be in place by May 2016.
 
Districts that ask teachers to obtain additional certifications or that want to encourage education aides to become teachers can share the FAQ to help educators understand the new limits on certification exam retakes.

Study finds better teachers were hired during recession

The quality of teacher hires improved during the recession, according to a recent working paper by the National Bureau of Economic Research.
 
Researchers looked at student test scores and administrative data (2000‒01 to 2008‒09) in Florida public schools, comparing teachers hired during recession periods to those hired during normal markets and their impact on the scores.
 
Education Week writer Stephen Sawchuk points out that this paper is among the first to provide evidence of how a recession affects the teacher labor market. The paper indicated that paying new teachers more would get better candidates in the door regardless of the economy.
 
It’s important to note that teachers hired in a slow economy were more prone to pack up and move on once the economy improved.

Failing to sign I-9s results in largest employer penalty to date

A California event-planning company was hit with the largest fine ever ordered, $602,250, due to a repeated failure to sign section 2 of the I-9 Form. The Office of the Chief Administrative Hearing Officer has jurisdiction to review civil penalties for I-9 violations. The office ordered the company to pay the fine for more than 800 I-9 paperwork violations.
 
Employers must complete and sign section 2 of Form I-9 within three business days of a hire, attesting that the appropriate verification and employment authorization documents have been reviewed.
 
Immigration and Customs Enforcement (ICE) audited the company in 2011. Other violations included failure to file I-9 forms in any state of completion for four people, failure to locate the I-9 Forms for eight employees at the time of the audit, failure to ensure that three workers checked a box in section 1 indicating immigration status, failure to ensure that two workers signed section 1, failure to ensure that two workers entered their alien numbers, and missing list A, B, and C documents.
 
“This case demonstrates the need for employers to conduct routine self-audits of their I-9 inventories to ensure that the forms have been properly completed and retained and are ready for inspection,” said Mary Pivec, a partner in the Washington, D.C., office of Ford Harrison.

Texas AFT pushes for overtime pay for teachers, calls for more affordable health care

Texas HR administrators are eagerly awaiting final Department of Labor (DOL) rules that will make some salaried school district workers eligible for overtime. Teacher organization Texas AFT is pushing for the new rules to go considerably farther. They want teachers to be eligible for overtime pay.
 
The organization encouraged its members to contact the DOL and comment on making teachers and other education professionals eligible for overtime rules. A long-standing federal administrative regulation excludes teachers from receiving overtime, and the proposed rules did nothing to change that.
 
Texas AFT and other educator groups are also pushing the Teacher Retirement System of Texas (TRS) to keep the TRS-ActiveCare 2 plan, a comprehensive coverage option chosen by about a third of school employees. Texas AFT notes that educators have borne most of the cost of health premium increases and called for TRS to seek more state funding to help cover educator health care costs.


Inside HR Services

HR Services membership invoices are due

As of Oct. 1, TASB HR Services started a new membership year. Invoices were sent to our program contacts in August. If you haven’t renewed your HR Services membership, be sure to do so to avoid losing access to critical resources for members, including DataCentral, the HR Library, our Model Job Descriptions, and our Model Employee Handbook, to name a few.

Q&A: Foregoing family and medical leave

Q: Is family medical leave (FML) required when an employee has sufficient leave to cover the time off?

A: The employee cannot choose to forego FML and only use paid leave if concurrent use of leave is required by Policy DEC (LOCAL). When concurrent use of leave is required, both types of leave will be applied and the employee’s FML leave and paid leave balances will be simultaneously reduced by the number of days absent.
 
According to FMLA regulations, employees may choose whether or not to use paid leave at the same time as FML only if the district does not address concurrent use of leave in district policy (29 CFR §825.207).
 
Requiring the concurrent use of FML and other leave allows the district some control over the total amount of time the employee may be absent from work. Coordinating leave benefits allows districts to accomplish the following:
  • Limit the amount of time an employee can be absent
  • Minimize the impact of absences on the instructional program
  • Provide staff coverage when employees are absent for prolonged periods of time
  • Contain substitute costs
  • Ensure compliance with legal requirements
The requirement to use accrued leave also applies to compensatory time under the Fair Labor Standards Act. The district may require an employee to use accrued compensatory time (comp time) before paid leave. In addition, FMLA regulations allow unpaid FML to run concurrently with comp time (29 C.F.R. §825.207(f)). Requiring employees to use comp time reduces the district’s financial liability with regard to paying them for unused comp time upon termination or if another specific deadline triggers payment (e.g., the end of the fiscal year).

2016-16 Salary Survey deadlines