Audit of Contractor Compliance with the Chicago Base Wage Ordinance
Summary
In November 2017, the City of Chicago Office of Inspector General completed an audit to determine if security guard and janitorial service contractors and subcontractors complied with the Chicago Base Wage Ordinance. Similar to living wage laws adopted by cities nationwide, the purpose of the Ordinance is to ensure that City contractors and related subcontractors pay their employees in excess of poverty-level wages, both as a matter of principle and as a means of stimulating the local economy.
Executive Summary
The Office of the Inspector General (OIG) conducted an audit to determine if contractors and subcontractors complied with the Chicago Base Wage Ordinance. Similar to living wage laws adopted by cities nationwide, the purpose of the Ordinance is to ensure that City contractors and related subcontractors pay their employees in excess of poverty-level wages, both as a matter of principle and as a means of stimulating the local economy.
Specifically, we reviewed wages paid by four security guard and janitorial service prime contractors identified by the Department of Procurement Services (DPS), as well as those contractors’ subcontractors. OIG found that while the four prime contractors and three subcontractors reviewed in this audit consistently paid their employees the hourly base wage rate required by MCC § 2-92-610, one subcontractor paid 12 employees between $0.02 and $0.03 less per hour. Those underpayments, however, were retroactively paid.
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