Library Employment Contracts

The "Prevailing Wage Rate" (or "PWR") is a pay equity concept found in Article 8 and Article 9 of the New York State Labor Law.

Article 8 addresses PWR in construction contracts.

Article 9 addresses PWR in service contracts.

Both articles require that workers on projects falling under the law be paid wages and benefits at least equal to those paid on private projects in the local area (or, as the law phrases it, the "prevailing wage").

Now, here's why (I think) the member had to submit the question.  Since both Article 8 and Article 9 deal with prevailing wage, one would think they apply to the same type of projects.

But the Labor Law—like its friends the Public Officers Law and the Education Law—has no problem casting a variably wide net over who falls under its different sections and sub-sections.[1] 

So, projects governed by Article 8 (construction) won't necessarily be governed under Article 9 (services).

For libraries, this distinction got a lot clearer on January 28th, 2021, with the ruling in the case Matter of Executive Cleaning Services v. NYS Department of Labor.[2]

While ostensibly about a fight over $16,671.57 dollars (plus 6% interest) in alleged wage underpayment by a cleaning service hired by the Ossining Public Library,[3] the ruling is really about the Article 8–Article 9 distinction, and how an entity covered by one might not be covered by the other.

Because the decision turns on the nature of a public library (in the case of Ossining, a school district public library), Executive Cleaning is also a great primer on the chimerical nature of libraries under the law.  If you are ready to hang on for some legal jargon, the case does a great job of laying out how a library can fit under one law but not another.[4]

So, with all that as background, what is the answer to the member's question: Are public library systems and public libraries (association, municipal, special district, school district) required to pay prevailing wage?

Contractors working for association libraries are only required by law to pay the PWR for either construction or service if they are using grant money that requires it.

Contractors working for special district, school district, and municipal public libraries only have to pay the PWR for "construction-like labor."

Of course, a library—of any type—can decide to require contractors to pay PWR for just about anything.  A requirement like that can be included in an RFP, procurement policy, or vendor contract rider.

To address the rest of the questions:

How does one know if a contract is signed with a vendor - and that vendor decides to subcontract?

Any contract for "construction-like labor" for a non-association library should require that PWR and other requirements of the primary contract apply to any subcontract.  While that doesn't guarantee the contractor (or subcontractor) will do the right thing, it at least requires them to do it and to pass the obligation to any subcontractors.

Is it dependent upon the 501 (C) status?

I have learned in this business to "never say never," but the IRS status is not determinative of whether an organization falls under Article 8 or Article 9 of the Labor Law.

And now, for some gratuitous commentary.

I have heard many people comment that a commitment to paying the PWR is regarded as a gold standard of economic justice.

However, for an association library that is not obligated to pay the PWR,[5] it is wise to remember that there can be other ways to assure equitable compensation for those who might be working on a project.

What is important, when in the early planning stages of a project, is to identify how an association library will live up to its stated values with respect to conditions for workers on the job.  While one option is certainly to require all contractors to pay the PWR, but there may be other options on the table.[6]

This same notion applies to ALL libraries when it comes to what types of worker conditions to include in service contracts not subject to PWR requirements. If a library decides to not require a contractor (and all subcontractors) to pay the PWR, it can still use its bargaining power to ensure workers providing services to the library are paid a living wage, have a certain level of benefits, and are afforded other considerations.[7]

If a library board finds it to be in the best interests of the library, a commitment of this nature should be included in the library's procurement policy, after which it can be baked into every phase of the contract process from start to finish.

Thank you for an excellent array of questions.

Regular readers of "Ask the Lawyer" know one of the cardinal rules is: "Do not reinvent the wheel."  So, before working on this reply, we[1] checked the "NY Library Trustees Handbook (2018),"[2] which has a whole section on hiring library directors.

The Handbook does not reference how "common" having a contract for a library director is, but on page 46, it does emphasize the importance of using a "hire letter" or "memorandum" or "contract" to confirm the hiring terms. 

This is wise counsel.  So, before we build on it to answer the member (and we will!), let's (briefly) talk about the difference between hire letters, memorandums,[3] and contracts.

As most readers likely know, New York is an "at will" employment state.  This means that, barring illegal[4] factors, an employer is free to terminate an employee as needed--and similarly, an employee is free to resign.  Most "hire letters" confirm "at-will" employment.[5]

An "employment contract," on the other hand, puts more bells and whistles on the relationship. It can address a range of things, including the parties' ability to terminate the relationship, and can alter (for a particular employee) the application of an employer's policies.[6]

Typical clauses in employment contracts for library directors are:

• A confirmation of the job description;
• A probationary period;
• A routine evaluation method;
• An assured period of employment (for instance, a 1-year or 5-year contract);
• Relocation costs;
• A recital of specific expectations beyond what is in the job description--for instance, if the director is being employed at the beginning of a strategic plan with expansion objectives, and part of the reason for the hire is a requirement to help keep the expansions on track;
• A benefit structure that differs from other job titles;
• A base compensation and bonus structure based on clearly articulated and quantifiable performance metrics;
• A commitment to a certain amount of budgeted funds and time out of the library for professional development;
• Tuition or professional development reimbursement;
• A consequence for early resignation;
• A list of specific reasons the contract can be terminated early by the board "for cause";
• A list of specific reasons the contract can be terminated early by the director;
• A buy-out or other provision in the event of early termination by the employer "without cause";
• A confidentiality clause;
• A clause regarding support in the event a lawsuit or legal complaint is directed at the employee[7] as a result of the employee performing their duties (similar to what protects a trustee).

Of course, the above-listed items are just examples.

So, how does a library board know when to use a contract?

There are too many factors to list, but here is a tool for assessing if a contract is the right approach to locking in employment terms between a library and director:

Factor	Comment	Yes	No
1. Is your library seeking the stability of a long-term commitment from its director?	Sometimes, even the promise of a year's service can lend stability...and a term can be as long as five years (or more...but five is a nice start).
2. Is the library about to undertake an initiative where the specific candidate’s skills and experience are a necessary asset?	For instance, if the library is overhauling its approach to IT over the next 5 years, and the candidate has specific prior experience with that type of project.
3. Is the search process unusually challenging for your library? (due to geography, etc.)	If every search costs time, money, and (most importantly) impacts services to the community, finding a way to get added stability may be worthwhile not only financially, but for the sake of the library's mission.
4. Are you more likely to retain a desirable director if you offer the protection of a contract?	The possibility of a contract can be an aid to recruitment.  If the job advertisement sets out the potential for greater stability, it might attract a more qualified candidate pool.
5. Will being able to tout having a director under contract help during budget and funding initiatives?	This could be a double-edged sword!  If the contract helps with cost containment, it's a benefit.  If it could be portrayed as excessive or unnecessary, it can backfire.
6. Will the library be channeling extra resources into professional development for the director, and thus want assurance of a return on investment?	This is a consideration where, if done right, the contract creates a win-win (the library director gets the benefit of development, and the library gets stability of an increasingly qualified director).
7. Will it help employee morale to know there is stability in the director role?	This can be another double-edged sword, depending on the relationship between the director and the other employees.
8. Will having the director under contract help with union negotiations? [skip if no union]	This may be a neutral factor, but certainly one to consider if there is an employee union.
9. Does the board want to be able to link compensation to specific objectives in an enforceable way?	A good contract can also serve as a planning tool.
10. [If director already employed by library] Has the director been successfully employed by the library for a while, but the library seeks greater assurance of retaining them?	Converting a successful at-will employee to a contract employee is another way to ensure stability.  If a system of progressive raises or bonuses is used, it can aid retention.

 

If your library answered "yes" to one or more of the above factors, it might be worth considering using a contract!  This is true even if no other library you know of is doing so (or if they all are).

 

That said, like all things that create obligations, a contract requires CAUTION.  Here are some factors to consider before a library decides to use a contract:

 

Factor	Comment	Yes	No
1. Does the board have what it takes to conduct a search that meets the objectives of the contract?	If the candidate pool is not robust, a contract cannot make things better.
2. Does the board have the capacity to pay attention to the compliance factors in the contract?	If the board doesn't follow the contract, it is dangerous to have one!
3. Does your board have the capacity to engage a lawyer to generate a custom contract?	A lawyer will look at the library's unique features, and the objectives of the board, to draft a contract.  The lawyer should also be ready to help the board negotiate.  Ideally, the first draft of the contract should be ready BEFORE the job is posted.
4. Does the library's financial position allow it to make the financial commitments the contract would create?	This should be confirmed by the Treasurer and the auditor before any offer is made.
5. Does Civil Service impact the terms of employment?	If yours is a non-association library, check with your local Civil Service rep to make sure the rules for hiring, discipline, promotion, and compensation are all honored in the contract (the lawyer mentioned in #3, above, can do this for you).
6. Is there anything in the enabling legislation, charter, bylaws, policies, or current Plan of Service that would deter using a contract?	This question is really one for the lawyer drafting the contract, who should review these documents before preparing the draft, but it is worth considering at the starting point of the process.

If the answer to any of the above questions is "no," a board should consider if additional steps need to be taken before deciding to offer a director an employment contract.  Employment contracts are like houseplants; although they largely just sit there, they need attention from time-to-time.

And that's my answer to the member's question; not based so much on what is "common", but definitely based on what might be "necessary" for a particular library.

Thanks for a great question, and good luck with your search.

BONUS CONTENT

If there are three take-aways I hope this answer conveys, they are:

1) a contract for a library director can be a positive and helpful thing for both parties;

2) before offering or requesting a contract, a board or director should know what they want, and why (and if a contract can fulfill that); and

3) never, never, NEVER use a generic contract from the internet...always have a draft contract reviewed by a lawyer[8] before it is offered.

To help emphasize these three take-aways, here are three limericks:

A pro-active library board

Over its strategy pored

"We seek a director

who has it together

Should a contract be offered?"

 

The board then decided "Why yes,

Our new person must fix quite the mess

So we'll set some terms

That our contract confirms

To address our points of high stress."

 

The right fit was finally found

A lawyer said the contract was sound

So to the future director,

A contract was sent o'er,

And now they are legally bound!

 

Did this trio of limericks skip the part of the process where the parties negotiate back and forth, and the contract is (hopefully) signed?  Yes.

But hey... the top 3 take-aways are in bold.  That's what's important. Please let us know if they are helpful.[9]

---

[1] Who is "we"?  The staff at the law office, and in this case, a call to the director of the council whose member sent in the question.

[2] Found as of June 2, 2022, at https://www.nysl.nysed.gov/libdev/trustees/handbook/index.html.

[3] The term "memorandum" is not a legal term.  If a "memorandum" of hire only confirms that the position is at will, it is at-will.  If the memorandum adds to the rights and/or obligations of the parties, it is a contract.  For this reason, I discourage use of the term "memorandum" to confirm hiring terms.

[4] Like discrimination, retaliation, and contract violation.

[5] These days, they also fulfill state legal requirements to confirm the date of hire, the rate and frequency of compensation, and the identity of the employer. For more on this, see the state's "wage theft" rules explained here: https://dol.ny.gov/system/files/documents/2022/05/p715.pdf.

[6] Most employee handbooks will have language confirming that the board can change the policy at will and nothing in the manual is to be taken as creating a contract; this is to preserve the "at will" arrangement.  Any employment contract should consider how it works with an existing or future employee handbook.

[7] Assurance of such coverage is not needed for most "Directors and Officers" (or "D&O) insurance to cover a director, but considering the extent of D&O coverage is an important annual task for the board.

[8] Who knows about both employment law and libraries.

[9] Feedback can go to info@losapllc.com.

The care required when addressing union-related issues in so critical, we're going to start with a small cautionary poem:

When employees seek to organize

A good employer must emphasize:

Contract, practice, policy...

If not there, don't intervene.

Why do I have to start this answer with a warning?

When it comes to employees communicating about their working conditions--whether they are in a union, talking about forming a union, or posting notices about union activity--if the activity is not governed by a contract or clearly established policy[1], there should be no effort to limit the activity.  Rather, the director and/or the board should consult the library's lawyer, and make sure you proceed with written advice from them.

This is the only way to safely proceed.

This extreme caution is necessary because: 1) if perceived as seeking to improperly limit communications, an employer can cause immense damage to employee relations in a short period of time; 2) both the National Labor Relations Board and the Public Employee Relations Board (who will handle any disputes, based on the "type" of library[2]), broadly recognize workers' right to organize and communicate regarding workplace conditions and union activity. 

As the member's question alludes to, there are protections in place an employer must honor.  For instance:

If there is an employee break room where pretty much anything can be discussed[3], workplace conditions and union organizing efforts can also be discussed;
If there is a bulletin board where general information can be posted, union-related materials can be posted there;
If employees are allowed to chat about pretty much anything they want as they perform work tasks, discussions of workplace conditions and organizing can't be barred.
These examples sound simple, but in real life, this issue is complex; a long line of cases going back to the 1940's[4] shows that there is an ever-changing balance between what a union and workers can and can't do on company property (and/or on company time).

This complexity is present even when union contract is in place. 

For instance, a union contract may provide something like this clause (taken from a contract posted on the PERB site):

Just as referenced in the member's question, this contract language allows for a "reasonable" use of on-the-clock time to post notices, distribute literature, transmit communications, and consult with representatives on contract issues.  This is a common clause in union contracts, and it is based on prior court decision stating that some access to employer resources may be required for union activity.

But as the member writes: "...how much time is reasonable?"

The only answer I can provide is: there is no right answer except to get a good answer about how to get the right answer.

Or, to add to our cautionary rhyme:

When employees seek to organize

A good employer must emphasize:

Contract, practice, policy...

If not there, don't intervene.

And if something needs more clarity

Ask your lawyer for strategy.

Many contracts, policies, or past practices will list (or have citable past examples of) what is a "reasonable" time for a meeting.  If, however, there is no clear information allowing the parties (the employer and the bargaining unit or employee) to discern what amount of time is "reasonable", the parties will need to discuss it.  For the library (the employer) this means calling in their lawyer to confirm:

 how to raise the issue
with that specific union,
under those precise circumstances, and
at that specific time.
This may sound overly paranoid[5], but sadly, it is not.  Here is 2023, the NLRB keeps back-flipping on precent, and the PERB doesn't have much out there on what "reasonable" means.  This leaves me without any solid precedent or definition to point to (and even in the most stable of times, the interpretation of "reasonable" is highly fact-specific).

Without clear shared understanding between the employer and the unit, a well-crafted legal strategy that considers the big picture is the only responsible[6] way to address union-related concerns, including ones related to union activity on company time. 

Because of this, a board or director who believes it is in the best interests of their library to raise such a concern should proceed only after securing attorney-client privileged legal advice based on a thorough analysis of the contract (or policy), past practice, and the present situation.[7]  The approach (which should be in writing) must be crafted so the outreach doesn't risk the appearance of undue pressure or restrictions on protected activity, and to ensure the parties reach (and document) an articulable understanding that both can rely on with confidence. Ideally, the way the issue should be raised in a way that will reinforce (or create) trusted pathways of communication with bargaining unit leadership. 

This technique will be different for different libraries.  Some will have to consider recent decisions from the NLRB[8], others will have to review decisions from the PERB[9].  Regardless of library "type", the precise contract, relevant policies, past practice, and overall climate and relationship will need to be considered. 

Once a strategy is in motion, if the lines of communication have been positive, the issue may be able to be resolved "at the speed of trust."  If the relationship is hostile or rocky, raising such a concern may result in other matters being brought up, with the worst-case scenario leading to filing a grievance or accusations of a labor law violation. All of this needs to be considered before the employer's position is communicated to the employee[10] or the union.

In fairness to the member who asked the question with the reasonable hope of getting an actual answer[11], I have to say that both the NLRB and the PERB are very fond of the word "reasonable"-- but provide very little guidance as to what the term means.  Looking at NLRB decisions and other authorities, "reasonable" seems to be whatever makes sense to the decision-maker at the time.[12] There just isn't a more reliable answer.

Because of this, what's important is that the employer and the union have clarity about what they jointly agree is "reasonable" and that they use good communication to maintain that understanding over time.

Or to add a final couplet to our poem:

When employees seek to organize

A good employer must emphasize:

Contract, practice, policy...

If not there, don't intervene.

And if something needs more clarity,

Ask your lawyer for strategy.

But most critical to good relations

Are trust and careful communications.

 

May your union-employer relations be smoother than my rhymes!

 
[1] Note that I say "activity", not "communication."  More on this soon.

[2] The PERB will handle libraries that are "public employers", the NLRB will handle the rest.

[3] Except things that are harassing, discriminatory, threatening, etc...

[4] Starting with this case here: https://www.law.cornell.edu/supremecourt/text/324/793

[5] I usually sound so hopeful and encouraging in these columns!

[6] By "responsible", I mean: "less likely to cause a grievance, more likely to foster good relations, less likely to cause needless resentment and panic, more likely to cost less legal fees in the long run." 

[7] This is not the time to call the lawyer you know to get a quick informal opinion.

[8] Found at https://www.nlrb.gov/cases-decisions/decisions

[9] Found at https://perb.ny.gov/nys-perb-board-decisions/

[10] If it is a union matter, don't raise it with the employee, if the contract calls for something else.

[11] Which they clearly haven't gotten, but truly, this is the most responsible way to reply.

[12] Okay, it's not that bad, but still, the flip-flipping out there in Labor Law jurisprudence is de-stabilizing the legal playing field.  If you know an attorney who regularly negotiates union contracts, say "Hey, how about that Caesar's decision?" and you'll likely get a tense smile.  https://www.nlrb.gov/case/28-CA-060841

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