Businesses complain about footing OT tab for Jobs Now 

San Francisco businesses are complaining that The City is not covering overtime pay for employees as part of the federal stimulus Jobs Now program, which was started more than a year ago to help residents find work.

Supervisor John Avalos said he plans to call for a hearing at Wednesday’s Board of Supervisers Budget and Finance Committee meeting to “examine” what’s working and what’s not working with Mayor Gavin Newsom’s Jobs Now program.

“I support the program,” Avalos said. “But it’s been expressed as an issue, and it’s worth taking a look at it.”

According to Scott Hauge, president of Small Business California, one of the biggest complaints is that The City does not reimburse businesses for overtime costs.

Newsom started the Jobs Now program during the recession using federal stimulus dollars. So far, the program, which has a budget of $25 million this fiscal year, has helped to employ more than 1,850 residents.

The City makes up its own rules for the program, which has been covering 100 percent of an employee’s pay up to 40 hours a week. The employer is responsible for paying benefits and overtime, according to the Human Services Agency.

California laws require that employers pay overtime for more than eight hours of work in a day, even if the workweek is less than 40 hours, which leaves very little flexibility to the employer if it hires someone through the Jobs Now program, Hauge said.

“It doesn’t make sense. The idea is to get money into [businesses] hands,” he said. “For a lot of jobs, overtime is part of the compensation package, especially for a small business.”

While many businesses say they have hired employees through Jobs Now and feel it has helped bolster San Francisco’s economy, they are hopeful policymakers will iron out some of the glitches, including furthering screening workers’ skills.

“I think there are employees that need to work overtime, and if they are hired through Jobs Now, it seems like it would be beneficial if [businesses] were reimbursed,” said Bradley Vaccaro, an insurance broker with Allpointe Insurance Services, which is looking to hire through the program.

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Erin Sherbert

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