Contract employees working for the University of Virginia will see minimum wages increase to $15 an hour, the same as for most UVa employees, President Jim Ryan announced Thursday.

The contractors — including food service, child care, janitorial, valet services and environmental services employees — will begin paying the wage on Jan. 1. That’s the same day that a raise for full-time, benefits-eligible employees will take effect, a change announced by the university in March.

UVa “living wage” activists applauded the decision and credited the university with taking the step to improve wages for all employees.

It could not be determined Thursday whether any job reductions — either through layoffs, attrition or decreases in hours — would result from the pay increases.

The raise will affect more than 800 contract employees, about 90% of full-time contract employees, according to the university. Contractors that agreed to the wage increases include Aramark, Morrison, Crothall, KinderCare, Bright Horizons, Exela, BMS and Towne Park.

Officials estimate that 96% of full-time UVa employees and full-time contract employees who made less than $15 will see the increase as of Jan. 1.

Ryan said that early in his tenure, higher wages were identified as an important issue for the school and the community.

“We realized that among community issues, number one was jobs and wages. There are a lot of people interested in this issue and our [Board of Visitors] was interested, too. If we wanted to build stronger relationships in the community, this was an issue we needed to address,” Ryan said.

“We had been talking about what would make a university not only great, but also good,” he said. “We made the case that a great and good university would treat its people well.”

The contractors provide services that UVa has decided not to provide itself, such as dining hall service and child care. They represent about 90% of the contract employees at the university, officials said.

“We realize that working with contractors who pay their employees themselves is decidedly different than working with our own employees,” Ryan said. “We are grateful that we were able to get all of our major contractors to agree with us.”

Promoters of a living wage have sought wage hikes for UVa contractors since the 1990s.

“We’re glad the issue is being addressed,” said Corey Runkel, a fourth-year student at UVa and president of the Living Wage Campaign at UVa, which has long championed higher wages for contract employees.

“It looks like there’s a real commitment from the Ryan administration,” he said. “There is still work to be done with health insurance costs and other issues, but we’re glad to see it get the attention it deserves.”

“This is a major decision,” said veteran wage advocate Emily Filler, now an assistant professor at an Indiana college. “Employees, students and faculty have advocated for a living wage for decades. This is an indication UVa is willing commit to its contract employees as members of the UVa community.”

UVa officials said the university has been building up wages for its lowest-paid employees and contract employees for years, but the effort to lift employee wages to a minimum of $15 per hour became a priority when Ryan took over as president in 2018.

“We’ve been working on this since 2011, and taking the base pay up to $15 is a signal to our employees that we appreciate them,” said Kelley Stuck, chief human resources officer for UVa. “We already have good benefits, but you also need to support employees through wage increases.”

The March announcement about raises came shortly after a community working group issued results of a survey and a report that charged the university with improving local jobs and wages, among other issues.

Stuck said many UVa employees have spouses who either work for the university or for contractors. The pay increase will help those families better cope with rising costs of living in Charlottesville and Albemarle County.

“From the contractors’ perspective, these are among the lowest-paid employees and this will be a really substantial pay increase,” said Colette Sheehy, senior vice president for operations at UVa. “To go, in some cases, from $10.65 to $15 an hour is really something.”

The wage increases will be funded through modifications in contracts and through existing university resources. That means finding cost savings and operation efficiencies in university departments, officials said.

Officials said they don’t believe the change will lead to fee or tuition hikes at any more than the usual annual increases.

“We don’t expect a sudden 8% or 10% increase in the meal plans or child care, for instance,” Sheehy said. “The costs usually go up a bit each year and I think that will remain the case. It’s really a matter of finding efficiencies. In the meal plans, it means selling more plans, as well. In most contracts, the changes can be met with cost savings.”

Officials said higher wages will keep employees on the job longer, decreasing the costs of recruiting and training replacements.

“I think it will help with retention of employees. When employees remain longer, there are a lot of cost efficiencies because you don’t need to find and train new people. You retain a lot of knowledge about the job,” Stuck said.

Officials said contractors understood UVa’s goal in raising wages and worked with the university during the last year to make it possible.

“We have a good partnership with the contractors and we explained the importance of this to them and they worked hard with us to find a way to get to $15,” Sheehy said.

University leadership will continue to have discussions with contractors about subsequent potential wage adjustments, officials said.

Ryan said the wage hike is one of several community issues the university needs to tackle.

“I have no illusions that our work is finished,” he said. “There are issues around affordable housing and health care that require our attention. We recognize that there are a lot of talented people in the Charlottesville area and we hope they will think of UVa as a good place to work.”

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