Regulatory Wrap-Up
Wages
Arizona - A house committee passed a bill that establishes a lower minimum wage for workers under the age of twenty-two who are enrolled as a full-time student and working part-time. The bill sets the wage for those workers at the federal minimum wage level of $7.25/hr, as opposed to the current state minimum wage of $11/hr.
Connecticut - The governor pledged his support for a minimum wage increase announcing that he will include language to raise the $10.10 wage to $15/hr by 2023 in his budget proposal.
Illinois - The house passed the exact same $15/hr wage bill that recently passed the senate advancing the bill to the governor’s desk for his approval. That bill did not include many provisions that are important to employers, such as a regionally-based minimum wage.
Michigan - The state attorney general is questioning the legality of the new minimum wage and paid leave laws passed by Republicans in last year’s lame duck session and may challenge the laws in the courts. Those laws significantly altered voter-approved initiatives on wages and leave. At question is whether the legislature can change citizen ballot petitions in the same legislative cycle in which they were originally passed.
Missouri - A Republican senator is planning to introduce legislation to trim back parts of the new minimum wage law passed by the voters last November. The bill would create a new minimum wage for workers under the age of eighteen and freeze the cash wage for tipped employees at its current rate.
New Mexico - The house passed legislation increasing the state minimum wage to $12/hr by July 1, 2021. It would also phase out the tip credit by 2022. The senate version, which preserves the current tip credit, is expected to be considered in the coming weeks.
Pasadena, CA - The city council advanced legislation that would bring the city minimum wage to $15/hr by July 2020, 18 months earlier than the statewide mandate of 2022.
Paid Leave
Connecticut - The governor announced his support for 0.05% payroll tax to fund a paid family leave program administered by the state. He did not specify how much leave and at what percentage of pay the program would allow. The bills are under debate in the legislature where they have failed in previous cycles due largely to cost concerns.
Illinois - A paid parental leave bill is gaining momentum. It would require private employers with 50 or more employees to provide six weeks of paid leave for employees on the job at least a year that recently gave birth to a child, adopted a child under eighteen years old or for a family member with a serious health condition. It is unclear whether the governor supports the measure.
Maine - The bill mandating employers with more than five employees offer a paid sick leave program will be heard in its first public committee meeting. The bill allows full and part-time employees to earn one hour of paid sick leave for every 30 hours worked. The city of Portland is considering a similar proposal and a council committee was set to vote to move it forward but the meeting was delayed by weather. They will reconvene next month and businesses have asked the city to delay further, allowing the state to take up the issue first.
Texas - Governor Abbott gave his full support to several bills that were recently introduced that would preempt local governments from regulating employer’s leave and benefit policies. The preemption effort is motivated by city action in Austin and San Antonio.
Scheduling
California - A state appeals court ruled that a retailer that utilized on-call scheduling practices must compensate workers due to the state’s reporting pay requirement, even though workers were not required to report to work. At issue, workers were required to call-in two hours before a shift, and if not called-in, the employer did not compensate the worker. The court ruled the employee was eligible for pay for at least a portion of the shift.
Washington - A bill to establish a statewide mandate for employee scheduling appears to have stalled in a house committee. A similar bill in the senate has failed to move as well, indicating senate leadership is waiting to see what the house may or may not do on the issue.
Labor Policy
Federal - Democrats introduced the Paycheck Fairness Act which would prohibit employers from retaliating against employees for discussing salaries and limits an employer’s use of wage history in the hiring process.
Arizona - A federal judge ruled that Walmart unlawfully terminated an employee who tested positive for marijuana use. The employee argued that under Arizona law she was legally prescribed medical marijuana and there was no evidence that she was impaired at work.
New York City, NY - The city council is considering legislation that would prohibit arbitrary termination, a provision typically found in collective bargaining agreements. Not only does it create expansive protections for firings based only on just cause but it also prohibits employers from cutting a worker’s hours by fifteen percent or more.
Taxes
Federal - Senator Marco Rubio released a plan to raise the tax on stock buybacks in order to extend policies like full expensing, which was enacted under the Tax Cuts and Jobs Act and expires at the end of 2022.
Indiana - A bill that would require online marketplace facilitators to collect sales taxes on behalf of third-party sellers on their platform passed the house and heads to the senate for debate.
Massachusetts - Following the defeat of a ballot initiative in court last year, supporters of an increased surtax on income over $1 million are reviving their effort by pushing legislation to alter the state’s constitution. State law mandates that income taxes be uniform which caused the initiative to fail in the courts.
Virginia - Both chambers passed a bill that would require online marketplace facilitators to collect sales taxes on behalf of third-party sellers on their platform. The bill moves to the governor’s desk for his expected signature.
Washington - The senate passed a bill bringing the state into compliance with the SCOTUS Wayfair ruling by establishing that sellers with over $100,000 in annual sales must comply with the state’s sales tax collection obligations. The state already has a law mandating online marketplaces like Amazon collect and remit sales taxes for all third-party sales on their site.
West Virginia - A bill establishing that sellers with over $100,000 in annual sales must comply with the state’s sales tax collection obligations passed the house and moved to the senate.
Wyoming - Both chambers passed a bill that would require online marketplace facilitators to collect sales taxes on behalf of third-party sellers on their platform. The bill moves to the governor’s desk for his expected signature.
Miscellaneous
New Hampshire - A bill that would allow municipalities to regulate formula retail, restaurant and hotel businesses failed in committee and will not advance this session. The bill would have allowed localities to ban a formula business from any municipality or district.
Philadelphia, PA - The city council has advanced an ordinance to the mayor’s desk that would require all retailers to accept cash payment. The city council reacted to a local advocacy campaign against a cashless Amazon store that was slated to open.
Key Takeaways
Legislature Status for Week of 2/19/19
Podcast
Check out our Working Lunch podcast each week that includes further analysis into these legislative issues, policy, politics and much more. You can find Working Lunch on the Nation's Restaurant News website, or by clicking here, and when you download the podcast and subscribe on iTunes here.
Arizona - A house committee passed a bill that establishes a lower minimum wage for workers under the age of twenty-two who are enrolled as a full-time student and working part-time. The bill sets the wage for those workers at the federal minimum wage level of $7.25/hr, as opposed to the current state minimum wage of $11/hr.
Connecticut - The governor pledged his support for a minimum wage increase announcing that he will include language to raise the $10.10 wage to $15/hr by 2023 in his budget proposal.
Illinois - The house passed the exact same $15/hr wage bill that recently passed the senate advancing the bill to the governor’s desk for his approval. That bill did not include many provisions that are important to employers, such as a regionally-based minimum wage.
Michigan - The state attorney general is questioning the legality of the new minimum wage and paid leave laws passed by Republicans in last year’s lame duck session and may challenge the laws in the courts. Those laws significantly altered voter-approved initiatives on wages and leave. At question is whether the legislature can change citizen ballot petitions in the same legislative cycle in which they were originally passed.
Missouri - A Republican senator is planning to introduce legislation to trim back parts of the new minimum wage law passed by the voters last November. The bill would create a new minimum wage for workers under the age of eighteen and freeze the cash wage for tipped employees at its current rate.
New Mexico - The house passed legislation increasing the state minimum wage to $12/hr by July 1, 2021. It would also phase out the tip credit by 2022. The senate version, which preserves the current tip credit, is expected to be considered in the coming weeks.
Pasadena, CA - The city council advanced legislation that would bring the city minimum wage to $15/hr by July 2020, 18 months earlier than the statewide mandate of 2022.
Paid Leave
Connecticut - The governor announced his support for 0.05% payroll tax to fund a paid family leave program administered by the state. He did not specify how much leave and at what percentage of pay the program would allow. The bills are under debate in the legislature where they have failed in previous cycles due largely to cost concerns.
Illinois - A paid parental leave bill is gaining momentum. It would require private employers with 50 or more employees to provide six weeks of paid leave for employees on the job at least a year that recently gave birth to a child, adopted a child under eighteen years old or for a family member with a serious health condition. It is unclear whether the governor supports the measure.
Maine - The bill mandating employers with more than five employees offer a paid sick leave program will be heard in its first public committee meeting. The bill allows full and part-time employees to earn one hour of paid sick leave for every 30 hours worked. The city of Portland is considering a similar proposal and a council committee was set to vote to move it forward but the meeting was delayed by weather. They will reconvene next month and businesses have asked the city to delay further, allowing the state to take up the issue first.
Texas - Governor Abbott gave his full support to several bills that were recently introduced that would preempt local governments from regulating employer’s leave and benefit policies. The preemption effort is motivated by city action in Austin and San Antonio.
Scheduling
California - A state appeals court ruled that a retailer that utilized on-call scheduling practices must compensate workers due to the state’s reporting pay requirement, even though workers were not required to report to work. At issue, workers were required to call-in two hours before a shift, and if not called-in, the employer did not compensate the worker. The court ruled the employee was eligible for pay for at least a portion of the shift.
Washington - A bill to establish a statewide mandate for employee scheduling appears to have stalled in a house committee. A similar bill in the senate has failed to move as well, indicating senate leadership is waiting to see what the house may or may not do on the issue.
Labor Policy
Federal - Democrats introduced the Paycheck Fairness Act which would prohibit employers from retaliating against employees for discussing salaries and limits an employer’s use of wage history in the hiring process.
Arizona - A federal judge ruled that Walmart unlawfully terminated an employee who tested positive for marijuana use. The employee argued that under Arizona law she was legally prescribed medical marijuana and there was no evidence that she was impaired at work.
New York City, NY - The city council is considering legislation that would prohibit arbitrary termination, a provision typically found in collective bargaining agreements. Not only does it create expansive protections for firings based only on just cause but it also prohibits employers from cutting a worker’s hours by fifteen percent or more.
Taxes
Federal - Senator Marco Rubio released a plan to raise the tax on stock buybacks in order to extend policies like full expensing, which was enacted under the Tax Cuts and Jobs Act and expires at the end of 2022.
Indiana - A bill that would require online marketplace facilitators to collect sales taxes on behalf of third-party sellers on their platform passed the house and heads to the senate for debate.
Massachusetts - Following the defeat of a ballot initiative in court last year, supporters of an increased surtax on income over $1 million are reviving their effort by pushing legislation to alter the state’s constitution. State law mandates that income taxes be uniform which caused the initiative to fail in the courts.
Virginia - Both chambers passed a bill that would require online marketplace facilitators to collect sales taxes on behalf of third-party sellers on their platform. The bill moves to the governor’s desk for his expected signature.
Washington - The senate passed a bill bringing the state into compliance with the SCOTUS Wayfair ruling by establishing that sellers with over $100,000 in annual sales must comply with the state’s sales tax collection obligations. The state already has a law mandating online marketplaces like Amazon collect and remit sales taxes for all third-party sales on their site.
West Virginia - A bill establishing that sellers with over $100,000 in annual sales must comply with the state’s sales tax collection obligations passed the house and moved to the senate.
Wyoming - Both chambers passed a bill that would require online marketplace facilitators to collect sales taxes on behalf of third-party sellers on their platform. The bill moves to the governor’s desk for his expected signature.
Miscellaneous
New Hampshire - A bill that would allow municipalities to regulate formula retail, restaurant and hotel businesses failed in committee and will not advance this session. The bill would have allowed localities to ban a formula business from any municipality or district.
Philadelphia, PA - The city council has advanced an ordinance to the mayor’s desk that would require all retailers to accept cash payment. The city council reacted to a local advocacy campaign against a cashless Amazon store that was slated to open.
Key Takeaways
- Companies should pay close attention to California Governor Gavin Newsom’s approach to data privacy. He announced a new policy concept in his recent state of the state address that is being referred to as a “data dividend” for consumers. While light on the details, the basic concept is anytime a consumer’s data is traded, the consumer would be compensated for a portion of that transaction. While some entry level employers might not be front-and-center in the data debate, data collection and retention by companies could get more expensive and legally onerous.
- New York City continues to present the industry with challenges as the labor community is aggressively using it as a test lab for their proposals. As NYC passes these initiatives, look for other progressive cities to follow suit - namely Seattle, San Francisco, Los Angeles and Chicago. And then progressive states after that. The industry has to reassess its positioning in the city - and other urban markets - if it ever hopes to reverse this trend. Grassroots activism and smart urban engagement are two very different things and the industry must transition to a longer-term strategic approach to government relations at the local level.
Legislature Status for Week of 2/19/19
- The United States Senate is in recess this week
- The United States House is in recess this week
- Forty-seven state legislatures are in regular session:
- AK, AZ, AR, CA, CO, CT, DE, GA, HI, ID, IL, IN, IA, KS, KY, ME, MD, MA, MI, MN, MS, MO, MT, NE, NV, NH, NJ, NM, NY, NC, ND, OH, OK,OR, PA, RI, SC, SD, TN, TX, UT, VT, VA, WA, WV, WI, WY
Podcast
Check out our Working Lunch podcast each week that includes further analysis into these legislative issues, policy, politics and much more. You can find Working Lunch on the Nation's Restaurant News website, or by clicking here, and when you download the podcast and subscribe on iTunes here.
The Regulatory Wrap-Up is presented by Align Public Strategies. Click here to learn how Align can provide your brand with the counsel and insight you need to navigate the policy and political issues impacting retail.