Regulatory Wrap-Up
Market Insights

Regulatory Wrap-Up

BY HBSDealer Staff

Wages

Federal – A group of Democrats introduced a bill this week that would create regional minimum wage rates based on the local cost-of-living, deepening a rift within the caucus about raising the minimum wage nationwide to $15/hr. Under the proposal, every metro area would be grouped into one of five tiers.

Arizona – Efforts to modify the minimum wage law passed by voters in 2016 have stalled as questions have arisen over the legality of legislatively altering voter-passed initiatives. Republicans in the state have led the effort to create a subminimum training wage for full-time students under 22 years of age working part-time jobs.

Arkansas – Similar to Arizona, the house rejected legislation to alter the state’s voter-approved increase to the minimum wage by creating a subminimum training wage. The issue is now dead for the year.

Florida – Republicans in the senate are pursuing changes to the signature gathering process for placing constitutional amendments on the ballot. The effort, if successful, would make it more difficult for Democratic priorities like increasing the minimum wage and legalizing marijuana to appear on the 2020 ballot.

Michigan – The state supreme court announced that it will consider the legislature’s request for an advisory opinion on whether or not new laws to raise the state’s minimum wage and require paid sick leave are legal. Oral arguments are scheduled to begin in July.

New Mexico – The governor signed legislation to raise the state’s minimum wage to $12/hr by 2023. The cash wage for tipped employees will ultimately increase from its current $2.13/hr to $3.00/hr but future increases will not be tied to a cost-of-living adjustment.

Minneapolis, MN – As expected, a state appeals court upheld a city ordinance to raise the minimum wage to $15/hr. The increase originally passed in 2018 and business groups have been litigating the measure saying it violates existing state laws regarding preemption. The matter now appears settled.

Google – The company announced that any third-party staffing companies with which it contracts must pay their workers at least $15/hr, offer health benefits and provide at least 12 weeks of paid leave as well as tuition reimbursement.

Target – Target announced that it is raising its starting wage to $13/hr and intends to raise it again to $15/hr by 2020.

Paid Leave

Vermont – By a 92-52 vote, the house approved legislation mandating 12 weeks of paid family leave. The vote count is important because it failed to hit the 100-vote threshold needed to override a likely veto. The governor has proposed a bi-state solution and does not support the mandatory program passed by the house.

Los Angeles, CA – With the support of the mayor, the city council advanced legislation mandating 18 weeks of leave which would be paid for by employers.

Labor Policy

U.S. House – Democrats will hold a hearing next week on combating wage theft, intended to highlight the “critical role of wage and hour enforcement.”

Labor Department – The Labor Department introduced a proposed rule this week that would make it harder to hold businesses jointly liable when their franchisees or contractors violate the Fair Labor Standards Act. The proposal would use a four-part test to determine whether a business is jointly liable under the minimum wage and overtime law. The move was applauded by business groups.

EEOC – Facing a court-imposed deadline, the Equal Employment Opportunity Commission (EEOC) reported to a judge this week that the new deadline for employers to submit pay data broken down by race, ethnicity and gender is Sept. 30. The courts had frozen the Obama-era requirement before a judge reinstated it just weeks before the agency began collecting the data in mid-March.

Colorado – A house committee advanced a bill that would make denial or underpayment of more than $2,000 in wages a felony offense.

Chicago, IL – A committee revised the 14-day advanced scheduling mandate currently under consideration. The new ordinance would exempt restaurants with less than 250 employees and 30 locations worldwide.  Businesses in other industries with less than 100 employees would also be excluded.  The full council could consider the measure as soon as April 10.

Fight for $15 – The SEIU organized protests at McDonald’s locations in Los Angeles, Chicago, Miami, St. Louis and other cities, criticizing the brand’s decision to halt lobbying against minimum wage hikes, calling it insufficient.

Burgerville – Two new Burgerville stores voted to unionize this week. The Industrial Workers of the World have now won union elections in five Burgerville stores.

Equal Pay Day – April 2 was Equal Pay Day. The date symbolizes how far into the new year a woman must work to earn what a man did in the previous year. As in year’s past, the day earned national headlines.

Taxes

ArkansasThe legislature passed a bill establishing that out-of-state sellers with more than $100,000 in annual sales or more than 200 transactions per year must begin collecting and remitting sales taxes on all sales made to in-state consumers. The bill also mandates that online marketplace providers must collect sales taxes on sales made by third-party vendors on their site. The bill now advances to the governor’s desk for his expected signature.

California – The senate unanimously passed legislation to raise the economic threshold for out-of-state retailers from $100,000 to $500,000 in sales per year, above which retailers are obliged to collect and remit sales taxes for in-state sales. The language also establishes that certain marketplace providers must collect sales taxes on sales made by third-party vendors on their site.

New Mexico – The governor signed a bill into law establishing that out-of-state sellers with more than $100,000 in annual sales or more than 200 transactions per year must begin collecting and remitting sales taxes on all sales made to in-state consumers. The law also mandates that online marketplace providers must collect sales taxes on sales made by third-party vendors on their site.

Key Takeaways

  • The election results in Chicago last week are the latest indication that progressives are in control of the Democratic party, especially at the local level in major metros. The new mayor ran against the establishment, the heralded Chicago “Democratic machine,” and at least six new aldermen describe themselves as socialists and will bring a new level of activism to city politics. And, considering their close relationship with the labor community, a new level of hostility to entry-level employers.

 

  • As delivery continues to become an increasingly larger percentage of sales, brands need to pay close attention to the renewed momentum around packaging restrictions. States, particularly in the Northeast, are aggressively pursuing single-use plastics bans, styrofoam bans and other restrictions. Companies not only need to re-engage in the packaging conversation, they need to be aggressively seeking alternatives as many of our traditional packing materials are being legislated out of existence.

Legislature Status for Week of 4/8/19

  • The United States Senate is in session this week
  • The United States House is in session this week
  • Forty-two state legislatures are in regular session:
    • AL, AK, AZ, AR, CA, CO, CT, DE, FL, HI, ID, IL, IN, IA, LA, ME, MD, MA, MI,  MN, MS, MO, MT, NE, NV, NH, NJ, NY, NC, ND, OH, OK, OR, PA, RI, SC, TN, TX, VT, WA, WV, WI

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.

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