Regulatory Wrap-Up
Market Insights

Regulatory Wrap-Up

BY HBSDealer Staff

Wages

Colorado – The senate passed legislation eliminating the state preemption on local minimum wage laws. An amendment was added mandating localities that create local minimum wages honor the existing state tip credit of $3.02/hr. Additionally, any local increase in excess of the state wage would be delayed until 2021.

Hawaii – Lawmakers failed to reach a deal on a bill to raise the minimum wage to $15/hr and deferred the issue to the next legislative cycle.

Louisiana – A bill that would allow voters to determine if the state should increase the minimum wage to $9/hr passed a senate committee. The language, if passed, would place the question on the 2020 ballot. A similar bill has moved in this committee in previous sessions but ultimately failed and did not pass into law.

Vermont – Senate-passed legislation to raise the state minimum wage to $15/hr passed out of its first house committee. Additionally, Governor Scott indicated he may be willing to sign the legislation provided the phase-in period is sufficiently long. This marks a significant departure from his previous statements in opposition to a $15/hr increase.

Paid Leave

Colorado – The bill to establish a statewide paid family leave program was killed; however, an amended bill establishing a study committee to examine the funding mechanism for the program is headed to the governor’s desk for his likely signature.

Louisiana – Legislation mandating employers offer paid leave to deal with family or medical issues advanced out of a senate committee. The bill also creates a fund similar to the state worker’s compensation fund to underwrite the law.

Minneapolis, MN – The legality of the city’s paid sick leave law, allowing workers to earn one hour of leave for every 30 hours worked, was upheld by the state court of appeals and can now be enforced by the city. One of the disputed issues that the court upheld is that out-of-area employers that have employees working within the city limits will be responsible for complying with the mandate.

Wage Theft

Minnesota – The attorney general penned an opinion piece this week vowing to crack down on wage theft in the state. He cited examples from a restaurant and a convenience store.

New Mexico – Due to a high number of complaints, the state’s labor department released a video designed to help employers comply with wage and hour laws in the state. The agency plans to ramp up enforcement efforts.

Scheduling

Pennsylvania – Legislation to enact a statewide “fair workweek” law similar to the one recently passed in Philadelphia has been unveiled. The political dynamics in the state capitol make final passage highly unlikely.

Labor Policy

California – A federal appeals court upheld the California Supreme Court decision in the Dynamex case and also found that the standard established in that case applies retroactively. The decision has far-reaching impacts for both “gig” economy and traditional “bricks and mortar” employers. In addition to ride-sharing apps facing lawsuits under the standard, at least one franchised janitorial company has also been fending off a class action lawsuit. State lawmakers have also indicated that they would like to enact legislation codifying the Dynamex standard which would make it harder for businesses to classify workers as independent contractors. Further complicating matters, the Dynamex employee classification test appears to conflict with a guidance document released by the federal Labor Department this week.

Labor Department – The agency released a guidance document related to employee versus independent contractor classification in the gig economy. It states that workers for an unnamed digital platform, which connects service providers with clients, are contractors, not employees. This guidance document appears to conflict with the federal appeals court Dynamex decision this week in California.

EEOC – The Equal Employment Opportunity Commission (EEOC) announced that it will begin accepting employer pay data submissions in mid-July so it can meet the court-mandated Sept. 30 deadline. The agency also decided that employers must submit data for 2017 and 2018. On another front, Commission nominee Janet Dhillon’s final confirmation vote, after a long delay, is slated for next week which will provide the Commission a quorum for the first time since early this year.

SEIU Forum – With the exception of Bernie Sanders, all major Democratic candidates for president descended on the Service Employees International Union-hosted forum last week in Las Vegas. Candidates pressed their case in front of attendees, many of whom will determine who receives the endorsement of one of the largest and most powerful unions in the country. Of note, Kamala Harris criticized McDonald’s USA “for not committing to higher pay” and vowed to fight right-to-work laws.

May Day – The first day of May, referred to as May Day or International Workers Day, saw protests and actions across the world. In the past, U.S. employers have experienced call-outs; however, this year, protests were limited. The Pacific Northwest, as usual, experienced a higher level of activism compared to other parts of the country.

Taxes

North Carolina – Language that would force online marketplace providers to collect sales taxes on sales made by third-party vendors on their site was included in the budget bill that passed the house. The full package will now be considered by the senate.

Texas – Both chambers have passed legislation which would force online marketplace providers to collect sales taxes on sales made by third-party vendors on their site. A few technical differences remain between the two chamber bills that will need to be reconciled before legislation can advance to the governor’s desk.

Trade

China – President Trump announced via tweet that tariffs on $200 billion of goods imported from China will rise from the current 10% level to 25% at the end of this week. The president also threatened to expand tariffs to an additional $325 billion worth of goods, with no specific timetable. The increase was put on hold by the administration in Jan. as Chinese and U.S. negotiators continue to work on an overall trade deal.

Key Takeaways

  • Last week Maine became the first state to ban single-use styrofoam food containers. The debate around styrofoam and plastic bags isn’t new but environmental activists are tapping into renewed energy and discussions related to plastic straws to make gains on all single-use, disposable items across the board. As the industry becomes more reliant on delivery, the public policy entities within the industry need to engage quickly and much more aggressively in the packaging debate.
  • The investigation by the New York Attorney General into claims of wage theft at a golf property owned by President Trump should not be viewed as merely a political stunt. Regardless of the outcome, it will shed a strong light on the issue of wage theft and make a somewhat obscure issue much more mainstream. Brands should take notice of the escalation of the issue and prepare accordingly.

Legislature Status for Week of 5/6/19

  • The United States Senate is in session this week
  • The United States House is in session this week
  • Twenty-seven state legislatures are in regular session:
    • AL, AK, AZ, CA, CT, DE, IL, LA, ME, MA, MI, MN, MO, NE, NV, NH, NJ, NY, NC, OH, OK, OR, PA, RI, SC, TX, VT

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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