Regulatory Wrap-Up

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Regulatory Wrap-Up

By HBSDealer Staff - 09/17/2018
Wages

St. Paul, MN - The city council reviewed three separate proposals from the Citizens League to create a $15/hr minimum wage. Reports indicate that a majority of the council favors a phase-in of seven years for smaller businesses and five years for larger businesses, but the council has yet to determine how to define the two groups. The majority of the council also supports a to-be-determined training wage, but not a tip credit. The council will continue to debate the issue over the coming weeks.

Chicago, IL - Following the surprise announcement last week that two-term Mayor Rahm Emanuel will not seek reelection, several viable candidates are claiming the progressive mantle in the closely-watched race to replace Emanuel. One of the leading Democratic candidates, Lori Lightfoot, announced her support for a universal basic income (UBI) program, a $15/hr minimum wage and enhanced wage theft enforcement.  The city has formed a task force to solicit input on the proposed UBI pilot program which was introduced in June.

Washington, DC - The city council will hold a hearing on Sept. 17 to consider legislation to repeal Initiative 77 which voters approved in June. Initiative 77 would gradually eliminate the city’s tipped wage (currently set at $3.33/hr) by increasing it to $15/hr by 2026. A majority of the city council supports repeal, as does the mayor, despite some public opposition.

Paid Leave

Austin, TX - The city has appealed a lower court decision to the state supreme court that would block enforcement of the city’s paid sick leave law. The law was set to go into effect Oct. 1. But, until the court rules on the matter or lifts the injunction, businesses will not have to comply.

Eataly - The Italian-themed food court and marketplace announced this week that it will begin offering paid parental leave for all its employees, as long as they have worked at the company for one year. For the first four weeks of parental leave, employees will be eligible for 100 percent of their gross weekly wages. For the second four weeks, they will be paid 60 percent of their gross weekly wages.

Labor Policy

NLRB - The National Labor Relations Board has asked a U.S. appeals court to pause its review of an Obama-era board ruling, Purple Communications, that allowed workers to use company email to engage in union organizing, saying it is considering overruling the decision. The Board is currently reviewing it, and the precedent it set, in the context of another case. The current Board is actively dismantling many Obama-era precedents and Purple Communications seems to be on that list.

Joint Employer

NLRB - On Sept. 14, the National Labor Relations Board released a proposed rule that clarifies the joint employer standard and moves to overturn the Obama-era standard. The new rule would require that an employer possess and actually exercise substantial direct and immediate control over employees in order to trigger a joint employer requirement. The rule is subject to a 60-day comment period after which the Board could modify it before the rule goes into effect.

Health Care

U.S. House - The U.S. House plans to vote on the The Save American Workers Act which would change the definition of full-time employees (from 30hrs/wk to 40hrs/wk) for the purposes of minimum health insurance coverage under the requirements set forth in the ACA. The proposed legislation would also retroactively suspend penalties for noncompliance with the employer mandate for 2015-2018. The bill may pass the House but has a tougher path in the U.S. Senate, particularly given the compressed calendar prior to the midterm elections.

Activism

Burgerville - Unionized workers at a Montavilla, OR location are threatening legal action against the company for banning political buttons on their work uniforms. The threat stems from several employees wearing #AbolishICE buttons on the job.

Marriott - The hospitality union UNITE HERE is holding a series of strike authorization votes involving as many as 12,000 members starting Sept. 10. Local unions in four cities - Waikiki, Maui, San Francisco and Boston - have already scheduled their votes. Local unions in five other cities - Seattle, Oakland, San Jose, Detroit and San Diego - may follow. Union leaders are focused not only on wages but also on automation and housekeeping workloads.

McDonald’s - Fight for $15 is organizing its second round of actions targeting McDonald’s on the issue of sexual harassment. As of today, organizers plan to target ten major metro areas Sept. 18. Fight for $15 also announced the formation of “women’s committees” in a dozen locations.

Target - Workers at a Long Island, NY location overwhelmingly rejected unionizing this week. The vote was 118-39 against joining the United Food and Commercial Workers (UFCW) union. It was the second defeat at a New York location in recent years.

Taxes

Colorado - The Department of Revenue announced that out-of-state sellers must begin collecting and remitting sales taxes for sales into the state on Nov. 1 2018. The department also announced a soon-to-be released package of regulations that will detail the collection responsibilities and thresholds associated with the announcement. Colorado’s local taxing authorities make collection more complicated than in other states. If local authority goes unaddressed by the state, efforts to force collection on out-of-state sellers could invite further litigation.

South Dakota - The governor signed a new law allowing the state to begin collection of sales taxes from out-of-state sellers on Nov. 1, 2018. Sellers with at least 200 transactions or $100,000 worth of sales into the state per year must register with the state and begin collecting. The action follows the state’s successful U.S. Supreme Court case which effectively eliminated the physical presence requirement for sales tax collection purposes. The governor also signed a law that requires certain sized online marketplaces to collect and remit sales taxes associated with the sales of their platform’s third party sellers. Vendors such as eBay, Amazon and Etsy must start collecting the tax for third-party sales in March 2019.

Soda Taxes

California - The secretary of state approved a potential ballot measure for 2020 that places a $0.02/oz tax on sugary beverages. Several localities already have soda taxes on the books and the state, under pressure from industry, recently passed a law preempting more localities from enacting similar laws. As a result, advocates are turning to the ballot process.

Key Takeaways

  • In the modern era, company responses to natural disasters like Hurricane Florence will, for better or worse, have an oversized impact on their brand reputations to employees, customers and other community stakeholders. Companies often tend to chase headlines and provide food and water to first responders. While laudable, that halo is fleeting. Not doing the right things by their employees and their families during a potential crisis will have a reputational shelf life that far exceeds any short term media coverage. The health and welfare of our employees has to be the first priority.

  • The business community has long awaited clarity and a bright-line test on the joint employer issue. With this week’s action by the NLRB, the process of relief has officially begun. Companies need to take full advantage of the 60-day public comment period and help educate policymakers on the importance of reforming the current rules.


Legislature Status for Week of 9/17/18

  • The United States Senate is in session this week

  • The United States House is in recess this week

  • Three state legislatures are meeting actively this week:

    • MA & NJ




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.


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