Numerous workplace-related measures making it much harder and more costly for Connecticut employers to operate successfully in the state have been approved by legislative committees this year.
Among other things, the proposals expand eligibility for workers’ compensation and unemployment compensation, mandate higher wages, and create steeper administrative hurdles.
On the other hand, also approved by committees are several measures that could improve some aspects of doing business in Connecticut.
Here is what the business community faces as the legislative session moves forward and the measures move to other committees:
Two proposals will expand eligibility for workers’ compensation benefits. allows employees to make new “sick building” illness claims and makes it hard for employers to challenge them. SB 823 enables employees to pursue workers’ compensation claims for psychological injuries that are unrelated to a physical injury. The proposal leaves several eligibility questions unanswered, which could lead to a large number of claims and an increase in defensive costs for employers.
SB 907 creates an administrative nightmare because it makes it nearly impossible for an employer to produce the necessary paperwork needed to challenge or reduce a workers’ comp claim.
But SB 1074, with modifications, would help stop workers’ compensation medical costs from going through the roof. It’s very important that this measure be adopted as soon as possible because a recent Workers’ Compensation Commission decision requires employers to pay whatever hospitals charge in the absence of previously negotiated fees.
With this ruling, hospitals would be foolish to negotiate fees as they can charge employers, andget paid, whatever they want. When modified, SB 1074 would provide employers, or their insurers, with the tools necessary to negotiate hospital reimbursement rates that are fair to both employers and hospitals for the treatment of work-related injuries or illnesses.
The Labor Committee approved SB 188, which allows out-of-work teachers to collect benefits while they pursue additional schooling—instead of being “available for work” or “looking for a new job,” two basic requirements for receiving unemployment benefits.
New penalties were approved. SB 909 penalizes the false unemployment claims of individuals--but also hits employers in cases where the Department of Labor pays out benefits and the affected businesses did not participate in the claims process.
Connecticut needs to encourage entrepreneurs and business startups, but HB 6451 nips at their heels by penalizing employers if they fail to register with the DOL for unemployment compensation purposes within 30 days of starting or acquiring a business. The committee also approved a 10% to 15% penalty for employers if they “willfully” fail to declare wage payments on their quarterly reports.
HB 6452 requires all employers to electronically file their quarterly unemployment tax returns.
Wages and Benefits
On a positive note, the Commerce Committee approved a bill (SB 1007) that makes some commonsense changes to the state’s mandatory paid sick leave law.
As the state struggles with economic recovery, state policymakers should be looking for ways to ease the high cost of doing business in Connecticut so that employers can create more jobs.
It’s a message that was lost in the Labor Committee, as the group approved a two-stage minimum wage hike (SB 387) that will reduce, not increase entry-level jobs; and a standard wage bill (HB 5756) that will discourage companies from doing business with the state.
A bill requiring employers that directly deposit employee paychecks to electronically tag the wages in order to identify them in the event of a wage garnishment by an employee’s creditors also requires payroll processors to purchase software upgrades, train employees, and incur liability in the event these wages are misidentified (SB 906).
Employers are already dealing with the costs, disruptions, and administrative burdens of mandatory paid sick leave. This year, the Children’s Committee created yet another leave--parental leave (HB 6501)--that mandates up to eight hours per year for employees to attend their children’s (or grandchildren’s) qualified school-related activities.
The Labor Committee also approved a study to explore how to pay employees who are out on family or medical leave (HB 6553)
Income Tax Withholding
The Labor Committee also adopted SB 1032 which will help employers by making Connecticut’s withholding tax policy consistent with those in neighboring states.
Both the Labor and Children’s committees found more ways to tie the hands of employers and increase their administrative burdens.
Under SB 159 (Labor Committee), employers can’t ask or require employees or job candidates to disclose to the company their social media passwords. The problem is, as currently drafted, the bill leaves employers unprotected in the event an employee commits a data breach using his or her personal social media account. For healthcare and financial services companies in particular, this could be a very dangerous omission.
The Labor Committee approved a “mission: impossible” for employers. SB 910 mandates that businesses provide access to and copies of their employees’—or former employees’—personnel files and any disciplinary notices on demand and within very short time frames. What defines a disciplinary notice is left undetermined, and the bill ignores the fact that many businesses keep years and volumes of records at off-site locations.
Another Labor Committee bill (SB 908) is a solution in search of a problem. It allows an employee who was terminated, or a job candidate who didn’t get the job, to sue the business by claiming that the reason for the termination or rejection was because the employer used an erased criminal history. State law already prohibits employers from using an individual’s erased criminal history.
Probably the most irrational of the Labor Committee bills is HB 5713, which requires the state Department of Education to develop curriculum about the history of the labor movement, the collective bargaining process, and employee rights. An amendment to add “the fundamentals of capitalism and the free market economy” was rejected.
For more information, contact CBIA’s Eric Gjede at 860.244.1931 or email@example.com.