Even in the short three-month session lawmakers considered numerous proposals impacting many aspects of Connecticut workplaces. Ultimately, the 2014 legislative session took a few steps forward but also some steps back--on cost-driving bills and others impacting Connecticut’s competitiveness.

Perhaps the most troubling aspect of the session was that many legislators, particularly the liberal wing of House Democrats, continued to advocate legislation to increase the costs and administrative burdens of doing business.

While the business community was able to halt most of these measures, it’s clear that much work remains to avoid altogether these types of efforts and instead focus on improving Connecticut’s economy and business climate.   

Wage and Hour Issues

Minimum Wage Hike: Under SB 32, Connecticut’s minimum wage will increase to $9.15 per hour in 2015, $9.60 per hour in 2016, and finally to $10.10 per hour in 2017.

The idea was championed by the governor, given the green light by House and Senate Democratic leadership, and even lobbied by a presidential visit in March. This increase, however, seemed to diminish some legislators’ enthusiasm for adopting any additional cost-raising measures. 

Several other proposals aimed to inject more government control over employee wages and hours:

  • Another minimum wage hike, albeit in different clothes, was opposed by businesses and failed in the Finance Committee. HB 5069 would have imposed a punitive tax on employers with more than 500 employees, or small businesses that are part of franchises that collectively have 500 or more employees, for each employee paid less than 130% of the state’s minimum wage.  
  • HB 5256, which would have required retailers to pay hourly employees two and a half times their normal hourly rate for each hour an employee works on Thanksgiving or Christmas, died in the House. 
  • One proposal (HB 5280) would have punished success. It made a business ineligible for state tax credits or financial assistance from the state if any of its executives was compensated above a certain rate. This also died in the House.  
  • At first, SB 57 required employers to electronically “tag” wages directly deposited into employee accounts to make them more easily identifiable in the event the employee’s account is executed upon by a creditor. But the business community succeeded in having that employer mandate pulled from the bill prior to passage. Wages also were added to the list of funds partially exempt from execution by creditors.    

Retirement Plan Study

One of the most controversial proposals (SB 249) aimed to require businesses with five or more employees that do not currently offer their employees access to a 401(k), IRA, or pension plan to facilitate employee participation in a new state-run Roth IRA plan.

Businesses flagged many problems with the bill, including the fact that it would have put the state in direct competition with Connecticut’s private-sector financial services marketplace. 

While SB 249 did not pass, HB 5597—the budget implementer—includes a section that creates a board to take steps to implement the plan down the road.  Oddly, the board won’t include any employer representation. Fortunately, the plan will require additional implementation legislation in subsequent years. 

Workers’ Compensation 

Lawmakers took a major step forward in the battle against rising workers’ compensation costs in Connecticut by approving SB 61, which requires the state Workers’ Compensation Commission to establish a Medicare based fee schedule for hospitals and ambulatory surgical centers (ASCs) for treating work-related injuries in the case the entities have not reached a negotiated fee.

It’s best and most responsible way to arrive at fair and equitable charges for medical facilities and employers alike.

The study must be completed and the schedule established by Jan. 1, 2015. (For more information on this issue, contact Bonnie Stewart at 860.244.1925 or bonnie.stewart@cbia.com.)

Paid Sick Leave Changes

On another positive note, employers will have more flexibility in the way they can administer paid sick leave through HB 5269.

It allows employers to track the accumulation of the paid sick leave benefit on any 365-day cycle (current law restricts it to a calendar year).

Businesses also will be able to report their number of employees once a year to allow for natural fluctuations in the workforce (versus a quarterly accounting).

However, the job title of radiologic technologists was added to the mandate; as well as language indicating employers may not terminate employees to circumvent compliance with the law. 

Unemployment Proposals

Several measures dealt with trying to provide help to Connecticut’s long-term unemployed.

While well-intentioned, the proposals came with troubling strings attached.

For example, two bills (HB 5054, HB 5274) would have allowed unemployed job-seekers to bring claims against employers if the candidates believed they didn’t get hired because of their jobless status.

If adopted, they likely would have caused businesses to spend time and money defending against numerous meritless claims—bringing a definite blow to Connecticut’s business climate.

The main thrust of the measures was to prohibit employers from posting job advertisements that discriminated against the unemployed, which businesses support.

Employers attempted to negotiate removal of the section opening the door to meritless claims, while leaving the discriminatory job posting portion intact.

While HB 5054 died in the Judiciary Committee, the House passed HB 5274, which ultimately died in the Senate.

Another effort to help the unemployed was HB 5452, which would have allowed jobless individuals to participate in community service in lieu of meeting their work search requirements and to satisfy a condition of receiving unemployment benefits. It died in the Labor Committee. 

At first, SB 243 would have made a variety of pro-business changes to the state’s unemployment compensation laws.

But the Labor Committee changed the bill to require all businesses to share the cost of unemployment compensation benefits  to commercial truck drivers who are terminated due to losing their commercial drivers’ licenses after driving drunk. What’s more, a financial penalty was added for failure to provide employees with a pink slip at the end of employment.  The House did not take up the measure. 

A House Republican proposal (HB 5314) called for $60 million of the once-projected state budget surplus to be used to pay part of the balance of interest owed on funds Connecticut borrowed from the federal government to keep the state’s unemployment compensation system afloat.

When the surplus disappeared, so did chances of this relief for employers. 

Miscellaneous

Several potentially harmful—or at least distracting--proposals failed this year, in part through the efforts of businesses reaching out to their legislators.

These are the types of proposals that would likely to dissuade employers from increasing investments or jobs in the state. 

Guilty First: Employers were facing a “guilty until you prove yourself innocent” dilemma under SB 371. Any business taking any immigration-related action against an employee within 90 days of that employee asserting any labor or employment right would have faced stiff penalties.The bill was amended in the Senate to remove a judge’s discretion to award less than double damages in certain wage claim cases.  Fortunately, the measure was blocked from passage by House Republicans. 

Labor Union History: Another effort was made this year to require the state Board of Education to make available curriculum on the histories of labor unions and free market capitalism (SB 220). Businesses opposed the bill by emphasizing that, in view of Connecticut’s achievement gap, schools should be focusing on core skills. SB 220 died in the House. 

No Call for Call Center Bill

Changes to the operations of call centers and phone bank facilities with contracts in Connecticut were proposed in HB 5491. If adopted, the bill would have required call center or phone bank employees to disclose specific information to the caller within the first 30 seconds of calls to or from a Connecticut resident.

Businesses opposed the measure as unnecessary and contrary to a business-friendly climate in Connecticut. Call centers and phone bank operations already have to comply with federal law–the Gramm Leach Bailey Act--which addresses disclosure of information to customers. 

Ultimately, HB 5491 never received a call for a full House vote. (For more information on this issue, email Faith Gavin Kuhn.)

CCHRO

SB 385 would have amended the Connecticut’s Commission on Human Rights and Opportunities (CCHRO) laws, including changes to the merit assessment review process, and many definition and technical revisions.

CCHRO had negotiated the measure with CBIA, and a better bill was crafted and agreed upon.

Unfortunately,  CCHRO was unable to get their bill out of the Judiciary Committee as a result of unrelated political reasons.

Later, Judiciary’s Senate chairperson attempted to resurrect a similar, but much worse bill that would have increased the damages allowable in a CCHRO case. Not even the CCHRO was looking for these increased damages.

The measure did not move forward in the Senate in the closing days of session. 

For more information, contact CBIA’s Eric Gjede at 860.244.1931 | eric.gjede@cbia.com | @egjede