Standard Wage Bill a Triple Attack on Jobs

A “standard wage” proposal in the Labor Committee would potentially penalize Connecticut business receiving certain tax or financial assistance from the state—and discourage many businesses from seeking those resources.  

Under HB 5756, many businesses would be required to pay an above-market union wage to any person (whether an employee of the business or not) who provides food-, building-, property- or equipment-services job functions for a period of 10 years after receiving the tax credit or financial assistance. 

If the business fails to pay the standard wage as mandated, the state could impose fines exceeding the assistance the business received.     

Wrong Direction

Proponents of the “standard” wage bill have nicknamed it the “good jobs bill”—but in reality, it won’t help create jobs. It’s really a three-pronged attack on businesses that will stifle job creation in the state. Here’s why:

1. Many businesses turn to the state’s economic development agencies because they do not qualify for assistance from a bank. Requiring a struggling business to make a long-term commitment to pay above-market wages to people providing grounds, maintenance, or food services in exchange for a one-time injection of capital will only worsen the employer’s financial situation—or lead the business to shut down altogether.   
2. Connecticut, like many states, offers financial assistance in order to encourage businesses to relocate or expand here. Requiring businesses to pay above-market wages in exchange for these incentives would make Connecticut less competitive and less likely to attract more job-creating businesses.
3. Mandating how much food, grounds, and maintenance workers must be paid takes away the competitive edge for businesses providing these services, and it means businesses using these services will have to pay more for them—leaving them with less money to invest in expanding their workforce. 

This bill will have a harmful economic effect on any business receiving any sort of financial assistance or tax credit in the state, and take away the state’s ability to attract new business and incentivize the expansion of existing businesses. 

For more information, contact CBIA’s Eric Gjede at 860.244.1921 or eric.gjede@cbia.com.