Workplace Mandates Fail As Legislative Session Ends
A number of costly proposed workplace mandates, including paid family medical leave and expanded sick leave, died this week as lawmakers failed to act on them by the session’s May 9 deadline.
CBIA and its allies warned those mandates threatened the state’s business climate, eroding our competitiveness while potentially costing employers and taxpayers as much as $530 million in compliance and implementation.
“The cost of doing business in Connecticut is one of the highest in the country,” Gjede said. “And one-size-fits-all mandates further weaken our ability to compete regionally, nationally, and globally.
“Through our efforts this session, we were able to inform and shape policy debates through the experiences of our members and their workforce.
“Our goal was to demonstrate that what Connecticut desperately needs to drive economic growth and job creation is a more positive business climate.”
SB 1 and HB 5387 taxed employees at companies with two or more employees to fund a costly and unsustainable paid FMLA program administered by the state.
The program carried enormous start-up and administrative costs, with lawmakers originally proposing issuing $20 million in bonds—essentially having taxpayers foot the bill—to fund implementation.
The legislature’s non-partisan Office of Fiscal Analysis estimated annual costs of $18.6 million, raising questions that the program likely would be unable to guarantee full benefits to workers.
State and local governments were exempted from both proposals.
The proposals also extended the right to use paid leave to care for extended family members—including siblings, grandparents, grandchildren, or “anyone close to you that is related by blood, or any whose close association with the employee is equivalent to that of a family member.”
CBIA supported HB 5584, which provided a tax credit for employers that have paid family and medical leave benefit programs. The House failed to act on that bill.
SB 1 failed by a single vote in the Finance, Revenue and Bonding Committee, while the state House did not act on HB 5387 before the May 9 deadline.
Paid Sick Leave Expansion
HB 5044 represented a major expansion of the state’s paid sick leave law.
In 2011, Connecticut became the first state in the country to adopt paid sick leave, mandating that certain non-manufacturing companies with 50 or more employees provide each service worker with up to five days annual leave to care for their own or a child’s illness.
This bill expanded the paid leave mandate to all businesses—including non-profit organizations—with 20 or more employees and requires all companies with less than 20 workers to provide unpaid leave.
Too many bills this session distracted from the most important issue facing Connecticut—the urgent need to spur business investment and job creation.
The state House did not act on the bill after the Labor and Public Employees Committee approved it 7-6.
Employer Gag Order
The House also failed to act on a heavy-handed measure that drastically limited what employers could discuss in the workplace.
HB 5473 prevented employers from speaking about any issue defined as a "political matter," including legislation or regulations that impact their businesses.
State Attorney General George Jepsen issued a formal opinion April 26 that the controversial proposal was preempted by federal law and would likely be struck down in court.
A measure requiring businesses in certain industries to pay one-half of an employee's regular pay if a shift is cancelled or reduced within 24 hours of its scheduled start failed three times this session
Having failed already in two legislative committees, the shift scheduling mandate surfaced unexpectedly in the Senate when Sen. Marilyn Moore (D-Bridgeport) replaced the language of an unrelated bill.
The Senate rejected the bill May 1 on a 16-20 vote, with Democrats Joan Hartley (Waterbury) and Gayle Slossberg (Milford) joining all Republicans in opposing the measure.
Labor Department's Employer Tax
The state Department of Labor pushed two proposals adding a 0.05% surcharge on all taxable wages that would be used to help pay agency staff salaries.
That proposal was originally included in SB 6, a budget bill.
After the Appropriations Committee did not act on SB 6, the department pushed for its inclusion in the revised budget, arguing it would help manufacturers meet workforce development needs.
The proposal was not included in the budget adopted by the legislature.
Minimum Wage Hike
HB 5388 hiked the state's hourly minimum wage from $10.10 to $12 on Jan. 1, 2019; $13.50 on Jan. 1, 2020; and $15 on Jan. 1, 2021.
Increases in subsequent years were tied to the Consumer Price Index. The federal minimum wage is $7.25 an hour.
OFA reported the bill would have cost Connecticut taxpayers at least $50 million annually through increased compensation and contract costs to state agencies and municipalities.
The House failed to act on the bill after it narrowly passed the Appropriations Committee 27-24.
SB 132, which proposed sweeping changes to the state's workplace harassment statutes, was changed through a strike-all amendment before passage in the Senate.
It required businesses with 20 or more employees to provide sexual harassment prevention training to all employees every 10 years. Companies with less than 20 employees would have to train supervisors.
Current state law requires that companies with 50 or more employees provide training for supervisors within six months of hire or promotion.
The bill required the state Commission on Human Rights and Opportunities to create an online training program to fulfill these requirements.
Language that restricted the use of certain affirmative defenses was removed from the bill.
The House failed to act on SB 132 and a similar bill, HB 5043, that required businesses with 15 or more employees to train employees every five years.
Several positive measures found traction during the session, with the legislature sending two measures to the governor's desk.
HB 5386 seeks to close gender-based pay gaps, prohibiting employers or third parties from inquiring about prospective employee salary histories.
CBIA was part of a group of stakeholders that worked on the bill's language.
While the legislation represents a significant change to the hiring process in Connecticut, employers understand the need to address this issue and are willing to do their part.
SB 472 passed the Senate after being amended to strike a proposal prohibiting employers, other than financial institutions, from using credit reports for employees who have access to non-financial assets.
Unfortunately, the state House did not act on much-needed reforms to the state's Unemployment Trust Fund.
HB 5480, which was supported by CBIA, featured a series of reforms designed to restore the fund's solvency without taxing businesses or cutting benefits to qualified workers.
Both the finance and labor committees approved the bill, which OFA reported would save the fund more than $163 million in the first two years alone.
For more information, contact CBIA's Eric Gjede (860.480.1784) | @egjede
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