Regulatory Wrap-Up: Governor of Illinois vetoes minimum wage hike
Wages
Illinois: As expected, Governor Rauner vetoed legislation seeking to raise the state’s minimum wage to $15/hr. by 2022. While not likely, the legislature could override the veto with ten additional votes in the house and six in the senate. While the statewide minimum remains at $8.25/hr., the city of Chicago is currently at $11/hr. with a rise to $13 by 2019. Cook County, the largest county in the state, has an increase scheduled to reach $13/hr. in 2020, however over 80% of municipalities have opted out of the increase.
Missouri: Minimum wage protests are occurring in both Kansas City and St. Louis. Protesters are calling on businesses to voluntarily maintain higher wages despite a recently passed statewide law that prevents cities from setting rates higher than the state’s $7.70/hr. rate. Protests are likely to continue through the weekend.
Flagstaff, AZ: A lawsuit that sought to remove a wage-related initiative from the ballot was dismissed by a judge this week. The current law calls for the city minimum wage to increase to $15.50 by 2020. The dismissal allows the initiative language supported by the Greater Flagstaff Chamber of Commerce to appear on the 2018 ballot. It would peg the city's wage rate $0.50/hr. higher than the state rate and link the city’s annual increases to the state’s timetable ($12/hr. by 2020).
Montgomery County, MD: County Executive Leggett reaffirmed his concerns regarding a countywide increase to a $15/hr. minimum wage. Leggett vetoed $15/hr. legislation earlier this year; however, several of the council members who are running for higher office have reintroduced the legislation. Leggett’s comments come as the county awaits a revised economic impact study that he commissioned. The original version contained methodology errors.
Paid Leave
Pennsylvania: A state senator reintroduced legislation for the third time that seeks to mandate employers provide 12 weeks of paid leave for new parents.
Labor Policy
NLRB: Peter Robb, a management attorney from Vermont, will be selected to fill the position of NLRB General Counsel, pending a background check. This position is one of most important within the agency and plays a critical role in determining what cases the board reviews. An NLRB General Counsel that leans towards management is a helpful development for employers. The outgoing general counsel’s term ends Oct. 31.
Missouri: Missouri allows residents to call a referendum on new legislation by collecting signatures from at least 5 percent of voters (over 100,000) from six of the state’s eight congressional districts. Unions appear to have completed that task by submitting 300,000 signatures to the secretary of state in an effort to overturn a right to work measure that passed during the 2017 legislative session. The secretary of state has suspended the law the while his office confirms the validity of the signatures. If more than 100,000 signatures are deemed valid, a referendum to overturn the state’s right to work law will appear on the 2018 ballot.
Labor Activism
Labor Day: Both the AFL-CIO and the SEIU are focusing their Labor Day PR efforts in midwestern states that went for Donald Trump. The AFL-CIO-backed Good Jobs Nation is organizing statewide rallies in hopes of highlighting the need for worker protections in the president’s ongoing trade negotiations and other policy initiatives, including an Indiana event aimed at highlighting Carrier plant job losses. President Trump previously pledged to keep Carrier jobs in the United States. The SEIU announced that it will spend $100 million organizing in rust belt states beginning this weekend and ramping up into 2018. On Sept. 4, operators should expect SEIU strikes and protests in major metros across the country.
Menu Labeling
New York City, NY: As a result of a case brought in federal court by the National Association of Convenience Stores and the National Restaurant Association among others, the city announced an agreement to postpone implementation of the city menu labeling law and defer to the enactment dates established in the federal regulations. The federal law goes into effect on May 7, 2018 and applies to restaurant chains with twenty or more outlets.
Health Care
Wellness Programs: The U.S. District Court ruled that the Equal Employment Opportunity Commission’s regulations regarding wellness programs were arbitrary and need to be revisited. The issue at hand is a regulation that allows employers to raise premiums up to 30% for employees that elect not to participate in employer-sponsored wellness programs. While the court found that the EEOC rules did not adequately defend the rationale for the 30% threshold, the current rules still remain in place. The federal judge determined that rescinding the rule at this time would cause ‘disruption and confusion’ in the market and directed the EEOC to revisit the rule. There is no announced timeline for future EEOC action.
Taxes
Massachusetts: The Department of Revenue heard testimony this week on the recently issued regulation that establishes apps and/or files on a customer’s computer or smartphone constitutes physical presence in the state for sales tax collection purposes. Public comments on the regulation remain open until Aug. 30.
New Jersey: The division of taxation announced a voluntary disclosure program for online retailers that is similar but distinct from the Multistate Tax Commission’s previously announced program. The program runs from Aug. 21 to Nov. 21 and applies to any non-compliant businesses that fall under the ‘affiliate nexus’ law passed in 2014. That law applies to sellers with contractual ties to any state-based entity from which the seller receives some form of compensation for referral sales.
South Dakota: The State Supreme Court is set to hear oral arguments on Aug. 29 in the landmark “economic nexus” case tha