Regulatory Wrap-Up: Updates on paid leave, cybersecurity and trade

8/21/2017

Wages

Kansas City, MO: The voter-approved $15/hr. minimum wage will begin to phase in four days (Aug. 24) before a recently passed state preemption law goes into effect; however, a previously enacted preemption law remains in effect for Kansas City and all other municipalities other than St. Louis (a judge struck down the law’s applicability to St. Louis). City officials have stated they will not enforce the new $10/hr. requirement during that four day period and reaffirmed that a state preemption law remains in effect.

Paid Leave

Michigan: The Michigan Board of State Canvassers gave approval to Michigan Time to Care’s paid leave constitutional amendment. The group can now begin gathering petitions. It has 180 days to collect over 300,000 signatures. The initiative would require businesses to allow employees to accrue one hour of paid leave for every 30 hours worked with a cap of 40 hours of paid leave per year.

Washington: The paid leave funding legislation passed earlier this year mandating weekly paycheck contributions by both employers and employees is currently in the rulemaking process. Multiple public hearings are being held during the month of August with public comments due by Sept. 1.

Albuquerque, NM: Opponents of the paid leave initiative are exhausting all legal options in an effort to remove it from the October ballot, appealing their case to the state supreme court. Ballots must be mailed to residents by Aug. 28, placing the legal challenge under significant time constraints. The initiative would apply to all businesses with a physical presence in the city and mandates that employers provide at least seven days of paid leave to employees.

Taxes

ACA: After the failed effort by Congressional Republicans to repeal the ACA, the IRS is reminding employers that reporting requirements remain in effect. The agency recently announced that it plans to enforce the employer requirements. To date, the IRS has not imposed any penalties even though the reporting rules have been in effect for two years.

California: A California Assemblyman is working on legislation to raise the state’s corporate tax rate from 8.84% to 9.84% for companies with 500 or more employees. The new revenue would be dedicated to building affordable housing. While a bill has not yet been officially introduced, this issue is likely to dominate the policy discussions when the legislature returns later this month.

Menu Labeling

New York: The New York City Health Department agreed to delay enforcement of the menu labeling requirements from Aug. 21 to Aug. 25 to allow negotiations with the affected business community to continue. If no agreement is made, the judge in the case brought by the NRA and NACS seeking to delay the city ordinance is expected to rule on an enforcement timeline by Aug. 25. The city law conflicts with the federal law which does not go into effect until May 7, 2018. Additionally, that law affects a larger pool of businesses. Under the NYC ordinance, foodservice establishments that have 15 or more locations nationwide must disclose calorie counts and other nutritional information as well as post a statement about the daily-recommended caloric intake.

Labor Policy

Labor Day Activism: Each Labor Day, unions and labor advocates celebrate the history of the labor movement, and press coverage around the holiday often focuses on the state of organized labor and ongoing union campaigns. The Fight for $15 campaign, for its part, is collecting petitions to highlight the positive impact of unions.

North Carolina: The Governor signed a new law creating an office to investigate employers who may be misclassifying workers as independent contractors to avoid providing benefits and paying taxes.

Safety

OSHA: In light of a potential security breach, the Occupational Safety and Health Administration announced it was deactivating a recently launched electronic portal for employer injury reporting. The Trump Administration had announced a delay in enforcement of the Obama-era rule requiring employers to report injuries via the portal, but OSHA instead launched the portal in July and some employers had already begun utilizing it.

Cybersecurity

NIST: The National Institute of Standards and Technology, the federal agency responsible for setting numerous standards including for cybersecurity, issued a draft revision of a special report outlining security and privacy controls for information systems. The report provides a catalog of operational protocols intended to protect all types of computer platforms including general purpose computing systems and internet of things devices from hostile attacks, natural disasters, human errors and privacy risks. The draft revision is open for public comment through Sept. 12.

Trade

NAFTA: Trade officials from the U.S., Mexico and Canada concluded the first round of NAFTA renegotiation talks and scheduled the second round Sept. 1-5 in Mexico. The joint press statement released this week focused on positive first steps and restated a commitment to a quick conclusion of the talks. All parties are seeking conclusion prior to domestic campaign seasons -- U.S. midterm elections and Mexico’s presidential election. Behind the scenes, tensions were high as the U.S. ruled out minor tweaks and restated its intent for a full renegotiation. Issues such as rules of origin for auto parts, dispute-resolution systems and labor standards will be among the more challenging negotiations.

South Korea: US Trade Representative Robert Lighthizer announced an Aug. 22 special session of the Joint Committee under the Korea-US Free Trade Agreement (KORUS) to be held in Seoul. This marks the beginning of U.S.-initiated discussions regarding the efficacy of the free trade agreement as well as concerns over market access and the growing trade imbalance.