As a result of strong
opposition from NFIB and the business community, Senate President Sweeney
pulled legislation that would mandate paid sick leave from the board list on
the last day before the legislature breaks for the summer.
The legislation requires
all employers to provide paid sick leave to each worker it employs in New
Jersey, with the exemption of employees bound by a collective bargaining
agreement. Employees will receive one hour of earned sick leave for every 30
hours worked. A major concern for NFIB is the clause that will grandfather the
current nine municipalities that already mandate paid sick leave through a
local ordinance into this version of the legislation. We believe that this does
not provide a level-playing field and may have unintended consequences, setting
a bad precedent regarding future legislation that seeks to set statewide
standards. Additional concerns include liability issues, notification, finding
replacements and documentation.
NFIB Members have been very vocal about their concerns with this
legislation and many say that they cannot afford to offer this benefit and that
it will shrink the economy and cause jobs to vanish.
Most employees in New Jersey already get paid sick leave. In fact, small businesses are eager to treat
their workers generously and attract better talent by offering better pay and
benefits. But the practical truth is
that many small businesses just cannot afford to provide additional
benefits.
A study
conducted by NFIB Research Foundation predicts a loss of up to 25,000 jobs in
the next decade if this job killing legislation is implemented. 58% of those jobs will be borne by the small
business community.
While NFIB believes this idea springs from good intentions, the
legislature is not considering the real-world economic consequences. Small bueinsses will be affected and it
will be another incentive to automate workforces, lay off employees, limit
hring or just giving up on New Jersey as a place to do business.
HISTORY
On Monday, June 22 the Senate Labor Committee approved S-785 with amendments. The bill requires employers to provide either five days or nine days of paid sick leave to their part-time and full-time employees. It also allows employees to carry unused sick time from one year to the next.
Amendments
that were added on June 22:
- Construction
employees with collective bargaining agreements are not covered. - An
employee without a spouse/partner can choose another person annually for whom
they can take leave. - Employees
begin accruing leave the very first day they are employed (instead of waiting
90 days). - Employers
may pay for unused sick leave in the final month of the benefit year in lieu of
a carryover. If the employee accepts the payment, it must be for the full
amount of unused leave or for 50 percent. The employee is entitled to carry
forward any unused leave if the employee declines payment or accepts the 50
percent payment. - An
employer may forego the accrual process (one hour of time for every 30 worked)
and make the full complement of leave time available on the first day of a
benefit year if the employer:
- allows
the employee to carry forward any unused leave; or, - pays
the full amount of the unused leave in the final month of the benefit year and
makes the full complement of leave time available in the next year.
- If
a municipality already has an ordinance, it would be grandfathered except for
provisions that are not as favorable to employees as the state legislation. In
those cases, the state legislation would supersede the provisions in the
ordinance that are not as favorable. Municipalities without ordinances when the
legislation takes effect would be preempted from adopting them. - Public
employers are not covered if they are already subject to another law or
regulation which is more favorable to their employees.
On Monday December 15 A2354,
mandatory paid leave legislation moved out of committee and now heads
to the Assembly floor for a vote. This bill is detrimental to small
business owners and has been referred to by both sides of the aisle as
“a mess.” The Assembly could vote on this legislation any time this week
and we implore you to take action and ask your legislator to oppose
A2354.
A2354, if passed, will mandate:
- Employers of 10 or more workers to provide their employees with at least 72 hours of paid time off.
- Employers of less than 10 workers to provide their employees with at least 40 hours of sick time.
- The accrual of one hour of sick leave for every 30 hours worked.
- Carrying over unused leave time from one year to the next
This bill ignores the fact that most small business
owners already arrange for their employees to take time off as needed, whether
for illness or for a family emergency. The reality for New Jersey small
businesses is that most owners compete for qualified employees by offering
flexibility to balance family and work.
A study conducted by the NFIB Research Foundation
analyzing the potential economic impact of mandating mandatory paid leave
concluded that A2354 would:
- Impose new costs on NJ employers including a loss of
production due to more workers taking leave and new paperwork and record keeping
costs incurred by complying with the mandate - Cause the loss of 25,000 jobs by 2023. Small businesses
would bear 58% of the job losses - Decrease NJ Real Output by more than $18.1 billion
between 2014 and 2023. Small businesses would bear 54% of lost sales
New Jersey’s unemployment rate is at 8.7%, the sixth
worse rate in the country; please tell your lawmakers that A2354 will only lead
to more job loss.
More Information:
- 12/15/14 “N.J.takes another step toward mandatory paid sick leave, angering business groups” – NJ.com
- 10/27/14 In a 6-3 vote along party lines, the Assembly Labor
Committee voted to advance Assembly
Bill 2354 on Monday October 27. NFIB testified against this bill on Thursday, Oct 9 and Monday, Oct 27. - What you need to know about mandatory paid sick leave legislation
