The 2018 General Session of the Utah State Legislature convenes January 22 with the expected return of a couple of issues.
The good news is that the vast majority of businesses already offer paid or unpaid time off, and for any reason the employee chooses: sickness, care for a family member, parental duties, personal or family member victim of domestic violence, etc. (see infographic here). Also, the federal Family and Medical Leave Act “provides certain employees with up to 12 weeks of unpaid, job-protected leave per year. It also requires that their group health benefits be maintained during the leave.”
Additional state mandates could do more harm than good.
As NFIB continues to point out, unlike the heads of corporations, small-business owners know personally each of their employees and their families, and most offer paid time off on a case-by-case basis, providing the employee what he or she needs in a way the business can afford. Mandatory paid leave would only impose unnecessary limitations on these businesses. Such initiatives assume one size fits all. In the small-business world, what works in one company could be detrimental for the next. The rigid nature of mandated paid leave often has a negative impact on employee morale. Three other points NFIB reminds policymakers of are:
- Big businesses and huge corporations have full-time legal and human resource departments to deal with local, state, and federal rules and regulations. Small businesses do not.
- Small businesses already pay 30 percent more per employee than big businesses do to comply with the same regulations
- Employee replacement costs can be a big issue for small-business owners when an employee goes on paid leave.
- A worker taking extended time off leaves a hole that has to be filled by other staff working overtime or by finding, hiring, and training a new temporary employee as a replacement—both of which are direct costs to the business.
For more information on how devastating paid leave could be, the Research Foundation of NFIB took a detailed look at a federal proposal, using sophisticated BSIM modeling (Business Size Insight Module). State paid-leave mandates on top of federal ones only exacerbate the already difficult jobs small-business owners have in keeping their doors open and Utahns employed.
The minimum wage is an entry level wage earned mostly by teenagers and young adults still living at home. Increases in the minimum wage have only one major effect—eliminating entry-level jobs. Despite these facts, proponents of ever-increasing rates wrongly argue that they’re needed to lift people out of poverty, even though little to no evidence backs it up.
The minimum wage is earned by just 2.7 percent of the nation’s workers, according to the U.S. Bureau of Labor Statistics, and most of them “tend to be young. Although workers under age 25 represented only about one-fifth of hourly paid workers, they made up about half of those paid the federal minimum wage or less. Among employed teenagers (ages 16 to 19) paid by the hour, about 10 percent earned the minimum wage or less, compared with about 2 percent of workers age 25 and older.”
Ballot initiatives and legislative proposals linking future increases to rises in the Consumer Price Index have not stopped cause groups such as Fight for $15 from crusading for higher and higher minimum-wage rates, which is why NFIB must constantly remind legislators here and in every state capital what the minimum wage really is, who really earns it, and what damages raising the rate can cause.
Even worse, legislators in some states are pushing to allow cities and counties to set their own rates, which would create a crazy quilt of minimum-wage rates throughout a state and a commensurate paperwork migraine for every business. Also, if a business is in a higher than normal minimum-wage locality, the selling prices would increase in proportion, which could lead customers to shop in other jurisdictions. NFIB/Utah will continue its opposition to any and all minimum-wage increases.