State Legislature Takes Action Against Local Hire Rule

Date: February 16, 2016 Last Edit: February 18, 2016

NFIB-supported legislation would nullify Nashville’s mandate.

State Legislature Takes Action Against Local Hire Rule

Local governments continue to pursue an anti-business agenda that often is well intended but still harmful to free enterprise. Many of these efforts can and will impact your business.  That’s why NFIB continues to act aggressively to counter such efforts at the state and federal level.

Last Summer, Nashville voters approved a charter amendment that authorized a local hire mandate.

HB 1674/SB 1621—This bill would prohibit the state or any local government from requiring a company bidding on a state or local construction project to employ individuals who reside within the jurisdiction of the state or local government. The sponsors of the bills, Rep. Pat Marsh and Sen. Jack Johnson, are both NFIB members.

“NFIB supports SB 1621/HB 1674 because it addresses well-intended, but flawed ‘local for hire’ initiatives that are either unlawful, unworkable or do more harm than good for our state’s business environment, as well as Tennessee-based construction employers and workers.”

In October 2015, Attorney General Herbert Slatery said Nashville’s local-hire rule violates Tennessee’s Contractors Licensing Act of 1994.

NFIB members in the construction industry have also said that while they often prefer to hire local workers, they may not be able to in every circumstance. Therefore, a mandate like this can lead to more exempt out-of-state contractors winning bids and hiring fewer local workers and/or having fewer local investments and profits that actually stay in Tennessee. The Nashville Area Chamber of Commerce has also outlined the unintended consequences if the local hire rule remains in effect, including hiring discrimination, higher costs, construction delays, bureaucracy and difficulty of enforcement.

At this writing, the Senate was scheduled to vote on the legislation on Feb. 17, while the House Business & Utilities Committee passed its version on Feb. 10, setting up another floor debate soon.

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