Competing Employer Mandates Take Center Stage

Date: February 04, 2017

“Someone previously imprisoned for robbery, embezzlement, or identity theft probably shouldn’t be hired as a bookkeeper, cashier, or locksmith. The ability to screen applicants unsuitable for a particular position due to prior criminal convictions should not be taken away.”

Employment mandates, health-care issues dominated activities during the legislative week ending February 3, reports State Director Patrick Connor.

The Senate Commerce, Labor & Sports Committee heard a number of dueling proposals this week.

Paid Family and Medical Leave – Senate Republicans have proposed Senate Bill 5149 (Sen. Joe Fain), an entirely worker-paid insurance program that would provide phased-in weekly benefits and leave beginning in 2020. Qualifying workers could receive up to eight weeks of leave at a maximum of about $550 per week:

  • for a birth or adoption
  • to care for a sick relative
  • for issues related to military duty.

Independent contractors could opt into the program that would grow to a maximum of 12 weeks leave and a roughly $725 weekly benefit by 2023. Senate Democrats offered a competing plan, Senate Bill 5032 (Sen. Karen Keiser), funded by employers who could deduct up to 50 percent of the premium from workers, much like our state’s workers’ compensation system premiums. Qualifying workers would be eligible for up to 26 weeks of paid leave, at 90 percent wage replacement, capped at $1,000 per week, for a birth or adoption, to care for a sick relative, or military-related needs. They could take up to 12 weeks of paid leave for their own personal health condition. NFIB opposes SB 5032, but is trying to work with committee members on SB 5149.

Pregnancy Accommodation – Senate Republicans recycled last year’s compromise, which passed the chamber unanimously, while Senate Democrats introduced a bill much like their initial proposal last year. The bills are Senate Bill SB 5531 (Sen. Michael Baumgartner) and Senate Bill 5299 (Sen. Karen Keiser).

NFIB met with Senator Keiser and testified about our concerns with her proposal. Specifically, we noted deficiencies in how “reasonable accommodation” and “undue hardship” are defined (or undefined), as well as a new civil cause of action that would be the only remedy to aggrieved workers. Lawsuits ought not be the first and only recourse if an employer and worker disagree on how best to accommodate pregnancy-related needs. Senator Keiser has indicated her willingness to continue working with NFIB and others to improve the bill.

Ban the Box – NFIB was the only organization to oppose Sen. Baumgartner’s Senate Bill 5312 in testimony this week. We pointed out that certain business activities may not be an appropriate fit for a worker with a felony conviction. For instance, someone previously imprisoned for robbery, embezzlement, or identity theft probably shouldn’t be hired as a bookkeeper, cashier, or locksmith.

The hiring process can be costly and time-consuming for small employers. The ability to screen applicants unsuitable for a particular position due to prior criminal convictions should not be taken away, and time and cost added, so a former offender has an opportunity to “tell their side of the story.”

NFIB suggested a phased implementation, small-business exemption, and a liability shield for employers hiring ex-cons. After the hearing, we learned the state Employment Security Department administers a federal program that provides free insurance for employers hiring workers with troubled backgrounds. The agency will be providing us additional information to share with NFIB members. Despite our protests, the committee approved the bill pending signatures.

Equal Pay – The committee also heard competing bills centered on gender wage disparity, Senate Bill 5344 (Sen. Fain) and Senate Bill 5140  (Sen. Annette Cleveland). Once again, the Republican version mirrors a compromise bill debated last year, while the Democrats returned to last year’s starting position.

NFIB confined its testimony to concerns about SB 5140’s prohibition on employers directing workers into “less favorable” positions or career tracks. We attempted to convey the difficulty an employer may face advising a worker on the type of work she should pursue based on short-term compensation versus aptitude, job satisfaction, or long-term earning potential. Once again, employers could be subject to significant financial penalties and litigation, without clear guidance in the bill about what to document or how, in order to demonstrate compliance with the law if enacted.

Health Care

High-risk pool – NFIB testified before the House and Senate health care committees, January 31, with concerns about bills to indefinitely extend the state’s high risk pool (WSHIP), House Bill 1338 (Rep. Eileen Cody) and Senate Bill 5253 (Sen. Cleveland). That program is scheduled to terminate at the end of this year.

WSHIP’s $40 million or so non-Medicare insurance program is largely funded by assessments on health insurance policyholders in the individual, small group, and association health plan markets – self-employed individuals, small business owners and their employees. If federal “repeal and replace” efforts lead to insurance companies withdrawing from less- or unprofitable counties, residents in those counties would be eligible to buy health plans through WSHIP. That could significantly increase the assessment on small-business owners and the families they employ.

Moreover, extending the high-risk pool would allow carriers to deny coverage to high-risk (high-cost) individuals, further growing WSHIP’s enrollment, shifting the cost on to you. NFIB has suggested alternative approaches to ensure continued coverage for those currently enrolled in WSHIP, and providing coverage opportunities for patients with chronic (and costly) conditions, or who live in counties where health plans may not be available in the future if carriers retreat from less lucrative counties.

Standard benefit design health plans – Building on NFIB’s work as a member of the Patient Out-of-Pocket Cost task force, and testimony we gave about its final report during the first week of session, Senate Health Care Committee Chairwoman Ann Rivers asked NFIB to assist in developing legislation to create a “standard benefit design” health plan.

Senate Bill 5697 (Sen. Rivers) would bring together health insurers, medical providers, patient advocates, labor, and both large and small employer representatives to design a higher-premium, lower-cost-sharing health insurance plan for individuals with chronic conditions requiring expensive drug therapy.

Many families face huge costs for prescription drugs that can exceed $10,000 in the first quarter of each year, often including their entire annual deductible and out-of-pocket maximum for co-payments or co-insurance costs. Shifting more of those expenses into the monthly premium and …

  • lowering deductibles
  • capping co-payments
  • limiting mid-year formulary changes
  • or eliminating co-insurance…

… are all potential components of a new plan design that would lessen the impact of the “first quarter cliff,” making health insurance costs more manageable for families throughout the year. The bill was introduced February 3. A House companion is expected.

Other Issues

Regulatory reform – Rep. Norma Smith’s House Bill 1120 which would update the state Regulatory Fairness Act and address shortcomings identified in a state auditor’s report, was approved unanimously by the House Technology & Economic Development Committee.

NFIB has been a primary intermediary negotiating language between Representative Smith, the governor’s office and more than a dozen state agencies. Our efforts resulted in changes to a key rulemaking form that will allow interested parties better access to the economic analysis agencies must perform to determine the impact of proposed rules on small businesses. The bill was referred to the Appropriations Committee for further consideration.

Municipal business licensing – On February 3, NFIB received a bill draft from Rep. Kris Lytton, chairwoman of the House Finance Committee, formalizing the recommendations of the Local Tax & Licensing Simplification task force on which NFIB serves. We are still reviewing the bill and identifying potential cosponsors. Interestingly, it would require the Department of Revenue to send progress reports to NFIB, Association of Washington Business, and the retail association (which were all members of the task force) as well as Gov. Jay Inslee and certain legislative committees.

It’s uncertain if NFIB has ever before been specifically named in statute to receive agency reports. The bill has not yet been officially filed. NFIB will provide a bill number once that occurs.

Previous Reports

January 27 Report—Small Business Bill of Rights Inventory Legislation Advances 

January 20 Report—Bill Introductions Begin in Earnest in Olympia 

January 13 Report—Opening of Legislative Session Sees NFIB Charging Ahead

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sbd-logo-no-hypenSmall Business Day is February 9. Click here to register.


graphic-wa-1-23-sen-palumbo“As a small-business owner and NFIB member, I am looking forward to spending time with fellow owners during this legislative lobbying day. We need more small-business owners in the Legislature, but for those who don’t have time to run, these annual Small Business Days at the Capitol are vital for making our voices heard.”– Sen. Guy Palumbo


“This is the year for small-business owners to really be engaged in Olympia. We’ve been inundated with ballot measures and local laws making it even harder to run our businesses. And that’s just the start. There’s a massive effort coming in the Legislature to identify ‘additional revenue sources,’ which we know will be aimed at small businesses. Entrepreneurs need to be aware of what’s happening, and what they can do to help turn things around. There is power in unity. Participating in NFIB and its Small Business Day is a great way to bring job creators together and really make an impact on our state’s decision-makers. I hope to see you there on February 9.” — Rep. Andrew Barkis, NFIB member

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