Small businesses need state-wide uniformity to stay competitive
NFIB Pennsylvania will soon testify on a bill in the state legislature that prevents cities like Pittsburgh and Philadelphia, as well as other local jurisdictions, from passing individual labor laws that impact private businesses within their borders. The bill, HB 861, sponsored by Rep. Seth Grove (R-York) would ensure labor laws be uniform statewide by preventing a patchwork of different laws related to things like employee pay, leave policies, and many other work-related issues.
It’s worth looking at testimony given in 2015 when Philadelphia passed a paid sick leave law to grasp the consequences. Business owners testified that companies would be placed at a competitive disadvantage by that local ordinance. Those located just outside the city borders would have to pay much less in labor costs. Companies with locations both in and outside the city said it would create an administrative nightmare. Calculations of pay and benefits for different employees would require multiple processes.
Small businesses would have an especially tough time complying with different local labor laws because owners often handle employment duties along with many other tasks. To stay abreast of the latest and various local ordinances, they are likely to have to hire an expert to avoid violations.
Having a patchwork of different employment laws around the state in as many as 2500 Pennsylvania jurisdictions would have a deleterious effect on business growth and the state’s economy. Out-of-state companies considering where to relocate or expand may avoid Pennsylvania. Without HB 861 to preempt these local labor laws, there could be a flurry of lawsuits against small businesses that fall out of compliance. Unfortunately, even one lawsuit can cause a small business to close.