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Much at Stake for Employers in Final 100 Days of Legislative Session

Posted by Rick Lord on Apr 23, 2018 8:30:00 AM

Today marks 100 days until the Massachusetts Legislature wraps up formal business for its 2017-2018 session.

ExteriorThe end of formal sessions will bring with it the usual eleventh-hour debate on bills that will otherwise have to go back to the starting line when a new session begins in January 2019. Informal sessions continue through the end of the year, but the rules of the Legislature make it all but impossible for controversial bills to pass.

Associated Industries of Massachusetts, as the statewide employer association, looks forward to representing employers late into the evening of July 31 – perhaps into the wee hours of August 1 – as lawmakers consider bills that could have a profound effect on employers and the Massachusetts economy.

But the real Beacon Hill deadline that employers need to keep their eye on this year is the first week of July. That’s because the end of the legislative session is inextricably bound up with four potential questions that could appear on the November election ballot, and any compromise on those issues will have to be wrapped up before ballots go to print in early July.

The most important issues for AIM at the end of the session all revolve around these potential ballot questions and ongoing negotiations intended to develop compromises that could be approved by the Legislature before July 31.

AIM has been part of negotiations for more than six months on a proposal to mandate paid family and medical leave for Massachusetts employees.

The association opposes the question, which would cost $1 billion annually by allowing covered workers to take up to 16 weeks of family leave or 26 weeks of medical leave. Workers could take family leave to care for a child after the child’s birth, adoption, or placement in foster care; to care for a seriously ill family member; or to address needs arising from a family member’s active duty military service.

John Regan, Executive Vice President of Government Affairs for AIM, has been hashing out the paid-leave issues with representatives of Raise Up Massachusetts, the coalition sponsoring the proposal.  All sides remain committed to seeking a fair agreement that does not inflict significant damage to the economy.

A poll of AIM-member employers last week indicated that companies favor by a two-to-one margin reaching a negotiated settlement.

House Speaker Robert DeLeo and Senate President Harriett Chandler have convened separate negotiations on proposed ballot questions that would increase the minimum wage to $15 per hour and reduce the state sales tax from 6.25 percent to 5 percent.

And looming over all the negotiations is a pending decision by the Massachusetts Supreme Judicial Court on a challenge that four business association colleagues and I filed to a proposed constitutional amendment that would impose a 4 percentage-point surtax on incomes more than $1 million. A decision in that case is expected this spring, adding pressure to the already tight time frame for finding common ground on the other questions.

“AIM will follow hundreds of bills as the session comes to an end, but creating a better and less burdensome paid family and medical leave law will be the priority,” Regan said.

“The minimum-wage increase and graduated income tax are right behind that. The objective is to provide the Legislature with the opportunity to resolve all these issues rather than mounting multiple ballot campaigns that could cost $10 million each.”

It’s a full plate for 100 days. The clock starts now.

Topics: Minimum Wage, Massachusetts Legislature, Paid Family Leave

AIM Weighs In On Key Employment-Law Issues

Posted by Brad MacDougall on Jan 12, 2018 12:48:37 PM

Associated Industries of Massachusetts weighed in yesterday on 73 bills pending before a key legislative committee considering employment-law issues ranging from independent contractors to the use of non-compete agreements.

State House 2015.jpgThe association delivered  a letter to members of the Joint Labor & Workforce Development Committee as the panel approaches a February 7 deadline to report out bills with either a positive or negative recommendation. AIM supports 29 bills now before the committee and opposes 44.

Among the measures that employers support are bills streamlining the complex definition of an independent contractor and compromise limitations on non-compete agreements that recognize the fact that employers often compensate workers for signing such agreements.

AIM opposes bills that would establish paid family and medical leave, increase the minimum wage, and impose vicarious liability for wage violations on any company that hires subcontractors. AIM also opposes legislation (S.1013) that would create civil liability and define workplace bullying.

“The February 7 deadline for Beacon Hill committees to report out bills under the Legislature’s Joint Rule 10 signals the start of a critical period for employers and the issues that affect them,” said John Regan, Executive Vice President of Government Affairs at AIM.

“There will be a flurry of activity between now and the end of the two-year legislative session on July 31. Employers need to pay close attention since important bills often move quickly during this period.”

The independent contractor issue revolves around an overly restrictive statute that leaves Massachusetts on the sidelines of one of the fastest developing sectors of the economy.

One out of every three American workers, from software engineers and researchers to graphic designers, freelance journalists and nannies, today works independently outside the bounds of traditional 9-to-5 employment. The trend includes the so-called sharing economy that provides apps allowing individuals to exchange goods and services ranging from rides to housecleaning.

But Massachusetts' share of that job growth is threatened by a state law that imposes a confusing and complex three-factor test to determine whether a worker is an employee or independent contractor.

On non-compete agreements, AIM has fought relentlessly for several years on behalf the vast majority of Massachusetts employers who wish to preserve the use of non-competes to protect intellectual property. The association supports a compromise that would limit non-competes to one year and give employees the opportunity to consult a lawyer when signing a non-compete, but not require companies that compensate employees at the time they sign non-competes to pay them again during the restricted period.

AIM also supports a group of measures intended to address discrimination and harassment in the workplace. One bill would allow employers to ask previous employers questions about an applicant’s work history (H.1046), while a second would encourage employers to engage in voluntary training regarding non-discrimination (H.1037/H.1047) and third would rewrite a highly confusing and problematic statute that makes adding disciplinary matters to a personnel record difficult (H.1049/S.1044).

The paid family and medical leave and minimum wage initiatives opposed by employers mirror similar measures headed to the statewide ballot in November. A third ballot question would create a constitutional amendment imposing a 4 percentage-point surtax on incomes of more than $1 million for thousands of subchapter-S and other pass-through business in Massachusetts.

AIM President and Chief Executive Officer Richard C. Lord and four other prominent business leaders are challenging the proposed tax amendment in court.

Please contact me at bmacdougall@aimnet.org for more information on any of these issues.

Topics: Independent Contractor Law, Massachusetts Legislature, Employment Law, Non-Compete Agreements

Summing Up, Looking Ahead: Challenges Await Employers

Posted by Rick Lord on Jan 2, 2018 8:30:00 AM

The first half of the 2017-2018 legislative session in Massachusetts was dominated by the issue of health-care costs and the role employers should play in helping to close a budget gap in the state Medicaid program.

Exterior.jpgBut larger battles await during 2018 as progressive activists seek to place three questions on the Massachusetts election ballot that would together impede economic growth for a generation. The initiatives would impose an 80 percent surtax on incomes more than $1 million for pass-through businesses, establish a $1.3 billion-per-year paid leave program and increase the minimum wage to $15 per hour.

Associated Industries of Massachusetts worked successfully during 2017 on a range of issues confronting its member employers from every sector of the economy.

The most important achievement was a compromise that transformed a proposed $700 million annual health-care surtax into a two-year, $200 million assessment to close the budget shortfall in the commonwealth’s health-insurance program for low-income people. The assessment increased the Employer Medical Assistance Contribution (EMAC) in a manner that will fall most heavily on companies where employees use MassHealth instead of an employer health plan.

The levy will be partially offset by a two-year Unemployment Insurance rate adjustment that will save employers $335 million over two years versus current rates. AIM was disappointed that lawmakers passed the assessment without making structural reforms to the MassHealth program.

“We believe, however, that the Legislature is committed to resolving the financial problems at MassHealth and employers look forward to working with lawmakers toward that goal in 2018,” said John Regan, Executive Vice President of Government Affairs at AIM.

AIM also played a key role in hammering out compromise legislation to extend employment protection to pregnant workers in Massachusetts.

The Pregnant Workers Fairness Act requires employers to make reasonable workplace accommodations for pregnant employees — more frequent or longer breaks, temporary transfer to a less strenuous or hazardous position, a modified work schedule, or seating for those whose jobs require extended standing.  AIM opposed early versions of the bill because of concern among employers that the legislation provided an applicant or employee with unlimited power to reject multiple and reasonable offers of accommodation by an employer. The compromise bill addresses that concern.

There was no such compromise in August when the Baker Administration introduced regulations that set specific limits on sources of greenhouse gases, the emissions linked to climate change. State officials indicate that the regulations could increase costs to electric ratepayers by as much as 2 percent. The new rules aim to reduce the state’s carbon emissions 25 percent below 1990 levels by 2020, as required by state law.

The regulations, however, were ultimately unnecessary. The administration could have chosen to work with the Legislature to change the Global Warming Solutions Act to allow alternative ways for the electricity sector to meet these obligations.  The administration instead turned a blind eye to the corrosive impacts that high electric rates are having on struggling Massachusetts companies.

The three potential 2018 ballot questions would represent an unprecedented potential policy crisis for Massachusetts:

  • The constitutional tax amendment would raise from 5.1 percent to 9.1 percent the levy on income of more than $1 million per year, including income generated by subchapter S-corporations, LLPs, LLCs, partnerships, and other pass-through entities. The $1.9 billion tax increase would be paid by roughly 19,500 filers, 80 percent of whom are anticipated to file with some business income.
  • The paid leave question would mandate 16 weeks of paid family leave and 26 weeks of paid medical leave for employees for a total projected cost of $1.3 billion.
  • The minimum wage question would raise the wage from the current $11 per hour in annual $1 per-hour annual increments starting in 2019 until it reaches $15 an hour in 2022. That amounts to a projected increase of 36 percent.

Supporters of the paid-leave and minimum wage questions filed the requisite number of signatures last month to move a step closer to the ballot. Massachusetts lawmakers now have until the end of April to consider and pass the initiatives. Any initiatives that are not adopted must gather and file an additional 10,792 signatures by July 3 to make the 2018 ballot.

The income surtax constitutional amendment qualified for the ballot in 2016. In October, I joined four other prominent business leaders in filing a suit challenging the validity of the proposal, asserting that the amendment is riddled with constitutional flaws and would make the new tax essentially permanent and unchangeable. 

“It is impossible to overstate the potential threat that these three ballot questions pose for Massachusetts employers.  The advocates supporting the questions are well funded and are prepared to spend millions of dollars to get their message across to voters,” Regan said.

The ballot battle will take place just as employers begin to comply with the new Massachusetts Pay Equity Law on July 1, 2018. The law prohibits employers from discriminating based on gender in the payment of wages and other compensation for “comparable” work. Many employers are already undertaking the internal wage studies that provide a safe harbor from litigation under the statute.

Beacon Hill lawmakers will conclude the second year of their two-year session on July 31. The end of formal sessions will kick off an election season that will see Governor Charlie Baker, US Senator Elizabeth Warren and other prominent office holders face re-election challenges.

 

Topics: Massachusetts Legislature, Massachusetts employers, Charlie Baker

The Top 10 Massachusetts Business Stories of 2017

Posted by Christopher Geehern on Dec 27, 2017 11:13:10 AM

A generational reset of the nation’s tax code, a controversial employer assessment to fund health insurance for poor people, and upheaval surrounding workplace sexual misconduct head the list of the top business stories in Massachusetts for 2017.

Tax.jpgIt was a year in which forces originating outside the borders of the commonwealth heavily influenced the fortunes of employers and political leaders here. Issues ranging from the political maelstrom in Washington, DC, and a strengthening economy to the #metoo movement and Amazon’s search for a second corporate headquarters all filtered into a complex mix that formed the Massachusetts business climate.

The tax law passed by Congress and signed by President Trump just before Christmas reduced the corporate excise tax from 35 to 21 percent and also dropped rates for pass-through businesses that pay at the personal level. Still, Bay State employers worried about adding $1.5 trillion to the federal deficit and new limitations on deductions for state and local taxes that will primarily affect high-cost states like Massachusetts.

Taxes in Massachusetts could be going in the opposite direction next year as advocates spent 2017 pushing a constitutional amendment that would increase the tax from 5 to 9 percent on income more than $1 million. AIM President and Chief Executive Officer Richard C. Lord joined four other prominent business leaders during October in filing a lawsuit challenging the validity of the proposed amendment.

“The proposal would lead to a radical decentralization of fiscal policy away from the Legislature and set the stage for future initiatives from a range of interest groups proposing constitutional amendments segregating funds for their preferred causes, or raising tax rates on some groups and lowering taxes on others," Lord said.

Here are the top 10 Massachusetts business stories for 2017:

  1. President Donald Trump signs a tax bill that reduces levies on corporations and pass-through businesses but increases the federal debt and trims popular deductions.

    In addition to lowering the corporate tax to 21 percent, the law will cut the burden on owners, partners and shareholders of S-corporations, LLCs and partnerships through a 20 percent deduction. On the personal side, it lowers many individual income tax rates, doubles the standard deduction, eliminates personal exemptions, narrows the alternative minimum tax, lowers the cap on mortgage interest deductions and caps deductions for state and local taxes at $10,000.

  2. Massachusetts lawmakers impose a $200 million assessment on employers to close a funding gap in the MassHealth insurance program for low-income people.

    The Baker Administration initially proposed a $2,000-per-worker fee for businesses that did not cover at least 80 percent of their workers and share at least 60 percent of the premium cost. The governor and business community eventually negotiated a compromise that placed the heaviest assessments on companies with workers that use Mass Health insurance while outlining structural changes to the Mass Health program. The Legislature approved the assessment without the structural changes, but included rate relief on unemployment insurance premiums.

  3. Employers grapple with the implications of the #metoo movement highlighting sexual harassment and sexual assault in workplaces ranging from film studios to television networks to restaurants and hotels.

    Employers scrambled to review their policies on sexual harassment – and their enforcement of those policies - as millions of women around the world shared stories of sexual harassment and abuse in the wake of accusations against movie mogul Harvey Weinstein. The tidal wave washed over high-profile figures from news hosts Charlie Rose and Matt Lauer to celebrity chefs like Mario Batali to classical music conductors like former Boston Symphony Orchestra Maestro James Levine. AIM urged employers to take seriously all employee claims of sexual misconduct on the job and to investigate those claims scrupulously.

  4. Twenty-six Massachusetts communities and regions submit bids to host the $5 billion “second headquarters” development of e-commerce behemoth Amazon.

    The project offers the promise of some 50,000 jobs in the information technology space that is a strength of the Massachusetts economy. Boston submitted a 218-page proposal to site the campus at the current Suffolk Downs property, while New Hampshire gratuitously threw shade on the city as a traffic choked, overly expensive nightmare. Worcester upped the ante by offering $500 million worth of incentives. Amazon said it received 238 proposals in all from throughout North America. The company is expected to narrow that field in 2018.

  5. Activists begin the process of placing on the 2018 statewide ballot the three potential questions that would represent an unprecedented public-policy crisis for Massachusetts employers.

    The proposals include the income surtax constitutional amendment, a mandate that employers provide 16 weeks of paid family leave and 26 weeks of paid medical leave for employees, and an increase in the state the state minimum wage from $11 per hour to $15 per hour.

  6. Employers and advocates hammer out compromise legislation to extend employment protection to pregnant workers in Massachusetts.

    The Pregnant Workers Fairness Act requires employers to make reasonable workplace accommodations for pregnant employees — more frequent or longer breaks, temporary transfer to a less strenuous or hazardous position, or seating for those whose jobs require extended standing. AIM opposed early versions of the bill during the 2015-2016 legislative session because of concern that the legislation provided an applicant or employee with unlimited power to reject multiple and reasonable offers of accommodation by an employer. The compromise bill addressed that concern and others.

  7. A strong employment market and long-term demographic shifts exacerbate the challenge of finding skilled employees, but wage growth remains muted.

    The good news is that the Massachusetts economy continued in full-employment mode during 2017 and the jobless rate dropped to 3.6 percent in November. But experts warn that those numbers threaten to derail the ability of employers to find the workers they need to grow at a time when large number of baby boomers prepare to leave the work force. “The concern is that Massachusetts could become a victim of its own success,” said Raymond G. Torto, Chair of AIM's Board of Economic Advisors. Still, wage growth is expected to remain slow during 2018 – the AIM Human Resource Practices Survey published in December shows that employers plan to provide average wage increases of 2.66 percent during 2018, down from 2.75 percent this year.

  8. Employer confidence reaches a 17-year high and remains strong throughout 2017.

    Massachusetts employers remained optimistic as the national economy surged and manufacturers, in particular, grew bullish about their own business prospects. The AIM Business Confidence Index began 2017 at a healthy 61.4 and moved in a narrow range before hitting a high of 62.7 in October. The AIM Index is calculated on a 100-point scale, with 50 as neutral - a reading above 50 is positive, while below 50 is negative. The Index reached its historic high of 68.5 on two occasions in 1997-98, and its all-time low of 33.3 in February 2009. The Index has remained above 50 since October 2013.

  9. The Baker Administration issues new regulations that set specific limits on sources of greenhouse gasses in a move that could increase already high employer electric rates by as much as 2 percent.

    The new rules aim to reduce the state’s carbon emissions 25 percent below 1990 levels by 2020, as required by state law. AIM was extremely disappointed with the regulations. The electric-rate increases generated by the proposed rules, when combined with other pending cost increases, could raise the electric bills of Massachusetts employers some 10 percent in the next year alone. AIM maintains that the regulations are ultimately unnecessary - the administration could have chosen to work with the legislature to change the Global Warming Solutions Act to allow for alternative ways for the electricity sector to meet these obligations.

  10. AIM member CVS Health proposes to acquire insurance company Aetna for $69 billion.

    The merger of one of the nation’s largest retail pharmacy companies with one of its dominant insurers under the shadow of a potential incursion by Amazon underscores the breathtaking changes sweeping through the American health-care and economic systems. With their merged data about people’s health and vast reach, the two companies assert that they can make real change in a health-care landscape that nearly everyone agrees is too convoluted, inefficient and expensive.

 

Topics: Massachusetts Legislature, Massachusetts economy, Taxes

Speaker Calls for Employer Policy Engagement

Posted by Christopher Geehern on Sep 15, 2017 11:33:00 AM

The first time Robert DeLeo spoke to the Associated Industries of Massachusetts after being elected Speaker of the Massachusetts House of Representatives in 2009, unemployment was 8.8 percent.

The new speaker drove to the AIM speech past empty buildings along Route 128. Traffic was minimal. Consumer and business confidence was at a nadir in the wake of the financial crisis and Great Recession.

Speaker DeLeo reminisced about that first speech this morning as he returned to address more than 300 business leaders at the AIM Executive Forum. He noted that unemployment now stands at 4.2 percent and that Massachusetts employers added 11,000 jobs in August alone. And Boston is on the short list of cities being considered for major development by Amazon just as General Electric settles into its new corporate headquarters.

The speaker attributed the economic resurgence in part to a unique collaboration forged by legislators and the business community to develop pro-business policies and that also benefit the society at large.

“They are not mutually exclusive. One does not detract from the other,” Speaker DeLeo said in a wide-ranging speech during which he thanked AIM and employers for helping to build consensus on issues such as education, wage equity and the Pregnant Workers Fairness Act.

“We are very mindful of the impact that changes might make on our employers, which we always remember are our economic engine,” he said.

The speaker outlined several key priorities as the Legislature heads in the fall, including moderating the cost of health insurance and monitoring what has become a persistent sluggishness in state tax revenues.  That sluggishness is affecting states throughout the country, despite the overall healthy economy.

“We obviously haven’t seen the revenue growth we have seen in past economic recoveries,” Mr. DeLeo said.

The speaker expressed optimism in the wake of a recent report that health-care costs in Massachusetts increased at a moderate 2.8 percent in 2016, well below the growth benchmark established by the 2012 health-cost control law. Such stability is essential at a time when federal health-care policy remains in flux.

“We have been successful in driving down health-care spending growth, even in a difficult and unpredictable environment,” he told the crowd.

“We appreciate willingness of business community to work with us and nd their patience on how to move forward.”

Topics: Massachusetts Legislature, House Speaker Robert DeLeo, AIM Executive Forum

Legislature Levies Medicaid Assessment Minus Reforms

Posted by Katie Holahan on Jul 26, 2017 4:53:35 PM

The Massachusetts Legislature today levied a $200 million tax on employers to cover a shortfall in the MassHealth program without making long-term structural changes needed to solve the problem.

StateHouse-resized-600.pngThe House of Representatives and Senate took the action despite pleas yesterday from the Baker Administration and the business community to consider the assessment and the long-term reforms as a package. AIM believes the financial problems at MassHealth, which provides health insurance to 1.9 million residents, will become more severe without significant reforms.

The assessment would increase the Employer Medical Assistance Contribution (EMAC) and fall most heavily on companies where employees use MassHealth instead of an employer health plan. The assessment would be partially offset by a two-year Unemployment Insurance rate adjustment that would save employers $335 million over two years versus current rates.

“The 4,000 employer members of Associated Industries of Massachusetts (AIM) are deeply disappointed that the Legislature has again decided to impose an assessment on employers without reforming the MassHealth program and reining in the crippling cost of health insurance,” said John Regan, Executive Vice President of Government Affairs at AIM.

“We note that the Legislature has pledged to pursue MassHealth reforms at a later date. We look forward to working with them on those reforms.”

The Legislature initially passed the reform-free assessment on July 7 as part of the budget for Fiscal Year 2018. Governor Charlie Baker returned that section of the budget to the Legislature 10 days later and asked lawmakers to pass the full package of reforms designed to place MassHealth on a firm financial footing.

The proposed reforms include:

  • Restructuring MassHealth coverage for non-disabled adults to look like commercial insurance coverage;
  • Moving 140,000 people with incomes more than the federal poverty level out of MassHealth and into ConnectorCare;
  • Shifting 230,000 MassHealth members from standard MassHealth coverage, which includes coverage for long-term care, into CarePlus, which does not;
  • Requiring the commonwealth to petition the federal government to re-establish the prohibition against employees who are offered employer-sponsored insurance from seeking coverage through MassHealth.

It is uncertain whether the governor will sign the newest version of the assessment.

“Employers are thus left not only to struggle with the rising cost of providing health insurance to their own employees, but to bail out an unsustainable public insurance program as well,” Regan said.

Topics: Massachusetts Legislature, Health Insurance, Employer Health Assessment

Boston Lawmaker Named Chair of Ways & Means Committee

Posted by Christopher Geehern on Jul 13, 2017 2:18:38 PM

House Speaker Robert DeLeo on Sunday named a Boston legislator with extensive experience in health-care policy to chair the Ways and Means committee that crafts the state budget.

Rep. Jeffrey Sanchez of Jaimaica Plain will take over from Representative Brian Dempsey, D-Haverhill, who announced last week that he will resign from the Legislature to take a job at lobbying firm ML Strategies.

Sanchez.jpg"Representative Sanchez is an exceptionally thoughtful legislator who has worked with Associated Industries of Massachusetts on some of the most complex issues facing the business community, especially managing the cost of health care," said John Regan, Executive Vice President of Government Affairs at AIM.

"We look forward to working with him in his new role as chair of the Ways & Means Committee."

Sanchez currently chairs the Health Care Financing Committee and previously co-chaired the Legislature's Joint Committee on Public Health. He has been active on economic justice issues and legislation aimed at addressing racial and ethnic health disparities, and recently co-chaired a special commission that examined price disparities in the health care sector.

His nomination will come before a Democratic caucus today.

Hinting at the potential for challenging health care policy changes at the federal level, DeLeo told State House News Service that the work Sanchez has done as committee chairman "will be crucial as we address the health care challenges inherent to the budget and grapple with uncertainty on the national level." 

Dempsey had served in the Legislature since 1991 and has overseen the past six state budgets. He will become senior vice president and chief operating officer of ML Strategies, an AIM member, in September.

“AIM congratulates Chairman Dempsey and looks forward to working with him in his new role at ML Strategies,” Regan said.

“Mr. Dempsey has always been willing to consider the opinions of the business community and has been a thoughtful voice of moderation in guiding the fiscal course of the commonwealth.”

Dempsey said in a statement: "It has been an incredible honor to serve the people of Haverhill in an elected capacity since 1988. I am proud of all that we have been able to accomplish together. I would like to thank all of my supporters, friends and family for their encouragement and help through the years.

"While I am moving on to a new chapter in my life, Haverhill will always be my home, and we will continue to keep the city moving in the right direction."

Topics: Massachusetts Legislature, Massachusetts House of Representatives

AIM, Advocates Reach Deal on Protections for Pregnant Workers

Posted by Brad MacDougall on Mar 1, 2017 3:56:22 PM

Associated Industries of Massachusetts has reached agreement with the advocacy group MotherWoman on compromise legislation to extend employment protection to pregnant workers in Massachusetts.
Pregnant2.jpg
The contours of the agreement were established late last year and affirmed recently when Senator Joan Lovely of Salem and Representative David Rogers of Belmont refiled the compromise bill.

The Pregnant Workers Fairness Act would require employers to make reasonable workplace accommodations for pregnant employees — more frequent or longer breaks, temporary transfer to a less strenuous or hazardous position, a modified work schedule, or seating for those whose jobs require extended standing. Businesses would not have to provide those accommodations if doing so would create an undue business hardship, defined as something “requiring significant difficulty or expense.”

AIM opposed early versions of the bill during the 2015-2016 legislative session because of concern among employers that the legislation provided an applicant or employee with unlimited power to reject multiple and reasonable offers of accommodation by an employer. The compromise bill addresses that concern and others

Richard C. Lord, president and CEO of AIM, said “AIM was pleased to work together respectfully on this bill with Senator Lovely, former Representative Ellen Story, and advocates from MotherWoman.  It is easy to confuse opposition to a draft of a bill with opposition to the issue itself. AIM is always willing to work with those seeking honest and effective compromise. That is exactly what happened with this legislation.”

Other AIM concerns addressed by the bill:

  • Provides clarity regarding definitions and terms related to current employees in need of accommodations related to pregnancy.
  • Aligns state and federal laws regarding reasonable accommodation as it relates to the essential functions of the job.
  • Provides flexibility rather than a mandating specific types of accommodations for employers and employees.
  • Provides a reasonable mechanism for employees and the employer to achieve a reasonable accommodation by engaging in a defined process, eliminating a concern by businesses that an employee could reject multiple reasonable offers of accommodation.
  • Adds language allowing the employer to evaluate undue hardship of an accommodation and the ability of employee to perform the essential functions of the job as it relates to an employer’s program, enterprise or business.
  • Provides opportunity for an employer to request documentation for certain cases to ensure that accommodations are reasonable for both employees and employers.
  • Limits provisions to current employees instead of employees and job applicants.
  • Reduces unnecessary burdens and allows for electronic or other means other than a “poster” for notifying employees.
  • Allows for certain accommodations to be either paid or unpaid.

MotherWoman said in a statement: “We are excited that we've reached agreement on how to level the playing field for the hard-working women of Massachusetts.

"Through a great collaborative effort among legislative sponsors, Rep. Dave Rogers, Rep. Ellen Story and Sen. Joan Lovely, our dedicated legal advocates at A Better Balance, and the team at AIM — who were so generous with their time and their attention to detail — we have a better proposal, which led to the refiling of this bill. It’s an important support for moms, children and families, and it makes good sense for both employers and employees."

The compromise faces a long process of legislative consideration. Senator Lovely expects the refiled bill will go before the Joint Committee on Labor and Workforce Development and its new chairs - Representative Paul Brodeur of Melrose and Senator Jason M. Lewis of Winchester - with a hearing scheduled later this year.

AIM and MotherWoman expect to support the measure at that time and hope that the bill will be considered by the full Legislature later in the session and sent to the governor for his approval.

Topics: Massachusetts Legislature, Employment Law

Raising Minimum Wage Would Boost Costs for Majority of Employers

Posted by Christopher Geehern on Jan 3, 2017 7:55:31 AM

Three-quarters of Massachusetts employers would face increases in their compensation costs if state lawmakers pass a $15 per hour minimum wage, according to two recent surveys by Associated Industries of Massachusetts.

TeenJobsCrop.jpgAnd those compensation increases would be enough to force some companies to postpone hiring or consider leaving the commonwealth altogether.

Both the monthly survey question attached to the AIM Business Confidence Index in December and the annual AIM HR Practices Survey, also taken a December, found that 13 percent of companies employed people at the former $10 per hour Massachusetts minimum wage, while another 24 percent employed people at between $10 and $15 per hour and would have to raise those wages if the minimum moved to $15.

Thirty-four percent of companies employed people at slightly more than $15 and would have to increase pay for some of those employees to deal with wage compression. Thirty-seven percent of companies said they pay much more than $15 per hour and will not be affected by a minimum-wage increase.

The Massachusetts minimum wage rose by $1 to $11 per hour on January 1, the final step in a three-year increase.

“While we are empathetic with the challenges facing lower wage staff, it is also the case that we will employ fewer hourly employees at higher minimum wages. Each dollar increase costs our company $1.5 million per year,” wrote one employer on the Business Confidence Survey.

Another commented: “This would be too much for the small business community to absorb. You'll lose many small businesses. The Massachusetts legislature should concentrate on cutting costs and make Massachusetts a more affordable place to live.”

AIM believes that raising the minimum wage to $15 per hour, while emotionally appealing and politically expedient, is an ineffective way to address income inequality.

Raising the minimum wage, in fact, represents a fundamental distraction from addressing the real economic impediments that prevent all Massachusetts citizens from sharing in the state’s prosperity. These are the same impediments, ironically, that contribute to the persistent skills shortage that threatens innovation and economic growth in Massachusetts.

Workers are ultimately compensated according to the skills, education, work ethic and value they bring to the enterprise.

Minimum-wage increases impose an arbitrary standard of value on entry-level jobs, disproportionately burdening small businesses while creating no long-term improvement in living standards for people at the lower end of the wage scale. The issue in an economy with a staggering 3.3 percent unemployment rate is not how to raise the wage but instead how to raise the economic value of each employee.

Consider a sandwich shop in Cambridge serving food to employees of companies such as Google, Biogen, or Novartis that have made Massachusetts a global center for information technology, biosciences, research and development. Many of the engineers, software designers, researchers and professional services workers who come to the restaurant for lunch make six-figure incomes from companies locked in a pitched battle for talent that will determine their success or failure in the global markets.

Given the degree to which those highly compensated employees are bidding up housing and other prices in Massachusetts, increasing the minimum wage for the restaurant workers represents a dead-end and pyrrhic victory that keeps them outside the economic mainstream.

The task instead should be to pave the way for those restaurant employees to cross the street and join the high-value economy, which will once and for all allow them to support their families and achieve financial stability.

How does that happen? Start by improving the ability of our educational system to teach all students; reduce the long waiting lists for vocational schools; make community colleges accountable for graduating students with the skills needed in the marketplace; create more high-tech software coding academies; and promote other efficient structures to provide people with the skills to succeed in the areas of fastest economic growth.

Those tasks are far more complex than raising the minimum wage but ultimately more effective. The alternative is not attractive.

“If we move to minimum wage of $15 per hour in Massachusetts, we would immediately terminate many unskilled positions and use temps.  That would allow us to better eliminate labor in the slower seasons.  Note that our competition is located outside Mass and would end up with a significant competitive advantage,” said one employer in the survey.

 

Topics: Compensation, Minimum Wage, Massachusetts Legislature

Beacon Hill Debrief: How Did Employers Do?

Posted by Christopher Geehern on Sep 29, 2016 2:45:43 PM

AIM Executive Vice President John Regan recently discussed the 2015-2016 Beacon Hill legislative session and what it meant for employers on Comcast Newsmakers.

Topics: Massachusetts Legislature, Associated Industries of Massachusetts, Massachusetts employers

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