Business groups oppose state sick leave proposal
MMA and chamber say ballot proposal is too broad and would create unfair burden for employers.
Business leaders statewide are voicing opposition to a measure that would guarantee workers at least one hour of sick time for every 30 hours worked.
On May 29, the Royal Oak-based MI Time to Care coalition submitted more than 380,000 signatures to the Secretary of State from a petition to create an “Earned Sick Time Act.”
If it becomes law, it would require businesses with 10 or more workers to provide at least 72 hours of earned sick time per year, while those with one to nine employees would be required to grant 40 hours, according to the Associated Press.
If the Michigan Board of State Canvassers certifies at least 252,523 of the signatures as valid, the proposal heads to the state’s Republican-controlled Legislature. If rejected there, it will join a slew of other human resources-related proposals, such as a $12 minimum wage, a prevailing wage repeal and marijuana legalization on the Nov. 6 ballot.
Chuck Hadden, president and CEO of the Michigan Manufacturers Association, said his organization is opposed to the measure because of its potential ramifications for employers.
“The way it is written, if you’re paid hourly, you can have an hour off anytime without a reason (if you’ve worked 30 hours to earn it),” Hadden said. “The employee is always right. It becomes a real problem if people can leave for an hour and come back during their shift. It’s written pro-employee, which is fine, but it says whatever the time limit is is on the basis of your payroll.
“If it goes into effect, most of my members will have to change their payroll system to keep track. Either they deal with employees coming and going, or they’re going to have to change their benefits.”
He said manufacturers, which often pay hourly wages, will be hit particularly hard, but his colleagues in food service and retail also are opposed.
“It impacts us because of the way we run the ship, but if you’re running a restaurant and you’re paying people an hourly wage, they can walk off anytime. Same thing with a jewelry store; they can just leave the desk,” Hadden said.
“Employers would like to be able to (let them have time off), but they need to know in advance. There’s no advance notice written into this bill.”
The proposed act deems any physical or mental illness of the employee or employee’s family, as well as domestic violence situations, to be conditions that merit paid sick leave, according to the AP.
The proposal defines family to include “any other individual related by blood or affinity whose close association with the employee is the equivalent of a family relationship.”
Andy Johnston, vice president of government and corporate affairs at the Grand Rapids Area Chamber of Commerce, said the chamber is opposed to the proposal for many reasons — one being that it needs tighter language than the above instance.
“This Earned Sick Time Act extends to family and friends,” he said. “We don’t know how that will be interpreted. So, then you have the additional burden of lawsuits.”
He said an unintended loophole might be that employees could take advantage of their sick time by showing up late to work, affecting productivity.
“An employee with a constant pattern of tardiness could deduct the time from their paid sick leave and say it was because they were out late the night before helping a family friend,” he said.
A bigger picture issue that would hit businesses, Johnston said, is the regulatory burden of the bill — which he described as “the most stringent in the nation,” ahead of the paid sick leave laws in California and Oregon — as well as its potential cost to businesses.
“The majority of our members are small businesses. To provide a benefit they can’t afford would put a damper on expansion and development plans,” he said. “Even for employers that already offer a rich benefit, this mandate would cause an additional regulatory burden that would lead them to make different decisions around health care, overtime and family leave.”
Johnston and Hadden said they think any negative implications are a result of “out-of-state political interests” pushing for this bill without fully considering the needs of Michigan businesses.
“It’s a one-size-fits-all forced benefit approach,” Johnston said.
“The people behind this petition don’t understand the details,” Hadden said.
MI Time to Care committee member and spokesperson Curtrise Garner said the proposal was “crafted with input from several organizations,” including Mothering Justice, Royal Oak; the Economic Justice Alliance of Michigan (EJAM), Royal Oak; Michigan United, Detroit and Kalamazoo; and United Way for Southeastern Michigan, Detroit.
Dave Woodward, EJAM strategic adviser and treasurer of MI Time to Care, said opponents’ objections amount to “scare tactics,” as MI Time to Care studied information from the Michigan League for Public Policy that shows the positive effects a paid sick leave policy had in other states.
“By providing earned sick time, small business owners can cut down on the high cost of turnover and loss of productivity while creating healthier families and communities,” he said. “We know from the eight states and many more cities that have already embraced this policy that earned sick days (are) a solution that is already working. This proposal will ensure nearly 2 million Michiganders get the earned paid sick time they need to care for themselves or a loved one.
“That’s why a majority of Michiganders are behind this sensible policy, along with a broad coalition of health care providers, small businesses and community organizations.”
According to campaign finance disclosure reports filed with the state of Michigan, along with Ballotpedia research, as of May 31, MI Time to Care had raised $1,892,443.75 in support of the campaign to put an earned sick leave policy in place.
The coalition’s heaviest backers are two Washington D.C.-based nonprofit organizations, the Sixteen Thirty Fund and The Fairness Project, which have contributed $1,331,010.87 and $311,922.88 in cash and in-kind donations, respectively, according to Ballotpedia.
The reports show Raise Michigan, EJAM, Michigan People’s Campaign and Mothering Justice have contributed between $50,000 and $80,400 apiece in cash and in-kind donations.
“We are continuing to build our coalition of supporters across the state,” Garner said.
Hadden said he doesn’t believe this proposal would help with talent attraction and retention.
“For manufacturers, we already work hard to keep employees because of the talent they have. This goes above and beyond what we do,” he said. “We have paid leave and sick time; a lot of other businesses don’t. But to break it down into ‘one hour and I can walk away’ — it might be good for the employee, but not for the business.”
Johnston said he hopes the measure is defeated because if voters approve it in its current form, any amendment would require a three-quarters supermajority in the state Legislature.
“That would be nearly impossible, and Michigan would be stuck with a mandate they can’t afford,” he said. “I think this should go through the deliberative legislative process to allow us to consider this type of proposal in a way that would allow us to amend and improve it as time goes on.”
Hadden said it’s too early for the MMA to offer alternatives, as he and his fellow business opponents are busy educating the public about how it will affect employers.
“If somebody said to me, ‘If you ran legislation, what would it look like?’ I would say, ‘I have one thing to worry about now, and it’s defeating this.’”
The Michigan Chamber of Commerce also is opposed to the proposal.