PSN 2013 Economic Security Roundup: Progress on Workers’ Rights as Conservatives Continue Anti-Worker Attacks

PSN 2013 Economic Security Roundup

With 2013 legislative sessions largely adjourned in statehouses across the nation, this is the fifth in a series of issue-specific session roundups from Progressive States Network highlighting trends in different policy areas across the fifty states.

State legislatures have seen an onslaught of anti-worker legislation in the past two years, with conservative legislators exploiting economic fears to dismantle collective bargaining rights and impede progress on labor standards. Yet, in statehouses across America this year, progressive leaders remained dedicated to fighting for workers’ rights and continued to advocate for legislation that will ensure greater economic security for all citizens. Here is a look at some of the inspiring victories and continuing challenges faced by state lawmakers who sought to advance policies to ensure economic security for working families in sessions this year:

Progress on Minimum Wage and Paid Sick Days in 2013

This year, 34 states saw bills relating to the minimum wage introduced, including at least 13 measures to raise state minimum wages. That included New York, where Gov. Andrew Cuomo signed into law a budget that will increase the state minimum wage to $9.00 an hour by the end of 2015. Connecticut also passed a law that increases the state's minimum wage from $8.25 to $9.00 an hour over the span of two years. Workers there will see a 45-cent increase beginning January 1, 2014 and another 30 cent bump the following year. Neighboring Rhode Island passed a modest increase to their minimum wage in a bipartisan vote, which will bring their rate to $8.00 an hour in 2014.

The Council of the District of Columbia recently passed legislation aimed at counteracting the wage-depressing effects of big-box retailers. If signed by Mayor Vincent Gray, and after a congressional review period, this law would require retailers with sales above $1 billion and stores larger than 75,000 square feet to pay a living wage. The District of Columbia, one of the nation’s most expensive cities, would require these retailers to pay $12.50 an hour, $4.25 more than its current minimum wage, to workers not covered by collective bargaining.

In Massachusetts, a bill to increase the minimum wage is still pending, with both opponents and proponents confident it will pass. If signed into law, the bill would increase the state’s minimum wage from $8.00 to $11.00 an hour by 2015 and allow for automatic adjustments for inflation. The bill also addresses the issue of stagnant wages for tipped workers, raising their minimum wage from $2.63 to $6.30 an hour. Advocates in Massachusetts recently announced that if lawmakers do not act, they would push for a ballot initiative to raise the wage.

Legislation that increases the minimum wage is a significant step towards securing a stronger economic future for states and their residents. When employers depress wages, workers struggle to afford basic living expenses and have no extra income to buy the goods and services that support local economies. When the minimum wage increases, so does workers’ purchasing power. This increased purchasing power means local businesses acquire more customers, grow, and hire more employees. States benefit from a growing economy and stronger tax base. As of 2013, only 19 states and Washington, D.C. currently have minimum wages above the federal level of $7.25 an hour, a number which will increase as bills passed this year take effect in future years:

Minimum Wage Laws in the States: 2013

Paid sick leave legislation was also introduced in 12 state legislatures and three municipalities. Strong coalitions on either side meant a range of proposed legislation surfaced, from bills guaranteeing paid sick days to bills prohibiting local governments from securing this keystone of job security for their residents.

This year, New York City and Portland, Oregon passed paid sick days legislation, joining Seattle, San Francisco, and Washington, D.C. as the few U.S. cities that guarantee this right for their workers. Connecticut is still the only state to offer such protections.

The New York City law requires employers with 20 or more employees to provide up to five paid sick days a year starting in spring of 2014. These protections would extend to workers at businesses with 15 to 19 employees in late 2015. Although this law excludes vital industries, such as manufacturing, it has the potential to provide greater job security to more than a million workers. Under the Portland, Oregon law, workers at businesses with six or more employees will earn up to 40 hours of paid sick leave each year.

The District of Columbia has a campaign to close a loophole in its paid sick days laws, which currently exempt certain employees, such as restaurant servers, bartenders, certain health care workers, and workers in their first year of employment. Legislation that extends paid sick leave protection to these workers and ramps up enforcement for other workers is likely to be introduced soon.

In Hawaii, paid sick leave legislation passed in both chambers, but the legislature adjourned before a bill came out of conference committee. The Hawaii legislative process allows bills to be carried over to the next legislative session, and PSN will continue to support these paid sick leave bills in 2014.

Paid sick days legislation remains vital to job security and public health. A reported 81% of low-wage workers are not afforded paid sick days and risk loss of income, promotion, or even employment. Workers without paid sick days are also more likely to report for work with contagious illnesses, jeopardizing public health. This risk to public health is significant when considering many workers without paid sick days work in child care and food service.

Conservatives Obstruct Minimum Wage Increases and Paid Sick Days Guarantees

While progressive leaders fight to raise the minimum wage and secure paid sick days for workers, conservatives continue to obstruct progress for workers’ rights. Relying on flawed economic reasoning, conservatives blocked popular minimum wage and paid sick days laws in 2013.

In New Jersey, legislation increasing the state's minimum wage to $8.50 an hour and enabling automatic adjustments for inflation passed both houses. Even though 77% of New Jersey residents support this increase, New Jersey Republican Governor Chris Christie vetoed the bill. Governor Christie instead insisted that New Jersey, a state with one of the highest costs of living in America, would be better served by a slight and slow increase of the minimum wage with no adjustment for inflation. He offered an increase of 25 cents in 2014, 50 cents in 2015, and 25 cents in 2016, increases that would be offset by inflation by the time of their implementation. After the veto, progressive legislators rallied and passed a measure to turn the question to a ballot initiative, allowing New Jersey workers to have the final say this November. Now, New Jersey workers will vote on whether to raise their minimum wage to $8.25 an hour on Jan. 1, 2014 and secure automatic adjustments for inflation.

Similarly, in New Mexico, the legislature passed a bill that would raise the state’s minimum wage from $7.50 to $8.50. But Republican Governor Susana Martinez vetoed the bill, calling legislation designed to secure a better living standard for workers a “gimmick.”

In Philadelphia, Mayor Michael Nutter vetoed a bill that would allow workers to earn one hour of sick leave for every 40 hours worked, with up to four days for workers at small firms, and seven days for workers at larger firms.

Conservatives Attempt to Stymie and Dismantle Workers’ Rights

While some conservative leaders stood as a roadblock to progress, others remained committed to ensuring workers’ rights regressed. This year, states saw bills designed to dismantle existing minimum wage standards. For example, in Montana, a bill designed to eliminate the minimum wage for high school dropouts was introduced but failed to pass.

Opponents of workers’ rights also relied on a pre-emption strategy, which blocks local municipalities from passing the paid sick leave and minimum wage ordinances workers need to ensure job and economic security. Such bills were introduced in Connecticut and Michigan.

In Mississippi, a newly enacted law prohibits any county or municipality from “establishing a mandatory minimum wage, living wage, minimum number of vacation or sick leave days." Similarly, Florida Republican Governor Rick Scott signed a bill banning local paid sick leave ordinances, derailing progressive and labor groups’ promising efforts to pass such ordinances in Orange and Miami-Dade counties.

Conservatives continued to push laws designed to attack workers’ rights to assemble and form unions. Twenty states saw legislation attacking collective bargaining and making workers more vulnerable to exploitive practices of big business. Five of these states (Ohio, Virginia, North Carolina, Iowa, and Alabama) saw bills attempting to amend their state constitutions to include so-called “right to work.”

Conservative groups like ALEC and pro-business lobbyists advance so-called “right to work” legislation with no regard for the deleterious effects for state economies and the average worker. Studies show that employees in states with "right to work" laws make about $1,500 a year less than their counterparts in other states, even taking into account other socioeconomic and state macroeconomic factors. Workers in “right to work” states are also less likely to get employer-sponsored health insurance or pensions. Lower pay and fewer benefits mean workers have decreased purchasing power, endangering states’ economic growth.

More Economic Security Highlights

This year, wage theft bills were introduced in Florida and Oregon. PSN met with legislators and state allies in Oregon this year to discuss economic security issues, including wage theft. One of the six wage theft bills introduced in Oregon passed and will better protect construction laborers. Florida’s bill, which would prohibit local governments from passing wage theft ordinances, failed.

Progressives also made strides in the area of retirement security. The Guaranteed Retirement Account (GRA), developed in 2012 by New School of Social Research Professor Teresa Ghilarducci, serves as a new model for private sector retirement plans. This plan would replace 401(k)s and provide workers with professionally managed accounts, a guaranteed rate of return, and annuity payouts. In 2012, California became the first state to enact this plan. This year, PSN worked with Maine Representative Diane Russell to introduce the bill as part of a strategy aimed at passing the legislation in 2014. Also, we worked with Maryland Delegate Tom Hucker to introduce a bill establishing the Maryland Secure Choice Retirement Savings Program. This program would allow private sector workers without employer-sponsored retirement plans to build retirement security.

During a state site visit in Washington, PSN also worked with state legislators to defeat a bill to repeal the prohibition of predatory lending. In Rhode Island, we supported a bill that would cut the annual percentage rate on predatory payday loans from 260 percent to 36 percent. We also worked with New Mexico Representative Georgene Louis to introduce a workplace flexibility bill that would allow employees threatened by layoffs to reduce their normal work hours and collect unemployment compensation benefits in proportion to that reduction. Hawaii Representative Roy Takumi also introduced domestic workers’ bill of rights legislation, after first learning about the bill at a PSN conference. The bill passed both chambers and was signed into law this summer, and Hawaii joined New York as the only two states to offer these vital wage and labor protections for domestic workers.

Additional Resources:

Wider Opportunities for Women - The Economic Security Scorecard
National Partnership for Women and Families – State and Local Action on Paid Sick Days
NCSL – 2013 Minimum Wage Legislation
NELP - Raise the Minimum Wage: Campaigns