A common presumption is that a proposed paid sick and family leave law would affect lower wage earners, primarily employed by small businesses, and that all of the impact would be positive for workers.
Business owners from around the state, including several from central Vermont, made it clear that the impact will ripple through all wage levels, and the impacts aren’t all good for workers.
Jeff Martel, expressing concerns on behalf of the granite industry, said granite workers make upwards of $20 hourly and have a benefits package worth a similar amount every hour, but the package doesn’t include paid sick leave. He said the workers, though their union, have been much more concerned about insurance, vacation and retirement. Paid sick leave would be an additional cost for an industry that has already seen 22 sheds close.
The industry has long battled intense competition from other states, as well as Canada, India and China among others. There is no way to pass the cost on to customers, Martel noted. The number of closures makes it clear that the sheds can’t just absorb the cost.
So what will happen?
Bob Lord, Jr. of E.F. Wall & Associates construction addressed that issue directly. He said, “We work with employees one-on-one to provide benefits that they feel are important.” If sick leave is mandated, the benefit would be offset by reductions in other benefits they’d rather have.
Paul Hutchins of Rock of Ages, who attended but did not testify, echoed similar sentiment, saying it will become part of the contract negotiations, a part that hasn’t been a priority in the past.
There isn’t much interest in paid sick leave among the employees of McCullough Crushing, Middlesex, says owner Fred McCullough. He testified, “My people just don’t get sick very often,” noting that the family business has a great relationship with employees, many of whom have been with them for years. “They don’t like this one bit,” he added.
Dawn Tatro, of Tatro Construction, a similar business in Jeffersonville, said essentially the same thing. “We try to do right by employees in the ways that truly meet their needs.”
The cough or sniffle that is a major concern for a nurse or food handler is not as limiting to a bricklayer or equipment operator who works in relative isolation.
The impact on businesses and workers runs the gamut from large employers with well-paid, union negotiated work environs, to the smallest businesses with entry-level work, and everywhere in between. Every business is a unique combination of size, type, employee interactions, temperaments and motivations. Some businesses are in very highly price-sensitive markets while others have a special niche and are less price sensitive.
Some, who already offer paid sick leave, are happy to do so and use it to attract and motivate better employees.
Andrew Brewer of Onion River Sports in Montpelier said that he is proud to offer paid sick leave, but doesn’t support the state mandating it. He said the fact that he can offer this benefit does not mean that everyone else can or should.
“It’s a decision that should be left to the employer.”
He said only an employer can weigh all the factors specific to his or her business and the market.
For businesses that don’t offer paid sick leave, the mandate will increase payroll costs by a minimum of three percent.
Testimony offered by the Central Vermont Chamber of Commerce pointed out that for businesses that cannot raise prices and must stay within a limited personnel spending cap, the only recourse will be to reduce the number of employees.
For every 30 employees working for businesses in that predicament, one will lose his or her job. No matter how the law is fine-tuned, the end result is that some percentage of businesses will be forced to cut staff.
The bill is currently in the House General, Military and Housing Committee, and a committee vote is expected at the end of the week.
With its wide ranging impact on business, presumably it will also be reviewed by the Commerce Committee, but House Speaker Shap Smith has not yet made his intentions clear on referral to the committee.
George Malek is executive director of the Central Vermont Chamber of Commerce.
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