CSA Regulatory Wrap-Up
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Regulatory Wrap-Up: Insider’s guide to retail-related legislative developments

BY CSA Staff

Wages

Hawaii: A senate committee advanced a bill that would increase the minimum wage to $15/hr by 2020 and would also repeal the tip credit.

Maryland: A bill to increase the minimum wage to $15/hr by 2026 contains a provision that would mandate that franchised establishments comply by 2022, four years earlier than other businesses. It is unclear at this stage if the measure has enough support to override a likely veto from Republican Governor Hogan.

New Mexico: A senate committee passed a bill that would increase the state’s wage level to $9/hr in 2018. The bill would also establish an $8/hr training wage and raise the tipped wage to $2.63/hr. Action now moves on to the house. For context, the Democratic-controlled legislature advanced minimum wage increase bills to the Republican Governor’s desk last cycle and all the bills were vetoed.

Pennsylvania: Governor Wolf has included a statewide minimum wage increase in his annual budget proposal. Last cycle, the Republican legislature declined to advance wage increase legislation to the governor’s desk despite his repeated endorsement. A similar scenario is likely to play out again this year.

Vermont: A senate committee voted to advance a bill that would increase the minimum wage to $15/hr by 2024. The full senate is likely to act soon and if the vote is successful, the bill would move to the house. However, Governor Scott has publicly stated his opposition to the bill, citing the negative impact on small businesses.

Washington: The advocacy group Working Washington has requested that the state’s labor department issue rules that prevent businesses from adding minimum wage surcharges to customers’ bills. Surcharges have become a popular practice in some areas of the country.

Study: A study by the National Bureau of Economic Research earned headlines this week. It reviewed minimum wage increases in 137 jurisdictions and found that “on average, minimum-wage increases eliminated jobs paying below the new minimum, but added jobs paying at or above the new minimum.”

Paid Leave

Federal: Republican Senator Marco Rubio is leading an effort to produce parental leave legislation that would allow workers to utilize Social Security benefits while caring for a newborn. Under this concept, the worker’s Social Security payments would be delayed at their retirement age commensurate to the amount of leave utilized. As of yet, no legislation has been introduced.

Maine: Lawmakers previously supporting legislation to establish an employee-funded paid family leave program amended their bill and are now calling for an actuarial study to determine the cost and feasibility of the proposed program.

New Hampshire: A bill allowing workers up to six weeks of paid family and medical leave narrowly passed a second reading in the house despite opposition from some in Republican leadership. The bill was amended to offer six weeks of paid leave, down from twelve in the original text. The bill will be debated by an additional committee before the house has a third and final vote. If passed, the bill would move to the senate. Governor Sununu supported family medical leave during his campaign but has yet to weigh in on the specifics of this legislation.

Washington: Several U.S.-based airlines are suing the state seeking a ruling that federal regulations preempt the sick leave law that went into effect last year. The case cites complexity resulting from a patchwork of state and local laws governing sick leave accrual and other related policies. While the case may have limited impact on brick-and-mortar operations in the state, it could have ramifications on state-by-state leave policies.

Lowe’s: The home improvement retailer announced a new paid leave policy for full-time employees allowing for up to ten weeks of paid maternity leave and two weeks of paid family leave.

CVS: In addition to increasing their starting hourly wage to $11/hr, the company also announced a paid leave policy for all full-time employees allowing for up to four weeks paid leave for the birth or adoption of a child.

Scheduling

Missouri: A preemption bill that prohibits localities from enacting employee scheduling laws passed a house committee this week. It is unclear how much support the provision has in the senate following a bruising preemption battle on wage and leave policies during the last session.

Mississippi: Legislation that preempts localities from enacting leave, scheduling and other benefit laws passed both the house and senate. Final passage and enactment is highly likely.

Labor Activism

Fight for $15: Fight for $15 will hold protests Feb. 12 to commemorate the 50th anniversary of the famous Memphis sanitation workers’ strike. While protests were initially announced in the Southeast, Operators should be prepared for protests in other major metropolitan areas. QSRs are the initial targets but other restaurants and retail locations could also experience disruptions as well.

Taxes

California: Advocates have announced a campaign to place an initiative on the Nov. ballot that would exempt commercial property from Proposition 13 – a 40-year-old law that limits state property tax increases for both commercial and residential property. If the initiative were to pass, the state legislature would be free to increase commercial property taxes while maintaining the current limits on residential property taxes.

Key Takeaways

• The parental leave conversation took an important step this week with Republican Senator Marco Rubio indicating that he may propose legislation that would allow workers to draw paid leave from their Social Security accounts at any time. Retirement benefits would be delayed for the period of time that workers utilize the benefit earlier in life. Regardless of whether such a proposal eventually becomes law, it broadens the concept of a government benefit pool – beyond Social Security – that workers can pay into and utilize. This increased flexibility is a de facto step down the road to portable benefits.

• A new international study released this week reports that the infant mortality rate in the United States remains the highest within developed nations and the gap appears to be growing. There are many factors contributing to these statistics including insurance coverage and access to pre- and post-natal care, but many health policy advocates also cited economic pressures disproportionately borne by women including lower wage jobs, lack of paid leave and lack of certainty in work schedules. While we continue to see an intentional merging of the social and economic justice narratives by the activist community, the integration of women’s health issues into this conversation opens a new front and could lead to additional reputational challenges for operators and merchants.

Legislature Status for Week of 2/12/18
• The United States Senate is in session this week
• The United States House is in session this week
• Forty-four state legislatures are meeting actively this week:
o AL, AK, AR, AZ, CA, CO, CT, DE, FL, GA, HI, IA, ID, IL, IN, KS, KY, MA, MD, ME, MI, MO, MS, NC, NE, NH, NJ, NM, NY, OH, OK, OR, PA, RI, SC, SD, TN, UT, VA, VT, WA, WI, WV, WY

Podcast

Check out our Working Lunch podcast each week that includes further analysis into these legislative issues, policy, politics and much more. You can find Working Lunch on the Nation’s Restaurant News website, or by clicking here, and when you download the podcast and subscribe on iTunes here.

The Regulatory Wrap-Up is presented by Align Public Strategies. Click here to learn how Align can provide your brand with the counsel and insight you need to navigate the policy and political issues impacting retail.

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New name for apparel retailer

BY Marianne Wilson

The women’s clothing and accessories brand Boston Proper has changed its name.

The Florida-based company will now be called Beyond Proper by Boston Proper. Sheryl Clark, president, explained the reasoning behind the change in a letter posted on the company’s site and social media platforms.

“We’re not from Boston,” Clark wrote. “Never have been, and we knew it was time for a name that fully embodies our beloved brand.”

Clark assured customers that the new name does not signify any change in strategy or re-branding.

“We’re not turning our backs on years of loyalty, memories and stories that made us who we are,” she wrote. “Beyond Proper by Boston Proper is a brand dedicated to making curated fashion accessible and wearable for real women at any age. We believe in shaking up the status quo, going beyond what’s expected and never settling. This name better defines those beliefs.”

The decision is timely in the wake of current events, Clark added.

“With the changing retail landscape, the need for brand authenticity and the global women’s movement that is upon us, we knew the timing couldn’t be better for this evolution,” she said.

Boston Proper began as a catalog-based company in 1992 and expanded into e-commerce. In 2016, it was acquired by private equity firm Brentwood Associates from Chico’s FAS.

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CSA Regulatory Wrap-Up
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Regulatory Wrap-Up: Insider’s guide to retail-related legislative developments

BY CSA Staff

Wages

Maine: Governor LePage is supporting a bill to scale back the scheduled increases in the state’s minimum wage law that passed by ballot initiative in 2016. The proposal would reduce the 2018 wage from $10/hr to $9.50/hr and allow for increases to $11/hr by 2021 instead of the previously approved $12/hr. It would also eliminate the cost-of-living adjustment and establish a training wage. The proposal faces an uphill climb in the state legislature.

Massachusetts: The Joint Labor and Workforce Development Committee heard testimony earlier this week on the merits of proposed ballot initiatives that would mandate paid leave as well as raise the state minimum wage to $15/hr. The legislature could adopt the initiatives as proposed but if it does not or passes legislation that is in anyway different from the proposed initiative, activists could still proceed to the ballot.

Rhode Island: Activists that successfully won a 2017 minimum wage increase to $10.50/hr by 2019 are again pushing legislation – this time increasing the state’s wage level further to $15/hr.

Utah: The Democratic sponsor who annually, and unsuccessfully, introduces legislation to raise the minimum wage to $15/hr is now sponsoring a bill that would require a more nominal increase to $12/hr. Also included in the proposal is an increase in the cash wage to at least $3.25/hr, up from the current $2.13/hr. Due to strong Republican majorities in both chambers, a wage increase is unlikely to pass at this time, but the inclusion of potential changes to the cash wage for tipped employees is a notable development.

Washington: A house committee heard industry testimony in support of a law that would allow younger workers or those out of work more than five years to be paid 75% of the state minimum wage for a limited period of time after hiring.

Redwood City, CA: The city council concluded a series of public workshops on legislation to increase the city’s minimum wage to $15/hr by 2019. Current state law calls for a longer escalation to $15/hr by 2022. Several cities in the Bay Area and Silicon Valley are considering, or have already enacted, similar mandates. The bill will be voted on during the March 26 council meeting.

St. Paul, MN: During an annual “Meet the Mayors” address to both the Minneapolis and St. Paul chambers of commerce and other business leaders, Mayor Melvin Carter reiterated his intent to pursue a $15/hr minimum wage ordinance similar to the current law in Minneapolis.

Paid Leave

Maryland: Senate Democrats have indicated support for a bill that would delay implementation of the recently passed paid leave law but house Democrats are reluctant to revisit the issue. Progress on a delay bill is unlikely prior to the law going into effect Feb. 11.

Taxes

Georgia: An economic nexus bill that passed the house but stalled in the senate last year, advanced through the Senate Finance Committee this week. The committee vote suggests more momentum in light of the U.S. Supreme Court decision to review the nexus standards of a similar South Dakota law. The bill would require remote sellers with annual retail sales exceeding $250,000 into the state, or at least 200 in-state transactions, to either collect and remit sales tax or report the tax information.

Soda Taxes

Philadelphia, PA: The state Supreme Court agreed to take up the industry-backed appeal of their case to overturn the city’s 1.75 cents per ounce tax on sugary beverages. The case has lost twice in lower courts since the law went into effect in 2017.

San Francisco, CA: The city has been granted en banc review of their appeal of the 9th Circuit decision which invalidated a 2015 law mandating health warning labels on some soda advertisements. The rare session in front of an eleven judge panel is only granted in roughly twenty cases per year.

Retail Crime

Tennessee: Sen. Richard Briggs introduced legislation establishing penalties for pawn shops and other second-hand stores that do not comply with the gift card database law that passed in 2017 that requires them to input gift card sales into a database for use by law enforcement. Criminals and drug addicts are known to return stolen merchandise to a store in exchange for a gift card which is then sold to a third-party seller such as a pawn shop for cash.

Menu Labeling

Philadelphia, PA: The city council is considering legislation to mandate that chain restaurants include a warning label beside items on their menu that have high sodium content, defined as 2,300 milligrams. Industry representatives continue to negotiate language and the bill now excludes delivery and limited time offerings.

Labor Policy

NLRB: The National Labor Relations Board extended the deadline to March 19 for responses to the Request for Information on the agency’s review of the 2014 ambush election rule.

Labor Activism

Fight for $15: Marking the 50th anniversary of the famous Memphis sanitation workers’ strike, Fight for $15 will hold protests at QSRs in “two dozen southern cities” on Feb. 12. While QSRs appear to be the initial targets, other restaurants and retail locations could also experience protests and disruptions as well.

Key Takeaways

• The announcement this week that Amazon, JP Morgan Chase and Berkshire Hathaway are forming a healthcare company to lower healthcare costs for their employees could be a game changer. They intend to leverage their internal technical expertise and take custody of the administration of their self-insured plans instead of outsourcing it to third-party plan managers as most companies do. Sharing resources, they intend to cut out significant amounts of red tape with regard to new models for payment and plan delivery and increase price transparency. Amazon’s involvement should be of particular note to retailers as they look to broaden their competitive advantage over traditional retailers and increasingly, grocery and restaurant operators.

• The upcoming Feb. 12 Fight for $15 protests across the Southeast will likely fail to capture significant national media but may earn meaningful attention in local protest markets. Because they are commemorating the labor strike that ultimately took Martin Luther King to Memphis, it is a natural backdrop to the SEIU’s effort to combine the income inequality and social justice narratives into one campaign – just as they did in 1968.

Legislature Status for Week of 2/5/18
• The United States Senate is in session this week
• The United States House is in session this week
• Forty-one state legislatures are meeting actively this week:
o AL, AK, AZ, CA, CO, DE, FL, GA, HI, IA, ID, IL, IN, KS, KY, MA, MD, ME, MI, MO, MS, NC, NE, NH, NJ, NM, NY, OH, OK, OR, PA, RI, SC, SD, TN, UT, VA, VT, WA, WI, WV

Podcast

Check out our Working Lunch podcast each week that includes further analysis into these legislative issues, policy, politics and much more. You can find Working Lunch on the Nation’s Restaurant News website, or by clicking here, and when you download the podcast and subscribe on iTunes here.

The Regulatory Wrap-Up is presented by Align Public Strategies. Click here to learn how Align can provide your brand with the counsel and insight you need to navigate the policy and political issues impacting retail.

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