Policy Today: Paid Sick Leave

 

In this episode of Policy Today, Kriss and I talk about paid sick leave. We also just published a policy brief on the topic.

New brief: Mandating Paid Sick Leave in Washington

We have a new policy brief today: Mandating Paid Sick Leave in Washington.

Briefly:

  • HB 1356 would require employers statewide to provide a paid sick and safe time benefit.
  • The amount of leave would be dependent on the size of the employer.
  • All businesses with more than four FTEs would be affected.
  • Employees could use three days of paid sick leave before having to document their illness.
  • Anyone (not just employees) could sue employers for violations.
  • The limited economic literature on the impacts of such mandates is inconclusive.
  • Seattle employers report no change in presenteeism even with paid sick leave in place.
  • Small businesses are more likely to be affected by this mandate.
  • Paid sick leave is an additional labor cost that, combined with other costs, would make Washington less competitive.

Teenagers, athletes, and the minimum wage

On Tuesday, the House passed HB 1355, which would increase the state minimum wage to $12. (See our special report for more.) As Jim Camden of the Spokesman-Review notes,

House Republicans tried repeatedly to change the bill, offering 13 amendments for things like lower teen wages, taking a longer look at inflation or varying the wage around the state to account for differences between the boom economy of the Central Puget Sound and high unemployment in some rural areas. Most were ruled outside the scope of the bill by House Speaker Frank Chopp and didn’t receive a vote; the few that did were rejected on partisan splits.

In the Senate, SB 5422, which would allow employers to pay teenagers at a rate of 85 percent of the minimum wage, was passed by the Commerce and Labor Committee last month.

Meanwhile, HB 1930 would essentially exempt the Western Hockey League from state labor laws — including the minimum wage. Washington has four teams in the league, and they are currently being investigated by L&I on child labor grounds. (Here’s some background.) I have no opinion on whether these athletes should be treated as amateurs or employees, but I do think the bill presents an interesting contrast to the teen training wage bill.

HB 1930 was passed unanimously by the House Labor Committee. The Seattle Times quoted House Majority Leader Pat Sullivan:

“Those are students who decide they want to participate in the Western Hockey League, they choose that pathway for themselves,” Sullivan said, later adding: “I think the system actually works pretty well.”

Another Seattle Times story notes,

Some of Washington’s prominent Democratic labor leaders have supported the proposed exemption. Sells, the House Labor Committee chairman, and Labor Committee member Rep. Timm Ormsby, D-Spokane, are among the lawmakers signed on to the bill.

“This is something that will maintain opportunities for our amateur athletes and help them advance their careers,” said state Rep. Marcus Riccelli, D-Spokane, a bill sponsor. “I think it’s a pretty strong collection of folks from those (organized labor) areas who are collectively saying we don’t want to take anything away.”

Six sponsors of HB 1930 and its Senate companion also sponsored bills to raise Washington’s minimum wage.

Seems to be a bit of a disconnect here. If requiring the league to do things like pay the minimum wage would reduce opportunities for the players and hinder their career advancement, what happens to the prospects of non-elite-athlete teenagers if the costs of hiring them rise?

Rules proposed for Seattle’s minimum wage

The City of Seattle has released proposed rules for implementation of the $15 minimum wage. According to the Seattle Times, the public comment period is open until March 6.

The minimum wage ordinance takes effect April 1; it will gradually increase the minimum wage in Seattle to $15 (and index it to inflation) depending on the size of the employer and whether the employee receives tips or medical benefits. All employers will have to pay the same minimum wage by 2025. Below is a chart from the city showing how this will work.

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Under the proposed rules, employers must pay employees who are under 16 an hourly rate that is at least 85 percent of the new city minimum wage. The rules specify that service charges are not tips. Additionally, if an employee is jointly employed (e.g. with a staffing agency and another company), the amount he is paid depends on the size of the larger employer.

Here is our recent report on the minimum wage.

Latest In Focus episode

 

Above is the latest episode of our In Focus podcast. Lew and Kriss talk about:

New report: The Long-Lasting, Negative Consequences of the Minimum Wage

We have a new report today: The Long-Lasting, Negative Consequences of the Minimum Wage. Briefly:

  • High labor costs hurt a state’s economic competitiveness.
  • In Washington, these costs include the nation’s highest minimum wage.
  • Unlike the federal minimum wage, Washington’s is indexed to inflation and has no tip credit.
  • HB 1355 would increase Washington’s minimum wage to $12 in 2019.
  • 3.03 percent of Washington’s FTE jobs were at the minimum wage in 2012.
  • Nationally, workers under 25 are about half of those paid the federal minimum wage.
  • Minimum wage increases have long-lasting, negative effects on workers.
  • Minimum wages reduce employment for those with fewer skills.
  • For each 10 percent increase in the minimum wage, about one-sixth fewer jobs are created.
  • Higher minimum wages reduce the earnings of the lowest-skilled.
  • Minimum wages do not reduce poverty.
  • Minimum wages limit human capital acquisition.
  • Minimum wages reduce consumer, employee, and employer choices.

We also talked about the minimum wage on the podcast — see here for the episode.

Podcast: Minimum Wage

 

In today’s episode of Policy Today, Lew, Kriss and I talk about Washington’s minimum wage, which is the highest in the nation. A special report on the topic is coming soon.

Update: Here’s the link to our report — The Long-Lasting, Negative Consequences of the Minimum Wage

Teen unemployment rate is higher in Washington than in Idaho

As Jim Camden at the Spokesman-Review reports, yesterday the Senate Commerce and Labor Committee held a hearing on bills that would allow for a lower minimum wage for teenagers (SB 5421 and 5422). One part of the hearing stood out to me, and Camden notes it in his blog post:

Democrats on the committee criticized the proposals, and argued that unemployment rates for young adults are higher in Idaho.

This is not correct. According to the Bureau of Labor Statistics, in 2014, the unemployment rate for those aged 16-19 in Washington was 23.2 percent. For those aged 20-24, it was 14.3 percent. In Idaho, the unemployment rate for those aged 16-19 was 14.7 percent and for those aged 20-24 was 9.6 percent. (The story is the same for 2013.)

We wrote a policy brief last year on the teenage unemployment rate in Washington.

Union membership declined in Washington in 2014

New data from the Current Population Survey shows that union membership in Washington declined in 2014, both in absolute numbers and as a percentage of total employment. In 2014, Washington’s total union membership was 490,112 (compared to 544,986 in 2013) and the percent of employment that was unionized was 16.8 (compared to 18.9 percent in 2013).

The U.S. Bureau of Labor Statistics reported on the national numbers (which also declined since 2013) and Professors Barry Hirsch (Georgia State University) and David Macpherson (Trinity University) estimated the rates of public- and private-sector unionization by state.

The public-sector unionization rate in Washington was 48.5 percent (14th highest in the nation) and Washington’s private-sector unionization rate was 10.9 percent (4th highest).

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Robotic orchard bins and the minimum wage

Last week Democrats in the House announced a bill that would increase the state minimum wage to $12 in 2019. Washington currently has the highest state minimum wage in the country, at $9.47.

Meanwhile, researchers at WSU have won a federal grant

to develop an intelligent bin management system supported by a robotic self-propelled fruit bin carrier in tree fruit orchards.

“This grant gives us the chance to convert what we thought would work into something that orchards can use,” said Dr. Qin Zhang, who will lead the research. “It’s one aspect to help address the overall labor shortage that orchards are dealing with.”

Zhang, director of the Center for Precision and Automated Agricultural Systems and professor in the Department of Biological Systems Engineering, said the project objective is to develop a system that can place and collect bins in a fruit tree orchard to reduce labor needs and increase worker productivity.

Zhang, along with his colleague Dr. Matthew E. Taylor, assistant professor in the WSU School of Electrical Engineering and Computer Science, will develop algorithms for a self-propelled robotic bin carrier, test the system in a lab, and then validate it in a working orchard.

As James Pethokoukis noted in December, raising the minimum wage is not a win-win. Automation is one trade-off. If the robotic bin carriers work, they will be more cost effective and attractive for orchardists as the minimum wage increases.