While the legislature is in session, the National Federation of Independent Business/California will be profiling anti-small business bills and initiatives and the adverse effect they would have on California’s job creators. This is the fourth column of the 2014 series.
You would think that after all the years I have been in Sacramento, nothing would surprise me. But, leave it to the California State Legislature to do just that with another bill that small business owners consider a Main Street Menace.
Assembly Bill 1792 (Gomez) creates a list of shame that would expose California employers to liability, targeted media attacks and protests. The bill asks the Department of Finance, in consultation with other state departments, to develop and publish a list of California’s private employers and the amount the state pays when their employees utilize public assistance programs including Medi-Cal, CalFresh, California Work Opportunity and Responsibility to Kids (CalWORKS), and Women, Infants and Children Program (WIC).
AB 1792 does not look for information about why employers in certain industries pay lower wages or provide fewer benefits than others, or at how rising health care costs impact employers’ competitiveness. The bill does not look at other costs that have risen for employers over the decades, limiting what they can offer in wages and other benefits over time. AB 1792 similarly does not consider the impact higher prices for goods and services, which would be necessary to support higher wages and health care benefits, could have on the very Californians it is seeking to help. Nor does the bill look at the number of hours workers are taking on, whether they have voluntarily limited their hours for any number of reasons or have lost an income in the family during the recession that forced their family to survive on a wage that was previously supplemental.
Instead, AB 1792, by looking only at the number of employees in a given business who utilize these programs, implies that it is the greed of corporate executives that leads them to pay lower wages and not offer health benefits. In asking for a report to highlight those employers that “create the greatest burden on the state,” the measure also ignores the fact that even employers who pay lower wages and do not provide health benefits still contribute greatly to the state economy and keep millions of Californians from being completely dependent on public assistance.
To add insult to injury, the measure also exempts public employers even though many of them face the same pressures and similarly pay lower wages or deny benefits. By doing so, AB 1792 targets private employers and seeks to shame them for choices that are largely driven by steep overhead costs, competition, regulation, litigation, consumer buying patterns, rising health care costs and more.
Finally, AB 1792 creates new grounds for litigation by prohibiting retaliation or discrimination against an employee who enrolls in a public assistance program or refuses to hire an individual because he or she is enrolled in a public assistance program. California employers are already overwhelmed with employment litigation. Adding this new expansive classification will only cause such cases to dramatically increase and burden California employers with costly litigation.
While we understand the concern that some employers pay low wages and/or do not provide health care benefits, AB 1792 will do nothing to drive up wages, make health care more affordable, or otherwise improve the lives of workers. At the same time, the bill will actually make it harder for some employers to provide good wages and benefits by exposing them to new litigation costs.
For more than 70 years, the National Federation of Independent Business has been the Voice of Small Business, taking the message from Main Street to the halls of Congress and all 50 state legislatures. NFIB annually surveys its members on state and federal issues vital to their survival as America’s economic engine and biggest creator of jobs. NFIB’s educational mission is to remind policymakers that small businesses are not smaller versions of bigger businesses; they have very different challenges and priorities. Learn more at www.NFIB.com/ca.