Mich.: House Passes Bill Voiding Local Wage, Benefits Ordinances

By Diane Cadrain Jun 10, 2015
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The Michigan House of Representatives on May 20, 2015, passed House Bill 4052, the Local Government Labor Regulatory Limitation Act, which would bar local governments from requiring employers within their jurisdictions to offer employee benefits and compensation beyond the level required by state or federal law.

“This legislation is about making sure local businesses have a consistent rule of law in regards to their employees,” said bill sponsor Rep. Earl Poleski. “Compliance with multiple city, township and county laws is not only complicated, but also costly. We need to make it easier for people to create jobs in Michigan, not harder.

“Prohibiting such ordinances,” Poleski continued, “is common sense for small businesses who work across municipal lines.”

Among the bill’s supporters are the Michigan affiliate of the National Federation of Independent Business (NFIB), a small-employer group.

“Small business cannot afford local micromanagement of employer benefit policies,” said the NFIB’s Charles Owens. “It is poor public policy to allow County and municipal governments to layer on duplicative requirements and regulations on small business at the behest of local activist groups or advocates who are unsuccessful in accomplishing these policies at the federal and state level.”

Rep. Andy Schor, who opposed the bill, explained that when he served as a county commissioner for Ingham County, the commissioners found that some county employees, and some working for service employers with county contracts, were forced to get public assistance to make ends meet.

In response, the county enacted a living wage ordinance.

“We did it to save the county and to … allow our people to feed their families and keep them healthy,” said Schor.

“I get that business wants to lower their costs, but we have to balance the needs of business with the needs of our residents,” Schor continued.

House Bill 4052 would apply to any employer working within the jurisdiction of a unit of local government, but exclude local government itself in its role as employer.

In response to complaints that the bill would void local ordinances banning discrimination against LGBT employees, the bill was amended to make it clear that it would not affect local antidiscrimination ordinances.

The bill is now before the Senate Committee on Michigan Competitiveness.

Diane Cadrain is an attorney who has been writing about employment law issues for more than 20 years.

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