Hartford Business Journal

20 Hartford Business Journal • May 7, 2018 • www.HartfordBusiness.com OTHER VOICES Lawmakers should pause new mandates By Joe Horvath O n April 30, various business and trade associations held a joint press conference opposing a slew of onerous and unaffordable mandates before the General Assembly. Bills to rapidly hike the minimum wage, expand paid family medical leave to friends of employees at two-person companies, force employers of hourly workers to pay employees to take days off, and implement the nation's most burdensome harassment training re- quirements all took center stage. In other states, job creators and economic drivers are valued; their busi- nesses may deal with a new regula- tion or prohibition now and then. In Connecticut, we propose mul- tiple significant mandates during a short legisla- tive session that is supposed to be primarily about budget adjustments. Connecticut's version of economic development is handing millions of taxpayer dollars to barely vetted but well-connected businesses and then triple-counting their growth. Our idea of tax reform is imposing a new 0.5 percent payroll tax on employers to di- rectly fund the Department of Labor's high-cost staff. It would be better for everyone if the General Assembly put these mandates to bed. The most challenging proposal is raising the minimum wage very high and very quickly. The admittedly well- intentioned proponents of a $15 mini- mum wage, if successful, would hurt the very individuals they seek to help. Connecticut holds the distinction of being the first state to raise its mini- mum wage to $10.10. Connecticut also holds the distinction of having only recovered 80 percent of its pre-Great Recession jobs and losing jobs in March. Minimum wage increases have rou- tinely been tied to the elimination of work. For example, the same year that Connecticut raised its minimum wage, the non-partisan Congressional Bud- get Office analyzed a proposal to raise the federal minimum to $10.10 and found that its implementation would result in the elimination of 500,000 jobs nationwide. Such a drastic increase to $15 per hour could produce as much harm as good. Another proposal before the General Assembly would be the creation of a state paid family medical leave pro- gram. As currently structured, House bill 5387 would apply to companies with as few as two employees. Further, it provides 12 weeks of paid time off at the employee's full regular wage (up to $1,000 per week). This time is meant to allow an individual to care for sick fam- ily, although the bill defines family as "an individual whose close association with the employee is the equivalent of a family member." That provision, simply put, is impossible to enforce. These benefits will allegedly be paid for by a 0.5 percent payroll tax on em- ployees. However, since a $52,000-per- year employee would contribute $260 and be eligible for $12,000 in benefits, the program is inherently unsustain- able and would almost certainly lead to higher taxes on both employees and, eventually, employers. There is also no opt-out provision for individuals who do not want the coverage, and startup costs for the program would cost the state more than $13 million, with more than $18 million in annual costs to administer. In fairness, there are good bills be- fore the General Assembly, too. House bill 5266 would allow state agencies to waive penalties on a business' first regulatory violation, assuming the business is acting in good faith to remedy and produces no personal or environmental harm. Additionally, House bill 5480 would dramatically improve the unemploy- ment insurance fund's fiscal stability, all without harming businesses or individuals with a practical connection to the labor force. Rather than spending every legisla- tive session considering new ways to erect barriers to job creation and eco- nomic growth, the General Assembly should reverse course. Joe Horvath is the director of legislative outreach at the Yankee Institute for Public Policy. RULE OF LAW Merit must be the basis for equal opportunity By John Horak A ny Connecticut employer who has responded to a Commission on Human Rights and Opportunities (CHRO) discrimination complaint should pay attention to a California lawsuit in which former Google employee, James Damore, claims he was fired because he is a conservative white male. I had experience with the CHRO when practicing law, and wondered what would happen if Damore lived in Connecticut and brought his com- plaint here? This question is interesting not because of Damore's politics (liberal or conservative makes no difference), but because it suggests that our employment discrimination laws (dated to 1947) have now come full circle to protect every- one of any race, religion, etc., such that there is no one against whom an employer can discriminate on any basis whatsoever other than merit — what the statutes (since 1947) call a "bona fide occupa- tional qualification or need" or "BFOQ." If we have come full circle to protect everyone, wouldn't it make sense for the CHRO to issue regu- lations saying that the only basis upon which an employer can legally discriminate (make an employment decision) is merit? The CHRO was created in 1943 by Republican Gov. Raymond Baldwin as the Inter-Racial Commission, "so that grievances of the state's African- American population might be heard." Its 1943 duties: investigate the "possi- bilities of affording equal opportunity of employment to all persons." In 1947 the Fair Employment Practic- es Act was added to put these goals into practice, and it does so in two steps. First, it divides the population into protected classes (the original five were race, color, religious creed, na- tional origin, and ancestry), and unpro- tected classes (all others by default). Second, it makes it unlawful to make employment decisions (to discriminate) with respect to people in protected classes on any basis other than merit. Hence, prior to 1947, employers could say "no Irish need apply," but not afterwards because "national origin" had become protected. In 1948 employers could say," only men under 30 need apply" — a practice that be- came unlawful as additional protected classes were added: age (1959), sex (1967), physical disability (1973), marital status (1975), intellectual disability (1978), mental disability (1978), learning disability (1990), sexual orientation in 1991, genetic information in 1998, and gender identity or expression in 2011. The problem is as additional protect- ed classes were added, larger portions of the population became protected, leaving fewer people unprotected; class lines blur such that multiple people competing for the same posi- tion might all be members of one or a combination of protected classes. Finally, as a matter of equal protec- tion, it's hard to explain why certain people are protected except on the basis of merit, and all others are un- protected even if they are clearly the best qualified for a job. Kudos to Gov. Baldwin for his lead- ership decades before the civil rights movement emerged nationally. But I do think that in 2018 we've reached the natural limits of a system that promotes equal opportunity by divi- sive means. The CHRO needs a modern tool to promote equal employment opportu- nity, and I suggest the device it needs is right in front of us in the form of the BFOQ concept. The CHRO could use its regulations and public outreach efforts to define, elevate and promote merit as a universal principle that all of us should recognize for its common- sense logic and complete neutrality. The same regulations could help employers establish merit standards in detail sufficient for them to follow. In the future, employee complaints to the CHRO would not be decided based on protected class membership but on whether the employer adhered to the merit standards. John M. Horak is the director of TANGO Nonprofit Education and Consulting. Opinion & Commentary Joe Horvath John Horak

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