Ocean City Today
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Paid sick leave legislation set for new year showdown

By Greg Ellison | Dec 28, 2017
Courtesy of: Executive office of the governor Gov. Larry Hogan unveiled an alternative paid sick leave bill in late November.

(Dec. 29, 2017) Political battle lines in Annapolis will be drawn again when the Maryland General Assembly convenes in January and considers overriding Gov. Larry Hogan’s veto last year of mandated paid sick leave legislation.

The topic continues to raise serious concerns among Ocean City business owners, who each summer hire more than 5,000 J-1 workers. These workers generally receive 120-day visas.

Prior to later amendments, HB01, the Maryland Healthy Working Families Act, permitted earned sick leave time to be used after 90 days on the job. Seasonal operators envisioned nightmare scenarios with staff members electing to burn up earned sick leave hours prior to the end of their employment.

After vetoing HB01 on May 25, in November Hogan offered an alternate called the Paid Sick Leave Compromise of 2018, which his office plans to submit in January.

Since Hogan vetoed HB01 after the regular session, it must be considered upon reconvening in January. With an effective date of Jan.1, if the veto is overridden by a two-thirds vote in both chambers, it becomes law retroactive to New Years Day.

Under current law, Maryland does not require businesses to provide employees with any type of sick leave. According to U.S. Bureau of Labor Statistics, during 2016 about 61 percent of Marylanders employed in private industry received paid sick leave, as did 92 percent of those with state and local government.

Greater Ocean City Chamber of Commerce Executive Director Melanie Pursel said the legislation mandates benefits, in many instances, small businesses could not afford.

“We have found that a large majority of Ocean City businesses already offer paid leave, as well as other benefits, to their year-round, full-time employees,” she said. “If they now had to offer paid leave to summer/seasonal employees, this law would actually compromise their ability to operate, as it would be extremely costly from a service standpoint.”

The bill would require businesses with 15 or more employees who clock in for a minimum of 12 hours per week to provide one hour of paid sick leave for every 30 worked. Businesses with 14 or fewer employees would be required to provide unpaid sick leave at the same rate.

The initial version of the bill, which passed the House by an 88-51 vote on March 3, would have permitted employees to use accrued leave after 90 days on the job.

Prior to that first passage, Delegate Mary Beth Carozza (R 38C), who voted against the legislation, lobbied unsuccessfully to exempt seasonal employees who work 120 days or less per year, as well as increasing to 50 the number of employees required for businesses to provider paid sick leave.

After the bill cleared the House, the concerns of local business owners was next championed by Sen. Jim Mathias (D-38), who pushed to have the seasonal employee exemption increased, albeit a few weeks shorter than Carozza’s effort.

“It took everything I had to get it moved from 90 days to 106 days,” he said. “It involved a long number of weeks and negotiation.”

By early April, the amended bill passed the Senate 29-18 before the House voted 87-53 in the affirmative on April 5.

Mathias also negotiated a caveat requiring workers who use earned paid sick leave between 107 to 120 days of employment to provide medical documentation.

“I was able to get 106 days in the Senate and an additional 14-day exception with a doctor’s note,” he said. “Regardless of what people think, it took an enormous amount of effort to get things in the bill that weren’t achievable on the House side.”

Mathias understood voting against the bill would limit negotiations, so he opted to support earned paid sick leave, albeit with conditions.

“It’s about working families and breadwinners who get sick or provide a caregiving need,” he said. “I choose to apply myself to make a coherent argument, and it was accepted.”

Despite the concessions negotiated, Hogan vetoed the bill in May and called for a “common-sense compromise.”

“Let’s reach a compromise to ensure that our small business job creators aren’t forced to lay off workers or shut their doors in order to comply with overly strict, burdensome, and costly regulations,” he said. “Let’s make sure that hardworking Marylanders don’t end up paying the price for a politicized legislative process.”

On Nov. 28, Hogan announced his alternate plan, the Paid Leave Compromise Act of 2018, which includes a three-year phase-in period for paid sick leave.

Hogan’s proposal mandates businesses with at least 50 employees to provide accrued paid sick leave staring in 2018. Beginning in 2019, employers with 40 or more workers would be included, with businesses with at least 25 employees required to comply by 2020.

The Compromise Act promoted by Hogan would also allow the Department of Labor to issue temporary waivers for affected businesses that exhibited a “significant financial hardship.” It also budgets $100,000 to provide tax credits, over a five-year period, for businesses with fewer than 50 employees who provide earned paid sick leave.

The paid sick leave conversation resumes in January.

According to a senate fiscal and policy note on the bill, while approximately 20,000 businesses that have 15 or more employees would be required to provide paid sick leave, fewer than 20 percent of state businesses have 15 or more employees, but they employee 86 percent of workers. Also it said approximately 84,000 Maryland businesses that have fewer than 15 employees would be required to provide unpaid sick leave.

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