January 22, 2015

Did The State Of The Union Matter For Employers?

The short answer: not really.  This year’s State of the Union Address, delivered by a lame-duck President to a hostile Congress, contained ideas that, if enacted, would surely affect American employers.  But in the end, the likelihood of any of those ideas becoming law is minimal.

The two biggest attention-grabbers for employers were a call for an increase in the federal minimum wage and a proposal to provide seven days of paid sick leave to all American employers.  Congress, now controlled entirely by Republicans seem unlikely to make any movement on either proposal.   The Senate, last year controlled by Democrats, was unable to pass a bill increasing the federal minimum hourly wage to $10.10 from its present rate of $7.25.  And, bills to provide paid sick leave stalled in Congressional committees.  These results seem likely to be repeated in a Republican-controlled Congress.

The question, of course, is whether the President will try to impose these requirements on federal contractors and subcontractors through executive action, as he has done in the past.  Just last week, the President ordered executive agencies to provide six weeks of paid leave for the birth or adoption of a child.  Last year too, the President raised the minimum wage for employees of many federal contractors and subcontractors to $10.10/hour.

For California employers, these proposals would have little effect.  The minimum wage here is presently $9.00/hour and will increase to $10.00 on July 1, 2016 and last year, the State enacted the Healthy Workplace Healthy Family Act, which required most employers to provide paid sick leave to employees.

Ultimately, however, the State of the Union proposals are largely academic and political, as no one expects any Congressional action on these proposals.  Barring something unforeseen, not much will happen on these proposals at the federal level until after the next election.

Category: Minimum Wage,