Last week’s state budget agreement included two of Gov. Andrew Cuomo’s top priorities for 2016: a big minimum wage increase and paid family leave. But the final versions of these measures contained changes from the governor’s original proposals—revisions needed to win legislative approval.
Cuomo on Monday, with Hillary Clinton nearby, signed the gradual $15-an-hour minimum wage hike and 12-week paid family leave bills into law.
The plurality of Snap Poll respondents—just shy of half—gave the final versions of the minimum wage hike and paid family leave law failing grades.
Cuomo sought to hike the minimum wage statewide to $15 an hour. But under the approved plan, north of New York City it will increase to $9.70 at the end of 2016, then another 70 cents annually until reaching $12.50 on Dec. 31, 2020. After that, it could continue to increase to $15 on an indexed schedule. But the measure contains a “safety valve.” Beginning in 2019, the state budget director each year will study the economy in each region “to determine whether a temporary suspension of the scheduled increases is necessary.”
On paid family leave, Cuomo sought—and won—approval for the most expansive program in the nation. When fully implemented in 2021, employees will be eligible for 12 weeks of paid family leave, funded by a payroll deduction. They will be eligible to participate after six months on the job; Cuomo had proposed eligibility after four consecutive weeks of employment.
Benefits will be phased-in beginning in 2018 at 50 percent of an employee’s average weekly wage, capped to 50 percent of the statewide average weekly wage, and fully implemented in 2021 at 67 percent of their average weekly wage, capped to 67 percent of the statewide average weekly wage.
Business representatives were mixed in their reactions to these measures. Greater Rochester Chamber of Commerce President and CEO Robert Duffy thanked Cuomo and lawmakers “for their compromise, flexibility and acknowledgment of the very real economic differences between upstate and downstate in determining the final result.” But Heather Briccetti, president and CEO of the Business Council of New York State Inc., expressed disappointment with the paid family leave law and with the minimum wage hike, which “at $8,000 per job upstate and $13,000 downstate when fully implemented (is) still too much for many businesses.”
Nearly 600 readers participated in this week’s poll, conducted April 4 and 5.
How would you grade the final version of the minimum wage increase passed in Albany last week?
How would you grade the final version of the paid family leave law passed in Albany last week?
For information on how the Snap Polls are conducted, click here.
Both the minimum wage increase and paid family leave will have a huge negative impact on small businesses and overall employment. What small business can survive these requirements if they are only moderately successful? If the business is just surviving before the wage hike, then it will either go under or have to lay people off and potentially still go under. These minimum wage jobs were never meant to be a living wage. They are supposed to be for high school students, part-time for college students, or first-job employees. People in these jobs are expected to move on to better jobs. I cut grass in the summers for the state parks when I was in college and high school. I did not live on that pay. It was to help pay for my college education.
Speaking as someone who has used family leave in the past to care for my husband after his transplant surgery in a different state, it was a blessing. It was also very financially difficult as it was unpaid leave after I used all my vacation. I commend Gov. Cuomo for getting this law passed. Until you need family leave, you have no idea how valuable a benefit it is. Paid family leave is vital to families already struggling with huge medical bills.
We’re getting to look like Europe more every day! What does Cuomo and the Legislature think is happening in New York State? Companies and people continue to leave due to excessive regulations, taxes and fees. How does a small company stay in business with these new costs? We have nine employees. What do we do when someone takes 12 weeks off to care for themselves or others? Seems to be an easy avenue for abuse.
—Art Elting, Palmyra
Our upstate economy is largely dependent on small independent businesses; mine specifically is agriculture. Although I favor a scheduled moderate minimum wage increase, our farm income stream does not align or project the growth necessary to match the wage acceleration of the governor’s plan. The dairy industry competes in a world market, and with Cuomo’s plan we won’t even be able to compete with farms in neighboring states.
—Sarah Noble-Moag, Noblehurst Farms
Simply passing this budget still leaves many unanswered questions. In addition to cost, these changes will certainly present administrative nightmares to New York companies. But I guess it looks good on paper during an election year!
—Nancy May, APPC
Are these politicians purposely trying to speed the demise of our state?
—Steve Wichtowski, Honeoye
Lawmakers should be ashamed of themselves for passing laws that are job killers and inflation generating like these two. Guess who is going to pay for these new laws—you and me as taxpayers and consumers.
The governor and his cohorts follow a consistent pattern. First, they propose something very damaging to the state’s small businesses. Then when they “compromise” they act as though they have done us a big, fat favor. The better favor would be to cease interfering in the free market.
—John Calia, Fairport
Another reason for businesses to exit New York State.
—Ed Rosen, Fairport
Just one more nail in the coffin. New York is already near the bottom of business-friendly states. This will put us solidly on the bottom! Way to go, Cuomo! Expect this paid leave program to be exploited just as the awful and terribly mismanaged New York workers compensation system is! Expect to pay way more out of your pocket for everything you buy when the combination of these two policies are fully implemented.
—George Thomas, Ogden
I’m going to concentrate on the minimum wage, which is long overdue for an increase. The scaling of the minimum at 70 cents per hour each year seems fair when viewed in a vacuum. That’s a 7.8 percent pay increase in the first year for some workers. Notably excluded are “tipped” workers. I guess they don’t require as much money to buy food, housing and clothing as other workers. That part of the legislation is a foul tip for restaurant employees.
—Wayne Donner, Rush
Terrible job by Emperor Cuomo.
We hire mostly high school and then early college students. They know they are not worth $15 an hour to us and do not expect that much. When they are worth that much, that is what we will pay them; otherwise, the good workers will leave! As written, the law is ridiculous as well as harmful to most businesses as is the 50 percent increase in tipped wages. Besides, we are a seasonal business and this whole thing could leave a lot of students without summer jobs.
—John Socha, Showboat Motel and Restaurant, Himrod
The Greater Rochester Chamber of Commerce—or Business Alliance, or whatever it’s called these days—has become a sad reflection of what has happened to Rochester. Instead of leading the fight for our business community, they have become a shill for Cuomo and the legislators who are going along with his efforts to ruin what’s left of our economy. The minimum wage hike and 12 weeks of paid vacation in the guise of family leave are unmitigated disasters for what’s left of Rochester’s economy. The city has shrunk by more than a third, the unemployment rate among young people is astronomical. Even in the suburbs the young working-age professionals are moving out because they can’t find jobs, and yet what does Cuomo do—makes it even more difficult to hire people. And the chamber applauds him. I don’t see how we have much hope left here, unless you work for a not-for-profit like UR, which seems to receive an endless flow of grant money. With our taxes still the highest in the nation, the most anti-business bureaucrats imaginable outside California, and now labor conditions becoming union-like even if you don’t have a union, who in their right mind would locate or expand here?
What has happened to free enterprise?
It is said, “Be careful that you don’t get what you wish for.” Lower-wage workers got what they wished for. Now they can be careful that their jobs don’t turn into being done by robots and technology. Pandering politicians got what they wished for. Now they can watch one of their own take a shot at higher office. They can be careful that their jobs don’t turn into being done by someone else come next election.
Upstate New York needs a $15 minimum wage now, not in four years. I understand that Cuomo had to make compromises to get the budget done. This was the wrong item to compromise on. People need a living wage.
Both of these add to the already-too-long list of reasons for businesses to prefer North Carolina, Vermont, Tennessee and others to New York. To stop the brain drain, we must stop subsidizing employees with mandated corporate handouts.
—Dorver Kendig, Webster
So, beginning in 2019, it’s essentially Gov. Cuomo who’ll be making the call on any additional increases in the minimum wage, since the state budget director is his appointee. The fixed annual increases thus top out at $11.10 an hour in 2018. At this point, it’s anybody’s guess as to whether or not the $15 per hour will ever be reached.
Just another reason why businesses are fleeing New York State like startled deer.
—Lou Calarese, president, Applied Audio & Theatre Supply
Hope everyone has plans to diversify. Move your businesses, your holdings and your family out of New York State; this sucker is going down.
—Kanyah Burn-Moore, Rochester
The best compromise for a business owner is to leave New York and move to another state that encourages business. Some states “‘get it” in regards to job creation. New York State is one the worst business-friendly states in the country. Laws like this will keep it that way.
—Todd Black, T. & R. Black’s Hardware
I think the Castro brothers rubbed off on Gov. Cuomo when he was down in Cuba. The governor’s recent actions with executive actions, wage boards, etc. are almost Marxist. His actions on the minimum wage increase, paid family leave (a.k.a. more vacation time), etc. are more straws that “will break the camel’s back.” The state legislators are almost as guilty. It will do great harm to entry-level jobs and also put pressure on especially small business. Well over 20 percent of minimum wage jobs are held by individuals who live in middle income and high income households. These are typically high-school or college-age young people who are working to gain some early work skills. These opportunities will be reduced. Paid family leave will be abused by freeloaders. The good workers will be paying for the stiffs that want to milk the system. Instead, the taxpayers will end up paying for the deficits to keep it solvent. Instead of following the example of Karl Marx, Lenin, Chairman Mao, Stalin, Bill DeBlasio, etc., the governor and his allies in the Legislature should educate themselves with Milt Friedman and Art Laffer on unleashing the economy without inefficient layers of government. Also, work on making New York a right-to-work state and instituting term limits instead. Remember, socialism is great until you run out of other people’s money.
There are so many ways to reduce the need for labor. It might result in layoffs or just reductions of hours. It will happen, and these two measures by the state government ensure that it will happen sooner, not later. What about the workers who are supposed to be helped? On one hand, we encourage young people to finish their schooling and obtain training or further education to earn a career-building job. But on the other, we are encouraging them to settle for a lifetime of minimum wage jobs by inflating them. There is a precedent. We preach to young women: “Avoid illegitimate pregnancies, but in case you don’t, here’s a lot of money.” It’s the same thing, the welfare state in all its glory. Will we ever learn? And there we can see the deception of Cuomo’s fetish-like wealth redistribution. He knows that good career jobs are never going to stop bleeding out of this state because of his leftist policies that drive them away. So, his solution is to make minimum wage jobs appear more lucrative and pretend that’s enough. He will hope that we believe it long enough until he can move his personal career fortunes out of New York to greener pastures in D.C.
Question for our elected representatives: Is the state going to increase the reimbursement rate they pay to the many human services agencies that currently pay less than the newly required hourly wage? Many of the agencies are operating on the “financial edge” and will have to cut back services or go out of business if they cannot receive the new living wage reimbursement from the state. It is easy for the governor to require businesses in New York to pay higher wages—but is he also going to make sure the state pays that increased cost to the not-for-profits that look to the state to reimbursement them for services provided to our sick, disabled and elderly citizens?
—Gerald Van Strydonck
Either or both of these proposals, if implemented, will accelerate the flow of businesses to more commerce-friendly states and countries.
—Tom Shea, Thomas P. Shea Agency Inc.
Government people—elected and non-elected—should not be able to tell/order business owners and operators how much a person is worth to a business. This latest budget illustrates the socialist mindset of both Democrats and Republicans!
—John L. Sackett Jr., Byron
4/8/2016 (c) 2016 Rochester Business Journal. To obtain permission to reprint this article, call 585-546-8303 or email firstname.lastname@example.org.