Rapid Fire: When Government Changes Policies Faster than the Market can Bear
For the last several months, the conversation at chambers of commerce, business associations, non-profit groups, and tourism associations has been dominated by numerous policies enacted in the last year at the state and federal level which will drastically change the way so many of us do business.
According to NYS Business Council President Heather Briccetti, “After making steady progress over the past five years in improving the state’s business climate, the 2016 session took a hard turn to the left, resulting in dramatic new costs and mandates on private sector employers. In the wake of a $15 per hour minimum wage, and the nation’s most expansive Paid Family Leave mandate, we are further disappointed that the session ended without agreement on any major pro-growth or cost reduction measures…” Learn more about the NYS Business Council’s perspective on the end of the Legislative session here.
Top off a more complex NYS business climate with new Federal regulations regarding the Fair Labor Standards Act (FLSA), which have increased the wage needed to meet the salary test for most salaried-exempt class employees by about 100%–to be implemented December 1, 2016. There is no phasing, there are few exemptions; those that exist carry significant risk and would be tricky for any business or non-profit to implement. Learn more about this rule and how you may be impacted here.
Though deals were struck regarding minimum wage increases for upstate being phased in over the course of five years—and at a lower level than many preferred—we will not know for many months the full impact or costs of implementation. Nor will we have a complete picture for businesses and non-profits addressing the wage compression that comes along with minimum wage increases. And, because something will have to give somewhere—it’s very possible that jobs could be lost, or at least, not be created as planned.
We want your feedback regarding how the new minimum wage policies, Paid Family Leave mandate, and FLSA rules will impact your business or non-profit. We also seek your input regarding what resources the Chamber can provided that will support your business in navigating these changes over the next several months and years. Look for a fresh survey soon seeking your input about these issues.
One thing is for certain: government has forced implementation of massive market corrections regarding wages and benefits in a considerably short period of time. Businesses and non-profits alike are about to deal with serious capacity issues, and only time will tell what the true cost vs. benefits are of these new policies.