New Labor Laws Pose Threat to Business Owners 

A Government Affairs Update

In a few weeks, the Michigan Legislature will return to Lansing for the fall session, with a key focus on labor and employee rights legislation, and the Michigan Restaurant & Lodging Association is ready to go to bat for you.

Specifically,  the MRLA is gearing up to advocate against predictive scheduling mandates, dramatic changes to Michigan’s independent contractor legislation, and municipal bans on plastic bags and containers. But the MRLA’s biggest fight this season may be the defense of a 2015 law preventing local municipalities from creating their own wage and labor policies.

As a business owner, the administrative duties that demand much of your time and attention are complex and cumbersome, but currently those duties are uniform across Michigan’s 83 counties. This is due to a law enacted in 2015, which prohibited local municipalities from adopting ordinances that exceeded state requirements pertaining to minimum wage, paid leave, and other employer mandates. The then-Michigan Restaurant Association joined a broad coalition in support of the law.

Prior to enacting this legislation, local governments were following a national trend and passing local laws governing private employers’ relations with their employees, mandating paid or unpaid leave time, setting wages higher than the state requires, and regulating other terms and conditions of employment. The 2015 law ended those local differences.

Now, the Michigan legislature is actively considering a bill that, if enacted, would allow Michigan’s more than 1,800 local units of government to craft their own rules and regulations governing private employers’ relations with their employees. This would create inconsistency, confusion, and a bureaucratic red tape nightmare for business owners.

House Bill 4237 was introduced on March 9. Before adjourning for summer recess in late June, both the House and Senate Committees on Labor heard testimony on the bill, sponsored by State Representative Joey Andrews (D-St. Joseph), as well as Senate Bill 171, sponsored by State Senator Sean McCann (D-Kalamazoo). It is expected that both bills will advance to their respective chambers when the legislature returns in early September.

The Michigan Restaurant & Lodging Association has joined a coalition opposing the repeal of the 2015 law on the following grounds:

• If the 2015 law is repealed, it is likely that multiple municipalities will work quickly to enact stricter local laws that go beyond current state laws on wage, labor, and leave-time policies. 

• It doesn’t make sense for local units of government to enact costly, one-size-fits-all leave mandates on job providers, as these mandates have the unfortunate effect of putting those local communities’ jobs and businesses at risk. 
• These ordinances are detailed, complex, apply to small and large employers, and cover both full- and part-time employees.  Many variables come into play with these local laws that make it extremely burdensome on businesses, especially if a business has multiple locations with multiple regulation systems.

 
As our industry continues to recover from the longest government-mandated ban on indoor dining, our state needs to do everything in its power to help both business owners and their employees. Allowing individual municipalities to create their own wage and labor policies does the exact opposite: mandates like these disrupt the traditional manager-employee relationship and discourage owners from expanding operations and investing in employees.
 
While some businesses have built momentum in a post-pandemic world, others were forced to close their doors. Unfortunately, supply chain interruptions and raising costs will force more businesses to close their doors through no fault of their own, and, if enacted, restrictive wage-and-labor policies will force still more businesses to close and employees to lose their jobs. The coming weeks and months will not be easy, but, as always, we are ready for the fight.

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