Dear OSCC Members and Colleagues -
The 2017 Oregon legislature forged into familiar territory last week with orchestrated hearings on legislation that is opposed and hotly contested by the business community - predictive scheduling (SB 828), removal of non-economic damage limits in lawsuits (SB 487), and a slew of bills regulating carbon emissions.
But unlike previous sessions, none of this legislation is a fait accompli. The future of all of these issues is tenuous at best.
OSCC's observations about the framework for the 2017 session is holding steady: (1) Leadership appears to be growing more serious about reducing the cost of state government, particularly in the area of labor costs, (2) there is continuing momentum for a comprehensive transportation funding package, (3) additional revenue generation is now a point of discussion between key bipartisan house and senate negotiators, and (4) there is a growing acknowledgement that PERS is not sustainable under the weight of $22 billion in unfunded liabilities.
Here's what we know from the past week:
The commitment to a bipartisan effort on the budget and transportation funding continues to forestall major anti-business legislation. Republicans have made it clear that their engagement in key budget and transportation efforts is contingent on not getting defeated on issues of primary concern to them - primarily business issues. Senate President Peter Courtney has also emphasized his desire for bipartisanship and the avoidance of partisan fights. This is perhaps the defining theme of 2017. The first casualty of this drive for bipartisanship appears to be environmental legislation - carbon pricing and emissions regulations. Once thought a foregone conclusion for 2017, these issues are clinging to life.
OSCC members did, indeed, catch a break on paid family leave legislation. We anticipated that legislators would find a way to raise the necessary revenue from business and employees to pay for a new paid family leave program without invoking the necessary 3/5th 'supermajority' voting requirement for raising taxes. Thankfully, we were wrong. Legislative Counsel has determined that the revenue needed to fund paid family leave constitutes a tax, and therefore, needs a 3/5th majority of the legislature to approve the legislation. This gives OSCC much greater leverage in defending against this expensive business mandate.
Predictive scheduling will likely be the primary 2017 labor issue now, but if it survives, it will be greatly watered down. The bill to pay attention to is SB 828. This bill specifically targets restaurants, hospitality establishments and retail stores. But Section 3 of the bill applies to all employers and would set onerous new wage requirements for any shift changes that result from lack of business demand or lack of customers on any given day. OSCC expects that Section 3 will be deleted in an effort to gain support as the bill is currently faltering. OSCC testified in opposition.
The House Revenue Committee began hearings on increased business taxes. The House committee heard bills that increase the corporate income tax to 8% (HB 2830) and increase the corporate minimum tax for large S corps (HB 2831). Although we don't believe there is an intention to move these bills independently of a pre-negotiated revenue package, OSCC will oppose these bills.
OSCC continues to urge members to pay attention to the discussion around SJR 41, which would switch Oregon to a gross receipts tax model.
Here's what's coming up this week:
New environmental regulations and taxes will be heard by a special joint House and Senate committee and will now involve informal evening hearings starting this week. This is a classic good news/bad news scenario.
The good news is that this new evening process essentially signals a 'white flag' of surrender on these anti-business measures for 2017. The bad news is that it represents an ongoing process to tee up these proposals once proponents sense the coast is clear. OSCC will closely monitor.
As of today, OSCC believes that while there is plenty of appetite (and votes) to move some sort of 'cap and trade' or carbon pricing proposal in the House, there is not enough support in the Senate. But again, as with most of the major non-budget and non-transportation issues that are looming, that could change if bipartisan negotiations on the budget or transportation break down. OSCC will oppose.
The "other" predictive scheduling bill - HB 2193 - will be heard in House Business & Labor Committee on Monday. Unlike the Senate hearing on SB 828, this bill will share the stage with several other bills, meaning it won't get the full attention of the committee ... an additional signal that SB 828 is the bill to pay attention to. But OSCC will continue to monitor HB 2193 in the event that it becomes the bill that proponents want to focus on.
The House Revenue Committee will continue its hearings on legislation that would impact business taxes. HB 2771 would discontinue the allowance of being able to deduct property taxes paid.
The Senate Environment & Natural Resources Committee will vote to approve SB 805, which appropriates $9.4 million for the agricultural experiment station and branch stations, Oregon State University Extension Service and Forest Research Laboratory programs of Oregon State University. This is very welcome news for our more rural members, but the legislation faces a tough road in a resource-constrained environment. OSCC will support.
Of particular interest to OSCC members:
We are continuing to sound the alarm on SB 828 - predictive scheduling. As we mentioned last week, OSCC has reason to believe that this is now the top labor priority for 2017.
What you need to know on SB 828: (1) It requires a minimum of four hours of pay for any food processor that calls an employee into work but the employee does not work the shift in its entirety, or (2) when an employee is told with less than 24 hours' notice that their upcoming shift is not needed or that the hours in the shift have been reduced.
SB 828 has much more stringent provisions for restaurants, hospitality establishments and retailers. It requires an interactive scheduling process in which an employer must accommodate employee scheduling requests. It also requires that schedules be set 14 days in advance. For any changes made to an employee's schedule with fewer than 14 days' notice, it requires one hour of additional pay per any change that does not result in a loss of hours worked, and it requires one-half rate of pay for any scheduling change that results in a loss of hours.
You can see SB 828 here.
OSCC members can submit testimony on SB 828 to: email@example.com
OSCC member testimony is encouraged NOW. Please make the request to your members to send customized testimony. Click here for talking points.
Alison Hart, Executive Director
JL Wilson, Legislative Counsel