After the California legislature adjourned—sending several noteworthy labor and employment bills to Governor Brown for his veto or signature in September¹—only a few states remain in active session. Before adjourning or taking a recess, however, several states certified questions for voters to consider on Election Day. This month's State of the States reviews notable ballot initiatives, as well as the handful of bills that advanced at the state and local levels in October.

Ballot Initiatives

Marijuana Legalization

Attempts to legalize marijuana tend to pop up each election cycle. This year is no exception, as voters in a handful of states will decide whether their jurisdictions should legalize cannabis for a variety of uses. And although none of these legalization efforts would change state employment law, employers in the affected states—should the measures be approved—would no doubt be faced with several questions about how the changes would affect enforcement of their workplace substance abuse policies.

On November 6, North Dakota voters will decide not just whether to legalize the recreational use of marijuana, but also whether convictions for possession of marijuana should be expunged. North Dakota Measure 3 would legalize the recreational use of marijuana for people 21 years of age or older. The measure would also create the category of “Illegitimate drug violations” and define them as “Any violation in the state of North Dakota, for a controlled substance that has been legalized or for an activity regarding the substance has been legalized, wherein the person has a record of punitive action by the state whether it be a plea deal or conviction,” and require the automatic expungement and sealing of those convictions within 30 days after the law is passed for those who are not currently incarcerated.

Michigan Proposal 1 also would legalize the recreational use of marijuana by adults age 21 years or older. It would establish licensing requirements for marijuana retailers, transporters, processors, and growers, and allow municipalities to ban or limit marijuana retailers or facilities. 

Marijuana for Medical Use

Missouri has two ballot initiatives (Amendment 2 and Amendment 3) that would amend the state constitution to provide for the use and distribution of marijuana for medicinal purposes. Both initiatives would authorize the prescription, sale, and research use of medical marijuana for patients diagnosed with certain medical conditions, including cancer, epilepsy, and any terminal illness.

Also on the Missouri ballot is Proposition C, which creates a mechanism for approving marijuana for medical use that stops short of requiring a constitutional amendment. The proposition would legalize marijuana for medical purposes, and allow state-licensed physicians to recommend medical marijuana if a patient has one of the nine qualifying conditions, but would prohibit the home cultivation of marijuana.

Utah also has a ballot initiative to legalize medical marijuana use. The Utah initiative would allow those with a qualifying illness—such as Alzheimer’s, cancer, or epilepsy—to apply for a medical marijuana card if prescribed by a physician.

Minimum Wage

This election season features numerous attempts by states and localities to increase, or simply alter, the minimum wage.

A ballot initiative in Arkansas seeks to increase the state minimum wage to $11.00 per hour. The current Arkansas minimum wage of $8.50 would be increased incrementally to $9.25 on January 1, 2019; to $10.00 on January 1, 2020; and finally to $11.00 per hour on January 1, 2021.

Missouri is also offering a ballot measure to increase the minimum wage. The current state minimum wage of $7.85 would be increased to $8.60 on January 1, 2019, and by $.85 each subsequent year until the minimum wage reaches $12.00 in 2023. After the minimum wage reaches $12.00 an hour, the minimum wage would increase or decrease each year based on changes in the Consumer Price Index for Urban Wage Earners and Clerical Workers.

At the local level, a Cook County, Illinois advisory question asks residents whether they want their municipality to be covered under the county’s minimum wage and paid sick leave ordinances. Currently, the overwhelming majority of municipalities in Cook County have voted to not be covered by the county law. An Anaheim, California ballot measure would establish a minimum wage for employees of companies that accept city subsidies: $15.00 per hour on January 1, 2019, which would increase $1.00 per hour annually in 2020, 2021, and 2022, with annual adjustments occurring in 2023 and future years.

By contrast, voters in Flagstaff, Arizona will get to decide, via Proposition 418, whether to decrease the local minimum wage to the state rate until 2021, and then to $0.50 more than the state minimum wage in 2021 and future years. The measure also proposes retaining the state tip credit rate of $3.00 per hour instead of gradually reducing the rate in future years until the tip credit is eliminated, as the law currently requires.

Oakland, California’s Measure Z would mostly affect hotel workers at hotels in Oakland with 50 or more guest rooms. It would establish a minimum wage of $15.00 for covered workers who receive employment benefits or $20.00 for those who do not receive benefits. The measure would also require employers to provide their staff with panic buttons, impose workload restrictions, and allow employees to have access to certain employment records, among other requirements.

Discrimination

Massachusetts has a veto referendum on the state’s transgender antidiscrimination act, which prohibits discrimination based on gender identity in places of public accommodation. The law requires access to gender separated areas, such as bathrooms, based on an individual’s self-identified gender identity. The penalty for a place of public accommodation violating the law ranges from up to $100 and up to 30 days in prison to $2,500 and up to a year in prison, depending on the violation. There is also a $10,000 to $50,000 civil penalty associated with the law for each violation based on prior violations. A vote of “yes” would uphold the antidiscrimination bill; a vote of “no” would repeal the law.

Non-Ballot Initiatives

Those state and municipal legislatures still in session introduced and advanced some interesting labor and employment bills and ordinances in October.

Discrimination and Harassment

On October 9, 2018, New York State's anti-sexual harassment legislation, which the governor described as the "strongest and most comprehensive" in the country, took effect. As of October 9, 2018, employers must distribute to all New York-based employees an updated anti-sexual harassment policy. New York State released model policies and their minimum standards for other policies on October 1st. Over the next year, employers also must train all New York-based employees regarding sexual harassment and retaliation, and repeat such training annually thereafter.²

In other training news, New Jersey introduced a bill (SB 3012) that would require restaurants employing 15 or more people to provide sexual harassment training to new employees within 90 days of employment, and to each employee at least every five years. Supervisors would have to receive additional training. The bill would also require covered restaurant owners to adopt a sexual harassment policy and provide that policy to all employees. The bill includes monetary fines for noncompliance.

Another New Jersey bill (AB 4633) introduced in October would prohibit employers from inquiring about a job applicant’s gender. In addition to prohibiting such questions on a job application, the bill would prevent employers from making any other oral or written inquiries about the applicant's gender, or taking any adverse employment actions against the applicant based on the applicant’s gender. The bill includes an exception where gender is a “bona fide occupational qualification, reasonably necessary to the normal operation of the particular business or enterprise.”

Racine, Wisconsin adopted a new ordinance that expands the city’s antidiscrimination ordinance to include gender identity. The ordinance also provides definitions for terms such as “gay,” “gender identity,” and “LGBTQ” to better protect those groups against discrimination in the city.

Protected Time Off

Westchester County became the second locality in New York to generally mandate paid sick leave.³ The Earned Sick Leave Law ordinance (ESLL) will take effect on April 10, 2019, requiring employers to allow employees to accrue one hour of earned paid sick time for every 30 hours worked, up to 40 hours per year.

Regarding unpaid leave, in Pennsylvania, a bill (SB 479) that would create the Pennsylvania Family and Medical Leave Act has cleared a Senate committee. The bill would extend leave rights available under the federal FMLA counterpart to employees caring for siblings, grandparents and grandchildren in certain instances. Specifically, it would provide up to six weeks of protected, unpaid leave to an employee to care for a sibling, grandparent or grandchild with a serious health condition if such sibling, grandparent or grandchild has no living spouse, child over 17 years of age or parent under 65 years of age.

Meanwhile, on October 23, the Pennsylvania Supreme Court heard arguments in a case challenging the Pittsburgh paid sick leave ordinance, among other measures, which never took effect due to the legal challenge. While opponents argued that Pittsburgh lacked the authority under the home rule charter to regulate the private employment sector, supporters of the ordinance asserted that local governments may adopt measures promoting public health and safety. As of the date of publication, the court has not issued its decision.

New Jersey Department of Labor and Workforce Development released a set of Frequently Asked Questions (FAQs) on the state’s new paid sick and safe leave law.⁴ The FAQs address myriad questions about the new sick leave law over 12 topic areas. Shortly thereafter, the Department published the mandatory notice in numerous languages in addition to English.⁵

Contingent Workers

The New Jersey Assembly and a Senate committee both approved a new bill, AB 1526, that would establish rules regarding payment of freelance workers. Under the bill, a freelance worker is defined as “a sole proprietor who is not an employee and who is hired or retained as a freelance worker by a client to provide services in exchange for compensation in an amount equal to or greater than $600.” The bill exempts lawyers, licensed medical professionals, real estate agents, sales representatives of a principle hired to solicit orders in New Jersey, and workers covered by a collective bargaining agreement. The law would also establish that freelance agreements must be written and include an itemization of all services and a description of the compensation mechanisms, including how the compensation is calculated and when it must be paid.

A new Pennsylvania bill (HB 1781) related to independent contractor status passed a House committee in October. The bill would create a mechanism for registering a worker as an independent contractor for workers’ compensation purposes. The registration would require workers to waive all workers’ compensation benefits in writing and to submit an affidavit stating they understand and agree they are not employees, not entitled to benefits, may purchase workers’ compensation insurance, and are not entitled to recovery from the client if injured while performing services.

No-Poaching Agreements

The New Jersey Assembly introduced a bill prohibiting no-poaching agreements. Assembly Bill 4545 would provide that a franchisor cannot prohibit a franchisee from employing an individual currently or previously employed by the franchisor or any other franchisee of the franchisor. The bill would allow employees of the franchisor or franchisee to sue if their employer violates the no-poaching provisions.

Predictive Scheduling

Boston is the latest jurisdiction to propose predictive scheduling requirements. The Boston ordinance would apply specifically to contractors that do business with the city. The proposal would require contractors to give their employees two weeks’ notice before changing their schedule. While this proposal would not affect most private employers, it would serve as a significant new regulation for those businesses that receive taxpayer funding.

In Philadelphia, a council committee has approved an ordinance that would require certain retail, hotel, and food service employers to implement "fair workweek" standards. Such standards would include reasonable advance notice of work schedules, predictability pay, rest breaks between shifts, and the opportunity to work more hours before the employer can hire new employees, temporary employees, or subcontractors from an external applicant pool. The ordinance would apply to retail, hotel and food service industry employers with 250 or more employees and 30 or more locations worldwide.

Benefits

The New Jersey Senate passed a bill (SB 1567) that would require any employer with at least 20 employees to offer a pre-tax transportation fringe benefit to their employees not subject to a collective bargaining agreement. Employers that fail to offer this fringe benefit would be subject to monetary penalties.

Meanwhile, the Seattle City Council passed an ordinance that requires employers to allow employees to use pre-tax earnings to purchase commuter benefits, other than parking. This law would affect employers with 20 or more employees, and cover employees who work an average of 10 hours or more per week in Seattle. By January 1, 2020, employers would be required to offer a pre-tax election commuter benefit to employees and must offer the benefit to new employees within 60 days of hire.  

Minimum Wage and/or Wage Payment

A paystub bill (SB 1791) passed the New Jersey Senate. The bill would require that wage statements include the employee's gross wages, net wages, the rate of pay and number of hours worked during the pay period, if relevant. The bill would apply to every employer with 10 or more employees and includes public employers.

For additional updates on recent wage and hour developments, read the latest edition of WPI's Wage Watch.⁶

What's Next?

All eyes will be on the November election results and what that means for employers. We will continue to keep an eye on developments at a state and local levels as the year draws to a close.