August 7, 2018

CMass businesses briefed on Grand Bargain fallout

Photo/Grant Welker
Christopher Carlozzi, the state director for the National Federation of Independent Business.

The wide-ranging bill signed in June by Gov. Charlie Baker known as the Grand Bargain will bring changes to businesses statewide starting next year.

The minimum wage will rise, workers will no longer receive higher pay on Sundays and holidays, and a sales tax holiday was made permanent each August. Most complex of all is a new paid family and medical leave.

Representatives from the National Federation of Independent Business and Retailers Association of Massachusetts briefed Central Massachusetts businesses on the upcoming changes Tuesday at the Worcester Regional Chamber of Commerce.

The Grand Bargain, as its name suggests, was legislation taking parts of what the business community and labor groups wanted to have enacted, and avoided a series of ballot questions this fall.

"Both sides were very unhappy with the outcome in its entirety," said Christopher Carlozzi, the state director for the NFIB. "And I think the legislature liked it that way."

Among the most notable changes in the Grand Bargain is a first paid family and medical leave program.

Under the new program, employees who contribute will be able to take paid leave for up to 12 weeks a year for care of a family member, up to 20 weeks a year for personal medical issues, and up to 26 weeks for family members who are deployed for military service. Weekly benefits will be capped at $850.

Contributions are made though a payroll tax of 0.63 percent. Self-employed workers may opt into the program, and municipal employees will be eligible if their city or town votes to participate.

The new leave program goes into effect in 2021, but payroll tax collections begin July 1.

The state's $11 minimum wage will rise to $12 per hour starting next Jan. 1. It will then rise in each subsequent year by 75 cents until hitting $15 an hour by 2023. Labor groups had pushed for a $15 minimum wage to go into effect far sooner.

Tipped workers, most of whom work in restaurants, will see their pay increase. They now make $3.75 an hour but will make $4.35 an hour starting next year. Their pay will be increased each year until hitting $6.75 in 2023. As with today, tipped workers will receive extra pay by their employers if their take-home pay is less than minimum wage.

Time-and-a-half pay on Sundays and holidays will be phased out over the next five years. Workers' pay at most retailers will rise by 1.4 times on Sunday and holidays starting next year, and 1.3 times by 2020. It'll disappear entirely by 2023.

Retailers Association of Massachusetts President Jon Hurst called the time-and-a-half feature a relic of so-called blue laws of decades ago, when many shops weren't open on Sundays.

"It was put in place when the minimum wage was $3," he said.

Rhode Island is the only other state with such a pay arrangement, Carlozzi said.

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