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Blog Post: Good Workplace Practices Lead to a Vibrant Economy
By: Richard Eidlin, American Sustainable Business Council and Ann Pratt, Progressive States Network
As state legislatures across the country wrap up their deliberative sessions it’s a good time to review what they accomplished on behalf of working families and small businesses. From Minnesota to Hawaii, states considered and passed minimum wage increases. States also looked at providing seniors with a more secure retirement and low-income workers with the safety of paid leave for illness or family care. These policies represent our vision for the economy, one that is pro-worker and pro-business and makes our workplaces healthier, drives more customers to local businesses, secures a future of prosperity for workers of all ages, and grows our country’s economy.
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A Higher Minimum Wage
At a time when employee productivity is soaring but pay remains stagnant, workers need a living wage and businesses need customers with money in their pockets. Raising the minimum wage accomplishes both of these goals, which is why 34 states considered bills to raise their minimum wage this year. Of those, Delaware, Hawaii, Massachusetts, Michigan, and Minnesota passed increases. Minnesota was able to broker a compromise between the House and Senate that would increase the minimum wage to $9.50 and index it to inflation, but allow the governor to veto the inflation increase during times of economic stress. In Nebraska, the legislature failed to pass a bill and in response activists have begun working to place the issue on the fall ballot. This effort represents an evolving strategy across the country where minimum wage advocates pursue a joint strategy of ballot measures and legislation.
Paid Sick Leave
Another important step in building a sustainable economy is ensuring that workers have access to paid sick days and family and medical leave insurance. In numerous restaurants and stores, many low-wage employees have no choice but to arrive at work with contagious illnesses because they can’t afford to take time off - without pay - in order to recuperate. It’s not just employees who suffer; businesses end up with higher turnover rates and greater health hazards as a result of employees coming to work sick or being forced to quit to care for a loved one. The single biggest cost for businesses is hiring and training new employees. Without adequate leave policies businesses are forced to hire and train new workers who are less efficient and less productive. Only a handful of states now have paid sick days, but 23 states saw legislators introduce bills to adopt the policy in 2014. Connecticut is the most recent state to have passed a paid sick days law, which will help businesses reduce turnover and lost economic activity.
A number of states are taking action to make sure all Americans have the access and ability to save for a secure retirement. A large number of Americans who don’t make enough to save are retiring into poverty. As employees age out of the workforce, they lose their buying power, which impedes economic growth. States are recognizing this counterproductive trend and are moving to implement systems that will help more workers save for retirement. Several states passed retirement security related bills this year: California, Connecticut, Minnesota, Massachusetts and Oregon.
Good Workplace = Good Business
As states look back on 2014 and begin to plan for 2015, it is imperative to recognize the positive impacts these policies have had and will continue to have on workers, the businesses that employ them, and the communities they serve. The business case is clear: good workplace policies make for a successful bottom line. About 60 percent of California businesses reported cost savings by coordinating their benefits with the state’s program after the passage of their family and medical leave insurance program. Business save money and grow their profits when they implement strong workplace standards and employees reap the benefits. As federal action on these initiatives fails to move forward, states have an important role in improving the quality of the workplace, because it’s a win-win-win for workers, businesses and the broader economy.
Richard Eidlin is the Policy Director and Co-Founder of the American Sustainable Business Council. Ann Pratt is the Executive Director of the Progressive States Network.