October 25, 2014

Medina
Mostly sunny
69°F

Business Beat: Businesses ill over proposal

By MARIA KACIK

Staff Writer

Business leaders gathered at Rustic Hills Country Club in Montville Township July 30 to talk about the November election, but nobody mentioned Barack Obama or John McCain.

Instead, they discussed the Ohio Healthy Families Act that likely will be on the Nov. 4 ballot. Those at the meeting said the issue, if approved, would adversely affect Ohioans — consumers and businesspeople.

“It is important that you have the facts so that if you can in any way influence employees, your peers or anyone else, you’ve got the information to talk about it and maybe influence the vote,” Debra Lynn-Schmitz, president of the Greater Medina Chamber of Commerce, said before the meeting.

The Ohio Healthy Families Act would mandate that companies with 25 or more employees provide workers with seven paid sick days annually. The sick days could be used for an employee’s own illness or that of immediate family members. The employees do not need to provide proof of illness for up to three consecutive sick days.

Ohioans for Healthy Families — the coalition sponsoring the proposed law — needed to collect 120,683 signatures from Ohio voters by today to have the measure placed on the November ballot. The coalition announced Tuesday it had collected more than 240,000 signatures.

Dale Butland, communications director for Ohio for Healthy Families, said 2.2 million Ohioans — 48 percent of the private work force — do not receive paid sick leave.

“So when illness strikes their families, they have to choose between their paycheck and taking care of their family,” he said. “We feel that this is a choice that no Ohioan should have to make.”

At the July 30 meeting in Montville, local business leaders expressed concerns about how this would affect business in Ohio.

Questions

Steve Millard, president of COSE, told the group not all questions that arise from the proposed law are answered in its text.

“There’s some questions about the definition of ‘employee,’ ” Millard said. “That’s one of the things that’s not defined here. Just like a day is not defined.”

He said that confusion may arise when nontraditional employees — such as those who are not paid by the hour, or those who do not work a traditional 9 a.m. to 5 p.m. shift — attempt to take sick leave.

Millard said if the law is passed, many questions will have to be answered.

“Unfortunately, we’re going to have to deal with it at the courts at a great expense for the employers,” he said.

“We think this is an old approach. This basically says, ‘one size fits all, everybody needs seven days in every industry for every type of employee.’ That doesn’t work in today’s economy,” Millard said.

However, Butland said most questions would be answered before the law would go into effect. If the law is passed in November, Butland said, there will be a rule-making procedure conducted by the State Department of Commerce. In that time frame, he said, many concerns would be addressed.

“That’s where they write the rules as to how the law will be implemented. There’s always a public comment section where if anybody has an issue they can write that into the rule making,” Butland said. “A lot of this stuff can be ironed out.”

Effect on business

Millard said the new law potentially could cost a 25-employee business $25,000 annually.

“And it goes up each year as employee costs increase each year,” he said.

This could deter new businesses from locating to Ohio, he said. Millard explained he had heard that one 500-employee company decided not to relocate to Ohio because of the potential law. Many other companies, he said, have told him they would stay under 25 employees in order to avoid the new law.

“This is the kind of initiative that continues to be a job killer for Ohio,” Millard said.

In addition, he said even the smaller businesses would be affected.

“As a smaller company, you’re now competing with larger companies who have to offer this,” he explained. “So from a benefits perspective, you’re behind the game in terms of what you offer to your employees versus your competitors, who may be larger and subject to this mandate.”

And Millard said every consumer would be affected, as well. He explained businesses will have to increase costs to pay for the price of providing employees with sick days.

“You’re going to have to add it to the price of your goods and services. You’re going to take it to your downstream suppliers. You’re going to find a way to sort of squeeze this out,” he said.

But Butland said the exact opposite is the truth. Currently, he explained, sickness costs Ohio businesses more money than seven mandated sick days would cost them.

Businesses “never take into account the savings that occur due to less lost productivity, reduced spread (of) sicknesses and faster recuperation times,” he said. “Once you factor in all those kinds of things, the studies say there will be net savings to business.”

Butland pointed to an October 2007 report from Policy Matters Ohio, which stated that providing paid sick days in Ohio would save businesses an average of $1 per worker per week.

Moreover, Butland said, most other industrialized countries throughout the world mandate paid sick leave.

“So the question then becomes, ‘if they can do this without hurting their productivity, why can’t we?’ ” Butland said.

Abuse

Millard noted the new law requires employees to give seven days notice of using sick leave, if possible. However, if something is not foreseeable, Millard said employees have to notify their employers when “practicable.”

“That means if they come in at 10 o’clock they can say, ‘Hey, there was so much of an issue that I couldn’t make a phone call. Take two hours of my sick time,’ ” Millard said.

In addition, he noted employers cannot cite use of sick leave in evaluating an employee’s performance.

“If you have an employee who uses their sick leave every Friday at 4 p.m. when a migraine develops, there’s nothing you can do about it until they run out of this leave,” he said.

This could create a strain between the employer and the employees, Millard said.

“Our message isn’t that employees aren’t going to abuse this, but it will change the dynamic between employer and employee,” he said. “The employee will know the code word is, ‘Boss, I’m sick’ when they want an additional vacation day.”

However, Butland said the new law does not allow businesses to work in such a way. If an employee is using sick days without actual sickness within his or her family, an employer can reprimand the employee.

“There is nothing in this bill that encourages cheating and there is nothing in the bill that protects cheaters,” he said.

But, he explained, it is not likely people will misuse the paid sick time. He pointed to a U.S. Labor Department statistic that shows more than half of employees with paid sick time never miss a day of work in an average year.

“There is not widespread cheating going on now. There is no reason to believe there will be once it is passed,” Butland said.

Playing cards

Medina businesses can be one of 55 sponsors to support Main Street Medina.

The Main Street Design Committee is selling sponsorship spots on playing cards. Each of the 55 cards, the regular 52 plus three wild cards, will contain the name of one sponsor, a photo of historic Medina’s past and a line identifying the photo.

“It’s a way to promote the history of Medina through historic photographs,” Matt Wiederhold, executive director of Main Street Medina said. As of now, 1,000 decks will be printed and sold, he said.

Interested businesses can contact Wiederhold at 330-952-0910 or e-mail him at info@mainstreetmedina.com.

Gold medal sale

Main Street Medina also is sponsoring the Gold Medal Sidewalk Sale Friday through Sunday in celebration of the Beijing Olympics. About 19 Medina stores in and around Public Square will offer sale prices on many items.

Not only does this help the stores make room for new and holiday merchandise, it also helps promote Main Street, Wiederhold said.

“It’s just to get people to come downtown and shop,” he said.

Mama Jo’s

An Amherst-based bakery that supplies pies to all area Heinen’s stores will have a retail location in Medina. Mama Jo’s Homestyle Pies will be signing a lease in the Medina Plaza on North Court Street near Walgreens and Chipotle, said Tom Krueger, Medina’s economic development director.

This will be an asset to the community, he said.

“Any time more retail comes into the community it offers more jobs,” he said.

Mama Jo’s is just part of the 95 more jobs expected to come to Medina in various retail and industrial developments, Krueger said. The company is a $3 million business that sells pies, cookies, strudels, cheesecake and specialty coffees.

Intern Caterina Guinta contributed to this report.

Kacik may be reached at 330-721-4049 or business@ohio.net.