ANNAPOLIS (Feb. 25, 2017)—A Democrat-backed earned-leave bill is headed to the House floor after being given a favorable report from the House Economic Matters Committee.
The bill had failed last year, after dying in a Senate committee.
Gov. Larry Hogan's related measure, which would require paid leave for larger companies than the Democrats' bill, is not likely to advance out of the committee.
The Maryland Healthy Working Families Act was passed by a 14-9 vote Thursday by the committee after lead sponsor Delegate Luke Clippinger, D-Baltimore, added some amendments.
One amendment ensures that an employee must work an average of eight hours per week, rather than every few weeks, to be allowed to earn the leave.
The other requires that caregivers for the developmentally disabled ensure substitute help is available when they take foreseeable leave.
Last year's bill failed to make it out of the Senate Finance Committee, however Clippinger said the bill should reach the Senate much sooner than it did last session. Additionally, he said, they have seen "real substantive movement in the Senate," regarding the legislation.
The Maryland Healthy Working Families Act mandates that businesses with 15 or more employees provide paid sick leave and businesses with fewer than 15 provide unpaid sick leave. Employees can accrue a maximum of 56 hours of leave annually.
The bill would not supercede leave set in collective bargaining agreements signed before 2017. It will maintain Montgomery County's earned leave policy, but does not allow for any other jurisdiction to pass their own version of earned sick leave.
Employers may provide an alternative form of leave, provided that it meets the bill's minimum requirement of one hour earned for 30 hours of work.
Employers may either count the earned leave throughout the year, or award it all to an employee at the beginning of the year.
The bill's detractors contend that it would place too much of a burden on small businesses.
Small-business owner Misty Schulze, of Pasadena, Maryland, testified during a hearing on Feb. 9 that the bill would have "dire consequences" for her company.
"We simply cannot afford to offer benefits such as paid sick leave," she said.
Schulze argued that her company, a cleaning service called Misty Cleans, of roughly 15 employees, receives at least one to two callouts per week.
"Some of the employees also receive state assistance, so if you ask me this is nothing more than a bonus at my expense," she said. "This type of watch-dog mentality from the state will only stifle business growth."
Schulze added she would "decrease sales and stop growing to avoid this penalty."
Delegate Seth Howard, R-Anne Arundel, and Delegate Warren Miller, R-Carroll and Howard, both described the bill as "a lot of stick" with "a little carrot" for businesses before voting to give the bill an unfavorable recommendation.
Howard, a small business owner, said the bill left him "speechless."
Delegate Benjamin Brooks Sr., D-Baltimore County, also a small-business owner, argued that the cost was being exaggerated.
"If we really look at the actual expense, you're talking about 56 hours a year," he said before the vote. "If you're talking about minimum wage that's 490 bucks. Divide that by 263 days a year. That's $1.86. That's a cup of coffee from McDonald's."
Brooks added that the cost is an expense, which can be written off.
"So really I don't think it's going to hurt the employer as much as we're saying," he said. "What we've got to do, we've got to look at both sides of that equation."
Hogan's bill mandates that employers with more than 50 employees at each location provide "paid time off"—for whatever circumstances they choose—to those employees. Employers with fewer than 50 employees at each location who choose to provide the leave are given a tax break.
Hogan's plan does not cover employees who do not work full time.
We believe our bill is "flexible, consistent and fair," said Chris Shank, a legislative director for the governor.
"A key component of the (governor's) bill is that it provides paid leave for any reason," said Phillip Ligon, the administrative accountant for Baltimore utility contractor Ligon & Ligon Inc., who testified against the Democrats' bill on Feb. 10. "In reality, (Hogan's bill) is much more liberal … as it relieves businesses from having to dissect the exact reasoning behind an employee taking time off."
According to analysis from the state, businesses in the accommodations and food service industries would be the most affected by the Democrats' bill. Only 31 percent of employees in these sectors have paid sick leave.
"We don't think the (governor's Commonsense Paid Leave Act) goes far enough," Stephen Shaff, the founding executive director of the Chesapeake Sustainable Business Council, told the University of Maryland's Capital News Service. "… It really doesn't cover as many people that should be covered."
The state's analysis found that both bills would cost the state an estimated amount of just above $400,000 in the 2018 fiscal year to implement.
The Maryland Healthy Working Families Act could cost the government over $10 million annually to provide sick leave for state employees and an estimated $8.1 million annually for the University System of Maryland, according to the bill's fiscal note.
Republican Gov. Larry Hogan's competing Commonsense Paid Leave Act was not voted on by the committee and no vote was scheduled as of Thursday.
A committee vote on the Senate version of the Maryland Healthy Working Families Act is expected for next week.