Michigan House panel OKs bill prohibiting local wage, benefit laws

LANSING — Communities would not be allowed to pass ordinances regarding wages, benefits or working conditions in their towns under a bill that was passed 11-7 by the House Commerce and Trade committee Tuesday.

The bill stalled in the Legislature last year, largely because it also would have prohibited communities from negotiating community benefits packages with businesses that are getting tax credits from towns. Such agreements dictate some of the terms of what developers do in communities, like hiring local residents for example.

An initial version of the bill took that language out, but it was reinserted into the amended version of the bill, leading to a loud and raucous protest that halted the committee meeting several times until the protesters - who were chanting "Democracy yes, corporate greed no" - were removed from the committee hearing.

Communities across the state opposed that provision, but it was still in the bill said the legislation's sponsor Rep. Earl Poleski, R-Jackson.

"A locality cannot compel an employer to have any particular employment related benefits in a contract," he said. "If we were to allow a patchwork of rules, it would make it that much more difficult for employers to hire in our state."

So, cities like Detroit that try to negotiate with developers who are receiving tax credits or abatements from the city, won't be allowed to set specific employment terms of a development agreement.

Cities still oppose the legislation, saying the bill limits local control. For example, several cities have passed living wage ordinances over the years. Democrats in the Legislature also have introduced bills that would require paid sick leave for employees in the state and a prohibition on wage discrimination based on gender, but those bills have not received a hearing and the bill passed Tuesday would render those bills moot.

"One size does not fit all. What works for Detroit, Muskegon and Marquette does not necessarily fit for Lathrup Village," said Kelly Garrett, a councilwoman in Lathrup Village. "State legislators should not intrude on my community. You don't know what Lathrup Village needs unless you live there."

But Justin Winslow of the Michigan Restaurant Association said profit margins for restaurants are already very thin - in the 3-4% range - and local wage ordinances would shrink those profits even further.

"We are uniquely harmed by local intrusion into wage and benefits," he said. "And paid leave mandates create a nightmare for small members."

Progressive activists and the 38 communities that have passed anti-discrimination ordinances also have opposed the legislation, saying that they could invalidate those ordinances, which prohibit discrimination against all, including the LGBT community.

Poleski said that argument had become a "distraction," and as a result language was added to the bill that would make it clear that those local ordinances were not affected by the law.

Democrats tried unsuccessfully to get nearly a dozen amendments added to the bill that, in part, would have allowed communities to negotiate community benefit packages with companies that are receiving taxpayer dollars, and prohibited the law from invalidating ballot proposals passed by voters in communities. All the amendments failed.

"This is the most anti-local control bill I've seen since I've been here," said Rep. Andy Schor, D-Lansing.

The House Commerce and Trade committee vote was along party lines with Democrats opposing the measure and Republicans supporting it. It now moves to the full House for consideration.

Contact Kathleen Gray: 517-372-8661, kgray99@freepress.com or on Twitter @michpoligal.