Why Do Indiana Republicans Want to Prohibit Indiana Cities From Adopting Living Wage or Similar Employment Laws?

The Indiana General Assembly has passed a bill (Senate Bill 213) that will prevent local governments from adopting local employment ordinances that go beyond what the State of Indiana requires. So far, SB 213 has gotten a fair bit of attention due to the concern that it will invalidate county or city non-discrimination ordinances related to employment. For example, if Indianapolis has an ordinance that an employer cannot discriminate against an employee (or prospective employee) on the basis of that person’s sexual orientation or gender identity, then because SB 213 prohibits cities from enacting employment legislation, it would seem that the Indianapolis non-discrimination law would be invalid.

And I think that’s a really bad idea. Thankfully, it appears that some legislators agree. Several have been forthcoming and noted that overturning non-discrimination ordinances was not the goal of the SB 213. OK. Good to know. And several legislators have also said that if it turns out that the bill would indeed have the “unintended” consequence of overturning non-discrimination ordinances, a separate piece of correcting legislation would probably be adopted. Once gain, good to know (though “probably” isn’t all that comforting…).

So let’s put aside the question of non-discrimination ordinances and look, instead, to the real goals of the SB 213.

First, let’s review the text of the relevant section of SB 213 (the first two sections are very technical and not really important for the discussion):

Sec. 3. Unless federal or state law provides otherwise, a unit may not establish, mandate, or otherwise require an employer to provide to an employee who is employed within the jurisdiction of the unit:
        (1) a benefit;
        (2) a term of employment;
        (3) a working condition; or
        (4) an attendance or leave policy;
that exceeds the requirements of federal or state law, rules, or regulations.

(Note that a “unit” is a county, municipality, or township.)

Thus, as I read SB 213, a unit cannot require employers to provide a benefit to employees that is more than what is required by federal or state law. So, for example, Indianapolis could not require local employers to provide parking for their employees or a security guard to escort women to the cars after dark. Each of those would be a benefit that exceeds the benefits mandated by state and federal law.

SB 213 also prohibits a unit from requiring a term of employment in excess of that mandated by federal or state law. So, for example, Indianapolis couldn’t require employees who work more than 30 hours be paid overtime as if they were full time employees or prohibit employers from firing employees other than for cause. Again, each of those would be a term of employment in excess of state or federal law.

SB 213 further prohibits a unit from mandating working conditions in excess of those mandated by state or federal law. Thus, for example, Indianapolis couldn’t require outdoor workplaces to be smoke free or require working fire extinguishers or prohibit harassment on the basis of sexual orientation (oops, I know I said I was going to put that aside…). Each of those would be a working condition in excess of that mandated by state or federal law.

SB 213 also prohibits a unit from requiring an attendance or leave policy in excess of federal or state law. Thus, again by way of example, Indianapolis couldn’t require employers to give employees a 2-hour delay to get to work if the employee’s minor child attends a school that has a 2-hour snow delay or require employers to give employees leave associated with efforts to adopt a child or to vote. You know the mantra: Those requirements would be in excess of those mandated by state or federal law.

And most important, SB 213 would prevent a unit from adopting a “living wage” that requires employers to pay a minimum wage in excess of the minimum wage adopted by the state and federal governments. Wages could be identified as a benefit or a term of employment, most likely.

Now I can see where all of this makes sense to the business community. Surely a business would prefer fewer governmental restrictions on how it deals with its employees, especially when it comes to salary. And attendance. And working conditions. And so on and so forth.

But last time I checked, we’re still a country “of the people, by the people, and for the people” and not “of the business, by the business, and for the business”. Or, said differently, is the proper role of our government just to do what’s best for business or should the consideration be what is best for the people being employed by those businesses? Or maybe even a balancing act between the needs of businesses and their employees and the community at large?

Again, I understand that some may argue that local employment ordinances may convince employers to move their businesses or not to come to that locality in the first place. Maybe yes, maybe no. I can see a counter-argument that says that employers may want to bring their businesses to places where employees will want to come because of the protections and requirements afforded by law. I can even see the competition argument cutting both ways.

But here’s the real issue that I have. Why is it the business of the legislature or of legislators from Evansville or Auburn to tell Indianapolis or Bloomington what’s best for their local communities. If the voters in Indianapolis feel that an ordinance is hurting employment opportunities in Indianapolis, the voters will certainly let the City-County Council and Mayor hear about it and may vote for candidates who will change the ordinances. On the other hand, if the voters elect local representatives for the purpose of implementing local employment laws, then why shouldn’t the will of those voters be respected? If the voters in Angola or Jeffersonville don’t want to provide increased employment benefits, they don’t have to; but why should that prevent voters in West Lafayette or Sheridan from doing so?

Just think how many times you’ve heard Republicans complaining about Washington or Congress telling the states how to act; yet here, Indiana’s Republican supermajority is telling local communities how to act. It’s probably worth noting that the communities that have enacted the sort of employment ordinances that would be prohibited by SB 213 are primarily Democratic-leaning communities. But then I doubt that comes as any great surprise…

And before somebody says “but Obamacare” or “but abortion” or “but _____ [fill in your favorite right wing cause de mode]”, let’s remember that we’re talking about local efforts to extend rights to people. Perhaps I’m not articulating it well, but I see a drastic difference between the federal government (or state government) telling states (or local governments) what they must do for people as opposed to telling states or local governments what they’re not allowed to do for people. Does that make sense? There is a big difference between requiring and prohibiting (though sometimes it’s a matter of semantics, I’ll admit).

Think of it this way: The federal government has set a minimum wage; it has not prohibited states from establishing their own wage laws so long as employees are provided at least that federal minimum wage. Thus, some states have enacted minimum wage laws that require employers to pay more than the federal minimum wage. Indiana has not done so. But the federal government has not told states that they cannot require employers to pay more. States are free to decide if businesses located in their state should be required to pay the state’s citizens a wage in excess of that mandated as the minimum by Congress. Again, Indiana has not done so. But some municipalities have (or are considering doing so). For example, Bloomington has a living wage ordinance that requires certain classes of employers to pay their employees $11.85/hour (Indiana’s minimum wage is $7.25/hour or $2.13/hour for employees receiving tips). Why shouldn’t Bloomington be able to make local businesses pay employees more? If the business doesn’t want to meet that requirement, it can move elsewhere, right? And nothing says that the business can’t raise its prices to reflect the increase cost of employees.

Yes, I understand there are some fine lines between the roles of the federal, state, and local governments. I understand that those lines are (often) drawn on the basis of the applicable constitutions. But it seems to me that in this case, SB 213 is an effort by Indiana’s Republican supermajority to enact legislation favored by businesses to rollback ordinances passed by local government for the benefit of the local voting electorate, usually in Democratic-leaning cities (and, perhaps, impacting primarily democratic voters). So just what is the rational being offered by Republicans for SB 213 beyond “protecting employers”?

Unfortunately, now that SB 213 has been passed by the House and Senate, it’s on its way to Gov. Pence.