Gov. Larry Hogan said Wednesday his administration would introduce legislation during the 2017 General Assembly that would require businesses with 50 or more employees to provide paid sick leave and offer tax incentives for smaller companies to provide the benefit.
The bill would pre-empt legislation passed by the Montgomery County Council, which essentially requires all businesses to provide some kind of paid sick leave. That law became effective Oct. 1.
At a press conference in Annapolis broadcast over Facebook, Hogan said state lawmakers have been unable to reach a compromise on the issue.
“It’s clear that in order to move forward, we’re going to need to strike a balance that meets the needs of Maryland’s employees while not hurting our small businesses and continuing to foster a more business friendly climate in our state,” Hogan said.
Montgomery County Council member Tom Hucker, whose legislation expanded the county’s Sick and Safe Leave law to new parents, said, “I guess the governor’s pollsters told him how popular paid sick leave is with working families.”
Still, employees of small and medium-sized companies need sick leave as well, he added.
“We’re opposed to it,” council member George Leventhal said of Hogan’s proposed legislation. He said the overwhelming majority of the county’s work force is employed in companies with 50 employees or fewer.
“The effect will be to take the benefit away from tens of thousands of employees in Montgomery County,” Leventhal said.
Hogan said the proposed legislation would follow the recommendations of the so-called Augustine Commission, which studied Maryland’s economic development and business climate. The commission was named for its chairman, Norman Augustine, a former president of Lockheed Martin Corp.
The bill would require businesses with 50 or more employees, who work 30 or more hours a week, to offer paid sick leave totaling at least 40 hours per year, with the ability for employees to roll over a maximum of 40 hours each year. Hogan said he would also propose that part-time employees receive paid sick leave if they worked 30 hours a week.
The 50-employee benchmark was chosen, the governor said, because it matches the number used by the federal government to define small businesses under the Family and Medical Leave Act and the Affordable Care Act.
If a company with fewer than 50 employees chooses to offer paid sick leave, it can exempt the first $20,000 of their income from state taxes.
After the press conference, Maryland Labor Secretary Kelly Schultz said about 380,000 workers in the state would be eligible for sick leave benefits if the General Assembly passes the proposed law.
According to Hogan, any company with a leave policy that meets the minimum requirements would not have to change.
“Our goal is to provide sick leave to more employees that need it, not to dictate or to interfere with the policies of small businesses,” Hogan said.
According to a press release from Hogan’s office, the state will honor existing collective bargaining agreements with unions in the state.
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