The Boeing Company move By Jan Teague, President/CEO
Today, the buzz is Boeing's recent decision to purchase a big plant facility in South Carolina, Vought Aircraft Industries. Governor Gregoire is very worried about Boeing's next move, which might be a decision to locate building the 787 plane there.
One visible piece in the press is the whole issue of unions not striking again for a while. This would seem like a good idea for the financial stability of the company since the last strike sent Boeing into a tail spin, quite frankly.
But the significance of the union strike is only part of the equation for the Boeing decision. Unions are so powerful in Washington State they also hold the votes of many Seattle-area legislators who tend to vote for increased labor benefits whenever a vote comes up. The union agenda in the Legislature is a big hindrance to Boeing staying in Washington.
This year the Legislature rebuffed Boeing during the final days of debate over unemployment insurance rates, a top Boeing priority. Even though Boeing made it very clear to every legislator in the House, the majority still voted against the Boeing Company. It was only when a small majority in the Senate refused to agree with legislators in the House that the unemployment insurance rates passed as the Boeing Company and others such as ourselves supported. There was a lot of talk about what happened to Boeing in the Legislature with that issue.
So while Governor Gregoire is aware of the union contract issue, can she manage the Legislature in such a way as to support Boeing, and therefore, business in general?
This remains to be seen, but quite frankly, the decision on the 787 will precede that test. The 787 decision will be this fall, and the Governor's efforts will not have time to impress Boeing. She did form a group to see what it will take to keep Boeing here, but many believe the agenda of Gregoire's study group, such as a well-trained workforce, does not cover the issues that Boeing has repeatedly told her are key - labor laws.
I am pretty sure that the cost of doing business in Washington State will be a pillar of any decision that Boeing makes to move its operations.
WRA Voting Record available to members
The Washington Retail Association's review of key retail-related legislation and voting from the 2009 Legislative session is available to members now.
The Law Review and Voting Record summarizes 118 bills of prime importance to retailers and the retail industry. Most of the bills the Legislature approved and the Governor later signed take effect on July 26 of this month.
The report reviews how each of the 147 state legislators voted on key bills of importance to retailers. It assigns a point value to how closely a legislator's voting record matched WRA's position on key legislation affecting the industry.
An e-mail version of the report went to WRA members earlier this week. To obtain a printed copy, contact Jim Szymanski, Director of Public Affairs, at 360-943-9198, Ext. 12 or at jim.szymanski@retailassociation.org.
Spokane "living wage" fails to qualify for ballot
The Peace and Justice Action League of Spokane (PJALS) failed to turn signatures in before the deadline of Monday, July 6, to qualify a "living wage" for the November 2009 ballot.
The proposal was to raise the minimum wage at retail operations with 95,000 square feet or more to 125 percent of the state minimum wage ($8.55), which works out to $10.69 an hour.
WRA partnered with a strong coalition of large and small businesses and the Greater Spokane Chamber of Commerce to mount an effective opposition campaign if needed.
The problems with a city-specific mandatory minimum wage are many.
First, it impacts both large and small businesses. Small businesses would be forced to pay the higher wages to attract workers. Artificially inflated wages would lead to less available positions. Businesses that are looking to open a new store would think twice about locating in Spokane because of the higher operating costs. Existing businesses would be leery of expanding their operations over the 95,000 square foot threshold, thus triggering the ordinance.
"We are pleased that the Spokane mandatory minimum wage or as the proponents like to call it, a 'living wage,' failed to qualify for the ballot," said Mark Johnson, WRA Vice President of Government Affairs. "This misguided attempt would have had significant negative consequences for workers, businesses and the City of Spokane. Let's hope this is the last we hear of this issue."
Environmental conference scheduled in Seattle
WRA is co-presenting an environmental conference and luncheon in Seattle later this month with the Washington Policy Center.
Climatologist Pat Michaels of the University of Virginia will address those who attend the event, from 8 a.m. to 1:30 p.m. on July 23 at the Westin Seattle hotel.
The event will feature panel discussions on eco-fads, new environmental regulations and market-based environmentalism. Michaels, past president of the American Association of State Climatologists, will speak about climate change and science refuting the impetus for climate change legislation and policy.
WRA meets again regarding possible L&I rate increases
Tammie Hetrick, WRA's Vice President of Retail Services, met again this week with an advisory committee preparing for possible increases coming in workers' compensation insurance rates.
The recession is drying up premium payments from certain industries where companies are closing, such as construction and manufacturing. At the same time, lost-time insurance claims due to injuries are increasing, Hetrick said.
That financial squeeze may make it necessary to raise rates next year, she said.
Hetrick said the committee is focusing its efforts on cost control.
"We're concerned about controlling claim costs as much as possible," she said.
The committee's aim also will be to lessen the impact of possible rate increases on businesses struggling to survive the recession.
In the past, L&I has been able to hedge against large rate increases by earning income from investments of the premiums. But returns from those investments have been down, Hetrick said.
Hetrick said preliminary estimates of possible rate increases for next year could be known by September of this year.
State posts tax law changes online
The Department of Revenue has posted online a summary of tax-related legislation approved during the 2009 Legislative session.
The summaries are meant to help businesses become aware of changes to the state tax system. The 2009 summary covers 43 bills.
Ladder injuries have been on the rise in the past month, according to Patti Vernie, WRA's Claim/Safety advisor.
Fortunately, none of the six cases reported to WRA's Retro program in the past month involved a serious injury. But Vernie said all ladder accidents are avoidable.
Vernie is available to visit the workplaces of WRA member companies to make recommendations for safety improvements. She shared the following tips on ladder safety:
*Inspect the ladder before use; make sure that it is in good condition.
*Select the right ladder for the job.
*Properly set up the ladder.
*Avoid overhead electrical hazards.
*Do not use a self-supporting ladder (step ladder) as a single ladder
*Always maintain a 3-point contact with the ladder when climbing; 2 feet, 1 hand or 2 hands and 1 foot.
*Always face the ladder when climbing and keep your body near the middle of the step.
*Do not use the top step/rung of a ladder as a step/rung unless it is designed for that purpose.
*Never use the ladder as a seat between jobs.
*Move material with caution when on the ladder.
*Always reposition the ladder closer to the work - do not over-reach.
The state Supreme Court last week ruled that employers in involuntary bankruptcies still can be considered to be willfully withholding wages, even if the company legally lacks the ability to pay wages.
The justices voted 6 to 3 in favor of that position in the case of Morgan v. Kingen. The case involved a failing SeaTac casino's involuntary conversion to a Chapter 7 bankruptcy while employee wage claims were pending.
Regardless, the court ruled that a company's inability to pay wages is not a defense against finding it willfully withheld wages.
The Washington Retail Association joined six other statewide business organizations last spring in a "friend of the court" brief while arguing that a legal inability to pay wages should not be mistaken as an intentional refusal to pay wages.
"This is a troubling case for businesses facing financial uncertainty and the prospect of bankruptcy," said attorney Kris Tefft, who filed the brief on behalf of the associations. " It further converts what was once a statute punishing with exemplary damages for what is essentially theft of employee wages into a personal guarantee statute against the personal estates of corporate officers despite the company's financial - or now even legal - inability to satisfy a wage claim."
In dissent, Justice Richard Sanders argued the SeaTac company could not have paid wages even if it wanted to.
"Their failure to pay was not volitional or willful but rather court-imposed," Sanders said.
But Justice Charles Johnson, reflecting the court majority, said "the payment of wages holds a preferential statutory position" making companies liable to pay damages, court costs and attorneys fees if they are found to have willfully withheld wages.
Businesses that will need a free new required state permit to avoid sales taxes on items they intend to resell will be able to learn more about the new policy in planned September communications from the Department of Revenue.
Revenue plans to post an online tutorial on the new permit process in September. Also that month, the department will be sending letters to all businesses statewide that collect retail sales taxes either explaining that they will automatically be getting a new permit mailed to them, or that they will be required to apply for a permit.
Revenue has been holding a series of public meetings this spring and summer since the Legislature approved the new policy in the 2009 Legislative session.
To comply with the new state law, businesses required to have the permits must obtain them by January, 2010. Revenue expects to begin issuing the permits in October of this year. Businesses buying for resale would be required to file a copy of the permit with each of their vendors/suppliers.
The reseller's permit will replace a seller's certificate that businesses have been downloading off the Internet. The Legislature passed the new law earlier this year to address the problem of businesses that were avoiding payment of sales taxes to buy items for personal use rather than resale. By law, the final purchaser of an item is supposed to pay sales taxes on it.
The state estimates it can recover $263.9 million by 2013 in otherwise unpaid state sales taxes by making businesses apply for the permit rather than downloading a certificate. The Washington Retail Association adopted a neutral position on the policy change after amendments improved a bill that implemented it.
As Revenue works on determining criteria for who must apply for the permit, retailers interested in updates can visit dor.wa.gov/sellerspermit to learn the latest on complying with the new law.
Meanwhile, Revenue is seeking volunteer business representatives to review its draft application for the new permits.
Revenue wants to set up "testing sessions" to ensure the permit application is understandable, said Janet Shimabukuro, Program Manager, Taxpayer Services. The department hopes to do the testing in the next two weeks and is willing to send state employees to businesses wishing to sample the applications and review a proposed design for the permit.
Interested volunteers should send names and contact information to Eric Jones at 360-705-6735 or at ericj@dor.wa.gov.
E-Cycle Washington sets monthly collection record
The E-Cycle Washington recycling program netted a record 3.6 million pounds of unusable or unwanted electronics last month and is on pace to collect more items than expected by the end of the year.
The record volume included tvs, computers and monitors. The free collection program began statewide in January.
The state's goal is to remove toxic materials used in electronics from winding up in landfills and endangering public health.
State officials expected to collect about 26 million pounds of items by year's end. But at the current collection pace, they now expect about 36 million pounds, said Miles Kuntz, of the Department of Ecology.
Kuntz said household spring cleanings and schools discarding old equipment at the end of the academic year probably combined to help set the June collection record.
While favoring a national program for collecting electronic waste, the Washington Retail Association worked to ensure that manufacturers, not retailers, were responsible for carrying out the state collection program.
To learn about collection sites where you live or operate a business, visit EcycleWashington.org.
The Washington Retail Association, WRA, is a 501 C 6 trade association formed to advocate for Washington State’s retailers at the local, state and national level. Since 1987, the WRA has protected Washington's retailers from unreasonable taxes, fees, regulations and legislation. The efforts of the WRA benefit all Washington state retailers and help fuel statewide economic growth.
