Business associations lobby Trump, Congress to ease paid sick leave requirements

• Mar 18, 2020

Amid the coronavirus pandemic, powerful business associations are lobbying the Trump administration and Congress to influence key components of economic relief bills to help Americans affected by the outbreak.

In a series of developing changes to a larger, trillion-dollar stimulus package, the Treasury Department announced on Tuesday that it would support $250 billion in direct payments and tax cuts for small businesses. That number could increase as the administration monitors market volatility and tries to prevent major financial fallout.

The announcement came after the House passed the Families First Coronavirus Response Act on Saturday morning. It aims to secure tens of billions of dollars for paid sick leave, unemployment insurance and free COVID-19 testing. The bill would require businesses to provide up to 10 weeks of paid sick time for affected employees.

The Senate passed the final version of the Families First package Wednesday with a 90-8 vote. President Donald Trump is expected to sign the bill into law.

The House passed the bill 363-40 over objections from some GOP lawmakers and business associations. The House then revised the bill to add more conditions under which employees can get paid sick leave. Small businesses with under 50 employees may be excused from paying sick leave by Labor Department Secretary Eugene Scalia under the law.

Business associations, which spent over $121 million on lobbying in 2019 alone, pushed Congress to make changes to the bill.

In a letter to the House, the U.S. Chamber of Commerce, the top lobbying spender last year, urged lawmakers to avoid coronavirus-related economic relief that is “poorly tailored to the situation.”

“This emergency bill should not create a federal, one-size-fits-all, permanent leave mandate on employers,” the letter said. “Those are longer term issues that should be addressed in separate legislation, and we intend to be helpful in seeking a solution to that issue.”

The business organization spent over $77 million on lobbying in 2019. The Chamber dispatched 153 lobbyists, nearly half of whom are previous government officials such as Brendan Dunn, the former policy advisor and counsel to McConnell.

Business associations, which includes groups representing small and midsize businesses, traditionally give to Republicans more than Democrats. Since 2004, business associations gave at least 70 percent of their contributions to the GOP. Senate Majority Leader Mitch McConnell (R-Ky.) received the most in the Senate from the business groups with over $43,600.

Arguing that the bill would affect small business owners, fast-food giant McDonald’s is also lobbying the Trump administration. Almost 95 percent of McDonald’s restaurants are owned by franchisees whose finances could be severely impacted by the bill, Business Insider reported. McDonald’s is opposing the bill’s plan to use tax credit to cover costs.

“We know that the funding mechanism and the repayment timing could cripple small-business owners,” David Tovar, McDonald’s vice president of U.S. communications, reportedly said in an internal call.

The fast food giant spent $1.8 million on lobbying and employed 30 lobbyists in 2019. More than two-thirds of their lobbyists previously held a position in government.

The National Federation of Independent Businesses also reiterated that small employers will not have the operating budget to pay for family and medical leave. The association said small businesses that have to shoulder the costs will eventually close.

After House Speaker Nancy Pelosi (D-Calif.) compromised with Treasury Secretary Steve Mnuchin to loosen paid leave measures, the requirement is limited to businesses with less than 500 employees and ensures the benefit will be at least two-thirds of pay. The paid-leave program is set to expire Dec. 31, 2020. Paid sick leave is capped at $511 per day and family leave at $200 per day.

To avoid backlash like that of the 2008 bank bailout package, Trump’s top economic officials including Mnuchin are insistent on the need to help small and medium-sized businesses.

Mnuchin warned that if senators do not reach a deal quickly, the nation’s unemployment could be as high as 20 percent. At its highest in recent years, unemployment reached 10 percent in 2009.
Business associations are not the only industry seeking to influence federal government spending amid the coronavirus outbreak. Major airlines are lobbying for a $58 billion bailout. Casinos, restaurants and hotels are also asking for federal assistance as they suffer from a demand shortage.


You can read the full article by Ilma Hasan and Tatyana Monnay here

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Ilma Hasan & Tatyana Monnay

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