Advocacy News – December 6, 2024
Lawmakers returned to the Capitol from their annual “hunting break” and Thanksgiving holiday this Tuesday, December 3 with an increasingly aggressive list of Lame Duck priorities they would like to see passed before the Democratic trifecta ends at the close of the year.
Why it matters: While less than two weeks of the 2023-24 session remains, there’s still plenty of time to pass any number of anti-business, anti-jobs proposals. In fact, the UAW, the state’s largest labor union, released a letter to lawmakers on Wednesday, calling them to “take urgent action” on 96 different policy proposals – everything from giving Michigan’s 1,800 local units of government the right pass their own local employment laws to increasing employer-financed unemployment insurance and workers’ compensation benefits to rethinking longstanding property valuation principles.
There’s a lot that remains on the table, but what’s really possible before the end of 2024? Here’s our prediction for Lame Duck and a full rundown of what issues impacting business might be considered yet this year:
The Lame Duck session: lame or disaster in the making? The answer is still unclear, but the UAW’s letter gives a glimpse as to how bad it could get. Ultimately, it will come down to discipline and organization. Are House and Senate leaders prepared to define and zero in on their priority issues? Can they get their caucuses to coalesce around them? Will they use the “Call of the House” mechanic to ensure they don’t continue to be plagued with attendance issues?
What issues remain on the table?
Employment Law:
- Fixing Earned Sick Time Act and minimum wage. This is a high priority for the Michigan Chamber. Legislation to fix the minimum wage and earned sick time laws to make them more workable for employees and businesses alike must be passed by the House no later than Dec. 12 or they will not be able to be considered by the Senate before the end of the legislative session. We believe the votes are there for HBs 6056 and 6057 (and even an expanded version of the latter), but we need leaders in the House and Senate to commit to allowing a vote. Read the latest HERE.
- Unemployment Insurance (UI) benefit increase. Legislation passed in the full Senate 21-15 Thursday to substantially increase UI benefits – and costs to employers, who fund 100% of the cost of the UI system. SB 40 and HB 5827 would expand the number of weeks claimants can collect benefits from 20 to 26 weeks. It would also increase the weekly maximum benefit rate from $362 per week to $614 per week and increase the dependent allowance from $6 to $26. Both the weekly benefit rate as well as the dependent allowance would be increase over a three-year period, then the rate would increase annually based on the rate of inflation. The Michigan Chamber is opposed to this proposal because it is nearly impossible to enact a benefit payout of this size without creating the need for a corresponding increase in UI taxes on employers. This is because there was so much fraud and mismanagement of the fund during COVID, and the fund is still rebuilding. It remains possible that this bill, along with other administrative changes to the system, will be sent to the Governor’s desk before the end of 2024. See the Chamber’s memo of opposition HERE.
- Costly Workers’ compensation overhaul. Senate Bills 1179–80 would make aggressive and costly changes to the workers’ comp system. As a result of these changes, workers’ compensation losses — and premiums — are expected to increase significantly. The Chamber has organized a broad coalition in opposition to this legislation and we are actively meeting with lawmakers to educate them on the cost implications of the proposal. With the first committee hearing on this bill on Dec. 5, the fate of this bill remains questionable. Read more HERE.
- Patchwork local labor laws. SB 171, which has remained stalled on the Senate floor, would give Michigan’s 1,800 local units of government the individual right to enact their own local employment laws (e.g., local minimum wage, paid leave laws, etc.). We oppose local authority on these issues because it would create a patchwork scheme and create high-cost islands across Michigan. While the bills is stalled for now, this legislation still could make it through yet this legislative session – especially given the last minute push by the unions.
- Restrictions on noncompete agreements, criminalize wage and fringe benefit violations, and subjecting employers to wage transparency requirements. The House Labor Committee sent legislation to the House floor on the aforementioned topics Thursday. Despite our opposition, it’s possible that these bills (HBs 4399, 4402-05) could make it through the House next week, but their fate in the Senate remains more questionable.
Legal Climate:
- Allow over 80 different regulated entities and professions to be sued under the Michigan Consumer Protection Act. SB 1022, which passed by a party-line vote of 20-16 Thursday, creates new incentives to sue businesses large and small – without good rationale. In fact, it layers the threat of lawsuits on top of what remedies might already be available to consumers under the business or entity’s regulatory statute. We are telling lawmakers we do not need dual tracks of penalties or litigation: one under the industry’s regulatory statute and another under the Consumer Protection Act, which allows for class action lawsuits, treble damages and the recovery of attorney’s fees. Opening the floodgates to new tracks of litigation benefits lawyers, not consumers. While the Senate passage is of concern, it remains unclear whether the House has the votes to send this bill to the Governor’s desk. Read the coalition memo we organized HERE and know that we are continuing to work to block this legislation in the House.
- Medical malpractice. The bills, which were advanced to the House Floor on Tuesday, would expand both noneconomic damage awards and wrongful death damages. We oppose these bills because they are an attack on medical providers across Michigan and, frankly, a give-away to plaintiff attorneys. Based on other states’ experiences with similar legislation, we know the bills will incentivize litigation, exacerbate defensive medicine, reduce physician availability, and raise malpractice insurance premiums — which will ultimately be passed along to employers and health insurers in the form of higher healthcare costs. We are opposed to these bills and will be working to block them in the Senate.
- Data privacy. Legislation was considered in the Senate Finance, Insurance, and Consumer Protection Committee this week to put in place a “Personal Data Privacy Act” (Act). The Michigan Chamber voiced opposition to SB 659 due to its overreaching and patchwork approach and because we believe any new privacy legislation should ensure Michigan businesses can continue to responsibly utilize data-driven approaches, such as email marketing, targeted advertising and customer retention efforts including loyalty programs, without imposing undue restrictions that hinder the ability to thrive in the 21st Century economy. The bill remains in committee and it remains unclear whether it will see further action in the Lame Duck session.
Tax Policy
- Property Tax. House Bills 5865-68 aim to create what sponsors argue is a fairer process for property tax disputes that are before the Michigan Tax Tribunal (MTT). Instead, these bills make it almost impossible for businesses to take a dispute to the tribunal and, even further, are likely unconstitutional and create an immense amount of hurdles for the MTT when determining a decision in these cases. Although many believe this issue, often referred to as the “dark stores” theory, only applies to large retailers and big box stores, this issue affects all businesses that own a larger building or warehouse.
Environmental Regulations
- Waste disposal. There are a number of bills that would lead to significant cost increases to the business community. SBs 938 and 1052, if enacted, ban the disposal of technologically enhanced naturally occurring radioactive waste or TENORM, as well as the future permitting and expansion of Class I and IV deep injection wells for disposal facility leachate, were voted out of committee in the Senate yesterday. These restrictions disproportionately impact the ability for some industries to safely dispose this material in the state, forcing it to be transported west of the Mississippi river. The limiting of deep injection wells will result in leachate having to be disposed of via wastewater infrastructure, burdening communities’ wastewater treatment facilities and creating unnecessary risk. There is also a push to significantly increase the cost of all waste disposal. Proposals range from doubling the current rate of 36 cents per ton, to increase over 100% to 5 dollars per ton. Read our opposition letter HERE.
- Bottle deposit expansion. SBs 1112 and 1113 ,voted out of the Senate Energy and Environment Committee yesterday, significantly expand the number of containers added to the 10-cent deposit system. If passed by a simple legislative majority, signed by Governor, and approved by voters at the Nov. 3, 2026 General Election, the bills would expand the 10-cent deposit to all beverages, excluding milk or fruit and vegetable juices greater than a half-gallon or freezable containers. They would also require universal redemption. Additionally, a new $60 million (tied to the Consumer Price Index) Beverage Container Handling Fund is created from Corporate Income Tax revenue.
- Advancing carbon capture. SBs 1131, 1132 and 1133, supported by the Michigan Chamber, create a permitting process within the Michigan Department of Environment, Great Lakes, and Energy (EGLE) regulating the construction, operation and closure of carbon sequestration projects. An application process that follows EPA Class VI and Michigan APA requirements would be created that allows for community engagement and feedback. It would also include a legacy fund and Certificate of Completion process and rule-making authority consistent with the EPA’s Class VI program. The bills received a hearing yesterday in the Senate Energy and Environment Committee. See the SUCCESS Coalition announcement HERE.
- Water quality rulemaking. HB 5205 was voted out of House Natural Resources Committee yesterday and would reinstate rulemaking authority for EGLE under Part 31 of the Natural Resources and Environmental Protection Act. EGLE is requesting this rulemaking authority (which has been suspended since 2006) in an attempt to reach compliance with national standards involving various programs including the National Flood Insurance Program (“NFIP”). If either of the bills is enacted, EGLE will be able to promulgate new rules and revise or eliminate existing rules related to floodplains and water quality under Part 31. The Chamber opposes this bill with strong concerns that this new, broadly worded authority could restrict new real estate development and infrastructure projects, as well as further burden agricultural sectors.