Earlier this month, Governor M. Jodi Rell vetoed several bills affecting employers — one that has garnered a great deal of publicity and a few that that have not. (The Office of Legislative Research has just released a full list of the vetoed bills here and the summaries of the bill are taken from the report.)
Here’s a brief recap of the bills affecting employers:
- An Act Establishing the Connecticut Healthcare Partnership — This act requires the comptroller to convert the state employee health insurance plan, excluding dental, to a self-insured arrangement beginning July 1, 2009 and would have allowed small employers to participate, ultimately. The bill passed the Senate (21-12) and the House (109-36). In vetoing the act, the Governor stated, in part:
Although including employees of small businesses in the plan appears to address the issue of access, this plan is simply too expensive for the typical small employer and thus unlikely to increase the number of residents who have health care insurance. I note that nine local chambers of commerce – whose membership is largely composed of small businesses – oppose this bill.
Although the Partnership bill has changes somewhat from last year, it still retains its most problematic component – a significant cost to the state. This is the direct result of pooling an unknown employer risk group with the state employees’ health insurance plan and prematurely converting such plan to a self-insured model. Those who most likely would be attracted to the pool would be those whose claims experience – the main driver of health care costs – is worse than that of the current state employee pool. When the experience of these new members is averaged across the entire pool, it will drastically increase premiums for the state and all those who have joined the pool. … This is a potentially fatal flaw, since the bill requires that premium payments remitted by these newly pooled employee groups ‘be the same as those paid by the state.
- An Act Concerning Green Jobs – This act requires the Department of Economic and Community Development (DECD) to apply for federal economic stimulus funds available under the American Recovery and Reinvestment Act of 2009 (ARRA) and use the funds to establish a program to create green jobs and promote green energy and conservation. It passed the General Assembly unanimously. In vetoing the bill, the Governor stated:
This legislation is both unnecessary and inconsistent with the current state plan for applying for green jobs and green energy stimulus funds. . . .The Green Collar Jobs Council created by Executive Order No. 23 has already reviewed available ARRA green job grant opportunities and has recommended which entities should apply for such grants. . . .In particular, the Green Jobs Council… identified a list of lead applicants for each grant, including the Department of Labor, Connecticut Business and Industry Association, Energy Workforce Development Consortium and Community Colleges. With respect to energy-related stimulus funds, the Office of Policy and Management (OPM) has taken the lead. These entities, as opposed to [DECD], are the most well-suited to both apply for and receive federal stimulus monies related to green initiatives. ”
An Act Concerning the Standard Wage for Certain Connecticut Workers – This act creates a new method for determining the hourly wage and benefits for employees under the standard wage law, which governs compensation for employees of private contractors who do certain types of work in state buildings. Under the act, such employees hired after July 1, 2009 will receive the same hourly wages and benefits as employees working under the union agreement covering the same type of work for the largest number of hourly nonsupervisory employees, as long as it covers at least 500 employees, in Hartford County. Those already working for standard wage employers on or before July 1, 2009 will be paid an hourly wage based on the current standard wage law, but after July 1, 2009 their benefits will be the same as those working under the Hartford County union contract for the same type of work. This creates two tiers for hourly pay while keeping all employees at the same level of benefits. It passed the Senate (30-6) and the House (112-35).
In vetoing the measure, the Governor stated.
This legislation creates an exception to current law and provides varying wages and benefits to certain employees of contractors at a potentially significant cost to the state. The law mandates that a select group of employees will be paid union contract wages and benefits, instead of the Department of Labor’s determined standard wage rates, and creates two distinct classes of janitors – those hired before July 1, 2009 and those hired after such date.
By removing the link of certain employees’ wages and benefits to the Department of Labor’s standard wage rates, we are exposing the state to an unknown and unmanageable level of cost. There will be an entire subset of services whose price will be dictated by privately conducted union negotiations and contracts to which the state is not a party. Both groups of janitors perform the same critical services for the state and therefore should be paid the same wage rates, regardless of when an individual was hired. I cannot sanction wages and benefits that are determined completely outside of the state’s control and that have not been included in the budget for the next biennium.