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Chamber President asks legislators to consider impact of regulations on small businesses

Thursday, July 19, 2018

Opinion: Give small business a break, New York

By: Jessica Walker

Published in New York Daily News

It’s a tough time for small businesses in New York; many proprietors and entrepreneurs do not feel that the government has their back. In fact, city and state officials seem to be adding new roadblocks at an alarming rate. This environment led to New York placing 47th this year in the Small Business and Entrepreneurship Council’s ranking of states’ friendliness to small businesses and entrepreneurs.

Add up the cumulative impact of an increasing minimum wage, now up to $12 an hour for Manhattan small businesses; paid sick and family leave mandates; the proposal to end the tip wage credit; a ban on salary-history questions during hiring; new employee scheduling laws, which limit owners’ and managers’ ability to assign workers to shifts; and coming soon, paid bereavement leave. 

Some of these policies are critically important to help address trenchant social and economic issues. Both the city and the state, however, have done far too little to aid resource-challenged small businesses in complying with the mandates they have piled on.

This new paid bereavement leave requirement, which awaits Gov. Cuomo’s signature, is being considered just months after the state’s Paid Family Leave Act took effect. Both mandates will allow employees to take 10 weeks of paid leave at a rate of 60% of their current wages. 

Together, all of these laws drive up costs and create staffing problems. Compliance is time-consuming and expensive to navigate, as new rules add to the list of potential violations, the amount of notice required for both employers and employees, and an exhaustive list of definitions and calculations to understand and implement. Even well-intentioned “carve-outs” for the smallest businesses often make the regulatory landscape more confusing and benefit only a sliver of them. 

Small businesses likely cannot afford human resource departments equipped to understand and implement the ever-expanding list of rules and regulations, leaving them susceptible to fines and penalties simply for being small. Rents for many are already high. Margins are already thin. Competition from the internet is already fierce. 

For some businesses, the new regulations are the difference between staying open and shuttering doors for good. 

Of the more than 200,000 businesses in New York City, 89% are small businesses with fewer than 20 employees. They strengthen the local economy, create jobs, anchor communities and add to the vibrancy of neighborhoods. Remove them, and the authenticity and character of the city is gone. 

Elected officials always say they want to help small businesses survive and grow. But it is clear that these same officials fail to understand the financial and operational burdens associated with the new laws they are passing. 

Despite piling layers of new legal requirements on business owners’ backs, New York City still has no formal process to analyze the cumulative effect that bills may have. Last year, the Manhattan Chamber of Commerce called for the implementation of economic impact statements to evaluate those potential effects before a new law is enacted — to ensure that our elected officials fully grasp the cost of doing business in New York and can see how small business is getting crushed under the weight of their good ideas. 

We haven’t heard a peep from Mayor de Blasio or the City Council in response to our request. 

Now is the time to listen to the voice of small business and seek to strike a better balance between helping employees and supporting the very businesses that create their jobs.