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Survey: Four Out of Five Small Business Owners Fear Layoffs If Unfunded, Paid Vacation Mandate Passes

Tuesday, July 16, 2019

NEW YORK – July 16, 2019: Small business owners across the five boroughs fear layoffs and curtailment of their operations if New York City adopts an unfunded mandate requiring employers to provide employees with two weeks of paid vacation.

In a June survey (click here to read report) of more than 1,470 small business owners released today, the most extensive by far to date, respondents expressed widespread alarm over the combined impact of the paid sick leave mandate adopted in 2014 together with the unfunded paid vacation mandate being considered in the City Council.

The legislation, supported by Mayor Bill de Blasio, requires businesses with five employees or more to provide full-time and part-time workers 10 paid vacation days, on top of already mandatory sick and family leave time.

Seventy-nine percent of small businesses -- many of whom are immigrant and “mom and pop” owned -- said they would be unable to afford the vacation mandate. Eighty percent said they would need to lay off employees, reduce hours, or scale back operations if the requirement went into effect. Ninety-three percent oppose the unfunded paid vacation mandate overall.

“Small businesses, restaurants and storefronts make essential contributions to New York City’s charm, its quality of life, and its economy,” said Andrew Rigie, executive director of the NYC Hospitality Alliance. “But they’re feeling huge pressures from rising labor costs, high rents, higher property taxes, big fines for small violations, the unfunded sick-leave mandate, and other onerous regulatory burdens. We have enough vacant storefronts and struggling businesses. Now’s the time to support small businesses and not force on them another unfunded mandate.”

“Our city is already grappling with a disturbing and growing vacant storefront crisis,” said Jessica Walker, president and CEO of the Manhattan Chamber of Commerce. “While small business owners want employees to succeed, an expanding roster of expensive regulatory burdens carry the risk of curtailments and shutdowns. Everyone loses when small businesses are forced to close. Though well-intentioned, policymakers shouldn’t impose massive financial burdens on these business owners.”

"It is getting harder and harder for restaurants to find success in New York City. Over regulation has contributed heavily to shrinking profit margins and is a major reason why so many commercial properties sit vacant," said Melissa Fleischut, President & CEO of the NYS Restaurant Association. "Piling a paid time off mandate on top off all the other red tape restaurants are faced with on a daily basis will exponentially increase these problems and cause more of our favorite local eateries to close their doors forever. I am proud to say that New York City is the culinary capital of the world but I do fear that this well-earned mantra may fall by the wayside if we continue to see legislation like ‘paid time off’ passed.”

In a joint statement, the survey sponsors implored elected leaders to refer to the data in this report as they consider future regulatory and legislative matters impacting small businesses, especially when they are unfunded and don’t provide meaningful offsets.

Moreover, the paid sick leave mandate that went into effect in 2014 has prevented 59 percent of firms from reinvesting in their businesses, while precluding some 47 percent of surveyed businesses from hiring new personnel.

This new survey refutes results of a far-smaller 2016 poll of 382 employers undertaken by the Murphy Institute, which had concluded that the Paid Safe and Sick Leave Law had registered negligible administrative and financial impacts on small and mid-size businesses.

Of the respondents to the new survey, 67 percent were comprised of restaurants, bars and clubs, eleven percent were retail stores, and roughly 22 percent fell into other categories.

The survey was undertaken by the Bronx Chamber of Commerce, the Brooklyn Chamber of Commerce, the Food Industry Alliance, the Greenwich Village Chelsea Chamber of Commerce, the New York City Hospitality Alliance, the Manhattan Chamber of Commerce, the National Supermarket Association, the New York State Restaurant Association, the Queens Chamber of Commerce, the Staten Island Chamber of Commerce, and the Theatre Association of New York State.

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Contact: Michael Johnston
Marino
(212) 402-3523
mjohnston@marinopr.com

RELATED DOCUMENTS

Report: Paid Sick and Safe Leave & Paid Vacation Proposal, New York City