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Gounardes’ Proposal Would Be Catastrophic For Small Businesses In New York State

Legislation to provide front-line workers with hazard pay for working during the COVID-19 pandemic will be a popular proposal for Democrats running for office in New York state this year.

Unfortunately for workers, the proposal by state Sen. Andrew Gounardes, D-Brooklyn, is a train wreck. The Brooklyn senator proposes that the state Labor Commissioner tell employers to make hazard payments to essential workers during a state disaster emergency. The payments will be a percentage or a fixed dollar amount and not be more than $25,000 in any year for any essential worker earning less than $200,000 a year or $5,000 for any essential worker earning more than $200,000.

Essential employers, according to the definitions in the legislation, include essential health care operations including research and laboratory services; essential infrastructure including utilities, telecommunication, airports and transportation infrastructure; essential retail including grocery stores and pharmacies; essential services including trash collection, mail, and shipping services; news media; banks and related financial institutions; providers of basic necessities to economically disadvantaged populations; construction; vendors of essential services necessary to maintain the safety, sanitation and essential operations of residences or other essential businesses; vendors that provide essential services or products, including logistics and technology support, child care and services needed to ensure the continuing operation of government agencies and provide for the health, safety and welfare of the public.

Pennsylvania also had a hazard pay program, and Gov. Tom Wolf and the Pennsylvania legislature handled it correctly by using federal CARES act funding to pay for it. Businesses applied for the hazard pay through a grant program and then, if the business received money, disbursed it to workers.

In our eyes, Gounardes’ proposal shows just how out of touch he is with the difficulties businesses are facing. Many businesses are cutting staff to keep their doors open. The proposed Senate legislation would force businesses to either cut jobs to pay for the hazard pay or close their doors altogether until the state’s COVID-19 emergency authority ends.

Gounardes’ proposal is little more than Election Day pandering from a senator facing his first re-election challenge. It would be catastrophic for small businesses in New York state if Democrats in the state Legislature actually adopt Gounardes’ legislation.

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