Even pennies can be a big deal
for small business
By Thomas Shapley: February 13, 2005
OLYMPIA -- A family friend, Rick Gehring, owns the A&W
restaurant in Port Orchard -- Buck's A&W, after founder Buck
Gehring, Rick's father. It is a small, family-owned business in what
may still be called a small town.
It's been useful over the past dozen years or so to apply what I
think of as the "Gehring Gauge" to seemingly good government policy
proposals. What does a tax, regulation or mandate, no matter how noble
the intent, mean to someone like Rick Gehring trying to run a small
We'd all be better off if everyone had health care coverage, but
expecting businesses to pay for a mandated level of coverage has left
many small business owners with little choice but to keep on fewer
workers or fewer full-time workers. Sure, a small business will
logically benefit over the long run from having healthier workers, but
logic and long-run prospects don't make the loan payments or sign the
Regulating business activities helps safeguard the environment
and protect workers and consumers. But we expect businesses to pick up
the tab, in money, in time, paperwork and delay. And for small
businesses, regulations mean a competitive advantage for big business.
The Democrats' expansion of their majorities in both the state
House and Senate and Democrat Christine Gregoire's capture of the
governorship (no matter how tenuous) got a strong boost from the labor
community. So it's naturally payback time in Olympia. Nothing wrong
with that. In politics, mother's milk buys love.
Democratic lawmakers have offered a slate of proposals that
would reward workers, in many cases quite deservedly, and often at the
natural expense of business.
Teachers and state employees deserve cost-of-living raises. But
especially with the new $430 million divot the state
Supreme Court just dug in the already $1.8 billion-deep
state budget hole, that'll take a tax increase.
There's talk of imposing a "play or pay" health care coverage
mandate on business. That would require employers to either provide
health care coverage for their employees or pitch in for state
In what's widely recognized as a direct slap -- if not a cheap
shot -- to the Building Industry Association of Washington for its
outspoken Republican political advocacy, Democrats would cut in half
the commission the BIAW is allowed to get for saving its client
businesses money on workers' compensation costs.
A more gentle-hearted bill would require that businesses of 50
or fewer employees to allow up to five weeks unpaid leave for such
things as a new baby, illness or crisis in the family. Workers would
get a weekly inflation-adjusted stipend of up to $250 from a state fund
into which employer and employee each contribute a penny for every
hour's wages up to 40 hours a week.
It conjures pictures of employees being able to spend the first
few weeks of life at home with their newborn child, or perhaps the last
few weeks of life with an elderly parent or folks able to take care of
sick or injured children or spouses. They're heartwarming images.
But then picture what small businesses might go through to
fulfill those images. While a case will likely be made for either
having the employee pay the whole 2 cents or for compensating business
with a B&O tax break, for a small business it's about much more
than pennies. There will be the time and cost of administering a whole
new payroll deduction. Are health care and pension benefits suspended
or continued? Who covers the benefits costs while the employee is
getting by on diminished leave wage?
One employee on leave in an organization of thousands is not the
same as in a business with five employees, where one person out means a
20 percent work force reduction. There are costs for overtime or
recruiting and training and temporary employees, unless the other
employees are expected to take up the slack with longer hours or
Proponents argue that a liberal family leave program is good for
business. It makes for happier, healthier, more loyal employees. It
cuts down on absenteeism and misuse of sick leave time and allows
workers to deal with family emergencies without cutting into valuable
vacation time. And yes, many companies report great success with such
But one need not be a business-lobby shill to sense that when
government tries to force a business practice on businesses with the
argument that it's good for business, it passes neither the smell test
nor the Gehring Gauge.
Thomas Shapley is an editorial writer and a member of the
Post-Intelligencer Editorial Board. E-mail: email@example.com