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 business?
  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 payroll checks.
  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 health-care coverage.
  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 smaller paychecks.
  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 policies.
  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: thomasshapley@seattlepi.com