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Over the past couple of years, paid leave initiatives, laws and measures have popped up in cities across the nation, including Seattle, Orlando, Philadelphia, Miami, Denver, New York, San Francisco and Washington. Statewide mandates have been proposed in California and Connecticut. Most of these proposed and enacted mandates would require that not only full-time employees be offered paid time off, but also part-time and temporary or seasonal employees, leaving many small businesses operating on narrow margins -- including convenience stores -- hit the hardest by these often arbitrary and onerous mandates.
In today's economy, c-store operators and other retailers face greater challenges launching their business and making payroll than ever before. C-store owners face difficulty securing business loans, difficult regulatory conditions and a highly competitive business climate. On top of these already tough conditions, anti-business activist groups are waging a national campaign to add paid leave to every business owner's operating costs. What they fail to recognize or even care about is, should they succeed, less jobs will be created and more people will end up unemployed in the push to implement their idealistic agendas.
Because the convenience store and retail industry in general relies on scheduled shift labor, paid leave regulations are particularly costly for these businesses. If an employee is sick, or just decides to take a day off to take a family member to the doctor or recover from a long weekend, the employer will have to pay for the labor twice, once for the sick employee and once for the employee who covers the shift. If the owner can't find an employee to cover the shift, it costs the owner revenues as the ability to serve customers is diminished.
Ultimately, these additional costs may be passed on to the consumer. With many of the products offered by c-stores already heavily taxed, it is even more difficult to recoup new government mandates through pricing adjustments. If the price of gasoline and other competitive items go up, convenience stores will be put at a significant disadvantage against big-box grocery and retail outlets that offer gasoline or tobacco products and are in a better position to cover impacted shifts.
In order to maintain a healthy profit per employee (PPE) margin, c-store operators are left with few other options except to raise prices. When their PPE hits zero or dips into the red, the result may be business closures and lost jobs.
While the majority of these initiatives appear to have an organic localized impetus, most are orchestrated by national labor activists driving the agenda of organized labor. You can't assume that only liberal cities and states will see initiatives like these come up. The latest ballot measure to emerge in Orange County, Fla., which includes Orlando, was specifically targeted there due to the heavy presence of service industry labor, despite the generally conservative bent of the county and state politically.
The sad truth is that these initiatives are part of an overall campaign backed by organized labor, leveraging its massive financial and grassroots resources, to demonize service industry employers and ultimately organize their workforces. The best counterattack against these forces is a vocal coalition allied to educate the voters and elected officials charged with choosing the outcome of these questions.
Denver provides a great example for how to defeat paid leave measures, one of which was soundly defeated in 2011. Restaurant owners, c-store operators, state trade groups, the chamber of commerce and many other parties joined forces to vocally and publicly oppose the measure on the ballot and the voters shot it down nearly 2:1. Public opinion so strongly opposed the question on the ballot that even Mayor Michael Hancock opposed it, despite the liberal bent to the city.
As election season approaches, be sure that you're not only following the candidates affecting your district, but also that you're educated on the initiatives on the ballot in your area. Talk to your state association to get active and advocate the policies that will help your business. The only voice that's heard is the one that's being used. Elected officials and voters need to know how their decisions will impact your business.
Joe Kefauver is managing partner of Parquet Public Affairs, a national issue management, communications, government relations and reputation assurance firm that specializes in service-sector industries. Parquet's clients include Fortune 500 corporations, trade associations, regional businesses and non-profit organizations. For more information, visit www.ParquetPA.com.
Editor's Note: The opinions expressed in this column are the author's and do not necessarily reflect the views of Convenience Store News.