Towns and cities would be barred from dictating the wages or benefits paid by private businesses under a bill set for a House vote next Thursday.
The move is the latest in a four-year battle to block so-called living wage bills at the local level. If passed, the bill would nullify bills passed in Nashville and Shelby County that require businesses that contract with those governments to offer a certain level of wages and benefits to employees.
Sponsored by Rep. Glen Casada, House Bill 501 would prohibit local governments from setting wages, family leave and insurance benefits that private businesses must offer employees. It also blocks local regulations that address wage theft.
“The most important person here is the taxpayer,” the Franklin representative said. “When a project costs more than it should, the taxpayer pays that. So this is a pro-taxpayer bill.”
Even if the legislation passes, there is no certainty that Gov. Bill Haslam will sign it.
“I’m not a fan of the living wage,” Haslam told the Chattanooga Times-Free Press in 2011. But local “governments should be able to decide for themselves if they want to do that.”
During the committee meeting, Rep. Mike Stewart, D-Nashville, questioned why local governments should be prohibited from requiring private companies to pay people “a living wage” if the company wants to do business with that government.
“You know in Davidson County, it’s harder to live. It’s more expensive,” Stewart said. “If the Davidson County legislators or council wants to say, for our contracts, we’re going to require that people be paid a living wage, why shouldn’t Davidson County people be able to control their own contracts?”
Casada replied that the problem is when a city dictates to a private business that operates statewide what that business must pay its employees.
“That’s not good public policy,” he said. “It drives up the cost of doing business, which is a burden to the taxpayers of Tennessee.”
This is not the first time this type of legislation has come before the General Assembly. Attempts by Casada and Sen. Brian Kelsey, R-Germantown, to prohibit local governments from establishing living wage laws date back to 2009.
The bill goes to Calendar & Rules to be scheduled for a vote on the House floor. The companion bill in the Senate, SB35, by Kelsey, has been referred to the Senate State and Local Government Committee.