A D.C. Council panel has made a major change to a bill requiring that large retailers pay their employees a living wage, dropping the square footage minimum to capture more businesses.
Rather than limit the $12.50 living wage requirement to retailers with at least 75,000 square feet and a parent company that earns $1 billion annually, the Committee on Business, Consumer and Regulatory Affairs is now proposing to use gross earnings as the only measure.
The nixed size requirement, according to a committee report issued in advance of Friday's scheduled committee mark-up and vote, is "arbitrary and would unfairly exclude large retailers like Nike and Apple, Inc. from coverage."
Apple and Nike both operate stores in Georgetown. It is unclear how the revised bill would impact, say, CityCenterDC's effort to lure Apple to its downtown development.
The Large Retailer Accountability Act, as originally proposed, was widely understood to target Wal-Mart Stores Inc., which is scheduled to open the first of six D.C. stores later this year. While only a handful of mega-retailers would have met the 75,000-square-foot threshold, the bill as proposed now would wrap in numerous others — at least those that haven't opened in the District yet.
Because the bill would not apply to "those large retailers that, at the date this law becomes effective, are currently operating in the District." That provision, for now, applies to specific store locations, said Councilman Vincent Orange, D-At large, chairman of the committee, not specific store brands.
"The Committee is interested in the creation of economic wealth for District-based businesses and residents," the panel's report states. "But it also wants residents to have a shot at a good education and an economy defined by opportunity and mobility. Currently, a rising economy is producing new job openings but many of the new job opportunities are at the low-end of the wage scale, paying wages that fall below the poverty line."
Among the committee's substantive changes:
- Only employees earning less than $50,000 a year would be eligible for the living wage.
- The living wage would be indexed annually.
- Businesses could use "any reasonable methodology" to prorate the hourly costs of any benefits toward payment of the living wage.
- Franchises would be exempt.
- Subcontractors and tenants of large retailers would be exempt.
The amendment certainly has not appeased the D.C. Chamber of Commerce, which issued an alert calling on members to voice their disapproval in advance of Friday's vote. The bill is "wrong for D.C.," the chamber argues, claiming it is inappropriate, possibly unconstitutional and will discourage businesses from growing in the District.
© 2013 American City Business Journals, Inc.