A Texas state appeals court last week temporarily blocked a local ordinance in the capital city of Austin requiring employers to provide paid sick leave from going into effect, the Texas Tribune reported:
[T]he measure quickly drew opposition from local and state leaders, including a lawsuit filed in April by the right-leaning Texas Public Policy Foundation claiming that the city measure violates the Texas Minimum Wage Act. … The ordinance had been set to take effect Oct. 1.
“Without this stay, Austin business owners would be forced to incur significant costs implementing the requirements of the ordinance while its legality was in serious doubt,” said Robert Henneke, general counsel and litigation director for TPPF’s Center for the American Future. Texas Attorney General Ken Paxton, who has lent support to the lawsuit, also praised the news, saying the issue of minimum wage is “entrusted by the Texas Constitution solely to the Texas Legislature.”
Austin’s ordinance, which the city council passed in a 9–2 vote in February, has also faced opposition from Republicans in the state legislature, who promised at the time to pass legislation at the state level that would preempt it. Other states with conservative legislatures have taken similar measures to stop local governments from enacting liberal labor laws in the past year. Indiana banned cities from implementing “ban-the-box” laws, Missouri passed a preemption law to prevent cities like St. Louis from legislating higher minimum wages, and a Florida court found that a minimum wage increase in Miami Beach was preempted by state law.
LinkedIn’s latest Workforce Report for the US spotlights a phenomenon that’s shaking up the labor market in and around Texas, the nerve center of the American oil industry, where hiring has spiked in tandem with oil prices. Energy industry hiring rose 5.2 percent in the year to May 2018, compared to an average of 4.5 percent across all industries nationwide, LinkedIn found. Job growth has closely tracked the price of oil, with a dip in 2015-2016 followed by a boom as prices have risen steadily over the past two years. Hiring in Houston, the energy industry’s home base, grew 12.4 percent year-over-year, contributing to a reduction in the surplus of petroleum engineering, energy, and geology skills.
The energy industry is particularly sensitive to boom-bust cycles, and, so are cities like Odessa and Midland in west Texas, where the local economy is dominated by a single industry (in this case, oil), the report notes. In the current boom cycle, the migration of workers to the Odessa-Midland area is further tightening labor markets in Houston and other Texas cities:
With oil prices on the rise, talent inflows to this oil boom-town have picked up, particularly from the three largest Texas cities—Houston, Dallas, and Austin. Net movements to Odessa-Midland from these cities have grown significantly since September 2017, to 0.34 per 10,000 from Dallas (750%), 1.05 per 10,000 from Houston (44%), and 1.03 from Austin (255%). This impact can also be felt in the housing market—a recent report found that Odessa-Midland had the highest national rent increase in 2017, up 35.7% year-over-year.
Driving this boom is the rapid expansion of shale oil extraction in the Permian Basin, west Texas’s oil and natural gas producing region. High oil prices combined with advances in extraction technology have made shale extraction increasingly profitable, meaning oil companies have the incentive and the resources to lure talent with high pay. That’s great news for anyone working on an oil rig, but ancillary workers like truck drivers are also seeing huge signing bonuses and pay hikes, the Wall Street Journal reports, with some truckers in the Permian Basin earning over $100,000 a year, double the national average for long-haul truckers.
The City Council in Austin, Texas voted last week to approve a new ordinance requiring employers in the city to provide paid sick leave to their employees, the Texas Tribune reported:
At a meeting where over 200 people came to testify — a majority of them supporting the ordinance — the council voted 9-2 to implement the policy. But hours after the rule was passed, state Rep. Paul Workman, R-Austin, sounded off against the bill, saying the ordinance is “declaring war” on small private businesses.
The new rule mandated that private employers allow their workers to accrue up to 64 hours, or eight days, of paid sick leave per year. Small businesses with 15 or fewer employees could have paid sick days up to 48 hours, or six work days. The passed ordinance is scheduled to go into effect on Oct. 1, making Austin the first Texas city to pass a paid sick-day ordinance.
Workman and other Republicans in the state legislature have already promised to pass legislation at the state level to prevent Austin’s policy from going into effect. This type of preemption legislation has been used in other states with conservative governments to stop liberal cities from enacting their own local employment laws: In the past year, Indiana banned cities from implementing “ban-the-box” laws, Missouri passed a preemption law to prevent cities like St. Louis from legislating higher minimum wages, and a Florida court found that a minimum wage increase in Miami Beach was preempted by state law.
In Texas, Governor Greg Abbott expressed interest last year in passing a similar law to throttle progressive local legislation, and the state already bars cities from raising the minimum wage, introducing rent controls, or instituting some forms of inclusionary zoning, CityLab‘s Sarah Holder adds.
In one of the worst natural disasters in US history, Hurricane Harvey has dumped more than 11 trillion gallons of rain on the Houston metro area and other parts of southeast Texas, leading to catastrophic flooding throughout the region. While the city of Houston was not ordered to evacuate, most organizations in the city, including major employers like NASA’s Johnson Space Center, ConocoPhillips, and Waste Management, Inc., were closed on Monday and instructed employees to stay home, according to the Wall Street Journal. Some encouraged employees who were safe to work remotely from home. Many local businesses and national firms with a presence in the region, including major retail chains like Target and Walmart have closed their stores in the area and are participating in relief efforts by donating money or emergency supplies.
For organizations whose employees are affected by the hurricane, the first priority in the coming days and weeks is to communicate with employees about the status of their workplaces and projects, as well as benefits and resources available to them, as Amanda Eisenberg highlights at Employee Benefit News:
“The most important thing to communicate is what the employers are doing for the employees and the community,” says LuAnn Heinen, vice president of the National Business Group on Health. “First of all, that help is on the way.”
Employers also are going to have to be flexible, she says. Employees need to know if they are expected to come into the workplace, and if they can’t, whether they can work remotely. Schools are likely to be closed, and relatives might have been relocated from nursing homes or hospitals to shelters. Employees might need access to childcare or eldercare, and companies should be in constant communication to relay those benefits, Heinen explains.
In an open letter sent to Texas Governor Greg Abbott on Monday, 55 Houston-area business leaders urged the governor to reconsider his support for the “bathroom bill” currently being considered in the state legislature, which would require transgender people to use restrooms in public buildings, including public schools, corresponding to the sex listed on their birth certificates rather than their expressed gender.
The signatories to the letter represent businesses belonging to the Greater Houston Partnership, an economic development group serving Texas’s second-largest metropolitan area, and include presidents, CEOs, regional managers, and other senior executives at companies such as Accenture, Chevron, ConocoPhillips, Dow Chemical, Ernst & Young, ExxonMobil, Shell, and Siemens. In the letter, the business leaders state succinctly that they “support diversity and inclusion, and… believe that any such bill risks harming Texas’ reputation and impacting the state’s economic growth and ability to create new jobs”:
Innovative companies are driven by their people, and winning the talent recruitment battle is key. Any bill that harms our ability to attract top talent to Houston will inhibit our growth and continued success – and ultimately the success of our great state. We appreciate your leadership in Texas and urge you avoid any actions, including the passage of any “bathroom bill,” that would threaten our continued growth.
In a special session this week, the Texas state legislature is expected to debate a proposed “bathroom bill,” which would require transgender people to use restrooms corresponding to the sex listed on their birth certificates rather than their expressed gender in public buildings, including public schools. LGBT advocates have decried the bill, similar to legislation proposed in North Carolina last year, as discriminatory and harmful to trans people, especially students in public schools. A number of major companies have also spoken out against the bill: In May, a group of tech CEOs including Facebook’s Mark Zuckerberg, IBM’s Ginni Rometty, Apple’s Tim Cook, and Google’s Sundar Pichai sent a joint letter to Governor Greg Abbott, urging him to withdraw his support for the bill.
As the legislature draws closer to voting on the bill, IBM is stepping up its lobbying campaign against it, and major Texas-based companies are adding their voices to the chorus of employers asking legislators to discard it, J. Weston Phippen reports at the Atlantic:
IBM is the latest major company to step up its fight against Texas’s bathroom bill, which lawmakers will likely debate in the coming week as they work through a special session. IBM sent an internal memo Monday to employees around the world that called the bill discriminatory. The company also dispatched about 20 executives to persuade lawmakers against passing the bill. …
Texas is the latest US state to consider a “bathroom bill” in its state legislature, which would require transgender people to use public restrooms corresponding to the sex listed on their birth certificates rather than their expressed gender. In yet another sign of their growing political influence, a group of major tech company CEOs sent a joint letter to Governor Greg Abbott this weekend, decrying the legislation as discriminatory and urging him to abandon it, Engadget reported on Monday:
“As large employers in the state, we are gravely concerned that any such legislation would deeply tarnish Texas’ reputation as open and friendly to businesses and families”, begins the tech companies’ letter to Abbott. “Our ability to attract, recruit and retain top talent, encourage new business relocations, expansions and investment, and maintain our economic competitiveness would all be negatively affected.”
“Discrimination is wrong and it has no place in Texas or anywhere in our country,” the letter continues. “Our perspective is grounded in our values and our long-held commitment to diversity and inclusion.”
The signatories to the letter include Facebook CEO Mark Zuckerberg, IBM’s Ginni Rometty, Apple’s Tim Cook, and Google’s Sundar Pichai, along with chief executives or presidents from ten other major tech companies. The decision by these CEOs to wade into the controversy in Texas is reminiscent of how they and other large companies banded together to oppose similar legislation in North Carolina last year. While the companies represented in the letter don’t directly threaten to scale back their business operations in Texas because of the law, other organizations have done so, the Associated Press reports: