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In “Grand Bargain,” Massachusetts Lawmakers Endorse $15 Minimum Wage and Paid Family and Medical Leave

Letting voters make law at the ballot box is messy.  In a frantic effort to prevent that, the Massachusetts legislature yesterday struck a rather far-reaching deal.

Under what it termed a “grand bargain,” legislative leaders capped weeks of negotiation with business and labor leaders by rushing through both chambers a compromise bill designed to forestall three proposed ballot questions.  Two of those measures were sponsored by organized labor, which wanted voters to raise the state’s minimum from $11 to $15 and to create a new state-run program to provide workers with family and medical leave.  The other, sponsored primarily by retailers, would have cut the state sales tax by 20% and enshrined in law an annual “sales tax holiday.”

If the legislature had not acted soon, all three questions would have been decided by voters in November – and early polls suggest all three would have won.

By striking a deal instead, legislators delayed by one year the transition to a $15 minimum wage, reduced the increase for tipped workers, and secured more control over details of the proposed paid leave program.  While agreeing to the annual tax holiday, they also killed the proposed sales tax cut, which would have cost the state $1.2 million annually.

To sweeten the deal for employers, the legislature also included in HB 4640 a provision gradually repealing the law requiring that workers receive 50% extra for working on Sundays and holidays.

Not everyone was happy with the compromise, or with the way it was rammed through both chambers, essentially unamended, in just a few hours.  But House Speaker Robert DeLeo termed the bill a “fair compromise,” while Gov. Baker called the agreement “good news.”  Baker has not yet announced when or if he would sign the bill.  House Majority Leader Ron Mariano, who helped lead the negotiations, said the compromise will not make everyone happy, but “I think there’s enough in the package to make both sides feel that they are getting something that was important to them.”

Raise Up Massachusetts, the labor-heavy organization behind the first two questions, agreed to drop the ballot question on family and medical leave once the compromise bill was enacted.  But many members, disappointed at losing time-and-a-half pay, have so far balked at withdrawing the minimum-wage proposal.

Yesterday’s action came as the last of several deadlines approached.  Ordinarily, the legislature would have acted by May 2, when the second round of signature-gathering for ballot questions begins.  The deadline for filing those signatures for verification passed this week; the only remaining step was submission of certified signatures with the secretary of state, which must occur by July 3.

The compromise came on the heels of a state Supreme Judicial Court decision which on Monday knocked another popular question, also backed by Raise Up Massachusetts, off the November ballot.  That proposed constitutional amendment, which called for a 4% “millionaire’s tax” on all incomes over $1M dollars, was struck down by the Court because it both tried to raise revenue and dictate how it could be spent, which the Court found to violate a requirement that a ballot questions deal only with “related” matters.

Update (June 28):  Gov. Baker today signed the “grand bargain” into law, after concluding that the employer assessments required to fund the new family and medical leave program did not violate a 2014 pledge not to raise taxes.  Two days earlier, Raise Up Massachusetts declared victory and decided not to pursue its minimum-wage ballot campaign.