2 years ago

The cost of employees

Most Americans have to work for a living. We must trade for the goods and services we want to consume, and for most of us, we trade our labor. Conflict over two legal work classifications, employees and independent contractors, illustrate how government’s rules can imperil economic prosperity.

People must work for a living, but people who want a job done, must secure assistance voluntarily through compensation. Difficult, physically demanding, boring, and dangerous tasks will require extra compensation.

Regulation heavily burdens business. According to a U.S. Small Business Administration study, federal regulations cost small businesses over $10,000 per employee. The National Small Business Association found that small businesses face $83,000 in regulatory costs during their first year of operation when owners struggle just to survive. Around 30 percent of a business’ labor cost is for benefits and paperwork.

How much do government rules affect hiring? Rules affecting employees include the minimum wage, overtime pay, workplace safety rules, collective bargaining and the National Labor Relations Act, the Americans with Disabilities Act, the Civil Rights Act, immigration eligibility, worker’s compensation and unemployment compensation. Many regulatory rules do not apply to independent contractors. Furthermore, requirements imposed on larger businesses are generally based on employees, not contractors.

Consumers must eventually pay for a business’ costs of complying with state and federal laws and rules. And costs tied specifically to employment reduce hiring to do tasks which create value in our economy. Half of small businesses report having held off hiring due to regulation.

Why do politicians impose so many rules on employment? In part, because mandates cost the government little; politicians do not spend tax dollars to boost wages or pay insurance premiums. The complexity of employment relations also matters, helping sustain an illusion of significant benefits to workers.

Businesses care about the full cost of an employee, meaning the wage or salary plus the cost of benefits, training, required paperwork, and so forth. When government mandates better terms for employees on one item, businesses can trim back others to contain the cost. For instance, less on-the-job training or flexibility in scheduling can offset the cost of a higher minimum wage.

The adjustments can cancel out mandated benefits. A college student might consider an $8 per hour job with the flexibility to adjust work hours around exams equal to a $10/hour with no flexibility. Raising the minimum wage to $10/hour may lead employers to eliminate flexibility, leaving the college student no better off.

Such offsets of government policies often go unnoticed. Supporters celebrate a hike in the minimum wage, or mandatory overtime pay, or required health insurance. Adjustments like a loss of scheduling flexibility may never get linked back to the policy. The mandate appears like a better deal than in reality.

As rules increased the cost of employment, businesses have not surprisingly tried reclassifying employees as independent contractors. The IRS and state governments enforce rules regarding these classifications, but some employers clearly try to bend the law. Efforts by state and federal regulators to protect traditional employment, however, also frustrate Americans seeking new self-employment options.

Work flexibility will be crucial to realize the full potential of the sharing economy. Exploiting opportunities for sharing will require many people to perform small tasks. Scooter rental companies like Spin and Lime, for instance, need people to charge their electric vehicles left on city sidewalks. Power and gardening tools sit in garages most of the time and could be widely shared. Getting tools to paying users and back to their owners will require on-demand delivery service. Each rental is unlikely to generate enough surplus value to cover employees’ costly regulations.

A market economy enables voluntary action in pursuit of our goals. The labor market forces people to pay for tasks they want performed. Burdensome government rules should not prevent willing parties from agreeing to deals to get work done.

Daniel Sutter is the Charles G. Koch Professor of Economics with the Manuel H. Johnson Center for Political Economy at Troy University.

10 hours ago

Sen. Doug Jones misleads on Trump administration’s coronavirus response

It should come as no surprise that the media and their Democrats are blaming President Donald Trump and his administration for the COVID-19 virus.

Call it predictable, call it politics, call it sad, but at the end of the day, call it wrong.

When U.S. Senator Doug Jones (D-AL) took part in what should have been a non-partisan conference call with the Alabama Department of Public Health Officer Dr. Scott Harris, he took the time to call out the Trump administration for its lack of action early on in the pandemic.

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After blaming the actual people responsible for this pandemic, China and the World Health Organization, Jones said, “I’ve been disappointed in the administration and their early responses.” He added the president and his team had a “cavalier attitudes.”

Too bad he’s wrong.

And truthfully, it’s not even an original thought as former comedienne Sarah Silverman beat him to it by two days.

In response to Silverman, the Daily Wire’s Ryan Saavedra took her apart with a timeline that tells a different story.

January 3: Tried to get CDC into China (numerous attempts made/China never allowed)
January 6: Began issuing travel notices (issued multiple)
January 7: Created issue management system
Janurary 17: Began screenings at airports
January 20: Announces work on development of a vaccine
January 21: Activated its emergency operations center to provide ongoing support to the coronavirus response
January 23: Sought a “special emergency authorization” from FDA to allow states to use its newly developed coronavirus test
January 23: China finally quarantines Wuhan, had lied to the world for weeks about what was going on and how contagious the virus was and deadly
January 29: Creates Coronavirus Task Force
January 31: Bans travel from China / Declares public health emergency / suspends entry from foreigners who pose risk of transmitting coronavirus
February 2: CDC expands screenings at airports
February 5: Briefs lawmakers about pandemic
February 6: CDC ships tests
February 9: Briefs governors about pandemic
February 11: Expands efforts with private sector to expedite vaccine
February 14: Partners with local labs to conduct influenza surveillance to see if alarms are going off
February 24: Writes Congress asking for billions to combat coronavirus
February 29: Bans travel from South Korea / Iran
March 3: Donates entire quarter’s salary to fighting coronavirus
March 4: Announces massive buy in N95 masks (which Obama-Biden admin depleted and never replaced
March 6: Signs $8.3 billion to combat coronavirus
March 11: Bans travel from Europe/made numerous moves to lower interest rates

March 13: Declares national emergency, freeing up $42 billion.

Over 100,000 Americans are dead, but Jones has to play politics because his job depends on it.

I don’t blame Jones. He’s mostly echoing the talking points of his party, their true leaders like Silverman, and rightly expecting very little actual push-back.

His only hope of hanging on to his job is pleasing the people who fund his campaign and hoping they will keep dumping their money into his account from New York, California and Washington, D.C. He can only do that by blasting Trump, whether he needs it or not.

But President Trump listened to his health officials and our current trajectory is far below the early projections of 2.2 million dead. This is a success.

Monday morning quarterbacking might make Jones and his handlers feel better, but if he is going to do it, he needs to be accurate.

On this front, he fails miserably. And he looks like another politician who doesn’t know what he is talking about.

Dale Jackson is a contributing writer to Yellowhammer News and hosts a talk show from 7-11 AM weekdays on WVNN.

10 hours ago

UAH Hockey saved after supporters successfully raise over $750K in less than five days

Just one week after the University of Alabama in Huntsville (UAH) announced that its men’s hockey team would be discontinued, UAH on Friday confirmed the program has been saved by supporters.

The university last Friday had listed financial shortfalls caused by the COVID-19 pandemic as the reason for cutting the popular program.

Following that announcement, a GoFundMe was launched on Monday evening in an effort to raise $500,000 by close-of-business on Friday. That ambitious goal was reached shortly after noon on Friday, with hours to spare.

As of 2:30 p.m. CT, the GoFundMe had garnered a total of $516,585 from more than 2,200 donors. Additionally, a t-shirt fundraising page had raised an additional $29,792.

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In addition to these crowdfunded donations, UAH in a statement advised that two long time hockey supporters, Taso Sofikitis and Sheldon Wolitski, have each gifted $125,000 to support the program.

In a statement to Yellowhammer News, UAH Athletic Director Cade Smith confirmed that these funds, combined with the crowdsourced funds, will enable the program to continue for the duration of the 2020-2021 season. The total amount of almost $800,000 in private dollars is the largest athletic campaign contribution in the history of UAH.

In addition to the private funds, UAH President Darren Dawson has committed dollars from the university to cover the balance of the hockey team’s operations during the upcoming season. The program will continue to compete in Division I.

Moving forward, supporters of the program will still need to secure long-term funding and competitive stability.

“We are thankful and gratified from the loyal support that has been demonstrated this week by the fans and alumni of Charger hockey,” stated Dawson. “We are hopeful that this support will translate into a sustainable funding model that will allow the UAH hockey program to rise again to high levels of success.”

Smith said, “The university is fully committed to the upcoming season. The university will work with the supporters of the UAH hockey program and a newly formed Hockey Advisory Board to develop a plan that will allow the Chargers to thrive in 2021-2022 season and beyond.”

One key obstacle moving forward besides funding will be UAH Hockey finding a new conference, as their current conference is disbanding following this upcoming season.

Smith stressed that “UAH is committed to building a world-class D1 hockey program with a permanent conference home that will allow the Chargers to continue past the 2020-2021 season.”

To continue beyond the current season, UAH said that the Chargers must develop a five-year philanthropic funding model and resolve the associated conference-related issues.

Sean Ross is the editor of Yellowhammer News. You can follow him on Twitter @sean_yhn

12 hours ago

Alabama Lt. Governor Ainsworth comments on death of George Floyd

The death of George Floyd while in Minneapolis Police Department custody on Monday evening has sparked bipartisan national outrage, including in the Yellowhammer State.

The situation on-the-ground in Minneapolis has gradually deteriorated since video footage of Floyd’s death surfaced. Four officers have been fired, however no one had — as of Friday morning — been charged. What began as peaceful protests demanding justice for Floyd have escalated into heavily publicized rioting, looting and arson.

President Donald J. Trump on Friday tweeted that the Minnesota National Guard has arrived in the city to get a hold of the situation.

This came shortly after Lt. Governor Will Ainsworth (R-AL) in a social media post warned, “Chaos rules without law and order.”

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“The death of George Floyd In Minneapolis was inexcusable and angers me greatly, but we must remember that all but a few officers are dedicated servants who risk their lives daily,” Ainsworth said. “My thanks to those who serve in law enforcement. Your brave service is appreciated. Chaos rules without law and order.”

Earlier in the week, Oxford Police Chief Bill Partridge shared a photo of the since-fired officer who was video taped kneeling on Floyd’s neck, with Partridge saying, “This is not a police officer. This is not American law enforcement. This is someone who has no integrity, honor, emotion, or respect.”

Partridge currently serves as president of the Alabama Association of Chiefs of Police.

“These four people have stained every professional law enforcement officer who swore an oath to protect and defend the communities they serve,” he continued, referring to the former Minneapolis PD officers.

“It is up to every officer, supervisor, and administrator to stand against this type of abuse of power. Each of these four officers will be prosecuted, as they should,” Partridge advised.

“As a police officer, I do not see color; I see human beings with thoughts, feelings and I will be the first to stand and say enough is enough to this type of rogue behavior by anyone,” he added. “To see this type of brutality makes me sick and disgusted. But, I know justice will prevail in this case. We just need to allow the system to work.”

Partridge remarked, “While Americans have the right to peacefully assemble and protest, they do not have the right to riot, loot and destroy innocent people’s property.”

“Please know that 99.9% of American law enforcement officers do the job flawlessly every day and risk their lives doing so. We work extremely hard to make inroads into the community and build strong relationships,” the Alabama police chief concluded.

UPDATE:

Derek Chauvin, the former Minneapolis PD officer who knelt on George Floyd’s neck, has been arrested and charged with third-degree murder and manslaughter, media outlets reported Friday afternoon.

Sean Ross is the editor of Yellowhammer News. You can follow him on Twitter @sean_yhn

13 hours ago

Alabama’s OWA to reopen amusement park on June 5

OWA this week announced that it will officially reopen its popular amusement park on Friday, June 5, at 11:00 a.m. CT, incorporating enhanced health and safety measures that were developed based on guidance from the CDC and health officials.

The heightened health and safety measures are being implemented for guests and team members to ensure the well-being of everyone visiting OWA, which is located in Foley, Alabama.

The new policies, which can be found here, will include health screenings for guests before entering The Park at OWA, installation of additional hand sanitizing stations throughout the resort, enhanced cleaning and sanitization practices, and added signage to encourage social distancing.

“Our entire team has worked tirelessly the past few months to get The Park ready for guests. We are excited to see guests enjoying the rides and share special family moments once again,” stated Kristin Hellmich, OWA’s director of marketing/PR.

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“We have always taken great pride in our Parks’ safety and cleanliness,” she continued. “The upcoming Park reopening will be no exception as we continue to implement recommended health and safety practices to ensure our guests have a great experience.”

Additional steps are being implemented to accommodate social distancing, such as limiting the number of guests allowed in the amusement park at one time. Riders will continue to purchase an attractions wristband to enjoy a day filled with unlimited access to amusement park rides. Guests wishing not to partake in any attractions can purchase a $5.00 Non-Rider Pass, which allows guests to enjoy strolling The Park and watching loved ones without having to purchase a full-priced ticket.

Downtown OWA businesses began reopening in April consistent with state health orders and continue to welcome guests using recommended health and safety standards.

Restaurants now open at OWA include Groovy Goat, Crazy Donuts, Paula Deen’s Family Kitchen, Lucy’s Retired Surfers Bar & Restaurant, Trattoria Pizza & Italian, Hershey’s Ice Cream Parlor, C’est Le Vin Wine Bar & Shop, Auntie Anne’s and Cinnabon.

Retailers currently open include Fairhope Soap Company, Parker & Co. (a women’s boutique), Alvin’s Island, The Spice & Tea Exchange and Body Tune Plus.

Brandon Styles Live is currently welcoming guests to both his Magic and Variety shows six days a week. Clash eSports Center, OWA’s state-of-the-art video gaming venue, and Sweet Tooth at OWA are set to open on June 5 in conjunction with the amusement park.

The Park will be open seven days a week during the summer season. Learn more at OWA’s website here.

Sean Ross is the editor of Yellowhammer News. You can follow him on Twitter @sean_yhn

14 hours ago

Auburn offering on-campus instruction beginning with second summer mini-term

Auburn University on Friday announced plans for its second summer mini-term that include a variety of instructional delivery methods, including on-campus instruction.

In March, the university announced its decision to suspend on-campus instruction for the full 10-week summer session and the first of two summer five-week mini-terms following guidance from public health officials due to the ongoing COVID-19 pandemic.

The decision announced Friday comes following months of careful preparation, with the recently amended State Health Order allowing for increased access to educational institutions beginning June 1.

Beginning June 29, Auburn plans to offer multiple course sections during the second summer five-week mini-term through a variety of instructional delivery methods. Consistent with the updated order, the university’s options incorporate important measures designed to protect students, faculty, staff and the broader campus community.

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“Following the Governor’s guidelines, Auburn is preparing to start re-opening our campus to students slowly,” stated Auburn University Provost Bill Hardgrave.

“While the pandemic has not affected our ability to offer quality instruction, it did restrict our options for delivering instruction,” he continued. “With the new guidance from the state, we can utilize instructional delivery modalities that will enable our campus to implement important protocols as we prepare for the broader re-entry of students this fall.”

In addition to the face-to-face and online options Auburn traditionally offers, the university will also offer blended and Hyflex courses. With blended courses, students utilize both face-to- face instruction and remote learning. Hyflex courses provide a structure that gives students the flexibility of attending sessions in the classroom, participating online or doing both through synchronous delivery. As the university prepares to implement physical distancing guidelines across campus, both blended and Hyflex options will reportedly enable students to experience some face-to-face instruction while remaining flexible to accommodate the institution’s safety protocols.

Auburn advised that more than 3,000 students are currently registered for courses in the second summer mini-term, with almost 150 faculty slated to teach. By working with their colleges and schools, faculty can select which of the four modalities best align with the learning outcomes for their courses to deliver instruction. The type of delivery method will be published so students can make informed choices when building their course schedule.

Opening academic buildings and offering face-to-face instruction during the latter part of the summer will allow the university to begin implementing several new protocols developed for students preparing to return in the fall.

Among these, the university will employ a mobile COVID-19 health check for all students and faculty, and appropriate social distancing will be followed in classrooms.

Following the university’s transition to remote teaching this spring, all faculty going forward are being asked to create a “syllabus B” in the event of a resurgence of the coronavirus that requires the institution to once again transition to full remote instruction.

“The second summer mini-term will allow us to glean important information for the fall,” Hardgrave concluded. “The current plan is to implement some key elements for summer that we see as necessary for fall and prepare to welcome our students, faculty and staff back to learning environments that support the well-being of our campus.”

Sean Ross is the editor of Yellowhammer News. You can follow him on Twitter @sean_yhn