NJBIA Comments on Senate Bill 3226 (Ruiz/Sweeney) Increases wages and benefits for certain transportation center service workers

On behalf of our 20,000 member companies and their 1.2 million employees, the New Jersey Business & Industry Association (NJBIA) is writing in opposition to S-3226.

The bill would increase wages and benefits for every subcontracted service worker at Newark Liberty Airport, Newark Penn Station, and Hoboken Terminal.   The increase rate would be the greater of: the applicable standard rate for the wage and benefit rates and paid time off minimums pursuant to the federal Service Contract Act of 1965 or New Jersey’s state building services prevailing wages schedule by the Department of Labor and Workforce or any successor statute establishing a prevailing wage requirement applicable to unarmed security services in the county in with the covered transportation center is located.

Under the bill minimum wages would be increased to $17.98 per hour and include the following fringe benefits:

• $4.27 in supplemental wages for health and welfare
• 1 hour of paid sick leave for every 30 hours they work, up to 56 hours of paid sick leave each year. (Conflicting with current paid sick leave requirements under Newark’s paid sick leave ordinance.)
• A minimum of eleven paid holidays per year.
• And an increasing number of paid vacation days starting with two weeks after one year of service and increasing to five weeks after 25 years.

The increased minimum wage represents a 110% increase and a nearly 300% increase if you include fringe benefits.  This increase would be a huge hit on businesses that are already running on thin profit margins.

Workers covered would include: security, escort services, cleaning services, passenger handling services, cargo related and ramp services and concession services.

The bill would circumvent the collective bargaining process by imposing wage and benefit mandates that are typically awarded through the contract negotiation process.

The legislation would also create a two tiered unfair compensation system for those businesses located in transportation centers and those who are not. A business at Newark Airport, Hoboken Terminal and Newark Penn Station will pay $22.25 an hour while those located outside those centers could pay a minimum wage of $8.44.

For these reasons we respectfully ask that you vote “No” on S-3226.

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