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Thursday, July 20, 2006

So Much For That Idea

As I was watching the news this morning, I caught the word that the "Wal-Mart Law" in Maryland had been declared invalid by a federal judge yesterday. (opinion here)

The judge used something interesting from the bench, common sense, when he threw aside the state's claim that the law wasn't a requirement to increase health care, but actually a tax on employers.

The states arguement was based on the idea that if Wal-Mart (or some other company with 10,000 employees, that doesn't exist in Maryland) didn't meet the 8% payroll goal for providing health care benefits, they wouldn't be "fined" by the state, but instead be required to pay a tax equal to the difference.

The judge said that the law ran afoul of the federal Employee Retirement Income Security Act (ERISA), which in his opinion he claimed overrules such state laws as Marylands.

If the ruling holds up on appeal to the 4th Circuit in Richmond, Va, there are some other interesting possible effects. For instances, would ERISA also be able to be used as a basis for companies to challenge the "living wage" laws many municipalities have passed? Could they use it to challenge the states that have different minimum wage laws than the federal standard?

The AFL-CIO blog is trying to spin this as a partial victory, by claiming:

"...While the Court’s ruling is deeply disappointing, its decision to roundly reject the claim by Wal-Mart’s lobbyists that the law singled out Wal-Mart was a positive sign"

Except the judge did rule that the law would create specific harm to Wal-Mart*, in fact, the first 13 pages or so of the ruling are on why RILA had rights to bring the suit on Wal-Mart's behalf, and why Wal Mart would be harmed by the law:

U.S. District Judge J. Frederick Motz decided that the Maryland Fair Share Health Care Fund Act would have hurt Wal-Mart by requiring it to track and allocate benefits for its Maryland employees in a different way from how it keeps track of employee benefits in other states. Motz wrote that the law "imposes legally cognizable injury upon Wal-Mart."
The AFL-CIO and Service Workers Unions have both tried to get an anti-Wal-Mart health care bill on the books in 33 states, and have failed in every one of them.

Doug at Below the Beltway has a great review of the ruling, and more links about this story.

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* PilotOnline.Com link provided by a group that lobbies for Wal-Mart


Blogger Mahndisa S. Rigmaiden said...

07 20 06

Well I like what you havta say as usual CP. This whole notion of telling a business how to run itself is offensive to me...Granted, I believe that workers should have 'safe' conditions, but other than that, let the market dictate needs. Speaking of that, the term 'you are overqualified' is starting to grate on my nerves. But that is another story...Have a great rest of week:)

7:48 AM  
Blogger hraglain said...

I have to point out that you have a logical fallacy in your post. You say the court did find that Wal-Mart was singled out by this law. That was not in the decision, at least as posted by you, at all. Finding that Wal-Mart was damaged by the law is a very different thing than finding it was singled out.

In court, if you can prove that a law was directed specifically at you and not as general policy, it is a guaranteed win. That did not happen in this case.

10:00 AM  
Blogger shoprat said...

The unions will not be happy until the Walmart employees are paying them extortion, er excuse me ... union dues for the priviledge of having a job there.

8:09 PM  
Blogger Crazy Politico said...

Hraglain, from the opinion (last paragraph, page 2 of 32):

There are four non-governmental employers of 10,000 or more people in Maryland:
Johns Hopkins University ("Johns Hopkins"), Northrop Grumman Corp. ("Northrop Grumman"),
Giant Food Inc. ("Giant Food"), and Wal-Mart. When enacting the law, the Maryland General
Assembly anticipated that only Wal-Mart would be affected by the Act’s spending requirement.

That too me looks like one company being signled out. Northrop got an exemption even though they are under the 8% ceiling because they have higher wages, Johns Hopkins is a non profit, and given an exemption, though they spend less than 8% and Giant spends more than 8% based on their union contract.

Shoprat, you are correct.

9:34 PM  

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