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News Briefs

Date Posted: March 3 2006

'Deadbeat boss' lawheads to court
The Retail Industry Leaders Association are fighting back against Maryland legislators, who in January adopted a law requiring companies employing more than 10,000 workers to spend at least 8 percent of their payroll on health care for employees - or pay any shortfall into a special state fund.

The law, the so-called "Deadbeat Boss" bill, was aimed squarely at Wal-Mart - the only company with that many employees in the state - because the retailing giant's lousy health care plan force many of its workers to fall back on taxpayer-funded state Medicare system. As we reported in our last issue, a Michigan lawmaker introduced similar legislation last month in Lansing.

The retail association has filed two federal lawsuits - against the State of Maryland and Suffolk County, New York, which also adopted such a law - seeking to overturn the rules. According to the Wall Street Journal, the laws are seen as discriminatory because they only target a few employers.

A Feb. 16 editorial by the conservative Journal points the finger at unions for backing this movement. The Journal opined that the lawsuit suggests "more companies are figuring out that organized labor's campaign against Wal-Mart is merely a warm-up to a broader assault. Thanks to the exhortations of the AFL-CIO, some 30 states are now considering so-called "fair-share" health-care laws that force companies to devote a certain percentage of their payroll to health care. The common denominator is that all of these laws largely single out non-union employers."

Paul Blank, campaign director for WakeUpWalMart.com responded to the legal action: "Today's lawsuit is just another attempt by Wal-Mart and its allies not to pay its fair share for health care in the state of Maryland and elsewhere. The Maryland Attorney General has already said Fair Share Health Care legislation is in compliance with the law.

"Wal-Mart would be better off changing its behavior and living up to its responsibilities. States should be applauded, not sued, for trying to address the fact that in every state where we have data, Wal-Mart is costing taxpayers millions by having more employees on taxpayer-funded health care than any other employer."

Michigan gets OK mark for pension funding
While multi-employer pension plans held by unionized building trades workers continue to be relatively solid, the fiscal difficulties of single-employer pension administered by companies like airlines and auto manufacturers have been well reported.

Now comes word that pension plans held by employees in many of the 50 states are also in fiscal trouble. However, even with our state's ongoing fiscal crisis, Michigan's public employee pension system is in fairly good shape.

According to a study released last month by Standard and Poor, public employee pensions in individual states have dropped, on average, from 100 percent funding in the 1990s to an average of 85.4 percent today. Michigan's 83.9 percent funding rate for public employee pensions ranks us at No. 28 among the states.

"Pension liabilities," said the report, must be managed so as not to adversely affect the employer's credit profile. Higher pension liabilities make it costlier for a state to borrow money.