With a vote expected this week, lawmakers in the California State Assembly face a key test of their proposal requiring Wal-Mart and other large companies to pay a living wage and provide health benefits for full-time employees.
If the proposal passes, it would fine employers $6,000 for each employee requiring assistance from taxpayer-funded programs like Medi-Cal, the state’s public health insurance program. Lacking proper health coverage from their employers, at least 130,000 Californians are expected to join Medi-Cal in the coming years.
The divisive bill has pitted labor organizations against business groups in a battle that union backers hope will bolster support for millions of low-wage workers who rely on Medi-Cal for coverage.
The Sacramento Bee reports that the bill needs a two-thirds majority to pass but has faced challenges from Republican opponents who say that the legislation will stifle job creation in a stagnant economy where unemployment remains above 8 percent. It’s been labeled a “job killer” by the California Chamber of Commerce.
“This is one of the first real, hard acid tests of the two-thirds supermajority casting an extraordinary vote for an obvious labor agenda,” Rob Stutzman, a GOP political consultant, told the Sacramento Bee. “It will be interesting to see if two-thirds is enough.”
The bill is seen as a way to hold Wal-Mart and other major retailers accountable, requiring them to provide sufficient hours and wages to keep employees off public health insurance and other programs funded by taxpayers.
The Los Angeles Times reports that 130,000 employees from large firms are expected to go on Medi-Cal in the next few years. This is expected to increase the total number of Californians on the Medi-Cal program to roughly 1 million.
Proponents of the bill claim that large corporations like Wal-Mart, a retailer with $17 billion in profits last year, have no excuse for not providing all employees with a decent wage and benefits.
“It’s really just the largest, most profitable employers in the state that we’re talking about – and it’s an issue of basic fairness,” said Steve Smith, a spokesperson for the California Labor Federation.
The 1.3 million Wal-Mart employees across the U.S. earn an average wage of $8.81 per hour. Up to 80 percent receive food stamps or some form of public assistance to make ends meet, according to Daily Kos.
Supporters of the California proposal also point to a study released by congressional Democrats last month showing that one Wal-Mart Supercenter in Wisconsin cost taxpayers $900,000 in a single year. The Huffington Post reports that the study looked at a number of Wal-Mart stores, comparing the average per-person cost the stores added to taxpayer receipts.
Using data from BadgerCare, the state’s health insurance program, authors of the report found that total taxpayer costs for a 300-employee Wal-Mart store totaled $251,706.
“When low wages leave Wal-Mart workers unable to afford the necessities of life, taxpayers pick up the tab,” the report says.
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