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PBA outlines possible impacts of new Obama admistration

28
Nov '08

As the "voice" of the professional beauty industry, the Professional Beauty Association (PBA) aims to keep its members abreast of legislation that has the potential to impact their businesses, as well as provide a collective viewpoint to Congress and other government officials on the ramifications legislation could have on the beauty industry.

As Director of Government Affairs for PBA, Sam Leyvas keeps PBA's membership informed of issues relevant to the beauty industry and informs members on how they can become involved in helping their government representatives understand how certain polices will affect their business and employees. With a new administration, control of Congress by the Democrats and significant changes to many state legislatures, Leyvas has outlined some of the key issues members should be aware of:

Negative Impact:
"Card Check" Law (Employee Free Choice Act): This law could have a significant impact on the beauty industry and many other Main Street businesses. While the bill was approved by the House in 2007, it died in the Senate this year - it will most likely resurface in early 2009. With Democrats traditionally supporting organized labor's agenda and with unions aiming to fold more employees into union membership, this law would completely change the economics of union organizing.

Card Check would make it cost effective for unions to go after Main Street businesses, such as beauty/nail salons, spas, restaurants and other retail establishments, which have never experienced unionization before. The law would do away with the secret ballot process currently used for unionization in the workplace and replace it with a Card Check system.

Once a union persuades more than half of workers to sign membership cards, the union would automatically be certified. Without the secret ballot process, employees would be exposed to intimidation and bullying tactics from union organizers. From large-scale beauty manufacturers to salon and spa owners, this is a law that could have serious consequences for the beauty industry.

Positive Impact:
FICA Tax Credit for Salons/Spas: While this proposed legislation has actively been supported by PBA for the last few years, the bill's principal sponsor (Shelley Berkeley D-NV) retained her seat in the House and is poised to keep this issue a priority. Additionally, 2009-2010 are likely to be years in which we will see a flurry of tax legislation in Congress - giving our industry newfound opportunities to advocate for a FICA tax credit.

The FICA Tax Credit would give salon/spa owners a dollar-for-dollar tax credit on the FICA taxes paid on employee's tip-income (employer's currently do not share that income but are taxed on it) - putting the professional beauty industry on equal footing with the restaurant industry. This legislation would significantly help small and large salons and spas to lower their tax liability and allow them to further invest in their businesses.

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