What if one particular industry that performed a specific type of service were subject to state requirements and potential fines that applied to no other industry when it came to notifying the state of plans to relocate operations offshore?
What if businesses in that one particular industry — and no other — were added to an official, state-maintained list if they relocated major operations overseas and were barred for two years from taking advantage of any state economic development incentive or loan assistance program?
And what if those same businesses exclusively in that same industry had to forfeit the value of any remaining economic development benefits they were receiving, if part of the business remained in Maine?
It sounds like a foolish, protectionist and woefully outdated approach to economic development. But it would be Maine law for call centers — and only for call centers — if Democratic majorities in the state Legislature have their way.
Democrats in the House and Senate have given initial approval to a bill that aims to protect the call center jobs already in Maine by making it less appealing for call center operators to move operations overseas.
The legislation is sponsored by Senate Majority Leader Troy Jackson, D-Allagash. It has elements in common with a bill the Communications Workers of America union is pushing on the federal level in Congress — to which Jackson hopes to be elected later this year.
Jackson’s bill started out as a more abhorrent piece of legislation that represented a reactionary attempt to hang onto one portion of Maine’s slice of the economic pie. The original legislation would have imposed a 120-day notice requirement for call centers planning to relocate offshore. If they failed to notify the state labor department, they would be fined $10,000 daily until they did. Under the version of the bill now pending in the Legislature, the notification requirement has been reduced to 60 days and the fine for failure to notify to $350 daily.
While Maine call centers have occasionally closed and relocated in recent years, others have opened and expanded — sometimes even relocating from overseas. Call center employment has generally grown in Maine over the past decade. The state Department of Labor estimates call centers — whether they are a unit within a larger business such as L.L.Bean or whether they perform sales and customer support for businesses on contract — employed more than 9,300 people last year. That was up about 1,000 since 2003.
Average wages for call center employees have also been on an upswing in that time. In 2003, employees of contract call centers earned $451 a week on average when measured in 2013 dollars, about $23,400 annually. In 2013, weekly pay was up to $608, about $31,600 annually.
Few want to see Maine’s call center jobs moved offshore, and few want to see businesses that move Maine jobs offshore benefit from state tax breaks and other incentive programs. But the legislation making its way through the Maine House and Senate is foolish for its redundancy and shortsightedness. No action by the Legislature will blunt global economic forces. Legislative actions, however, can help to write Maine off as a viable location for a business that could locate anywhere it chooses. Even if this bill doesn’t ultimately become law, it shows the penchant for a legislature from a small state to meddle in individual industries.
There are already 60-day notification requirements in state and federal law when major employers close up shop or relocate and cause job losses as a result. Under federal law, employers who violate notice requirements owe their employees back pay and are subject to fines of up to $500 daily.
If lawmakers are intent on cutting off economic development assistance to businesses that offshore jobs, they should write that in as a criterion for economic development programs. If those programs’ beneficiaries are commonly moving jobs offshore, that should send a message to lawmakers that those incentive programs need to be reviewed and, potentially, redesigned to be more effective.
If this legislation clears the final House and Senate hurdles, we’re thankful Gov. Paul LePage is almost sure to veto this poorly thought-out bill.