Commentary

The long and hidden tentacles of HB2

In case you missed it this morning, be sure to check out the fine essay by Prof. Nichola Lowe of the City and Regional Planning Department at UNC Chapel Hill about some of the less well-reported and understood provisions of HB2 — North Carolina’s new all-purpose discrimination law. As Lowe explains:

“House Bill 2 goes a lot further than regulating bathrooms or repealing workers’ protections against employer discrimination. HB2 also changes how local governments contract with private businesses – raising important questions about whether local governments should move from outsourcing to insourcing essential public services.

Local governments often contract with private businesses to maintain government buildings, process local tax payments, provide temporary clerical support, in addition to other functions. House Bill 2 severely restricts what local governments can require contractors do in terms of how they treat their employees in regards to living wages, paid sick days or even workplace health and safety standards.”

Happily as Lowe also explains, there are ways to get around this problem — most notably by “insourcing” (i.e. hiring and paying their own employees) rather than outsourcing work to private firms. Again, here’s Lowe:
“As enacted, House Bill 2 undermines the ability of local governments to promote shared prosperity through the contracts they extend to private business. Eliminating this option is equivalent to telling individual consumers they can select products and services only on the basis of lower prices – even if those immediate financial gains come at the expense of product safety, quality and reliability. But unlike most individuals, local governments can still decide to perform essential public services through a calculated ‘make or buy’ decision that ultimately allows them to retain labor market control and reach.”
Of course, the simplest and best solution to the numerous conundrums created by HB2 is to simply repeal the darned thing. Until that inevitability comes about, however, it looks like local governments in North Carolina will be looking for workarounds and that one of the many unforeseen consequences of the new law could be, of all things, a spike in public employment.

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