Newsletter — February 15, 2024 | |
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POLICY
ECONOMY
RETAIL THEFT & PUBLIC SAFETY
TRENDS
SAFETY
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What we are tracking — WR Legislative Hot List
Washington Recycling and Packaging (WRAP) Act (HB 2049)
- Focus: Defines ‘producer’ to put manufacturers at the top of the responsibility chart and retailers at a lower position, preventing them from paying for packaging and recycling for every item on their shelves.
- Failed to be voted on and not likely to proceed.
Artificial Intelligence Bills (SB 5838)/(HB 1934)
- Progress: Senate version heard waiting for a vote; House hearing imminent.
- WR’s Stance: More information is needed before the state begins regulating. Supports retail inclusion in a task force, seeks timeline extension; high-priority concerns. Believes a national solution would be preferable.
- Status: SB 5838 passed out of Senate 31-18; HB 1934 failed to move.
Unemployment Insurance (UI) for Striking Workers (HB 1893/SB 5777)
- Allows for striking workers to collect unemployment insurance benefits
- WR is opposed to these bills
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Status: HB 1893 passed the House Feb 13 with amendments; scheduled for a hearing on 2/15 in the Senate Labor & Commerce Committee, SB 5777, has failed to move.
Retail workforce workgroup (SB 6296)
- Objective: Establish a retail workgroup to promote training opportunities
- WR supports this bill
- Status: the Senate passed this bill unanimously on 2/13. Hearing scheduled in the House Postsecondary and Workforce committee on 2/20.
Incentives for Return to Work (SB 5368) (HB 2127)
- Changes: SB 5368 allows small businesses to partner with local nonprofits to provide light-duty return-to-work opportunities; HB 2127 increases the reimbursement rate for businesses that provide a light-duty return-to-work opportunity for an injured worker.
- WR supports these bills
- Status: SB 5368 passed Senate 44-4; Public hearing held on 2/14 in the House Committee on Labor and Workplace Standards. HB 2127 passed House of Representatives 97-0; Public hearing scheduled in Senate Labor and Commerce committee on Feb 15.
Repeat Offenders (SB 5056)
- Proposal: Allows a court to sentence a habitual property offender to an additional 24 months for a Class B felony, and an additional 12 months for a Class C felony
- WR supports this bill
- Status: Public hearing held in the House Committee on Community Safety, Justice, & Reentry Feb 14.
Multiple Accomplices (HB 5160)
- Changes: A person commits second-degree organized retail theft if they—along with at least two accomplices—enter the store within five minutes of each other and steal property worth $750 or more from a retail store.
- WR opposes this bill
- Status: Status: Passed Senate 49-0. Referred to House Committee on Community Safety, Justice, & Reentry.
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All House and Senate Bills had to be voted out of their original chambers by 5:00 pm Tuesday, February 13– or the bills would be considered finished for the session. Of the hundreds of bills introduced, most never go so far as to receive a hearing – the first step in their arduous process.
Even fewer bills that are fortunate enough to get out of committee and voted on by the entire “House of Origin” – the halfway point for a bill’s journey. Then the Senate hears House bills and vice versa – all in a condensed calendar. Now, each side has just over a week to hear and vote on bills to keep them moving. If they do make it out of the opposite chamber’s committees, they must be voted on by the entire body by March 1.
If the opposite house changes the legislation so much as one word in a bill, it has to go back to the original house for “concurrence,” an opportunity for them to agree, disagree, or ask for a conference to discuss their differences. Of all the bills introduced, only about 10-15% get signed into law – the final step in the process. Washington’s Governor can choose to sign the entire bill into law, veto the whole bill, or veto portions of it. If the Governor doesn’t take action on the bill within 20 days of it sitting on their desk, it automatically goes into law.
Now for the disclaimer. Bills “necessary to implement the budget” or NITB are immune from all cutoffs. These bills usually take in new monies or expend money.
The other option to keep a bill moving is to amend it onto another related bill, or as we say, “hang” it onto a measure. Some bills with broad titles attract many other bills and become known as ”Christmas trees” for all the ornaments hung on them.
Finally, bills that may appear to have gone by the wayside by missing a vote or cutoff can be brought back to life through a series of parliamentary maneuvers. While this is rare, it occasionally happens to secure support on the budget or some other bill that the majority party wants to pass.
The bottom line is that no bill is truly “dead” for the session until the Legislature adjourns for the year – which is scheduled for March 7.
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In a legislative session marked by competing priorities and the backdrop of an election year, the progression of a significant property tax bill, SB 5770, emerged as an unexpected dark horse, advancing out of Ways and Means just before the cutoff and was expected to be voted on the Senate floor.
SB 5770 aimed to lift the 1% property tax cap and allow city and county governments the option to increase the rate to 3%, impacting both businesses and homeowners statewide.
Senate Minority Leader John Braun (R – 20) expressed concerns, stating, "Senate Bill 5770 could have resulted in the largest property tax increase in our state's history — without a vote of the people. This bill is overwhelmingly unpopular."
However, swift action from Washington Retail Association and AWB, as well as other business associations, shed light on the devastating impact a tax increase would have on Washington residents and businesses. The Senate Republicans press conference amplified the opposition, prompting the bill's removal from consideration during this session.
Prime Sponsor Senator Jamie Pedersen acknowledged the public's apprehensions, saying in a statement, "We have heard the public's concerns about property taxes." While the bill won't progress in this session, the issue remains pertinent, with cities and counties advocating for its reconsideration in future legislative sessions.
Though the bill's fate is deferred for now, it underscores the ongoing debate and pressure surrounding property tax policies in Washington State, ensuring continued dialogue and deliberation on this crucial matter.
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In early morning floor action, the House of Representatives passed HB 1893 to extend unemployment insurance benefits to workers on strike or locked out of their workplace due to a labor dispute. The bill passed at around 2:00 a.m. on February 13 on a 53-44 vote, with five Democrats voting with Republicans against the bill.
Washington’s unemployment insurance system, which is entirely funded by employers, provides benefits to workers who lose their jobs through “no fault of their own.” There are several situations where benefits are allowed when a worker leaves a position voluntarily. A strike, however, is very different --- the worker is voluntarily leaving their position and likely has a job to return to after the strike. HB 1893 is a dramatic change in policy.
The bill was amended on the floor to limit benefits to four weeks, apply all benefit costs against the experience rating of the impacted employer, exempt strikes that are prohibited under federal or state law, and require the return of benefits if workers receive back pay at the conclusion of a strike.
HB 1893 now moves to the Senate, where a similar bill, SB 5777 has failed to move.
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Washington State's proposed lighting legislation, House Bill E2SHB 1185, advanced out of the house on a 52/45 split vote. The bill, aimed at banning the sale of all linear fluorescent lights beginning in 2029, would affect every business and residential consumer as they will be forced to switch to a different form of lighting after that date. In addition to the lighting ban, many Washingtonians and businesses could incur additional costs to change out their light fixtures to accommodate new lighting products.
Additionally, the advancement of this legislation jumps ahead of the Joint Legislative Administrative Review Committee's data collection process and report, which is not due until later this year. The absence of conclusive evidence underscores the need for informed decision-making. Without concrete data-backed insights, rushing into such a significant legislative change risks adverse repercussions for businesses and consumers alike.
Further exacerbating concerns is the limited stakeholder engagement in the bill's development process. More time and genuine stakeholder involvement from all sides should be given before enacting a law like this.
The bill is scheduled for a public hearing in the Senate Environment, Energy & Technology Committee on February 14. WR is working very closely with other interest groups on this bill and will be testifying our concerns.
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WR uses VoterVoice as an excellent platform to help our state legislators hear from their constituents about key topics affecting retailers, employees, and keeping workplaces safe. We make it easy with prewritten letters that can be personalized by each sender. Most campaigns will take 2-minutes or less to contact your legislators on the bills they make into law. Will you join us? Use this link to sign up!
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Trade leaders, including the National Retail Federation (NRF) and other state and national trade associations, are advocating for greater international involvement in enhancing maritime security in the Red Sea. In a concerted effort, these organizations have issued an open letter calling for additional global support to counteract threats, particularly from Houthi rebels to crucial maritime trade routes. The letter underscores the importance of expanding the coalition beyond the 23 countries currently participating in the U.S.-led Operation Prosperity Guardian, which aims to protect commercial shipping in the area.
The appeal for increased cooperation comes amidst heightened political scrutiny of military operations in the region and the unfortunate loss of U.S. military personnel. The trade associations point out the dependency of international trade on these shipping lanes, noting that a large volume of U.S. trade relies on foreign-flagged vessels. This dependency highlights the global significance of secure maritime pathways beyond regional security concerns.
WR is concerned about the potential for ongoing disruptions to the supply chain despite the adaptive measures taken by the shipping industry to maintain cargo flow through U.S. ports. According to reports by the NRF and Hackett Associates, there is an expected increase in inbound cargo volumes, indicating the sector's resilience. However, the importance of sustained efforts to secure maritime routes to prevent future supply chain setbacks can't be understated.
The collective action by the NRF and other trade organizations emphasizes the necessity of a unified international stance against threats to maritime commerce. The emphasis on a zero-tolerance approach to maritime threats and the call for broader international collaboration reflect a straightforward business perspective on ensuring the stability and efficiency of global trade networks.
Read more from CNBC.com
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In January 2024, the retail sector experienced a solid start, nearly matching the high levels of activity seen in December's holiday season and marking a significant increase from the previous year. This positive trend was highlighted in the latest CNBC/NRF Retail Monitor report. Retail sales, excluding automobiles and gasoline, experienced a slight decrease of 0.16% month-over-month but saw a rise of 2.34% year-over-year. This performance underscores consumers' continued optimism and spending willingness, buoyed by the growth in employment and wages.
Core retail sales, which exclude restaurants, autos, and gas, showed a minimal month-over-month decline of 0.04% but an encouraging annual increase of 3.24%. This data, derived from actual credit and debit card transactions, provides a real-time snapshot of consumer behavior without requiring revisions often associated with survey-based data.
The report also elaborated on performance across a range of retail categories, with six out of nine categories witnessing annual growth. Online sales, health and personal care stores, and clothing and accessory stores led the gains. On a monthly basis, five categories showed improvement. Specific highlights include a significant 25.47% year-over-year increase in online sales, a 9.7% rise in health and personal care stores, and a 5.9% growth in clothing and accessories stores.
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In a significant move against organized retail crime, Attorney General Bob Ferguson's Organized Retail Crime Unit has filed its second felony criminal case. Shellonda K. Daniel, a Maple Valley woman, faces charges for a series of thefts across six counties in western Washington, involving over $200,000 worth of fragrances and cosmetics stolen from 28 Ulta stores. The charges, filed in King County Superior Court, include two counts of first-degree organized retail theft, a felony offense.
This case highlights the Attorney General's commitment to addressing the growing issue of organized retail crime, which poses a threat not only to businesses but also to the safety of workers and customers. The state's Organized Retail Theft statute has enabled the consolidation of charges across multiple jurisdictions into a single county, reflecting the coordinated effort to tackle such widespread criminal activities.
Daniel's alleged actions included not only the theft of high-value items but also intimidation and threats towards store employees and customers, escalating the severity of her crimes. The Attorney General's Office is pursuing a prison sentence of up to 10 years and a $20,000 penalty for each count against Daniel, along with full restitution for the stolen goods.
The Organized Retail Crime Unit, established in partnership with the Legislature in April 2023, represents a centralized effort to combat retail thefts that are organized and systematic, rather than isolated incidents of shoplifting. This unit, part of a broader task force that includes representatives from various levels of law enforcement and the retail industry, underscores the collaborative approach required to address such complex challenges.
As the unit continues to build its team and capabilities, this case serves as evidence of its potential impact in safeguarding communities and businesses from the ramifications of organized retail crime. With nine other states having dedicated task forces for this issue, Washington's proactive stance sets a precedent for comprehensive and coordinated action against these criminal networks.
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Credible data has been the focus of discussions regarding organized retail crime (ORC), and some national groups are facing criticism for alleged data misrepresentation. Although the error was quickly corrected the discussion over data continues.
The report, an NRF and K2 Integrity collaborative project, revealed the challenges in quantifying its impact due to inconsistent and fragmented data. This inconsistency in data, stemming from varied law enforcement and retailer reporting practices, complicates the understanding of ORC's true scale and effects.
ORC encompasses a range of criminal activities, including shoplifting, cargo theft, and break-ins, all aimed at profiting from the resale of stolen goods. The lack of a unified approach to addressing and reporting these crimes makes it difficult to grasp their full extent. Despite these data challenges, the tangible evidence of ORC's impact is undeniable and widespread. Reports of violent incidents, the involvement of organized theft rings with global connections, and the resulting harm to employees, consumers, and communities underscore the seriousness of the issue.
The focus should shift from debating data inaccuracies to taking action against the visible threats posed by ORC. The evidence of increased retail theft and its repercussions demands immediate and concerted efforts to protect retail environments and uphold community safety. It is imperative to acknowledge the substantial effects of ORC and work collectively towards effective solutions rather than getting bogged down by data discrepancies. We need a proactive approach to combatting ORC, and a unified response to addressing and mitigating the risks and damages inflicted by these criminal activities.
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Target Corp. is considering launching a paid membership program, similar to Amazon Prime and Walmart+, to drive growth and stay competitive in the retail market. Internally referred to as Project Trident, this initiative could be introduced early this year, aiming to enhance customer loyalty and generate additional revenue.
Target currently offers a free loyalty program named Target Circle, which rewards customers with deals and discounts on their purchases. The proposed paid membership would expand on these benefits, potentially incorporating services like Shipt, Target's grocery delivery service acquired in 2017, for a subscription fee.
Entering the paid membership market could position Target to better compete with other retail competitors, such as Amazon and Walmart. Kroger's Boost program, started in 2022, has exceeded expectations, highlighting the potential benefits of such initiatives.
To succeed, Target will carefully consider the perks and benefits of its membership program as consumers evaluate the value of multiple retail subscriptions. Offering unique advantages, such as savings on gas or exclusive deals, could be vital to attracting and retaining subscribers in this competitive landscape.
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Shein, a leading Singapore-based e-commerce and fast-fashion brand, is set to open a new office in downtown Bellevue, strengthening its U.S. operations. The 10,000-square-foot facility at Key Center will focus on U.S. fulfillment and logistics, aiming to improve delivery times for American consumers. This move is part of Shein's broader strategy to expand its presence in the U.S. market amidst plans to potentially go public on a U.S. stock exchange.
The company, known for its affordable, trendy apparel targeting younger demographics, operates primarily online but has also launched pop-up stores. Shein plans to staff the Bellevue office with 50 employees by year's end, contributing to its U.S. workforce of over 1,500. Andy Huang, Shein's head of U.S. fulfillment and logistics, emphasized the expansion's role in enhancing operational efficiency and fostering local community engagement.
Shein's U.S. network includes a central hub in Los Angeles, offices in Washington, D.C., and Philadelphia, and warehouses in Indiana and California. Internationally, it maintains significant offices in global cities such as São Paulo, Dublin, Singapore, Paris, London, and Guangzhou.
Despite its rapid growth and valuation between $45 billion and $55 billion, Shein faces scrutiny over labor practices, including allegations of forced labor, which the company denies, maintaining a zero-tolerance policy. It has pledged to invest in improving labor standards and aims to reduce supply chain carbon emissions by 25% by 2030.
Shein's Bellevue office marks a positive development for the local office market, which has seen rising vacancy rates. The arrival of Shein, along with other companies like TikTok and Pokémon expanding their Bellevue footprint, offers potential for market revitalization, according to industry experts.
Read more from The Seattle Times
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According to experts at Dell Technologies, AI is leading the way for innovation in retail in 2024. It enables retailers to improve customer and employee experiences and optimize their operations. Dell Technologies and its partners are helping retailers achieve these goals by providing solutions that accelerate innovation and create long-term value.
AI is a key factor for success in retail. Michael Dell recently shared his vision of the superpowers AI will give to organizations. He said, “If you’re not applying AI across your organization and thinking deeply about reinvention, you’re already behind.” Retailers have been using AI for years. For example, to enhance computer vision, to streamline supply chains, or to suggest products to customers. New capabilities like Generative AI can also help with customer experience, as well as with internal operations, marketing initiatives, or customer support and engagement. Data Management is essential, and retailers must have a strategy to access data from different systems.
At NRF 2024, Dell Technologies hosted a “Big Idea” session focused on the responsible use of AI in retail. Traditional forms of AI are important to provide insights that can be used across broader applications of Generative AI models. Using Computer Vision as an example, we can monitor customer traffic patterns, detect potential risks, prevent loss, and enable frictionless shopping. Combining data from computer vision with inventory can help prioritize stocking. Using digital twins can help design store layouts and simulate shopper experiences without making major changes. Generative AI can use all these data sources to help automate store management tasks and improve employee training and service response, thus enhancing shopping experiences.
AI will need the right platforms to deliver value for retailers. Retailers need a variety of technology solutions and services to support retail workloads from the front end to the back of the store and from the store to the distribution center to the corporate. They need the flexibility to deploy retail capabilities their way, from the edge to the cloud.
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Unannounced safety inspections are rising at the rate of a 10% increase per year, according to data the WR Safety Team gathered from national inspection data. We expect the trend in 2024 to be no different. Inspections can be triggered for different reasons, such as a complaint from a current or former employee or a customer or following a significant accident at your store location.
- It is imperative to maintain key items and have them readily available for inspectors that may drop by without notice. Items inspectors routinely request include:
- Accident Prevention Program
- Accident logs (OSHA 300 Form)
- Safety Meeting Minutes for the last 12 months
- Training records (First Aid, Forklift, specific tool operation, etc.)
- Any accident investigation reports
- Automobile lift inspection records (for automotive businesses)
When an inspection is complaint-driven, inspectors often request additional documents such as Job Hazard Analysis, Hazardous Chemical Plan, and Shop Safety Walks checklists.
If these documents are not readily available, the inspection might expand to include other topics that may result in additional citations and fines. Please use this checklist to assist safety inspection readiness.
Need help with improving your safety program? Check out our free Safety Ambassador Program, where we can help your safety programs to go from compliance toward quality safety practices. Contact us at safety@waretailservices.com to learn more.
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WR is committed to the principles of justice, equity, diversity, and inclusion. We strive to create a safe, welcoming environment in which these principles can thrive.
We value all people regardless of race, ethnicity, gender, religion, age, identity, sexual orientation, nationality, or disability, and that is the foundation of our commitment to those we serve.
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Renée Sunde, President/CEO — 360.200.6450 — Email
Mark Johnson, Sr. VP of Policy & Government Affairs — 360.943.0667 — Email
Crystal Leatherman, State & Local GA Manager — 360.200-6453 — Email
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