[Congressional Record Volume 163, Number 58 (Tuesday, April 4, 2017)]
[House]
[Pages H2641-H2647]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
PROVIDING FOR CONSIDERATION OF H.R. 1343, ENCOURAGING EMPLOYEE
OWNERSHIP ACT of 2017
Mr. BUCK. Mr. Speaker, by direction of the Committee on Rules, I call
up House Resolution 240 and ask for its immediate consideration.
The Clerk read the resolution, as follows:
H. Res. 240
Resolved, That upon adoption of this resolution it shall be
in order to consider in the House the bill (H.R. 1343) to
direct the Securities and Exchange Commission to revise its
rules so as to increase the threshold amount for requiring
issuers to provide certain disclosures relating to
compensatory benefit plans. All points of order against
consideration of the bill are waived. An amendment in the
nature of a substitute consisting of the text of Rules
Committee Print 115-11 shall be considered as adopted. The
bill, as amended, shall be considered as read. All points of
order against provisions in the bill, as amended, are waived.
The previous question shall be considered as ordered on the
bill, as amended, and on any further amendment thereto, to
final passage without intervening motion except: (1) one hour
of debate equally divided and controlled by the chair and
ranking minority member of the Committee on Financial
Services; (2) the further amendment printed in the report of
the Committee on Rules accompanying this resolution, if
offered by the Member designated in the report, which shall
be in order without intervention of any point of order, shall
be considered as read, shall be separately debatable for the
time specified in the report equally divided and controlled
by the proponent and an opponent, and shall not be subject to
a demand for a division of the question; and (3) one motion
to recommit with or without instructions.
The SPEAKER pro tempore. The gentleman from Colorado is recognized
for 1 hour.
Mr. BUCK. Mr. Speaker, for the purpose of debate only, I yield the
customary 30 minutes to the gentleman from Colorado (Mr. Polis),
pending which I yield myself such time as I may consume. During
consideration of this resolution, all time yielded is for the purpose
of debate only.
General Leave
Mr. BUCK. Mr. Speaker, I ask unanimous consent that all Members have
5 legislative days to revise and extend their remarks.
The SPEAKER pro tempore. Is there objection to the request of the
gentleman from Colorado?
There was no objection.
Mr. BUCK. Mr. Speaker, I rise today in support of the rule and the
underlying legislation. Americans have always been a people known for
taking ownership. We take ownership of our lives and livelihoods,
working hard to provide for our families. We take ownership in our
communities, setting standards of conduct. We take ownership in all our
political process, voting for the right candidates. We have even taken
ownership in our world, fighting evil actors and regimes to maintain
peace.
{time} 1230
H.R. 1343, the bill we are discussing today, allows employees to take
ownership in their companies. This is the American way.
Under SEC rule 701, private companies can offer their own securities
to employees, enabling those employees to take a stake in the company.
This is a great deal for both businessowners and employees. I doubt
either side of the aisle would disagree.
Rule 701 allows employers to better recruit talented employees and
pay them without having to borrow money or sell securities. For some
companies, especially younger ones, compensating employees through
equity is vital for survival.
These younger companies need the top talent but often can't pay the
top salaries. Rule 701 allows them to offer potential recruits a
tradeoff: accept a lower salary now for more equity in the company
later.
By giving the employees a stake in the company, businessowners reward
the employees for their continued hard
[[Page H2642]]
work and innovation. Workers have an opportunity to buy into the
mission and future of the company. They have the opportunity to reap
what they sow, making their work more meaningful and fulfilling.
Mr. Speaker, H.R. 1343 simply raises the reporting threshold for
companies who issue securities to their employees as compensatory
benefits. Right now, any company that issues more than $5 million of
securities in a yearlong period faces significant reporting
requirements, including financial statements and disclosure of risk
factors. These requirements cost small businesses time and money,
making them less likely to issue stock as compensation for their
employees. That is why this legislation moves the threshold up to $10
million.
The original $5 million threshold was added to rule 701 in 1999 and
hasn't been updated since. By easing the threshold and indexing it to
inflation every 5 years, we allow companies to increase the amount of
stock they offer to employees. Additionally, raising the threshold will
prevent private companies from having to disclose confidential
financial information.
America is known for taking ownership, but we are also known for
innovation. Our technology industry, especially, has propelled our
economy and quality of life forward. But so many great tech companies
started as small startups, struggling along from month to month before
the financial rewards of their hard work could be achieved.
Thinking about the young companies right now that have grand
innovative visions for improving our quality of life, this legislation
will help them thrive. The employees already pour so much of their
livelihoods into the venture. This bill will reward those workers with
equity so that their perseverance and investment will pay off.
Mr. Speaker, before I close, I would like to discuss the broad
support for this bill. I indicated earlier that both sides of the aisle
can support this legislation, and I want to highlight that bipartisan
support for the bill.
H.R. 1343 has equal numbers of Republican and Democratic sponsors.
Further, the bill passed out of the Financial Services Committee 48-11.
A majority of the Democrats on the committee supported the bill. A
similar bill passed with a bipartisan vote last Congress, with more
than two dozen Democrats joining Republicans to pass the bill. And in
the Senate, this same basic proposal passed the Senate Banking
Committee by a voice vote just a few weeks ago.
Mr. Speaker, it is clear to see why this proposal is generating so
much bipartisan support. With a higher threshold, companies can focus
their time on innovating and creating jobs instead of filling out
paperwork. Employees, meanwhile, can take a stake in their company and
their own future. I urge my colleagues to vote for this important rule
and the underlying legislation.
Mr. Speaker, I reserve the balance of my time.
Mr. POLIS. Mr. Speaker, I thank the gentleman for yielding me the
customary 30 minutes, and I yield myself such time as I may consume.
Mr. Speaker, I rise in opposition to the rule, one that provides for
consideration of H.R. 1343, the Encouraging Employee Ownership Act.
I strongly support the underlying legislation. I wish it had been
brought forward to the floor under an open rule that allowed Democrats
and Republicans to freely offer amendments that could be adopted by a
simple majority vote.
Before we get to the specifics of the bill, I want to talk about the
importance of employee ownership. I join my friend and colleague from
my neighboring district in Colorado in extolling the virtues of
employee stock ownership, of ensuring that employees in the company are
stakeholders and able to benefit from the value that is being created.
You know, we have different stakeholders in our economy, and when you
look at a company, you have different stakeholders that that company is
responsible to and caters to: You have the shareholders, you have the
employees, and you have the customers. In running a company, as I have
done, it is always a constant balancing act to make sure that you are
able to satisfy the legitimate demands of all those various
stakeholders.
Now, one of the things that has been out of whack in our economy the
last few decades is that a disproportionate share of the value creation
has gone to the shareholders and the customers, often to the detriment
of the employees.
Now, everybody has benefited as consumers and as customers with
revolutions in prices and consumer technology. It is so exciting to see
people, you know, where a flat screen television used to be out of
reach, you now see them in nearly every home; and, in many cases, they
cost less than a television would have cost that was significantly
smaller 10 years ago--not to mention the remarkable mobile computing
devices that middle class families and working families carry in their
pockets with them that contains more processing power than a $3,000
computer did just a decade ago.
Consumers have benefited and shareholders have benefited. There has
been an unprecedented increase in private equity markets, in stocks, a
huge amount of value creation in the American economy, both on the
balance sheet as well as in the market valuation of companies.
Now, the issue is that, while all of this has happened, wages have
largely stagnated. A lot of the increases in efficiency and economic
growth have gone to benefit consumers and shareholders. Employees and
workers have felt, legitimately so, that they haven't seen their share
of value creation.
Now, there are a number of reasons for that. One of those has been
the weakening of the union movement that gave workers a collective
voice. But if you look at what some of the remedies are, really none
can make a bigger impact than employee stock ownership. This bill
doesn't change the ball on that. It is a positive step.
There are a lot of other ideas that I hope we can talk about in a
bipartisan way. Fundamentally, we need to create an economy that works
for everyone, one in which employees and workers can directly benefit
from the increase in value of the firm that they helped create. And
what better way to do that than employee stock ownership in a variety
of models and options for that. This bill deals with one; but we have
ESOPs, we have co-ops, we have employee stock option plans, to name a
few.
Companies find that it is in their interest to help improve morale
and maintain a stable employee base to align the incentives of
employees with shareholders and, of course, to help align the success
of our economy with the success of all the stakeholders in our economy.
H.R. 1343 is a bipartisan bill. It was passed last year; it will pass
again overwhelmingly this year. It sends a strong statement that
Democrats and Republicans in the House of Representatives want to make
employee stock ownership easier. Hopefully, this is a starting point
rather than an ending point.
The two other bills the Chamber is considering are also bipartisan,
and I am hopeful that they can move forward expeditiously.
Now, that stands in stark contrast to some of the other actions of
this Chamber, for instance, the 15 Congressional Review Act resolutions
which simply sought to undo some of the positive steps that President
Obama took rather than put forward a proactive agenda of where
Republicans actually want to lead the Nation.
We also spent countless hours debating healthcare legislation that,
thankfully, didn't go anywhere because it would have left 24 million
Americans without health insurance and increased premiums by 15 to 20
percent for those who were lucky enough not to lose their insurance
altogether.
I am glad that we have been able to move past that towards a more
bipartisan discussion here that will fundamentally help American
innovators and entrepreneurs and help lead to a fair economy that works
better for everybody, that shows that Democrats and Republicans can
work together to create a real solution that addresses a real problem
and takes a first step towards creating an economy that works for
workers, consumers, and shareholders.
I am hopeful that we can continue this trend after the district work
period and move forward on bipartisan legislation that will simplify
our complex Tax Code and realign incentives in
[[Page H2643]]
a positive way, fix our broken immigration system, and make sure that
we have the infrastructure we need for our country to succeed in the
21st century. I hope that my colleagues are encouraged by the strong
bipartisan show of support for H.R. 1343 and we can work together to
bring more bipartisan legislation to the floor instead of divisive
bills that make problems even larger.
This bill, very simply, updates an SEC rule from 1999 that will allow
private companies to offer employees a greater stake in the place they
work without requiring additional paperwork or regulation--a simple and
good idea.
Currently, a private company that offers over $5 million in
securities through compensation for employees is required to provide
additional disclosures which can, A, often serve as a detriment to
going over the $5 million in compensatory stock for their employees,
and, B, take up costs, administrative overhead, should they choose to
proceed. H.R. 1343 simply raises that threshold from $5 million to $10
million, and this legislation gives a private company more flexibility
to reward and retain employees of all levels.
Employee ownership of various structures has benefits to both the
company, the employees, and the overall economy. It helps align the
interests. It results in more productivity, higher employee retention.
It can help make a business more profitable and more sustainable. It
helps make the American economy and the amazing value that is created
work for everybody rather than just one of the stakeholder groups.
For many startups and small businesses, giving employees a stake in
the business is a great way to provide an additional benefit, an
incentive. It gives companies flexibility to attract new employees when
they are starting up, to retain talent as a company grows and matures.
Providing workers stakes in their company helps strengthen their
retirement savings. Employee stock ownership plans, or ESOPs, are a
type of retirement plan that offers employees an ownership stake
without upfront costs. In Colorado, there are 118 businesses that use
employee-owned ESOPs as a way to promote employee ownership.
A good example of an ESOP is Fire Safety Services. The owner, Jeff,
wanted to offer his employees a stake in the business. He converted his
business to an ESOP, an employee-owned company, that allowed him to
create a succession plan so the business can stay locally owned by the
people who worked to create the value. Jeff noted that, after the
conversion, employee morale was up and sales were up.
One of our most famous examples of employee-owned companies is in my
district in Fort Collins, Colorado: New Belgium Brewing. From the
perspective of the employees, New Belgium has a very strong corporate
culture of personal and collective growth. The employee owners are
concerned about their own professional development and that of their
colleagues. They have a vested stake in the management, economic
health, and stability of the company.
This bill is a commonsense approach and makes it easier for companies
to give their employees ownership opportunities. It is a small first
step towards encouraging an economy that works for everybody.
Now, I want to make sure that this legislation helps employees at all
income levels have access to ownership opportunities and that workers'
retirement savings are not put in jeopardy by an overconcentration in
company stock. That is why I offered an amendment requiring GAO to do a
study on the impact of this legislation on employee participation and
ownership and the effect this legislation has on securities held by
retirement plans that are governed by ERISA.
I very much look forward and am grateful that the rule has made in
order my amendment. This study will give us important information on
how these changes impacting employee ownership also affect retirement.
It will give this body information that we need to move forward.
The example of my amendment is an example of the many great ideas
that Democrats and Republicans could have brought forward had this been
brought forward under an open rule. What better bill to bring forward
under an open rule than this kind of bipartisan bill where there is
nobody in this body who is trying to undermine or sabotage this bill?
There may be some Members who vote against it on both sides, I don't
know, but the overwhelming majority are for it. I think there are
Democrats and Republicans with great ideas who would love the
opportunity to take 10 or 15 minutes--10 minutes as I am afforded under
this rule. How many other Republicans and Democrats would love that
same opportunity to offer amendments to improve this bill to make it
even better?
The good news is employee ownership is not a partisan issue. Employee
ownership strengthens our economy, helps small and medium-sized and
large businesses across our entire economic spectrum create and retain
jobs, and promotes an increased retirement savings for the middle
class. These companies are often anchor businesses in our communities
that go beyond offering jobs but are involved with sponsoring Little
League or being involved with community nonprofits by giving back, by
helping local charities and helping support an ecosystem of
entrepreneurship by helping other entrepreneurs get off the ground
through mentorship networks and angel funding networks.
I am a strong supporter of this bill and, of course, want to point
out that it is simply a starting place. We have a long way to go with
encouraging employee ownership in all of its forms--ESOPs, co-ops,
stock options, outright stock grants--and any other ways that we can
come up with or that the private sector can come up with that allow a
stake in the company and in the value being created to reside with the
employees, aligning their incentive, making our economy work for
everybody, and ensuring that stakeholders have balanced benefits from
our overall growth.
I support this bill. I wish it had been brought to the floor under an
open rule. I oppose the rule.
Mr. Speaker, I reserve the balance of my time.
{time} 1245
Mr. BUCK. Mr. Speaker, I just want to respond briefly to my friend
from Colorado's comments about the nature of the rule. The Rules
Committee did make in order every single germane rule that was offered
to this bill.
Mr. Speaker, I yield such time as he may consume to the gentleman
from Illinois (Mr. Hultgren).
Mr. HULTGREN. Mr. Speaker, I want to thank my friends, colleagues
from Colorado for their work on this, for their support of this
important legislation.
I rise today to speak in support of the rule providing for
consideration of H.R. 1343, the Encouraging Employee Ownership Act of
2017. I am proud to be a sponsor of this legislation, and I am grateful
for the consideration it has been given by the House, and I am
encouraged by its strong record of bipartisan support. The bill has
passed the House in prior Congresses as part of larger capital markets
packages, but this is the first time the legislation will be considered
on its own.
We have had very constructive debate on the bill in the Financial
Services Committee over the last few years. This debate has allowed us
to build a strong consensus around this uniting principle: What is good
for the company should also be good for the employee, and vice versa.
We want it to be easy for companies to offer stock compensation to
their employees. This is a company issue, and this is a jobs issue, but
this is also a workforce issue. The title of this legislation does not
betray its intent. We believe encouraging employee ownership is
important.
Agreement on the benefits of employee ownership has contributed to
the strong bipartisan support enjoyed by this legislation. It has three
Republican and three Democratic original cosponsors. Furthermore, the
majority of Republicans and Democrats voted in favor of the Encouraging
Employee Ownership Act when it was considered in the House Financial
Services Committee just last month. We are simply expanding on
something that is working.
The Securities and Exchange Commission, the investor protection
regulator, has never raised issue with reduced disclosures available
under rule 701, so we are simply saying this tool
[[Page H2644]]
should be made available to more companies and to their employees. We
do this by adjusting for inflation the threshold for the amount of
securities that can be issued each year under rule 701.
Again, I want to thank my colleagues from Colorado. I want to thank
all for the work in the Financial Services Committee, and I look
forward to the House's consideration and, hopefully, passage of this
important legislation.
Mr. POLIS. Mr. Speaker, I yield myself such time as I may consume.
You know, the beauty of an open rule, which we did see when the
Democrats had the majority and we have not seen since the Republicans
took the majority, is it allows the floor debate to inspire good ideas.
It allows Democrats and Republicans to bring forward amendments,
subject to germaneness, that can be considered and voted upon.
Frankly, it seems like the Republicans didn't have much for us to do
this week. This would have been a perfect week to try an open rule; and
I know that Democrats and Republicans would have, consistent with the
spirit of an open rule, brought forth good ideas and offered them. Good
ideas would have been included in the bill.
But most importantly, we could have set a precedent that open rules
work and an open process that values our contributions as legislators
and as representatives of 750,000 Americans who would be able to work
to improve legislation. So I think that we need to move in that
direction. Let the debate on the floor and the back-and-forth inspire
new collaboration between Democrats and Republicans, new ideas, new
ways of working together.
Here you have a concept that Democrats and Republicans join together
in support of. How can we reduce the costs or the red tape around
administering employee ownership? We would love to remove barriers to
employee ownership that exist across all forms of employee ownership.
We would love to see an economy that works for everybody, one that
values employees and workers as stakeholders that share in the economic
growth that they helped create. That is a big part of the answer to the
discrepancies in our economy and the simple fact--yes, fact--that the
majority of the benefit of our economic growth has resided with a few
and, generally, with shareholders and executives rather than workers.
So at the same time we can continue to move forward with conveying
value to consumers, I think we can also find a way to make sure that
workers are able to participate in the value that is created in our
economy. But to be able to do so, we should have an open process that
allows Democrats and Republicans to bring forward germane amendments
that improve the bill, to create an even better and more comprehensive
effort to encourage employee ownership.
Employee ownership ultimately touches a number of different
committees. There are issues around employee ownership that affect
government procurement. There are issues that would reside in the Ways
and Means Committee under taxes. There are issues that reside in the
Judiciary Committee, and, yes, Financial Services and regulator issues
as well.
I am hopeful that Democrats and Republicans can work together to
create a comprehensive omnibus approach to improving access to employee
ownership for firms across our country.
Mr. Speaker, I reserve the balance of my time.
Mr. BUCK. Mr. Speaker, I yield 4 minutes to the gentleman from
Michigan (Mr. Huizenga).
Mr. HUIZENGA. Mr. Speaker, small businesses and entrepreneurs are
what drive the American economy. I meet with these folks all the time
when I am back home in the Second District, as I know my colleagues do
when they are back in their districts, and we see firsthand the
benefits that these people's dreams, their innovations, their hard
work, and as they provide to our communities that inspiration.
These innovators, entrepreneurs, and risk-takers are critical to our
country's economic growth and prosperity. In fact, small businesses are
responsible for more than 60 percent of all of the net new jobs. Let me
repeat that. Small businesses are responsible for more than 60 percent
of all the net new jobs over the past two decades. This isn't just a
one-time blip. This is over the last two decades.
So if our Nation is going to have an economy that provides
opportunities for every American, then we must promote and encourage
success and growth for our small businesses, our startups, and our
entrepreneurs. It is this notion that I think brings us to this
legislation we are discussing here today.
H.R. 1343, the Encouraging Employee Ownership Act, would simply level
the playing field for small companies by updating Federal rules that
allow small businesses to better compensate their employees with
ownership in those businesses.
Currently, the SEC rule 701 permits private companies to offer their
own securities as part of written compensation agreements with
employees, directors, general partners, trustees, officers, or other
certain consultants without having to comply with rigid Federal
securities registration requirements. The SEC rule 701, therefore,
allows small companies to reward their employees.
Despite the SEC having the authority to increase the $5 million
threshold via a rulemaking, the SEC has once again chosen to prioritize
what, I would argue, are highly politicized regulatory undertakings
instead of focusing on its core mission, which includes the
facilitation of capital formation. That is one of the key core jobs of
the Securities and Exchange Commission. Well, if the SEC isn't going to
focus its priorities, then Congress will help them do that. So that is
why we are here today on this bill.
I believe it is imperative that small businesses not only in West
Michigan, but across America, have the ability to compete. A critical
element of competition and success is, first, that small businesses be
able to offer compensation packages that attract and retain top-tier
talent in their fields. In today's world, that includes rewarding
employees with stock options. To me, this is common sense. Small-
business employees have a clear and vested interest in the success of
their employers, and oftentimes they are attracted to it.
I know, having some younger children myself that are coming into
adulthood, they are looking for that excitement. They are looking for
that opportunity. They are looking to be builders themselves.
Well, by increasing the rule 701 threshold to $10 million, it will
give these private companies more flexibility to attract, reward, and
retain those employees. This simple change would allow companies to
offer twice as much stock to their employees annually without having to
trigger additional disclosure information to investors about those
compensation packages that include securities offerings.
By reforming this regulatory burden, Mr. Speaker, startups, small
businesses, and emerging growth companies will be better equipped to
attract highly talented individuals from companies that are better
capitalized and able to provide cash compensation. By incentivizing
employees with stock options, small businesses will now be able to
compete on a more level playing field in order to retain those valuable
employees rather than seeing them flee to cash, frankly.
This bill is an example, I believe, of positive, bipartisan results
that can be achieved when Republicans and Democrats reach across the
aisle. I commend our sponsors of the bills, Representative Hultgren,
who spoke a little earlier; Representatives Delaney, Higgins,
MacArthur, Sinema, and Stivers, for their leadership on this issue; and
my friend from Colorado, as well, and what he is doing.
I encourage all my colleagues to support this rule and the underlying
bill.
Mr. POLIS. Mr. Speaker, I yield myself such time as I may consume.
Mr. Speaker, I have had the opportunity to convene several
roundtables in my district featuring employee-owned businesses, and it
has been great to hear their stories, whether it is New Belgium
Brewing, talking to employee owners who are excited to spend their time
building value for themselves and creating stability in their own job
and bringing a wonderful craft brew product to people in all the States
in which they distribute, or medical care companies and so many others
that have different variations of employee ownership.
[[Page H2645]]
As a private sector entrepreneur before I came to Congress, I founded
several companies in the technology sector. My companies used stock
options for every employee, ranging from entry-level front desk and
telephone all the way to executive positions; and, frankly, Mr.
Speaker, that has become the standard in the tech industry.
So many venture-backed companies and technology companies provide
stock options across the board such that people who participate in
building that value are able to also participate in sharing the value
that is created. That is one of the great aspects of the technology
sector, in particular, and the startup sector that I hope can export to
other sectors.
On the margins, this bill will make it a little bit easier for small
and mid-sized companies to provide equity compensation to employees.
But again, we need to do a lot more. We need to do a lot more
culturally to make this the norm. We need to do a lot more from a tax
perspective and from a regulatory perspective to make it easier for
companies to share ownership with employees so that employees can
benefit from the value that is being created.
It is considered the cultural norm and the best practice within the
technology entrepreneurship sector, and I hope that that can carry
across to other sectors as well. It is very important to have an
economy that works for everybody, and employee ownership is a critical
linchpin of that effort.
Mr. Speaker, we are debating on a rule and a bill that makes it
easier for companies to offer employee stock as part of their
compensation; but, unfortunately, the backdrop to this discussion is
that there continues to be an enduring wage gap in which women are
simply not paid the same as men for doing the same job. Any efforts by
us to strengthen compensation packages continue to remain hollow for 51
percent of the country--women.
Today is Equal Pay Day. I wish you, Mr. Speaker, a happy Equal Pay
Day, and it is time that we do something to address pay and equity in
our country.
If we defeat the previous question, I will offer an amendment to the
rule to bring up Representative DeLauro's Paycheck Fairness Act in
addition to the legislation we have been debating, H.R. 1343. So what
that means is I will still bring forward this legislation. I will just
also bring forward the Paycheck Fairness Act, which I am a proud
cosponsor of.
Sometimes when we move the previous question, we bring forward a
piece of legislation in lieu of the legislation that we bring to the
floor under the rule. In this case, once we defeat the previous
question, I will offer both of those bills: this employee stock
ownership bill and the bill to address paycheck inequity, the Paycheck
Fairness Act.
Mr. Speaker, I ask unanimous consent to insert the text of my
amendment in the Record, along with extraneous material, immediately
prior to the vote on the previous question.
The SPEAKER pro tempore. Is there objection to the request of the
gentleman from Colorado?
There was no objection.
Mr. POLIS. Mr. Speaker, the gentlewoman from Connecticut (Ms.
DeLauro) may be joining us on the floor in a few minutes to talk about
her proposal.
I have an article written by Ms. DeLauro that I include in the
Record.
[From Cosmopolitan, Apr. 4, 2017]
We Will Win the Fight for Equal Pay
(By Rosa DeLauro)
Think about 20 cents. It doesn't feel very significant--
there isn't much you could buy with it. But over a lifetime,
those 20 cents add up in a major way.
Today, we have reached yet another Equal Pay Day--the day
on which the average woman's earnings finally catch up to
what the average man made last year. This year's Equal Pay
Day falls 94 days into 2017--94 days too late.
Women are nearly half the workforce--yet they still only
earn about 80 cents on average, to a man's dollar. The gap
widens even further when you consider women of color--
African-American women make 63 cents on the dollar, while
Latinas make only 54 cents on average, compared with what
white men earn. This is unacceptable.
The National Women's Law Center found that based on today's
wage gap, a woman starting her career now will lose $418,800
over a 40-vear career. For African-Americans, the losses are
$840,040. And for Latinas, the lifetime gap is over $1
million.
These disparities exist at all levels of education and
occupation--even at the very top. The world champion U.S.
women's soccer team is fighting for pay equality, as are
Academy-Award winning actresses from Emma Stone to Viola
Davis and Patricia Arquette, who have used their platforms to
call for equal pay in Hollywood.
Men and women in the same job should have the same pay.
Period. Wage discrimination takes place not just on the
soccer field or the silver screen, but in the board room, on
the factory floor, and in countless other workplaces across
the country. That is why I am fighting for equal pay--for all
women.
I am fighting for AnnMarie in Massachusetts, who found out,
years into her job, that the university she worked for was
paying men more for the same work. I am fighting for Terri in
Tennessee, who only discovered she was making less than she
deserved because her husband held the exact same job and was
paid more! And I am fighting for ReShonda in Iowa, who
discovered that her own father was paying women less when she
went to work in the family business. Pay discrimination in
the workplace is real--and it is happening everywhere.
Pay inequity does not just affect women--it affects
children, families, and our economy as a whole. That is
because women in this country are the sole or co-breadwinner
in half of families with children. The biggest problem facing
our country today is that families are not making enough to
live on--and closing the wage gap would help address that
problem.
Over 50 years ago, Congress came together--in a bipartisan
fashion--to pass the Equal Pay Act and end what President
John F. Kennedy called ``the serious and endemic problem'' of
unequal wages. The Equal Pay Act made it illegal for
employers to pay men and women differently for substantially
equal work. Yet we still have so far to go to close the wage
gap.
In 2009, we took a critical step forward with the passage
of the Lilly Ledbetter Fair Pay Act, which kept the
courthouse door open to sue for pay discrimination. But we
must continue the fight and finish the job by passing into
law the Paycheck Fairness Act.
I first introduced the Paycheck Fairness Act on June 24,
1997--almost 20 years ago. The Paycheck Fairness Act will
mean real progress in the fight to eliminate the gender wage
gap and help families. The act ensures that employers who try
to justify paying a man more than a woman for the same job
must show the disparity is not sex-based, but job-related and
necessary. It prohibits employers from retaliating against
employees who discuss or disclose salary information with
their coworkers. The bill would also allow women to join
together in class-action lawsuits where there are allegations
of sex-based pay discrimination.
The bill actually passed the House twice, with bipartisan
support. Yet it has never made it to the president's desk--
despite the fact that this is an issue that affects every
single state in this country. In the last session of
Congress, I was proud to have every single Democratic member
of Congress signed onto the Paycheck Fairness Act--and even
one Republican!
But we need to keep fighting. When women raise their
voices, we get results. Take the recent victory for the U.S.
women's national hockey team who were able to negotiate a
historic new contract to address pay inequality. They spoke
up--even threatening to boycott the International Ice Hockey
Federation World Championship games--and their voices were
heard.
In January, I attended the Wonnen's March in Washington.
The organic energy--the real, tangible power of the people--
was unlike anything I have ever seen. It was a stark reminder
of what we can achieve together, when we speak with one voice
and demand what we deserve.
When I looked out at the sea of pink hats and powerful,
handmade signs, I thought of my mother. When she was born,
women could not even vote. Yet today, her daughter is a
congresswoman. When we fight for equal pay for equal work, we
carry on the legacy of all the women who have fought before
us. And when we finally succeed, we will create a better
future for all the women who will follow us.
Equal pay is an idea whose time has come--in fact, it is
long overdue. But we have the power. We have the momentum.
And I believe that we will win.
Mr. POLIS. Mr. Speaker, Congresswoman DeLauro's article from
Cosmopolitan magazine, dated April 4, 2017, today, talks about how,
over a lifetime, the 20 cents that women are missing every paycheck on
a dollar earned by men adds up. In fact, the National Women's Law
Center found that a woman starting her career now will lose over
$400,000 over a 40-year career. That could be a house. That could be
college for two kids or three kids. That could be a family vacation
every year. That means a lot, which is why we need to defeat the
previous question and move forward on both of these worthy bills.
Mr. Speaker, I reserve the balance of my time.
{time} 1300
Mr. BUCK. Mr. Speaker, I have no other speakers, and I reserve the
balance of my time.
Mr. POLIS. Mr. Speaker, I yield myself such time as I may consume,
and
[[Page H2646]]
say to the gentleman that I do have one other speaker on the way.
Mr. Speaker, this bill under consideration is a small but significant
step to help companies increase worker ownership to help improve the
overall equity of our economy. I hope that this bill, along with the
other two coming to the floor later this week, are the start of
something. I hope they are a sign that this body will actually consider
meaningful, bipartisan, practical, and commonsense legislation to
address the issues the American people sent us to Washington to fix:
creating jobs, growing our economy, reforming our Tax Code, and fixing
our broken immigration system.
I hope my colleagues support the underlying legislation, H.R. 1343,
oppose the rule, and defeat the previous question so I can bring
forward not only the employee stock ownership rule, but also the
Paycheck Fairness Act here on Equal Pay Day across America so that we
can make sure as we are talking about making sure that women receive
the same cash and ownership in recognition of their efforts as
employees across the country.
This bill will hopefully pass overwhelmingly. I just wish it could be
an example of how we could work under an open rule and give Democrats
and Republicans a chance to build upon and improve legislation. There
have been zero open rules under Speaker Ryan since he has taken over
the Speaker's gavel promising, ironically, a more open process. It is
about time.
If not this bill, what bill, Mr. Speaker? If not a bill with strong
bipartisan support that Democratic and Republican leaders are committed
to bringing across the finish line, when can we have an open process
that allows us as legislators to bring forward our amendments in
response to debate on the floor in realtime?
I wish that this would have been that bill. And I hope that by
defeating this rule, we can send a message back to the Rules Committee
that we should consider open rules for these kinds of bipartisan
legislation.
Promoting employee stock ownership is incredibly important. To have a
multistakeholder economy that works for everybody will help address a
lot of the legitimate concerns that Americans have, that workers and
employees have not shared, and the great amount of value that has been
created.
Mr. Speaker, I yield 4 minutes to the distinguished gentlewoman from
Connecticut (Ms. DeLauro) to further discuss our proposal on the
previous question on Equal Pay Day and the Paycheck Fairness Act.
Ms. DeLAURO. Mr. Speaker, I rise in strong opposition to the previous
question and to the rule. If we defeat this rule, we can enable the
House of Representatives to vote on the Paycheck Fairness Act.
Today is Equal Pay Day. This is the day that the average woman's
earnings finally catch up to what the average man made last year--and
we are 94 days into 2017.
Women are nearly half the workforce, yet they still only earn about
80 cents, on average, to a man's dollar. The gap widens even further
when you consider women of color. African-American women make 63 cents
on the dollar, while Latinas make only 54 cents, on average, compared
with White men.
This is unacceptable. The National Women's Law Center found that,
based on today's wage gap, a woman starting her career will lose
$418,800 over a 40-year career. For African-American women, the losses
are $840,000. For Latinas, the lifetime gap is over $1 million.
This disparity, by the way, exists at all levels of education and
occupation--even at the very top. The world champion U.S. women's
soccer team is fighting for pay equity, as are Academy Award-winning
actresses like Emma Stone and Viola Davis, who have used their
platforms to call for equal pay in Hollywood. The fact that women at
the top of their field feel the repercussions of this issue speaks to
its pervasiveness. Women from the boardroom to the factory floor and in
every industry in every State are hurt by the wage gap.
The biggest issue of our time is that people are not making enough to
live on, and their jobs just don't pay them enough money. Pay inequity
does not just affect women; it affects children, families, and our
economy as a whole, and that is because women in this country are the
sole or co-breadwinner in half of families with children today.
I first introduced the Paycheck Fairness Act on June 24, 1997, almost
20 years ago. The Paycheck Fairness Act will mean real progress in the
fight to eliminate the gender wage gap and help families. The act
ensures that employers who try to justify paying a man more than a
woman for the same job must show the disparity is not sex-based but
job-related and necessary. It prohibits employers from retaliating
against employees who discuss or disclose salary information with their
coworkers. The bill would allow women to join together in class action
lawsuits where there are allegations of sex-based pay discrimination.
This bill, by the way, has passed the House of Representatives twice
in a bipartisan way. Today we have 198 cosponsors of that bill, and,
yes, it is bipartisan. We can pass this piece of legislation in this
body. We have not been able to get it to the President's desk despite
the fact that this is an issue that affects every single State in this
country.
Every year I hope we never have to recognize this day again because
equal pay will be the law of the land. Men and women in the same job
deserve the same pay. It is true in the House of Representatives; it
should be true all over this country. We are men and women in this body
who come from different parts of the country with different skill sets,
different educational backgrounds, and different philosophies, and,
yes, we get paid the same amount of money. Let's make sure that the
Paycheck Fairness Act is the law of the land. The time has come for
equal pay.
Mr. BUCK. Mr. Speaker, I reserve the balance of my time.
Mr. POLIS. Mr. Speaker, I yield myself the balance of my time.
I want to thank Ms. DeLauro for her tireless advocacy on behalf of
equal pay. I would also encourage my colleagues to join me in
cosponsoring the Equal Rights Amendment to the U.S. Constitution. It is
about time. Today, on Equal Pay Day, let's enshrine equality between
men and women into the U.S. Constitution.
If we can defeat the previous question, we will bring forward H.R.
1343, the employee stock ownership bill, but we will also bring forward
the Paycheck Fairness Act so that we can do a little more work of the
people's work here in the House of Representatives and help make sure
that we can look ourselves in the mirror knowing that men and women
will both benefit equally from a hard day's work.
Mr. Speaker, I encourage my colleagues to vote ``no'' on the rule to
defeat the previous question and to vote ``yes'' on H.R. 1343 as a
first step to encouraging an economy that works for everybody and
employee stock ownership.
Mr. Speaker, I yield back the balance of my time.
Mr. BUCK. Mr. Speaker, I yield myself the balance of my time.
Mr. Speaker, we often talk about coming together in support of good
policy. We all have friends on both sides of the aisle, and we
routinely promise to work together on issues upon which we agree. Most
of us speak in front of our constituents about our desire to work with
the other party. However, we all know that Americans perceive us to be
constantly engaged in partisan conflict.
It is unfortunate that we are not able to work together on good
legislation more often. It is understandable that Americans feel
disappointed by Washington's partisan sniping. But here before us today
is a bill with wide bipartisan support. Not only has it already
received numerous bipartisan votes, there were only two amendments
offered to the bill. One amendment was withdrawn because it was not
germane. The other amendment from my good friend from Colorado and the
Rules Committee, Mr. Polis, is simply requiring a report.
Why is this bill so noncontroversial?
I believe it has to do with the process by which we received this
legislation. The Committee on Financial Services held hearings as far
back as 2015 in which problems with the SEC rule were raised by small-
business owners.
The sponsor of this bill, Mr. Hultgren, worked with his Democratic
[[Page H2647]]
colleagues on the committee and introduced a proposal to reform the SEC
rule. Chairman Hensarling held a full committee markup last month which
allowed for full debate and amendment, and now we have the bill on the
floor this week. Good process produces good policy. But perhaps equally
as important, good process helps instill faith in this institution.
When Americans see us take up an issue, hear their concerns, and work
together to find a commonsense solution, they will trust us to tackle
even bigger problems.
This may not be the largest legislative product that Chairman
Hensarling and the Financial Services Committee produce in this
Congress, but, nevertheless, it is an important work that is helping us
solve problems faced by American small businesses. This legislation
ensures that the employees of America's small businesses can take
ownership in their companies and their jobs. It reduces regulatory
encroachment on America's job creators and helps our small businesses
expand and grow.
I thank Representative Hultgren for bringing this bill before us. I
commend Chairman Hensarling for working with both sides of the aisle
and for following a good process on this legislation.
Mr. Speaker, I urge my colleagues to vote ``yes'' on the rule and
vote ``yes'' on the bill.
The material previously referred to by Mr. Polis is as follows:
An Amendment to H. Res. 240 Offered by Mr. Polis
At the end of the resolution, add the following new
sections:
Sec. 2. Immediately upon adoption of this resolution the
Speaker shall, pursuant to clause 2(b) of rule XVIII, declare
the House resolved into the Committee of the Whole House on
the state of the Union for consideration of the bill (H.R.
1869) to amend the Fair Labor Standards Act of 1938 to
provide more effective remedies to victims of discrimination
in the payment of wages on the basis of sex, and for other
purposes. The first reading of the bill shall be dispensed
with. All points of order against consideration of the bill
are waived. General debate shall be confined to the bill and
shall not exceed one hour equally divided and controlled by
the chair and ranking minority member of the Committee on
Education and the Workforce. After general debate the bill
shall be considered for amendment under the five-minute rule.
All points of order against provisions in the bill are
waived. At the conclusion of consideration of the bill for
amendment the Committee shall rise and report the bill to the
House with such amendments as may have been adopted. The
previous question shall be considered as ordered on the bill
and amendments thereto to final passage without intervening
motion except one motion to recommit with or without
instructions. If the Committee of the Whole rises and reports
that it has come to no resolution on the bill, then on the
next legislative day the House shall, immediately after the
third daily order of business under clause 1 of rule XIV,
resolve into the Committee of the Whole for further
consideration of the bill.
Sec. 3. Clause 1(c) of rule XIX shall not apply to the
consideration of H.R. 1869.
____
The Vote on the Previous Question: What It Really Means
This vote, the vote on whether to order the previous
question on a special rule, is not merely a procedural vote.
A vote against ordering the previous question is a vote
against the Republican majority agenda and a vote to allow
the Democratic minority to offer an altemative plan. It is a
vote about what the House should be debating.
Mr. Clarence Cannon's Precedents of the House of
Representatives (VI, 308-311), describes the vote on the
previous question on the rule as ``a motion to direct or
control the consideration of the subject before the House
being made by the Member in charge.'' To defeat the previous
question is to give the opposition a chance to decide the
subject before the House. Cannon cites the Speaker's ruling
of January 13, 1920, to the effect that ``the refusal of the
House to sustain the demand for the previous question passes
the control of the resolution to the opposition'' in order to
offer an amendment. On March 15, 1909, a member of the
majority party offered a rule resolution. The House defeated
the previous question and a member of the opposition rose to
a parliamentary inquiry, asking who was entitled to
recognition. Speaker Joseph G. Cannon (R-Illinois) said:
``The previous question having been refused, the gentleman
from New York, Mr. Fitzgerald, who had asked the gentleman to
yield to him for an amendment, is entitled to the first
recognition.''
The Republican majority may say ``the vote on the previous
question is simply a vote on whether to proceed to an
immediate vote on adopting the resolution . . . [and] has no
substantive legislative or policy implications whatsoever.''
But that is not what they have always said. Listen to the
Republican Leadership Manual on the Legislative Process in
the United States House of Representatives, (6th edition,
page 135). Here's how the Republicans describe the previous
question vote in their own manual: ``Although it is generally
not possible to amend the rule because the majority Member
controlling the time will not yield for the purpose of
offering an amendment, the same result may be achieved by
voting down the previous question on the rule. . . . When the
motion for the previous question is defeated, control of the
time passes to the Member who led the opposition to ordering
the previous question. That Member, because he then controls
the time, may offer an amendment to the rule, or yield for
the purpose of amendment.''
In Deschler's Procedure in the U.S. House of
Representatives, the subchapter titled ``Amending Special
Rules'' states: ``a refusal to order the previous question on
such a rule [a special rule reported from the Committee on
Rules] opens the resolution to amendment and further
debate.'' (Chapter 21, section 21.2) Section 21.3 continues:
``Upon rejection of the motion for the previous question on a
resolution reported from the Committee on Rules, control
shifts to the Member leading the opposition to the previous
question, who may offer a proper amendment or motion and who
controls the time for debate thereon.''
Clearly, the vote on the previous question on a rule does
have substantive policy implications. It is one of the only
available tools for those who oppose the Republican
majority's agenda and allows those with altemative views the
opportunity to offer an alternative plan.
Mr. BUCK. Mr. Speaker, I yield back the balance of my time, and I
move the previous question on the resolution.
The SPEAKER pro tempore. The question is on ordering the previous
question.
The question was taken; and the Speaker pro tempore announced that
the ayes appeared to have it.
Mr. POLIS. Mr. Speaker, on that I demand the yeas and nays.
The yeas and nays were ordered.
The SPEAKER. Pursuant to clause 8 of rule XX, further proceedings on
this question will be postponed.
____________________