With President-elect Obama set to take office along with control of the U.S. Congress held by one poltical party, the professional beauty industry in can expect politics to play an increasing role in how the industry conducts business. As the “voice” of the industry, the Professional Beauty Association (PBA) aims to keep its membership of salons, spas, manufacturers and distributors actively engaged in legislative matters that will impact their businesses. Some of the key issues PBA has identified include:
New Beauty & Cosmetic Regulations: Cosmetic manufacturers that export - take note! The Food & Drug Administration (FDA) Globalization Act of 2008 will likely see more intense action in 2009. This proposed act includes mandatory registration of “any facility engaged in manufacturing, processing, packaging or holding cosmetics in the U.S. or for import” into the United States. Registration is required on an annual basis and facilities will be subject to a $2,000 registration fee. Other provisions include mandatory adverse reporting, mandatory facility inspections and an annual registration fee of $10,000 for imports. PBA is concerned that the current language is overly ambiguous and a burden on small businesses.
“Card Check” Law (Employee Free Choice Act): This law could have a significant impact on the beauty industry and many other Main Street businesses. Card Check would make it cost effective for unions to target Main Street businesses, such as beauty/nail salons, spas, restaurants and other retail establishments, which have never experienced unionization before. The law would eliminate 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 simply 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 and ultimately deprived of their right to vote in private. From large-scale beauty manufacturers to individual beauty professionals, this is a law that could have serious consequences for the beauty industry.
FICA Tax Credit for Salons/Spas: This proposed legislation has actively been supported by PBA for the last several years. The bill’s principal sponsor, Rep. Shelley Berkeley of Nevada, has retained her seat in the U.S. 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.
Credit Card “Interchange Fees”: For years, small businesses like salons and spas, restaurants and other merchants have been waging a quiet war with the credit card companies over “interchange fees” – the hidden costs of processing credit and debit card transactions that can gobble up a store’s profits while earning banks a pretty penny. With a new Congress set to take power in January, we’re likely to see the resurrection of the “Credit Card Fair Fee Act” – federal legislation that would require credit card companies with “substantial market power” to negotiate with merchants and retailers on terms for fees paid when processing card transactions. “Interchange” is a percentage of each transaction that credit card companies collect from merchants every time a credit/debit card is used to pay for a purchase. The fee varies with type of card, size of merchant and other factors, but as much as $2 of every $100 consumers spend goes to card issuers
State-by-State Cosmetology License: At the state level, PBA is working on raising awareness with state legislatures about license mobility. Salon professionals can sometimes face state regulations that limit their ability to practice their craft and conduct business when moving across state lines. License mobility allows a licensed professional in good standing – whose documentation in education and experience is substantial – to qualify for licensure from one state to another without further examination. To sign the petition and support other stylists across the nation, visit probeauty.org/licensemobility.
"In order for the entire professional beauty industry to move forward, we must have a unified voice and actively engage government officials on the issues that have an impact on our livelihoods, our employee's livelihoods and the future prosperity of the industry as a whole. I urge everyone to become active with PBA's government affairs efforts and do your part for the betterment of our industry," states Lee Rizzuto Jr, Chair of PBA's Board of Directors and Senior Vice President of Conair.
For more on PBA and other legislative matters, visit: probeauty.org/advocacy.
