Sonoma County companies jump on employee bonus bandwagon after GOP tax cut
Companies across the country have started handing out employee bonuses in the aftermath of the $1.5 trillion tax package signed into law last month by President Donald Trump.
At Comcast and AT&T it was $1,000 per worker. North Carolina-based bank BB&T Corp. doled out $1,200 per employee. The benefit was $2,000 per worker at Express Employment Professionals, an Oklahoma City-based staffing company.
Local businesses also are jumping on the bandwagon. Summit State Bank in Santa Rosa has distributed $2,000 checks to its almost 80 employees, while Jordan Vineyard and Winery in Healdsburg gave out $1,000 bonuses to its 85 employees.
“We are a business where we rely on our employees,” said Jim Brush, president and chief executive officer of Summit State, which specializes in serving small businesses and nonprofits.
Yet as typical in these highly polarizing times, the bonuses also have triggered a larger debate on what is the best policy to help workers keep a foothold in the middle class, especially in an area that has one of the highest costs of living in the country. The average median household income in 2016 for the Santa Rosa area was $62,705, according to the Census Bureau.
While no one opposes the bonuses, the crux of the tax cut debate comes down to opposing arguments. Proponents contend the business community will invest the tax break in new equipment and increase compensation for their workers, knowing they must recruit and retain the best talent to grow their companies. This, they argue, will lead to increased consumer spending, spurring economic growth.
President Trump said the recent bonuses are evidence that companies are voluntarily rewarding their workers without new requirements being forced upon them by Washington.
“More than 60 companies have announced they are raising wages, including many that have voluntarily raised their minimum wage to $15 per hour — and I mean they did that voluntarily, which many politicians said could only be achieved by government mandate,” Trump said in a videotaped message to the White House briefing room on Thursday.
Opponents argue that trickle-down economics doesn’t work — as shown recently in Kansas — and that efforts such as an increased minimum wage, greater unionization and affordable higher education do more to help expand the middle class.
The Republican tax package was passed without any support from Democrats, who argued the tax cuts were too targeted to businesses and the wealthy while exacerbating the county’s debt because the legislation was not offset with any spending cuts.
“I’m happy to hear that some people in my district are getting bonuses and I applaud the employers who are awarding them, but we all deserved better than a hastily-written tax bill passed along party lines that adds $2.3 trillion to our national debt,” said Rep. Mike Thompson, D-St. Helena, who is a member of the Ways and Means Committee that has oversight on tax matters.
John Jordan, owner of Jordan Winery, mostly sees pluses even though the tax cut would likely have a negligible effect on his own business, which produces around 100,000 cases of wine annually.
Jordan started an effort called 1Country1K to urge fellow business owners to pledge $1,000 bonuses to each employee. He noted that if 5,000 small businesses that each have approximately 200 employees join the cause, $1 billion would be pumped into the American economy even before workers see more in their paycheck within the next two months as withholding tables change.