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Spokane, Washington  Est. May 19, 1883

Hair stylists flood hearing on proposal to change their taxes and fees

Hair stylists opposed to a bill that would change state laws on taxes and fees fill the Senate Labor and Commerce Committee hearing room while others stand in line to testify against it in Olympia on Monday. (Jim Camden / The Spokesman-Review)

OLYMPIA – A proposal that could force independent hair stylists to become employees of salons where they rent their stations generated stiff opposition Monday, with critics saying the legislation discriminates against small businesses dominated by women and minorities.

“If you pass this bill, you will be stealing from the cosmetologists their pride, their dreams and in some cases their livelihoods,” Lucinda Marshall, the owner of a Greenacres salon that rents stations, said. Lawmakers who vote for it may claim to support women and small business “but this bill tells a very different story,” she said.

Prime sponsor Sen. Karen Keiser, D-Kent, tried to calm the more than 1,000 people who filled the main hearing room and two overflow areas, telling them the bill is just at the beginning stages. It’s subject to change and lawmakers could be “working on this issue for probably the next 10 years,” she said.

She called it an attempt to “level the playing field” for employee benefits, workers compensation and unemployment program costs, along with business and occupation tax obligations between salon owners who have employees and those who rent booths or stations to sole proprietors. A salon with employees can pay B&O taxes on their stylists’ gross receipts, but a salon that rents stations to sole proprietors would not, and neither would the stylists if their receipts are below the $56,000 per year exemption.

Before the hearing even started, a new version of the bill was announced that did away with a provision that would have ended the ability of a sole proprietor to lease a booth in a salon as part of a separate business. They would, however, be required to pay into the unemployment compensation and workers comp systems under the latest version.

Keiser acknowledged the original bill sparked outrage on social media, with threats directed at her and the salon owner who suggested it to her.

Megan White, who operates Beauty by Megz in Spokane Valley, said stylists operate within all the confines of current law, using a business model that many trades have, not just stylists.

“You can’t just target one profession under a sole proprietorship,” said White, who was representing Stylists of Spokane, which she said has more than 1,000 members. Going after cosmetologists but not other sole proprietorships is discriminating against women, the LGBT community, immigrants and single mothers – groups most likely to be in that profession, she said.

The hearing highlighted tension within the profession’s different business models. Sole proprietors said they had worked long hours and were denied benefits when they worked as employees for large salons, and decided to go on their own to have more flexible hours and spend time with their families. But salon owners said they helped new people train and build up customers, only to have them take those skills and customers when they left to be sole proprietors.

The proposal could have more changes if it comes up for a committee vote in the coming weeks.

Sen. Steve Conway, D-Tacoma, suggested the stylists from all over the state who flooded the hearing rooms take advantage of their trip to Olympia by stopping by their own legislators’ offices to let them know how they feel.