A product of thePennsylvania Chamber Foundation

Labor, Legal and Regulatory Climate

Several legal and regulatory reforms have long been recognized by business as helpful in spurring growth and economic activity.  In this category, Pennsylvania joins forty states that have modified or abolished the rule of “joint and several” liability.  On the other hand, the commonwealth is not among the twenty-two states that have modified the rules for awarding noneconomic damages. Nor is Pennsylvania among the 11 states that have enacted venue reform or the 25 states that have adopted “Right to Work” statutes.  Pennsylvania is among the states with the largest portion of unionization in the workforce: overall, 13% of the state’s workforce is unionized, compared to the 50-state median of 10.55%. The percentage of the Pennsylvania’s workforce that is unionized has decreased by 3.2% between 2009 and 2017, and Pennsylvania’s rank has moved up from 35th in 2012 to 32nd in 2017.

Pennsylvania tends to be among the more expensive states for both Unemployment Compensation and for Workers’ Compensation. As a function of pay, Pennsylvania is among the ten most-expensive states, ranking 47th for the cost of Unemployment Compensation (UC) relative to wages, where the 1st ranked state has the lowest UC cost and the 50th state has the highest UC cost. UC costs are high, but the commonwealth’s rate for Workers’ Compensation has dropped from $2.32 per $100 of payroll in 2009 to $1.84 in 2016. This has led to an improvement in Pennsylvania’s rank for cost of Workers’ Compensation from 37th in 2009 to 25th in 2016.

  2009 to Most Recent Change Most Recent PA Score Most Recent Median Score Most Recent PA Rank 2009 to Most Recent Change in Rank
Minimum Wage $0.10 $7.25 $8.48 1 +26
Right to Work States N/A No 27 states have N/A N/A
Percent of Employed Represented by Unions 2.80% 13.40% 10.70% 33 +3
Unemployment Compensation Tax Rates 110.05% 111.00% 56.00% 46 -1
Workers’ Compensation Premium Rates $0.47 $1.85 $1.70 34 +3
Forum and Venue Reform N/A No 12 states have N/A N/A
Joint and Several Liability Reform No to Yes Yes 41 states have N/A N/A
Noneconomic Damage Reform N/A No 23 states have N/A N/A