Pay-to-Play Laws: Good Government or Speech Infringement

in

Summary: Are pay-to-play laws meant to protect us against kickbacks in government contracts, but are they an unwarranted attack on First Amendment freedom of speech?

While I normally stay on the topic of feedback management and related topics, I recently was forwarded an email that should concern all of you who are Americans. (No offense to my international friends, but you still may find this interesting.) And some of you no doubt will disagree with me or think my concerns are overblown.

My wife works for a large corporation, and it sent an email to all employees about the ramifications of so-called “pay-to-play” laws that many states and municipalities have adopted. To quote the key section:

These laws restrict [companies] and, in some instances, its employees and members of its Board of Directors, from making monetary and in-kind (including donated labor, materials, and services) political contributions to, or soliciting such contributions on behalf of, candidates for certain elected offices, political party committees and other political committees (e.g., PACs). Some of these laws prohibit [companies] from entering into a government contract for a certain number of years if [the company], an employee, or a member of the Board makes or solicits a “covered contribution.”

Depending on the jurisdiction, the law may even cover certain family members (such as spouses and children) of [company] employees or Board members. Violating these requirements may lead to civil and, under certain circumstances, criminal liability.

Accordingly, [the company] is requiring all employees and members of the Board of Directors to pre-clear certain personal political contributions in the jurisdictions that have “pay-to-play” laws.

The ostensible goal is to avoid kickbacks to get government contracts. In the age of Blagojevich, pay-to-play concerns are real. In my home state of Massachusetts our previous Speaker of the House is now serving time for steering state business to a company; however, no campaign contributions appear to have been involved.

One aspect of many of these laws is to make public large contributions from business leaders, which is required by law even for PACs. But these laws may intimidate some, in essence negating the Supreme Court Citizens United decision.  Strong arguments can be made about whether the unintended consequences outweigh the positives.

But consider the broad scope of this crop of laws. My wife is a mid-level software engineering manager. She has no direct contact with customers and is far removed from any sales processes. Our state is not in an affected jurisdiction (yet), but what if we were. If I wanted to make a $100 donation to a candidate, make phone calls on his/her behalf, or even to hold a sign at a rally, I would have to get clearance from corporate legal.

I guess the good thing is that this legislation has spawned a new compliance industry and is creating jobs for lawyers.  But at what cost?

I want to say this is absurd, despite the ostensible clean government goals, but the sweeping scope actually makes these laws chilling attacks on First Amendment freedom of speech rights.  Why should I have to get approval to exercise my First Amendment rights?  Imagine someone getting fired because his/her spouse attended a political rally holding signs for a candidate. Imagine the mischief that can be raised as the anti-business crowd seeks to find companies that are not in compliance.

It’s just wrong.

Regardless of political affiliation, we should all be concerned.

Want to know if you are potentially affected? Here’s the list of jurisdictions with such laws according to the email

Employee Pay-to-Play List

  • California (including immediate family)
  • Denver, Colorado (including spouse and minor children)
  • Connecticut (including spouse and dependent children 18 or over)
  • Illinois (including spouse and, for contributions to the Comptroller – s Office and Treasurers Office, spouse and minor children)
  • Kentucky (including spouse)
  • Maryland
  • Missouri
  • New Jersey (including spouse, civil union partner, and children residing in same residence)
  • New Mexico
  • New York City, New York
  • Pennsylvania (including spouse and dependent children)
  • Philadelphia, Pennsylvania (including spouse residing in same household, life partner, and minor dependent children)
  • Rhode Island (including spouse and minor children)
  • Dallas, Texas
  • Houston, Texas
  • San Antonio, Texas (including spouse)
  • Virginia

Board Pay-to-Play List

  • Culver City, California
  • Los Angeles, California
  • Pasadena, California
  • San Francisco, California
  • Denver, Colorado (including spouse and minor children)
  • Connecticut (including spouse and dependent children 18 or over)
  • Illinois (including spouse and minor children)
  • Cook County, Illinois
  • Maryland
  • Missouri
  • New Jersey (including spouse, civil union partner, and children residing in same residence)
  • New Mexico
  • Pennsylvania (including spouse and dependent children)
  • Philadelphia, Pennsylvania (including spouse residing in same household, life partner, and minor dependent children)
  • Rhode Island (including spouse and minor children)
  • Dallas, Texas
  • Houston, Texas
  • Virginia