Sets a New Standard for Big Cities
SEATTLE
— The City Council here went where no big-city lawmakers have gone
before on Monday, raising the local minimum wage to $15 an hour, more
than double the federal minimum, and pushing Seattle to the forefront of
urban efforts to address income inequality.
The
unanimous vote of the nine-member Council, after months of discussion
by a committee of business and labor leaders convened by Mayor Ed
Murray, will give low-wage workers here — in incremental stages, with
different tracks for different sizes of business — the highest big-city
minimum in the nation.
“Even
before the Great Recession a lot of us have started to have doubt and
concern about the basic economic promise that underpins economic life in
the United States,” said Sally J. Clark, a Council member. “Today
Seattle answers that challenge,” she added. “We go into uncharted,
unevaluated territory.”
But
some business owners who have questioned the proposal say that the
city’s booming economy is creating an illusion of permanence. The fat
times and the ability to pay higher wages, they warn, will not go on
forever.
“We’re
living in this bubble of Amazon, but that’s not going to go on,” said
Tom Douglas, a prominent restaurateur in Seattle, referring to the local
boom in jobs and economic growth from hiring at Amazon, the online
retailer, which has its headquarters here. Mr. Douglas said the new law
will inevitably result in costs being passed on to consumers. “There’s
going to be some terrific price inflation,” he said.
The
measure has the support of Mr. Murray, who ran last year on a pledge to
raise the wage to $15 and made it one of his first priorities in
office.
Cheers
and jeers repeatedly erupted in the City Hall meeting room, which was
packed with supporters of the plan, who often interrupted speakers in
the 90-minute debate before the vote with chants.
“We
did it — workers did this,” said Kshama Sawant, a socialist who
campaigned for a $15 minimum wage when she was elected to the Council
last year. Ms. Sawant sought to accelerate the carrying out of the
measure and to strip out a lower youth wage training rate, but the
council rejected her proposals.
The
vote, economists and labor experts said, accentuates the patchwork in
wages around the country, with places like Seattle — and other cities
considering sharply higher minimum pay, including San Diego, Chicago and
San Francisco — having economic outlooks increasingly distinct from
those in other parts of the nation. Through much of the South,
especially, the federal minimum of $7.25 holds fast.
Eight
states plus the District of Columbia have already increased their
minimum wages this year, the most to have done so in a single year since
2006, and at least eight other states and municipalities could put
minimum wage ballot measures before voters by November. But it is the
scale of ambition that is catching the attention of economists, labor
leaders and business owners.
“In
past rounds of minimum wage increases, proposals sought chiefly to
restore the value of the minimum wage lost to inflation over the
decades,” said Paul Sonn, the general counsel and program director at
the National Employment Law Project, a New York-based group that
supports raising the minimum wage. The increases in places like Seattle,
Mr. Sonn said, go beyond playing catch-up. “The $15 proposals make real
gains,” he said.
Economists who study the minimum wage are not sure of the effect of having sharply different levels — in some places, it is twice that of others. Though records are a bit uncertain, people who track minimum wage law say the range of mandated minimums, lowest to highest, is the largest it has been since a national minimum was established by Congress in 1938.
“Nobody has studied a doubling of the minimum wage — that’s outside our experience,” said Dale Belman, a professor of labor and industrial relations at Michigan State University and co-author of a coming book about the minimum wage.
Economists who study the minimum wage are not sure of the effect of having sharply different levels — in some places, it is twice that of others. Though records are a bit uncertain, people who track minimum wage law say the range of mandated minimums, lowest to highest, is the largest it has been since a national minimum was established by Congress in 1938.
“Nobody has studied a doubling of the minimum wage — that’s outside our experience,” said Dale Belman, a professor of labor and industrial relations at Michigan State University and co-author of a coming book about the minimum wage.
Individual
workers and business owners in and around Seattle are unsure of the
implications. Washington State already has the highest state minimum
wage in the nation, $9.32, but more than 24 percent of Seattle residents
earn hourly wages of $15 or less, according to the city, and
approximately 13.6 percent of Seattle residents live below the federal
poverty level.
Under the plan approved on Monday, the hourly wage will rise to $15 by 2017 for employers with more than 500 workers that do not provide health insurance, and by 2018 for those large employers who do. The minimum will be phased in through 2021 for smaller employers.
In its early years, the law allows employers to include tips as part of a workers’ compensation in reaching the minimum, but that provision is phased out over time.
“The short-term side of it says it’s attractive,” said Mickey Adame, a bartender who works in Bellevue, Washington’s fifth-largest city, which is just outside Seattle, and the new $15 wage boundary. “But I think people in Seattle aren’t going to tip as much, knowing the servers are getting paid $15,” added Mr. Adame, who lives in Seattle and is trying to start a music record label called Sounder Music, for which his tip jar, he said, is crucial. “If I had to pick an answer, I would say I think I’ll make more in Bellevue.”
Under the plan approved on Monday, the hourly wage will rise to $15 by 2017 for employers with more than 500 workers that do not provide health insurance, and by 2018 for those large employers who do. The minimum will be phased in through 2021 for smaller employers.
In its early years, the law allows employers to include tips as part of a workers’ compensation in reaching the minimum, but that provision is phased out over time.
“The short-term side of it says it’s attractive,” said Mickey Adame, a bartender who works in Bellevue, Washington’s fifth-largest city, which is just outside Seattle, and the new $15 wage boundary. “But I think people in Seattle aren’t going to tip as much, knowing the servers are getting paid $15,” added Mr. Adame, who lives in Seattle and is trying to start a music record label called Sounder Music, for which his tip jar, he said, is crucial. “If I had to pick an answer, I would say I think I’ll make more in Bellevue.”
Ms. Sawant, in her comments to the Council and the crowd, did not take the tone of someone who was savoring a victory. The fight for workers’ rights and economic fairness, she said, is not over.
“We have fought to the last day, the last hour, against all the loopholes demanded by business,” she said. “The attempts of business to undermine $15 will continue,” she said, as would the battle to “turn the tide against corporate politics.”
She added: “$15 in Seattle is just a beginning. We have an entire world to win.”
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