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January 26, 2015

Minimum wage increase, paid sick leave topics of House hearing

By: Bobbi Cussins   Comments: 1
AWB members testify Jan. 26, 2015, about the real-world consequences of a House proposal to increase the minimum wage to $12 an hour. From right, JoReen Brinkman, co-owner of four Subway restaurants in Whitman County; Jasmine Donovan, vice president and director of communications at Dick's Drive-In Restaurants; and Robert Bleu, president of Shining Ocean, Inc. (Photo by Brian Mittge/AWB)

A $12 minimum wage would require her to operate at loss, increase prices by more than 7 percent or close her businesses, JoReen Brinkman, AWB member and co-owner of four Subway restaurants in Pullman and Colfax, told the House Labor Committee today.

Her comments were part of the public hearing today on a trio of bills that propose to raise the minimum wage to $12 per hour, require paid sick and safe leave and a policy for alleged employer retaliation.

Bob Battles, government affairs director for workplace and labor issues, led a group of AWB members to the Capitol to testify on how the measures could make it harder and increase the costs to do business in Washington.

House Bill 1355 would increase the state minimum wage to $12 per hour over four years. It is sponsored by Rep. Jessyn Farrell, D-Seattle. She said in today’s hearing, “if you are working full-time on the minimum wage, it is really hard to get by. The goal is to narrowly target our lowest-wage workers and help them get by.”

AWB member Jasmine Donovan, vice president of communications at Dick's Drive-In Restaurants, said her company already pays high wages and has good benefits, including college scholarships. She told the committee that one study shows that for every $1 in wage increase there is a 4 percent increase in youth unemployment. This, she said, hurts at-risk youth who need a job to get by and that gives them a productive way to spend their time.

Brinkman shared that her profit margin is less than 5 percent. And, her business has a unique issue – it’s close to the Idaho border where the minimum wage is the federal standard of $7.25 per hour. This creates a situation where she would have to increase prices and see her vendor prices go up, but her neighboring state’s shops would not have the same impact.

AWB member Robert Bleu, Shining Ocean in Sumner, employs 165 people. He expressed concern that there is an entrepreneur startup crisis and higher wages, and therefore costs, will further hurt job creation and lead to more automation.

The $12 minimum wage would be phased in as follows:

  • Beginning January 1, 2016: $10.00
  • Beginning January 1, 2017: $10.50
  • Beginning January 1, 2018: $11.00
  • Beginning January 1, 2019: $12.00
  • Beginning January 1, 2020, and thereafter, rate adjusted for inflation.

Among those in support of the wage increase, Luke Bridges, a Sea-Tac worker, cited his college school schedule as creating a problem with working full-time and making ends meet. He said $12 per hour would be a good start and that a wage increase “is not asking for much.”

Local ordinances with higher minimum wage floors, like Sea-Tac and Seattle, would be exempt from the $12 minimum wage provisions. There is discussion that if this bill does not pass the Legislature this year, a ballot measure to increase the minimum wage will likely be sent to voters in November 2016.

Rep. Laurie Jinkins, D-Tacoma, introduced the mandatory safe and sick leave measure, House Bill 1356, saying she is concerned about the spread of illness. If someone can’t afford to take an unpaid day off due to illness, then that is something that needs to be addressed, Jinkins said. The bill is modeled after the mandatory sick and safe leave policy the city of Seattle enacted last year.

As the law is written, unionized employees may not get the benefit of this leave requirement because the policy could be excluded from the labor contract during the collective bargaining process.

The Washington Food Industry Association, which represents independent grocers (not the large chains), opposed the bill because of the cost factor. The industry does have good benefits, but the competition against larger corporations would create an unfair disadvantage for small grocers.

Rep. Cindy Ryu, D-Shoreline, introduced House Bill 1354 that is aimed at addressing alleged employer retaliation against an employee. Rep. Matt Manweller, R-Ellensburg, asked about a possible amendment that would ensure an employer is not considered guilty at the start of the process when an employee files the initial complaint, just like our justice system presumes the innocence of the accused.

AWB member Tim O'Connell, Stoel-Rives, said House Bill 1354 is un-American in that it has a presumption of guilt rather than innocence, which is the hallmark of the nation’s justice system. There is ample case law to invalidate the law, if passed, he said.

These bills will receive further action likely this week, possibly being passed out of committee for further consideration in the House Rules Committee. For more information contact Bob Battles at 360.943.1600.

The House Labor Committee hearing is online at TVW.


Jerry Mitchell Jan 26, 2015

Our business (commercial janitorial) is directed at entry level and workers who need additional income. We do not hire anyone who needs this work as a main source of income. We already pay our employees $10.00 per hour. An increase to $12.00 an hour would limit our ability to hire additional workers and be competitive with small mom and pop cleaners who do not have to pay themselves a minimum wage.