Members of the powerful House Economic Matters Committee are scheduled to vote on their House version of the $15 minimum wage bill – statewide, no exclusions for tipped workers – on Monday (Feb. 25). The National Employment Law Project explains why it should stay that way, with no exclusions or "carve-outs."
Members of the powerful House Economic Matters Committee are set to vote on their House bill, HB166, on the $15 minimum wage – statewide, no exclusions for tipped workers – on Monday (Feb. 25). There is now and will almost certainly be more attempts to exclude parts of Maryland like the Eastern Shore and the Western counties, or categories of workers like young ones. The National Employment Law Project has analyzed the conditions not only in Maryland but in the past experience of other states and jurisdictions whose officials have wrestled with this problem. The NELP finds find that it is much less a problem than local businesses claim it is. Attempts to “carve out” geographical areas, younger workers or specific job categories from the $15 minimum wage, or to phase it in more slowly in some categories than in others, will have a bad, not good, effect on overall prosperity. It may also show that some local officials or members of the Assembly don’t understand their local labor market and economic conditions as well as they think they do. – PM BlogSpace
Here are excerpts from the NELP analysis:
“Legislators in Annapolis are poised to introduce a bill to gradually raise Maryland’s minimum wage to $15.00 by 2023 and to eliminate the sub-minimum wage for tipped workers. As a high-cost of living state, Maryland’s current minimum wage of $10.10 an hour, or $21,000 a year for a full-time worker, is far too low for workers to make ends meet. According to an analysis by the Economic Policy Institute (EPI), at least 573,000 workers across the state will benefit—approximately 22 percent of the state’s workforce.
“Raising the minimum wage must bring all workers along and ensure that all workers have access to family-sustaining jobs. Maryland legislators should reject efforts to deny thousands of workers, particularly agricultural workers and young workers, hard-earned and overdue raises, as well as efforts to create “regional” minimum wages that would cut entire parts of the state out of a $15 minimum wage. [PM’s emphasis] These exclusions often affect workers and regions that have historically struggled the most economically. Additionally, although opponents of higher wages around the country have banned local governments from raising wages above the state level, Maryland should protect cities’ and counties’ longstanding power to enact a higher minimum wage for their residents.
“Importantly, two of the largest states that have thus far enacted a $15 statewide minimum wage— California and New York—have done so without exemptions for farmworkers or any new exemptions for youth workers. With $15 on the horizon, no worker in any part of Maryland should be deprived of a minimum wage that helps them and their families meet their basic needs. This fact sheet explains why excluding youth and agricultural workers, in addition to slower phase-ins for certain business and parts of the state, is bad policy.”
Excluding Agricultural Workers from the Minimum Wage Perpetuates a Historically Racially-Based Exclusion from Basic Worker Protections
“Many agricultural workers, including workers in freezing, canning, and processing operations, have long been excluded from the minimum wage in Maryland. This exclusion must be abolished to ensure that all workers are treated equally. This exclusion is rooted in the more shameful chapters of our country’s history. Federal minimum wage law originally excluded most agricultural workers from its protections. This exclusion is widely acknowledged to have been race-based, when deals were made in the New Deal era to exclude African-Americans, who were the predominant workforce in Southern agriculture at the time. Federal law was since modernized to end this exclusion, though farmworkers are still excluded from federal overtime and collective bargaining rights. The current trend across the country is to extend greater protections to agricultural workers. More than a dozen states extend state minimum wage protections to agricultural workers.”
Maryland progressives east of the Bay would caution that Eastern Shore poultry factories, in particular, may seek to protect their profits by getting an exclusion of this familiar and shameful sort.
Excluding Youth Workers from the Minimum Wage Mainly Benefits Fast Food, Retail and other Industries with High Turnover Staffing Models
“Current Maryland law allows employers to pay employees who are 20 years of age or younger 85 percent of the full minimum wage for the first six months of employment. For an employee working full-time for their first six months of work at the current minimum wage, this difference can amount to more than $1,400. Exempting youth workers from the $15 minimum wage hurts teen workers and their families, [PM emphasis] and does not address the decline in teen workforce participation—which repeated studies have shown has nothing to do with the minimum wage.
“Many teen workers provide essential income to struggling low- and middle-income households. In Baltimore, for example, census data shows that workers who would benefit from a $15 minimum wage, on average, contribute over half (54.6 percent) of their entire family’s income.
“Young workers are also using their income to pay for school. In the U.S., nearly 50 percent of students pursuing a 2-year degree, and over 40 percent of students pursuing a 4-year degree work more than 35 hours per week. Exempting them from the $15 minimum wage will force them to work more hours, take longer to graduate, and take on more debt—hurting their economic futures.
“Youth exemptions from the minimum wage have been shown to be a strategy that corporate-backed lobbyists use to slow the adoption of higher wages, as a leaked memo from lobbyist Rick Berman showed. By undercutting the wages that an employer must pay to adult workers, a teen subminimum wage will also hurt adult workers—especially in higher unemployment areas—who are struggling to find jobs. For all these reasons, no other state or city with a $15 minimum wage has expanded any existing wholesale exemption for teen workers.”
A “Regional” Minimum Wage Will Slow Down Hard-Earned Raises – and Will Leave Rural and Poorer Parts of the State Behind
“One counterproposal to the $15 statewide base minimum wage would create lower “regional” minimum wages, supposedly to reflect lower costs of living in certain parts of the state. This approach is unfortunately misguided and ignores the reality that $15 is the bare minimum workers in Maryland already need to survive. [PM emphasis]
“A regional approach misses the point of a minimum wage. The state minimum wage, like the stagnant federal wage, is meant to be a floor to protect all workers across the state and ensure they can meet their basic needs. Nowhere in Maryland is less than $15 per hour enough to sustain a single adult without children. EPI’s Family Budget Calculator estimates that a single worker in the Baltimore metro area needed to earn $38,698 a year in 2017—or approximately $18.60 per hour for a full-time worker—to make ends meet. That same worker in rural Garrett County, in the far western part of the state, would need $33,322, or about $16 per year. Lower minimum wages set by region only hurt those regions. As EPI and NELP wrote in a report, “Regional minimum wages bake-in low wages to already low-wage places.” Setting lower regional wages in the state is a surefire way to disadvantage workers who are already struggling the most to make ends meet.”
A Slower Phase-In for Small Businesses Puts Both Workers and Businesses at a Disadvantage
“Another way that opponents of a higher minimum wage try to create exceptions to the minimum wage is to propose a slower phase-in for smaller businesses. Yet this approach is likely to backfire, putting small businesses at a disadvantage. Excluding small businesses from a higher minimum Sign up HERE for Progressive Maryland's Lobby Night Monday, March 4
wage can have adverse effects on those very businesses by making it more difficult for them to attract employees, who will prefer to take higher-paying jobs at larger companies. Extensive and sophisticated research from across the country has shown that gradual minimum wage increases have not and do not cause job loss and have no measurable adverse effects on businesses. Businesses of all sizes benefit from a higher minimum wage as a result of lower costs associated with turnover, more productive employees, and customers who have more money in their pockets to spend.”
Local Power to Raise the Minimum Wage Is Important for High-Cost-of-Living Communities and Preserving Local Democracy
“Opponents of higher wages around the country are also pressing to prevent cities and counties from enacting local minimum wages above the statewide minimum—no matter what local residents’ preferences or needs are. Local power to raise the minimum wage allows higher-cost-of-living communities in a state to adopt wages that better match their higher housing and living costs. Fifteen dollars per hour is the bare minimum workers across Maryland need to survive—and local governments—particularly those in higher cost-of-living areas—should keep their ability to go over it. Many state preemption laws around the country that have passed in recent years have been pushed and adopted as a response to successful local campaigns to raise the minimum wage. Big business, which generally opposes minimum wage increases, have pushed for these laws.
“Across the country, voters across party lines believe that local governments are well- positioned to craft and adopt policies that correspond to local needs. State legislators must trust communities to respond to the unique needs of workers in cities and counties where the federal and state minimum wages do not cover basic needs. Maryland advocates, workers, and legislators must reject efforts to take away Maryland cities’ and counties’ existing local control over wages.
“Since November 2012, more than 50 states and localities have raised their minimum wage, including 16 states, cities and counties that have adopted a $15 minimum wage. That has brought $68 billion in wage increases to 22 million low-wage workers. Stagnating paychecks and gridlock in the U.S. Congress are among the factors that have compelled legislatures and voters across the country to take action on the minimum wage. Those 50 states and localities have seen the impact of that $68 billion on their local economies, because low-wage workers spend their wage increases on everyday needs. [NELP urges that] Maryland should join those states and localities to ensure that the state’s low-wage workers receive a much needed and significant increase in their paychecks. “
The House Economic Matters Committee, which is scheduled to vote Monday on HB 166, is a powerful 24-member standing committee and readers may well have a member in their district. Check the committee membership and call a member in your legislative district or county Monday morning urging them to keep the bill "clean" without exclusions or carve-outs when they send the bill to the floor for a full vote that will come later in the Session. The 70-plus co-sponsors of the bill are listed here. If one of them is in your district, a call to that delegate might help sway a committee member.