Union Exempted From Minimum Wage Initiative
The organization behind the push for a $15 minimum wage in Seattle has announced it will begin collecting signatures to put a city charter amendment mandating the high wage on the ballot. The group, 15 Now, needs 30,957 signatures to qualify the measure for the November ballot.
The campaign kick-off came just days after a committee appointed by Seattle Mayor Ed Murray failed to reach a consensus on the details of a $15 minimum wage mandate by the April 23 deadline. The committee, comprised of representatives of business and labor, is deadlocked over thorny issues such as how the wage should be phased in and whether to allow employers to count tips and other benefits toward a minimum wage calculation. Responding to the committee’s stalemate, Mayor Murray said he would release his own plan the following day, but later announced he would give the task force more time to hammer out an agreement.
The mayor urged minimum wage supporters to give the committee more time and cautioned against a ballot measure that would “end up in a mini-version of class warfare.” Ignoring Murray’s pleas, 15 Now is pressing forward with their plan to put the issue before voters.
The proposed charter amendment would force “big businesses,” defined as those with 250 or more employees, to pay workers a $15 minimum wage beginning January 1, 2015. The wage would be raised each year according to inflation. Small businesses and non-profits would begin paying $11 an hour in January 2015, $12.25 in 2016, $13.50 in 2017 and the full minimum wage in 2018. Franchises are excluded from the small business category. The proposal does not allow for any inclusion of tips or other non-wage compensation toward the $15 wage.
Notably, the 15 Now measure includes a provision exempting members of the Unite Here Local 8 union, which represents hospitality workers. The union and the campaign say those union workers do not need a $15 wage because they, “…have a unique relationship with the boss,” to negotiate their total compensation package. The union spokesperson said the union’s members currently receive “a very good” health plan, and that even those working 20 hours a week are eligible. The union argues its members should have the option to bargain and accept a lower wage in order to keep that generous health plan:
“We didn’t want the unintended consequence to be that that [the current health plan] gets stripped away.”
There are a multitude of criticisms of the union exemption.
First, there is the inherent unfairness of allowing union-shop employers in the hospitality industry to pay their workers less than what their non-union competitors must pay. Second, there is the injustice of giving union workers the option to negotiate lower pay in exchange for better benefits while denying non-union workers the same bargaining option. Third, there is a shocking double-standard to which the 15 Now campaign is holding employers; union employers are pandered to while non-union employers are attacked. And finally, there is the hypocrisy.
The hypocrisy in the union exemption is glaring. CEO Starbucks Howard Schultz was attacked by 15 Now—the same group sponsoring the ballot measure exempting the Unite Here union—when he recently said that a higher minimum wage could result in cuts to the company’s famously generous employee benefits. These benefits include full health coverage, free food, bus passes, 401K, education assistance, stock rewards, bonuses and more—even for part-time employees working 20 hours per week. Starbucks workers also earn tips.
Despite these generous benefits, which earn the company a perennial spot on the “Best Companies to Work For” rankings, Starbucks is accused by 15 Now of paying workers “unsustainably low wages” in order to “secure continued record profits.”
It is obvious that 15 Now’s problem with Starbucks is not that the company pays “unsustainably low wages.” Their problem with Starbucks is that the company is not union. If they were union, they could pay whatever wage their workers would accept.
Of course, the irony of the union’s comment defending their exemption is that it is the best argument against raising the minimum wage to $15 per hour. Employers of all sizes and in all industries are warning a mandated $15 wage will force them to cut employee benefits, among other cost saving measures. Clearly Unite Here Local 8 and 15 Now believe a $15 wage will reduce the nonwage benefits of the union’s workers, leaving those workers worse off.
15 Now can no longer deny that there are trade-offs that come with a $15 minimum wage. They can no longer claim that businesses will simply absorb the entire wage increase. They can longer declare that all workers will be better off with the higher wage.
The union exemption is an admission by 15 Now that increasing the minimum wage will come with costs. They just think it is a price non-union employers and their workers should be willing to pay.