Minimum wage workers from throughout the state have testified in favor of a senate bill that would let Missourians vote on whether to increase the minimum wage to $10.10 an hour. Sen. Jamilah Nasheed (D-St. Louis) is sponsoring a bill that would put it to a vote of the people. She introduced the proposal to the Senate Small Business Committee, chaired by Sen. Scott Rupp (R-Wentzville).
The Missouri Retailers Association, the Chamber of Commerce, and the Missouri Restaurant Association spoke out against the measure, saying it would push young and unskilled employees out of the workforce.
Sen. Gina Walsh, a North St. Louis County Democrat, says she agrees to disagree with them that it would burden the economy. Walsh says when people make more, they spend more, and to many, it can make the difference in feeding their family or not. Nasheed says if people made more, they would rely less on state services, another economic incentive for elected officials to support the increase.
Also speaking in favor of the measure were faith leaders, the ACLU, and Robert Minor with the Kansas City Workers Rights Board, who says the last time a minimum wage increase was on the ballot — 2006 — it passed by a three to one margin. Minor added that though opponents say minimum-wage jobs are introductory-level or no-skilled jobs for young people, more than 80 percent of minimum wage workers are over the age of 20.
David Overfelt with Missouri Retailers and Missouri Grocers says this shouldn’t be a state issue, and should be left to the federal government. And, as of today it is a federal issue. Obama’s executive order raises the hourly minimum wage to $10.10 an hour beginning January 1, 20-15, and raises the wage for tipped employees, such as servers in restaurants, to $4.90 an hour, more than double the current amount of $2.13.
Read the full executive order below.
AUDIO: Listen to the arguments for and against the increase — Jessica Machetta reports. (5:57)
AUDIO: Interview with Sen. Jamilah Nasheed, sponsor of the bill (3:46)
From the White House:
The Executive Order the President will sign today will benefit hundreds of thousands of people working under contracts with the federal government who are making less than $10.10 an hour. It will also improve the value that taxpayers are getting from the federal government’s investment. Studies show that boosting low wages will reduce turnover and absenteeism, while also boosting morale and improving the incentives for workers, leading to higher productivity overall. These gains improve the quality and efficiency of services provided to the government.
In his State of the Union Address, President Obama pledged to both take executive action wherever he can and work with Congress to increase opportunity for all Americans. Consistent with that pledge, the President will continue to work with Congress to finish the job to raise the minimum wage for all Americans and pass the Harkin-Miller bill so that all workers can be paid at least a $10.10 minimum wage.
Details of the Executive Order:
Ø The Executive Order will raise the minimum wage to $10.10 effective for new contracts beginning January 1, 2015. Obama says the higher wage will apply to new contracts and replacements for expiring contracts. Boosting wages will lower turnover and absenteeism, and increase morale and productivity overall. Raising wages for those at the bottom will improve the quality and efficiency of services provided to the government.
Ø Benefits hundreds of thousands of hardworking Americans. The President says there are hundreds of thousands of people working under contracts with the federal government to provide services or construction who are currently making less than $10.10 an hour. “Some examples of the hardworking people who would see their wages go up under this Executive Order include nursing assistants providing care to our veterans at nursing homes, concessions workers in National Parks, people serving food to our troops, and individuals with disabilities working to maintain the grounds on military bases,” he said.
Ø Includes an increase in the tipped minimum wage. This executive order also includes provisions to make sure that tipped workers earn at least $10.10 overall, through a combination of tips and an employer contribution. Employers are currently required to pay a minimum base wage of $2.13 per hour, a base that has remained unchanged for over twenty years, and if a worker’s tips do not add up to the minimum wage, the employer must make up the difference. Under the Executive Order, employers are required to ensure that tipped workers earn at least $10.10 an hour. The Executive Order requires that employers pay a minimum base wage of $4.90 for new contracts and replacements for expiring contracts put out for bid after January 1, 2015. That amount increases by 95 cents per year until it reaches 70 percent of the regular minimum wage, and if a worker’s tips do not add up to at least $10.10, the employer will be required to pay the difference.
Ø Covers individuals with disabilities. Under current law, workers whose productivity is affected because of their disabilities may be paid less than the wage paid to others doing the same job under certain specialized certificate programs. Under this Executive Order, all individuals working under service or concessions contracts with the federal government will be covered by the same $10.10 per hour minimum wage protections.
The White House press statement says an increase improves value for the federal government and taxpayers.
“One study showed that when Maryland passed its living wage law for companies contracting with the state, there was an increase in the number of contractors bidding and higher competition can help ensure better quality. The increase will take effect for new contracts and replacements for expiring contracts put out for bid after the effective date of the order, so contractors will have time to prepare and price their bids accordingly.”
Obama says he will continue to work with Congress, states and localities to help workers.
“Businesses like Costco have supported past increases to the minimum wage because it helps build a strong workforce and profitability over the long run,” he said in an e-mailed statement. “Low wages are also bad for business, as paying low wages lowers employee morale, encourages low productivity, and leads to frequent employee turnover-all of which impose costs.”
Since the President called for an increase in the minimum wage in last year’s State of the Union, five states have passed laws increasing their minimum wage.
Obama’s office reports that a full-time minimum wage worker makes $14,500 a year, and even after accounting for programs like the Earned Income Tax Credit, a family of four supported by a minimum wage worker still ends up living below the poverty line.