City's minimum wage hearings show no one's happy

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A citywide conversation regarding raising the minimum wage has sparked much passion, pleading and pushback.

Five public meetings held by the city of Chicago’s Minimum Wage Working Group contained all these elements, and now the 17-member panel appointed by Mayor Rahm Emanuel is digesting testimony from hundreds of stakeholders who turned out to share their stories and weigh in on a debate taking place locally and nationally.

“It’s a complex issue. I think people have been hurting,” Ald. Will Burns (4th), the panel’s co-chairman, said. “The Great Recession effectively wiped out a decade of income and wealth for most Americans, and if you look at workers with only a high school degree, their wages when indexed for inflation have not changed since the early 1970s.”

The panel, representing business, labor, civic and political arenas, is expected to make its report to Emanuel by July 5 on how high to raise wages to lift the working poor — against the specter of potential harm to small businesses or running larger corporations away from the city. The City Council could vote on a wage measure July 30, its next meeting.

Raging nationally — minimum wage increases have been considered in 38 states this year — the debate has sparked passion as the nation’s third-largest city considers an increase beyond Illinois’ current $8.25 an hour.

“At $8.25 an hour, what kind of deals are we making with these corporations, where they come into our neighborhoods, pay you minimum wage and ask you to stand in a Public Aid line to subsidize your paychecks?” worker Anthony Edwards demanded at the Working Group’s first meeting, held June 9 at Kennedy-King College.

The minimum wage issue is part of a national push by Democrats, led by President Barack Obama, whose efforts to have the federal minimum wage raised to $10.10 an hour from the current $7.25 failed in Congress in April.

The issue will go before Illinois voters in the fall, after Gov. Pat Quinn signed a bill last week placing a nonbinding referendum on the Nov. 4 ballot asking voters whether minimum wage for those over age 18 should be raised to $10 an hour by Jan. 1, 2015.

In Chicago, the Working Group heard pleas from low-wage workers complaining that Illinois’ current $8.25 an hour minimum wage isn’t a “livable” wage able to sustain housing, transportation and other costs of living in Chicago.

“I am tired of waiting to get my bills shut off because I can’t pay it. I’m tired of not being able to afford what my son wants. . . . I am just tired,” worker Nancy Salgado said through tears at the group’s June 12 meeting held at Malcolm X College.

Appointed by the mayor on May 19, the Working Group was given 45 days to come up with a recommendation. Emanuel has told the group he supports a raise, its members said, but hasn’t indicated an amount he thinks can be stomached.

“This is an emotional issue,” said panel member Tanya Triche, vice president and general counsel at the Illinois Retail Merchants Association. “It’s not about whether businesses value their workers. This is about what the market will bear for certain levels of skills in the workforce.”

Retailers oppose enacting a minimum wage for Chicago that will be different from the Illinois rate.

Members of the Working Group, which include the Illinois Restaurant Association, Chicagoland Chamber of Commerce, Chicago Federation of Labor and the Service Employees International Union, hold wildly divergent views. The group has toiled in the shadow of a City Council ordinance proposed by some 15 aldermen on May 28, seeking to raise the minimum wage in Chicago to $15 an hour — the same as in Seattle. Immediately challenged in a federal lawsuit, Seattle’s minimum wage would be the highest base pay in any major U.S. city.

Chicago’s Working Group has gotten pushback from businesses arguing that the proposed ordinance would kill jobs.

“If I have to pay $15 an hour, I’m slashing my staff in half, and at the same time raising my prices so that I can afford to pay the staff that I have,” small-business owner Stephanie King-Myers said at the June 19 meeting, held at Truman College.

Under the proposed city ordinance, firms with more than $50 million in annual revenue would pay $12.50 an hour within 90 days of passage, $15 within a year. Phase-in for small- and medium-size firms would be $12 an hour within 15 months; $13 in two years; $14 in three years; and $15 in four years. For employees who rely on tips, the current $4.95 an hour minimum wage would increase to 70 percent of the new minimum wage.

“In the restaurant business, we don’t pay everybody the same. My grill man is paid $15 an hour, my dishwasher $8 an hour,” restaurant owner Josh Rutherford testified at Truman College. “Of every dollar, 30 percent is your food. Your payroll, operating expenses, rent and payback of your loan each are 10 percent. Only 5 percent is profit.”

The public meetingsoften were raucous, with the panel struggling to maintain order.

Mostly, they brought out the city’s low-wage workers and members of community and labor groups that form the Raise Chicago coalition — the group responsible for getting a nonbinding referendum on the March election ballot in 5 percent of city precincts.

The Working Group also has been reviewing data and other cities’ policies. It hopes to come to a conclusion in discussion among members this week.

“The overriding theme we heard was the unaffordability of everyday life for hard-working people under the current minimum wage.” said panel co-chairman John Bouman, president of Chicago-based Sargent Shriver National Center on Poverty Law.

“There’s definitely disagreements on the panel and very strongly held points of view. But people do trust each other, and hopefully, we can preserve an atmosphere of free conversation and come to some sort of consensus.”

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