State Panel Urges Hike in Minimum Wage to $4

A little-known but powerful state commission Friday recommended a 65-cent hike in the minimum wage to $4 an hour for many California workers, but gave large numbers of younger wage earners a raise of only a nickel over the current $3.35 minimum hourly rate.

The Industrial Welfare Commission’s proposed $4-an-hour wage would be make California’s rate higher than all states but one--Connecticut will pay $4.25 next year--and would be the first increase in the state in more than six years.

Full-time students under 21 would receive $3.40 an hour under the proposal.

Unknown Number of Students

California has an estimated 600,000 minimum-wage earners. By far, the bulk of them are under 21, though the exact number of students is not known.

Employers throughout California would have to pay the new rate sometime next year, after the commission takes final action after at least three more hearings.

Despite the commission’s action Friday, the Senate voted 26 to 9 to pass and send to Gov. George Deukmejian a bill that would set the minimum wage at $4.25 for all workers in the state.

Deukmejian, however, has indicated that he would veto any minimum-wage legislation, prefering instead to let the five-member board he appointed set the pay rate.

Deukmejian Noncommittal

In Sacramento, Deukmejian remained noncommittal, except to restate his position that there is a “need to increase the minimum wage” and was awaiting the commission’s action before deciding on a veto.

“I would want to see what their recommendation is and what the basis is of their recommendation,” the governor said at an impromptu press conference.

Sen. Art Torres (D-Los Angeles), the author of the bill, said a wage of $4.25 was the minimum needed to survive in California. Any lower wage, he said, would make going on welfare more attractive than working.

“Rather than giving an incentive for people to stay on welfare, we ought to give them an incentive to be tax-paying citizens in this state,” Torres said.

$570 a Month in Pay

Torres noted that a minimum-wage employee who worked a 40-hour week would receive $570 a month. “Can you imagine living on $570 a month?” he told his colleagues. “Impossible. You get more than that in per diem (the legislators’ expense allowance) per week.”

The Los Angeles Democrat harshly criticized the Industrial Welfare Commission for creating separate minimum wages for two classes of workers.

“We’re creating a subclass of the minimum wage in California: $3.40 for student slave labor,” he said. “What incentive do you create for people to leave school to go to work to make 60 cents more an hour? The impact is untold at this point.”

Torres also questioned the commission’s decision to set a $3.40 wage for employees “known” to receive tips. Some employees, such as busboys in restaurants, may not actually receive tips but would be paid the lower hourly wage, he said.

Established in 1913

The Industrial Welfare Commission, established in 1913, has the responsibility of setting minimum wages. The Legislature also can enact an increase with gubernatorial approval--unlike the commission, which needs no signature. Should the governor sign the legislation, it would take precedence over the commission, officials in the legislative counsel’s office and at the commission said they believe.

The commission includes two representatives of labor, two of employers and one public member. The minimum wage cannot be lower than the federal wage of $3.35, but it can be higher.

Commission member Muriel Morse, the public member and swing vote who introduced the motion to increase the rate to $4, said she reached the figure after long hours of study, and said it represents “some constraint.”

She pointed out that the minimum wage was never intended to be the sole support of a family. Rather, it is designed to support only a single person. Morse said she might decide to side with two labor members and opt to raise it beyond $4 after the coming public hearings.

“We should do something for the poor people now,” David Padilla, a labor member, declared as he called for a wage of $5 in a failed effort. He cast the lone dissenting vote to Morse’s proposal, after urging that the $4 rate be increased in the following year to $4.35 an hour.

20% Raise

While the proposed $4 wage represents an almost 20% raise over the current rate, Democratic legislators in Sacramento and labor and minority activists who had jammed the commission hearing called the raise piddling.

Assemblyman Richard E. Floyd (D-Hawthorne) called the 65-cent increase an “insult,” and said the Deukmejian-appointed board is “locked in medieval thought.”

“It’s welcome, but a thirsty man would welcome a drink of bad water,” Floyd said in a telephone interview.

While the $4-an-hour rate is high by comparison to other states, large numbers of workers will see little benefit from the commission’s largess.

85% of Minimum Wage

In one of a series of actions taken after demonstrators had left, the commission voted 3 to 2 that full-time students under age 21 should earn 85% of the proposed $4 minimum wage, or $3.40.

In another 3-2 vote, again with labor representatives in the minority, the commission said workers whose tips amount to 15% of the minimum wage--or 60 cents an hour--also should have a minimum wage of $3.40.

Under the current system, minors under 18 who go to school full time and work part time can be paid a sub-minimum wage. But the new category of wage earners who will make below the minimum wage “is a lot broader,” said Richard Stephens, spokesman for the commission.

CALIFORNIA INDUSTRIAL WELFARE COMMISSION

Created in 1913, authorized to set minimum wage, maximum hours and working conditions. Originally applied only to women and minors. Minimum wage extended to cover men in 1974.

Members appointed by governor for four-year terms. Earn $100 per-diem payment for every meeting, which take place at least once a month.

The five-member panel must include:

Two members from labor organizations;

Two employer members;

One member of general public;

One of the five must be a woman.

Current members: Chair--Lynnell Pollock, Woodland. Farmer. Employer member.

Public member--Muriel Morse, Altadena. Self-employed personnel management consultant.

Labor member--Michael Callahan, Long Beach. Retired Vice President of California Labor Federation. Secretary Emeritus, California State Council of Culinary Workers.

Labor member--David Padilla, Stockton. Former president of Cannery Workers Union Local 601.

Employer member--James Rude, Elk Grove. Director of Personnel Services, Sutter Health Systems, Sacramento.