Assembly OKs Wage Increase

The minimum wage in California would climb nearly 15% over the next 18 months to $7.75 an hour under legislation approved Wednesday by the Assembly.

Passage in the Assembly was the biggest hurdle for the bill, which is expected to slide through the more-liberal state Senate. Aides to Gov. Arnold Schwarzenegger said he had not taken a position on the bill, but the Republican governor frequently has said that California businesses are being hammered by too much regulation.

The state’s current minimum wage is $6.75 an hour, which for a 40-hour workweek equals an annual income of $14,040. An estimated 1 million Californians make the minimum wage.

The Assembly legislation would increase the minimum wage in California by 50 cents in January, to $7.25 an hour, and then to $7.75 an hour in January 2006. California is one of 10 states with a minimum wage higher than the federal minimum of $5.15 an hour. The highest is Washington state, which ties minimum-wage increases to inflation, at $7.16 an hour.

California has steadily increased its minimum wage since 1996, when voters approved the Living Wage Act, Proposition 210, to establish a $5.75-an-hour wage. The Legislature subsequently has raised the minimum wage twice.

During debate Wednesday, Democratic lawmakers said it was difficult to survive on the minimum wage, noting that most low-wage earners are trying to support a family.

“You see by and large slightly more women than men, by and large more adults working full time” and being paid within $1 of the minimum wage, said Jean Ross, executive director of the California Budget Project, which monitors legislation affecting low-income workers.

Ross said that more than 60% of the people earning the minimum wage were 25 or older, and that the same percentage were working full time at those wages. Democrats supporting the bill said raising the minimum wage would keep people off welfare programs.

“When wages are kept low, taxpayers make up the difference,” said Assemblywoman Sally Lieber (D-Mountain View), author of the wage increase measure, AB 2832, which passed the Assembly with a 45-30 vote.

Republicans said the state was once again adding a burden on California businesses, just weeks after approving changes to the workers’ compensation system to address complaints that high insurance costs have been driving companies out of the state.

“So we give them a small bit of reform, and now what do we do with it? Let’s raise the minimum wage. Let’s give you another reason to suffer,” said Assemblyman Dennis Mountjoy (R-Monrovia).

The Assembly legislation was opposed by the California Restaurant Assn., which said raising the minimum wage would do nothing to help workers’ bottom lines but would put a bigger burden on the restaurant owner.

Jot Condie, president of the association, said the group’s study showed that restaurant workers making minimum wage actually averaged about $26 an hour because they received tips. California is one of seven states that require a minimum wage even for people who receive tips.

Other workers, such as those in the kitchen who don’t receive tips, probably are making more than the minimum wage anyway, Condie said. “So when the wages go up, restaurateurs are forced to give the minimum wage increase to those who earn the most,” he said. “It drives up those finite labor dollars.”

In the past, Democrats have attempted to tie increases in the minimum wage to inflation, but those efforts have failed to get out of the Legislature. Now, Republicans said, Democrats were resorting to relatively small incremental increases when what they really want is a minimum wage of $10 an hour or even $20.

“We in government can make that happen by ordering people to do it,” said Assemblyman Ray Haynes (R-Murrieta). “They will either do it or go out of business. They will either do it or move out of this state.”