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Seattle on verge of ‘historic’ action on minimum wage

Seattle moved one step closer to a significant minimum wage increase on Thursday, as a City Council committee approved legislation that would begin phasing in a $15 per hour pay floor early next year.

The committee left legislation proposed by Mayor Ed Murray largely intact, though it did amend the start date for beginning the pay hike from Jan. 1, 2015 to April 1, 2015 and added a provision that would allow a slightly lower minimum wage for teenagers and workers in apprenticeship programs. Despite disagreements over individual amendments, the council members present at the meeting voted unanimously to approve the overall legislation.

A full council vote on the wage ordinance is scheduled for next Monday.

Socialist Councilmember Kshama Sawant, a champion of the wage increase, had qualms about some of the specifics in the ordinance, but she touted its noteworthiness during remarks after the meeting, which she delivered on the steps of City Hall.

"Today is a historic day for low wage workers, for the labor movement and for anyone who believes, as I do, that no one who works should have to live in poverty," she said.

Sawant expressed misgivings about the council's 4-3 vote to push back the start of the phase-in period to April 1. Councilmembers Sally Clark, Sally Bagshaw, Jean Godden and Tim Burgess voted for the amendment. Sawant opposed it, along with Bruce Harrell and Mike O'Brien. Councilmembers Nick Licata and Tom Rasmussen were traveling and did not attend Thursday's meeting.

The legislation grew out of recommendations from an advisory committee of 24 business, labor and nonprofit representatives, which the mayor convened last December before taking office. A majority of the committee brokered a last-minute agreement, after battling through a variety of contentious issues that included the length of the phase-in period, wages for training, whether tips should be counted toward compensation and how the new pay scale would apply to small businesses. It was considered a fragile deal. Murray urged the council to pass the legislation he had proposed without excessive tinkering, so that it did not lose the support of key business and labor backers.

Clark, who chairs the Council's Committee on Minimum Wage and Income Inequality, said that she believed the legislation passed on Thursday was "close to what the mayor's committee put forward."

"I think we very thoughtfully and expeditiously moved through the amendments," she said.

Howard Wright, CEO of the Seattle Hospitality Group, who co-chaired the mayor's advisory committee, seemed to agree.

"I'm pleased that the mayor's recommendations did not come unraveled," he said.

As it stands, the ordinance would require businesses with more than 500 employees to pay their workers $11 per hour in April of next year. The wage would ramp up to $15 by 2017. For larger businesses that provide their employees with health care, the phase-in period would last one year longer. By 2018 they, too, would be required to pay workers $15 per hour.

Under Mayor Murray's proposed plan, wages would rise at different rates for larger and smaller businesses. The "minimum compensation" figures in Schedule C show the amount that employers with fewer than 500 employees must pay their workers including tips and health care benefits. To be counted toward total compensation, tips and health care benefits need to appear on an employee's paycheck. Source: Seattle Mayor's Office

For smaller businesses, the minimum wage would reach $15 in 2021. Smaller businesses would also be required to guarantee workers "minimum compensation," which includes tips and health insurance. Minimum compensation, including tips and healthcare, would rise to $15 per hour in 2019.

After each wage category hits $15 per hour, it would increase at the same rate as the consumer price index. Based on a consumer price index of 2.4 percent, minimum wage and total compensation for workers at all of the city's businesses reach $18.13 by 2025.

During the meeting, Sawant introduced an amendment that would have accelerated the minimum wage increase, phasing it in for workers at larger-sized businesses to by Jan. 1, 2015 and for smaller businesses in three years, while also eliminating the total compensation regimen for smaller employers. But the amendment failed.

Owners of franchise food outlets and small restaurants continued to voice concerns about how the pay increase would affect their businesses on Thursday.

"We'll be able to absorb it for the first couple years," said Linda Di Lello Morton, who is one of the co-owner of Terra Plata, a Capitol Hill restaurant. She added: "Labor hours will have to be reduced in order to survive."

Sawant meanwhile, continued to knock the influence of business on the ordinance. "There are a number of corporate loopholes in this legislation," she said. 

Clark expressed satisfaction with the result of Thursday's voting. "This whole process is more complicated than some people wanted it to be and it's by necessity," Clark said. "Speaking for myself, what I really tried to do is separate out the sound bite stuff."

Kshama Sawant speaks to reporters on the steps of City Hall on Thursday, after a City Council committee voted to approve $15 minimum wage legislation.

Clark also acknowledged that it remains unclear what the overall effect of the wage increase will be for the city's low-income residents. She also said it will likely take more than a pay bump to address some of the issues that keep people in dire economic situations.

"We have no idea," she said, "if we will actually move the needle on poverty."

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