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National Restaurant Association - Majority of states reject minimum wage increases

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Majority of states reject minimum wage increases

Bolstered by President Barack Obama’s January call for a $1.75 increase at the federal level, wage legislation flooded state legislatures in 2013, with 29 states considering increases. As the majority of states end their legislative sessions, most wage hike proposals have failed and only a handful of bills remain.

Only one state, New York, has passed a bill to increase the minimum wage. There, the rate will go from $7.25 to $9 by 2016.

Across the country, state restaurant associations have voiced strong opposition to these proposals with measurable results.

Minnesota recently became the fifteenth state this year to reject wage hike legislation. “We know that the grassroots contacts by our members to both conference committee members and hometown legislators made a huge difference on this issue,” Dan McElroy, executive vice president of the Minnesota Restaurant Association, said after the failure of the wage increase proposal in Minnesota.

Earlier this year, New Mexico Governor Susana Martinez vetoed legislation to increase the state’s minimum wage from $7.50 to $8.50. The New Mexico Restaurant Association played an active role in encouraging the veto, with NMRA members voicing their opposition to the Governor’s office during a grassroots campaign.

In California, a bill to increase the minimum wage by $1.25 just passed the Assembly. The California Restaurant Association sent a letter to legislators voicing its opposition to the proposal.

“Raising the minimum wage forces restaurants and other small businesses to make unfortunate operational decisions to meet their increased labor costs,” Matthew Sutton, CRA vice president of government affairs and public policy, wrote in the letter. “Restaurants have no choice but to adjust their business plans and budgets, which may mean foregoing expansion and/or reducing hours and opportunities for employees.”

With strong majorities in the Connecticut House and Senate supporting drastic changes to the state’s wage laws, the legislature last week sent a bill to the governor proposing a 45-cent increase in the minimum wage. The Connecticut Restaurant Association has worked to reduce potential damage from the legislation, which will likely be signed by the Governor.

“While the Connecticut Restaurant Association opposed the original version of this bill, which would have increased the minimum wage by $1.50 over two years and tied it to consumer price indexing in future years, we worked to educate legislators about the bill’s impact on the hospitality industry in our state,” said Nicole Griffin, executive director of the CRA. “We were able to reach a compromise that cut that increase in half, will not tie the minimum wage to consumer price indexing and most importantly, will increase the tip credit to freeze both server and bartender wages at their current rates.”

Wage hike legislation is also pending in Iowa, Massachusetts, Michigan, Nevada, New Hampshire, North Carolina, Pennsylvania, Rhode Island, and Wisconsin. New Jersey voters will decide on a ballot initiative to increase the minimum wage this November. In Maine, an increase from $7.50 to $8.50 that passed the legislature is currently awaiting action from the governor.

View the current state wage rates and the 2013 legislation map.

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