Connecticut Loses Its Lead in Minimum Wage War

by | January 4, 2016

By Ken Dixon

The hike in the minimum wage that gave about 150,000 of Connecticut's lowest-paid workers a 45-cents-an-hour raise on Friday -- to $9.60 -- seemed progressive when it was first proposed two years ago.

Back then, Gov. Dannel P. Malloy was hailed as a leader in the living wage fight after the state approved a gradual increase to bring the minimum wage to $10.10 by 2017.

But Connecticut has been eclipsed in recent months by the "Fight for $15" movement. Spurred on by fast-food worker protests across the nation, several states and cities plan to phase in a $15 minimum wage over the next few years.

Despite falling behind, Malloy is still trumpeting the state's record.

"We are proud that Connecticut was the first state in the nation to raise the wage to $10.10, and we are proud to be a national leader on paid sick days as well," Malloy said last week. "We always have said that no one should have to work 40 hours per week and have to live in poverty, and that's something we stand by, now and in the future."

In neighboring New York, Gov. Andrew Cuomo recently ordered that state workers would receive $15 an hour by the end of 2021. In Los Angeles, all workers can expect a $15 minimum wage in 2020. In Massachusetts, home health care workers will reach that milestone in 2018. And in cities from Seattle to Buffalo, N.Y.; Missoula, Mont. to Greensboro, N.C., there are plans to gradually institute the $15-an-hour wage.

But don't expect a $15 wage in Connecticut anytime soon.

With 2016 an election year for the Connecticut General Assembly, it's unlikely that Democrats, who hold the majority, want to hand Republicans any political ammunition. The party took heavy anti-business criticism following the corporate tax increases that were adopted in June and partially repealed in December.

"A lot of things don't happen in an election year," said Sen. Edwin A. Gomes, D-Bridgeport, co-chairman of the legislative Labor and Public Employees Committee. "When we work with the minimum wage, we're always behind the times. It's just a poverty level anyhow, so we hope to keep raising it. I try to make progress each year I'm in office."

Changing the way restaurants and bars pay their servers, with lower per-hour wages supplemented by tips, stands a better chance of revision, Gomes said.

Spurring the economy

Lori Pelletier, president of the state AFL-CIO and a political realist, agreed that the $10.10 per hour set for next January will likely not be increased this year.

"Ten dollars and 10 cents an hour is the floor, and the floor really needs to be higher," Pelletier said. "I think as a state, unfortunately, passing legislation in not easy. We're leaving a whole segment of women and minority workers behind."

Department of Labor Commissioner Sharon M. Palmer said higher wages spur the economy.

"An increase in the minimum wage makes economic sense because the result is more money in the hands of people who will spend it and invest in our local businesses," Palmer said. "Paying a higher wage helps companies retain skilled employees, and this translates to increased productivity, better customer service and a stronger economy."

Business flight

Raising the minimum wage could drive businesses out of state, said Eric Gjede, assistant counsel for the Connecticut Business & Industry Association.

"I think right now, the governor and legislative leaders have been speaking about making Connecticut more competitive," Gjede said, noting the December special session that retooled this year's corporate tax increases, which had drawn threats from Fairfield-based General Electric.

Higher labor costs have resulted in cutbacks in employee hours and benefits, with a rise in consumer prices, Gjede warned.

"Seattle was the first to impose $15 and businesses are leaving the city limits to escape this thing," Gjede said.

In the headlines

In February 2014, Malloy grabbed the spotlight at the White House when he tussled over wages with Louisiana Gov. Bobby Jindal. At the time a presidential aspirant, Jindal criticized President Barack Obama for "waving the white flag" on the pay issue. "We think we can do better than the minimum-wage economy," Jindal said to reporters.

Malloy could barely contain himself.

"I don't know what the heck was a reference to white flag when it comes to people making $404 a week," Malloy said. "I mean, that's the most insane statement I've ever heard, quite frankly."

A few weeks ago, Cuomo, who sometimes seems to be competing with Malloy for most-progressive-governor status, seized the political high ground in announcing that he would sign an executive order giving $15 an hour to thousands of New York state workers.

In Connecticut, several thousand state and municipal employees will benefit from the scheduled wage increases which are expected to cost the state an additional $3.7 million.

The new $9.60-per-hour wage means that a full-time, single employee working a 40-hour week will earn $19,938 a year and pay Connecticut $74 in income taxes, according to the state Department of Revenue Services.

In a state that is among both the highest-earning and has the highest cost of living in the nation, it makes sense to pay more, particular to the working poor, who put their income back into the economy, said Derek Thomas, fiscal policy fellow at the nonprofit Connecticut Voices for Children.

"Connecticut has one of the highest minimum wages in the country, and lawmakers should be applauded," said Thomas, stressing that it's still poverty pay. "It looks like there are very few places, if any, where that wage would be enough to support a single adult, let alone an adult with a child. Fifteen dollars is the goal to help a single parent support a child."

More than 60 percent of the minimum-wage workforce is made up of women," Lt. Gov. Nancy Wyman said last week.

"This pay increase will help us narrow wage gaps," Wyman said. "But it's also part of broader efforts to ensure that full-time workers can afford to work and live in Connecticut."

(c)2016 the Connecticut Post (Bridgeport, Conn.)