March 4, 2019

A meaningful and principled minimum wage hike

The legislature is poised to pass a bill to raise the state’s minimum wage and benefit nearly 250.000 New Mexican residents and families, providing a boost to communities across the state. The New Mexico House of Representatives version of the bill phases in a raise of $12 by 2022. It also includes provisions to index the minimum wage to rise with the cost of living and eliminate the sub-minimum wage for workers who rely on tips. Instead of the current basement wage of $2.13 per hour, tipped employees would earn the same minimum wage as other workers, plus tips. But big business and the restaurant industry are engaged in intense lobbying at the Roundhouse mischaracterizing what it means to work for a basement wage.

Unfortunately, the House bill was amended in the Senate Public Affairs Committee to keep the tipped wage at the current rate, raising it over time to just 30 percent of the statewide minimum wage. Another minimum wage bill passed by the Public Affairs Committee, introduced by Sen. Clemente Sanchez, would raise the minimum wage to a meager $10 within the next year, introduces a so-called training wage for young workers, who should earn the same for doing the same work, and leaves the $2.13 tipped wage barely increased.

Gov. Michelle Lujan Grisham has indicated that she will sign a strong minimum wage bill, one that will raise standards for hundreds of thousands of workers, their families, and our communities. Lobbyists for the wealthy and well-connected are pushing legislators to cut out classes of workers, like tipped workers and young workers, who are most likely to be living in poverty. Carving categories of workers out of a rise in the lowest legal wage is unjust, cruel, and contrary to the core goal of creating better wages and fairer workplaces. We call on our legislators to stand strong for all workers and not do the bidding of lobbyists by cutting workers out of this opportunity for economic security.

Comedian Chris Rock, a former minimum wage worker, has said, “You know what that means when someone pays you minimum wage? You know what your boss was trying to say? ‘Hey if I could pay you less, I would, but it’s against the law.’”

For tipped workers, the current rate of $2.31 hasn’t changed since 1991. Employers are supposed to ensure that these workers make the full state (or local prevailing) minimum wage but many do not and wage theft (or nonpayment) is rife in the service industries. According to the US Department of Labor’s Wage and Hour Division, almost “84 percent of full-service restaurants it investigated between 2010 and 2012 had violated labor standards.” And workers who request their full legal salary can find themselves getting fewer and less profitable shifts, or left off work schedules altogether.

The New Mexico Restaurant Association has incorrectly characterized workers who would be affected by this higher minimum wage. At a recent House Commerce and Economic Development Committee hearing, the Association and restaurant owners turned out a crowd of servers from white tablecloth restaurants who earn more than the minimum wage. These business interests tried to erase the reality of the majority of tipped workers, who labor in nail salons, car washes, and casual dining restaurants, particularly the large chains.

Nathan Siegel of Albuquerque, who has been a server in Oregon and here in New Mexico, knows the difference between a living wage and a poverty wage. In Oregon, where tipped workers earn a minimum wage of $10.75 plus tips, the service industry is a career where people can make a family-sustaining income. While Nathan worked in restaurants to supplement his students loans, he says his New Mexican co-workers were struggling, living shift to shift, one step away from financial disaster, including a pregnant co-worker working 13 hour shifts into her ninth month just to make ends meet.

The reality is that most tipped workers — predominantly women and workers of color — live in poverty and are twice as likely to depend on food stamps as the general population. This workforce is vulnerable to unpredictable drops in pay as tips fluctuate from shift to shift, fueling even higher poverty rates. And contrary to claims from the New Mexico Restaurant Association, research shows that both workers and restaurants have prospered in localities that have eliminated the subminimum wage. After California eliminated its tipped wage, workers now have a median wage of over $12 per hour while restaurants reported an annual sales increase of over five percent.

This wrangling over increasing the minimum wage is death by a thousand cuts made to the people who can least sustain them. Raising the wage is an economic and moral issue. Too many state residents are working full time and barely making ends meet. Raising the minimum wage to at least $12 by 2022, along with indexing the wage and eliminating the tipped worker credit, is the right thing to do — not just for workers but for the economy, which is where their extra wages will go. And higher pay will reduce workers’ dependency on food stamps, Medicaid, and other social programs. The House of Representatives has passed a principled and reasonable measure; on behalf of New Mexico’s working families, I urge the Senate to follow their leadership and pass their bill.

J.D. Mathews is the state political director for the New Mexico Working Families Party.