Portland Minimum Wage – Legal knots and likely challenges. Webbert says, “That language leaves uncertainty to the law.”

Read the full article here at the Portland Press Herald.

That language adds uncertainty to the law, said David Webbert of the law firm Johnson, Webbert & Young, which specializes in employment issues. He said “primarily” has been defined as 50 percent-plus. But “substantially” is less clear, Webbert said, so opponents may turn to the courts for a definition.

 

Tipped Workers Deserve To Be Paid Like Everyone Else

Read it here.

900px-Busy_WaiterCould you live on $3.75 an hour? Would you be willing to demand that your boss pay you an additional $3.75 in tips to bring you to the state minimum wage of $7.50 an hour? What would you do if your boss didn’t make up the difference? Would you be willing to sue your employer? Could you even find an attorney who would take your case?

These are all questions that tipped workers—primarily but not only restaurant workers—already may have to face on a daily basis in Maine. And if the minimum wage in Portland goes to $10.10 an hour and the minimum tipped workers make is not increased at the same time, the questions get that much tougher for tipped workers. Would you demand that your boss pay you $6.35 per hour more?

I’ve spent a not inconsiderable amount of time these past few months working to get the minimum wage raised in Portland. I’ve met with City Councilors Hinck and Suslovic, attended several hearings that have lasted late into the evening, and carried signs calling for an increase in the minimum wage.

I’ve listened to representatives of the hospitality industry—including Steve DiMillo and Michelle Corry, both of whom own restaurants I frequent (DiMillo’s, 555, Petite Jacqueline)—testify repeatedly that their servers make $30-40 an hour and don’t need a raise. And I’ve listened to the lobbyist from the Chamber of Commerce contend that the sky is falling and don’t kill the goose that laid the golden egg.

Interestingly, there is one group that the Portland City Council really has not heard from—the workers who would be most affected by the raise in the minimum wage. Those would be the servers who work in our restaurants and diners—not just those who work in high end spots like those run by Michelle Corry, but also those who work in fast food franchises, in breakfast spots like BreaLu and (yes) Marcy’s, in the ethnic restaurants like Babylon and Seng Thai.

I am curious. Would the servers at DiMillo’s and 555 really testify that they earn $30-40 shift? Or is that only on a summer night when the restaurant is packed with tourists? What about in the dead of winter? And what would the folks who work at Dunkin Donuts, at Mickey D’s, at Dennys’, and at Portland’s diners and family restaurants have to say? Are they making $7.50 an hour?

Why haven’t these folks showed up to testify? Surely they must know that Portland is considering raising the minimum wage; the story has been all over the news for the last 18 months. Don’t they care? Are they afraid their employer would retaliate if they testified they weren’t really making the minimum wage? That they weren’t really making $30-40/hour?

I don’t know the answers to most of these questions. But I do know that workers are hesitant to challenge their bosses, to stand up for their rights. Virtually the first question out of the mouth of every worker who contacts me is “If my boss finds out I contacted you, can he retaliate?” Usually my response is, “It is illegal to retaliate, but I can’t guarantee that it won’t happen.” For many workers, that’s the end of the conversation.

And for those who still want to press forward, there is always the question whether it makes economic sense for me as a lawyer to accept their case. If someone hasn’t been paid at least $ 3.75 in tips on a given shift, how can she prove it? And if it happens every shift all the time, at most the worker is owed $7,500 (2,000 hours x 3.75/hour). But most restaurant workers don’t work 40 hours per week, so the number is going to be a lot less. That’s not a real attractive case to an attorney.

According to the Bureau of Labor Statistics, the average tipped restaurant worker in Portland-South Portland-Biddeford earns $9.80 an hour. So if the average is just $9.80 and so many servers are making $30-40/hour, there must be a hell of a lot less making minimum wage!

There is a way out of this. Eliminate the tipped worker exception altogether. Seven states (and the territory of Guam) currently require that tipped workers be paid the state minimum just like every other worker. A number of those states are among the fastest growing states in the country—California, Nevada, and Washington. Even in big sky country—Montana—the sky isn’t falling just because there is no tip credit.

As Greg Kesich recently pointed out in a column in this paper, the entire concept of tipped workers is an anachronism. Let’s get rid of the tipped credit altogether, set a fair minimum wage for everyone, and include the cost of service in the price of a meal at a restaurant.

Now that would be what I call Dirigo!

 

Fore! Portland Off Course On Minimum Wage Vote

Read it here.

Portland City HallDuring the summer, I often arrive before 6AM at Val Halla, the town links in Cumberland where I live, before I head off to work. I’m not much of a golfer (some folks won’t disclose their age; I won’t disclose my handicap except to say that it is higher than the age of my son, who was born in 1991), but if I keep the ball in play I can usually get in nine holes in about one and a quarter hours.

After spending about that same amount of time three times this past week shoveling the snow off the steps leading to my house (it’s set up on a knoll), golf season seems a long ways off. A couple of years ago I remember playing golf at Val Halla in late March; this year it looks like I will be cross country skiing there well into April!

But one thing’s for sure; I won’t have to wait until April to cry “fore.” Portland (that big bad liberal bogeyman to much of the rest of Maine), is about to drive the ball deep out of bounds when it comes to raising the minimum wage.

Last November, despite a conservative tidal wave, voters across the country in the most conservative of states—Alaska, Arkansas, Nebraska, and South Dakota—as well as in Illinois, passed referenda increasing their minimum wage. These states followed the lead of a number of cities which already had passed minimum wage increases or enacted increases on election day, including Seattle, San Francisco, Oakland Chicago, Santa Fe, and Washington DC.

Here in Portland, however, despite Mayor Brennan’s efforts to raise the minimum to $9.50 (still far short of the poverty line for a family of four), it is now apparent that there will be no such raise in 2015. At a hearing I attended on January 22 (the third such hearing), only one of the three city councilors in attendance at a Finance Committee session expressed unconditional support for such a raise.

In addition, two of the three councilors indicated they would oppose indexing any raise, which would avoid annual debates about increasing the minimum wage further by tying future increases to increases in the cost of living. Indexing is commonly used to prevent inflation from eroding the value of wages and benefits, such as in the Social Security program.

Several city councilors also indicated that they would not support any requirement that employers pay tipped workers 50% of the minimum wage. Under Maine state law, employers are required to pay one-half of the $7.50 state minimum, or $3.75/hour, to employees who rely on tips, like waiters and waitresses. So, if Portland were to raise its minimum to even the $8.50 level, one might think that employers in the hospitality industry would have to pay their employees $4.25 an hour—a $.50 raise. But since the proposed increase would be a municipal, not a state law, such an increase would not be required. Apparently the two counselors (and Mayor Brennan) believe that the waiters and waitresses are rolling in tips. But no one could answer Councilor Jon Hinck’s question—whether employers actually make up the difference now if business is slow.

There was, however, one bright spot. The councilors seemed to agree, with one exception not to support a sub-minimum training wage for employees under age 18. That idea has been heavily pushed by the hospitality industry.

After months of dilly dallying (Mayor Brennan first proposed raising the minimum last April) in the name ostensibly of getting more information, the Finance Committee scheduled a public hearing and vote on March 12 at 5PM. Absent some unexpected developments, it appears that the most any Portland minimum wage worker can expect is a raise to $8.50 per hour some time in 2016 with no indexing and in the hospitality industry–which comprises a large percentage of Portland’s low wage workforce–probably no real raise at all (unless the worker is willing to demand additional pay when tips are less than $4.75 an hour).

So much for San Francisco on the Fore! Portland workers should be screaming “fore.” Apparently the city’s councilors can’t hear you!

Were Ben & Jerry Right About Ice Cream and Fair Pay?

Read it here.

About 25 years ago it was a dream of mine to work as a lawyer for Ben & Jerry’s ice cream company in Vermont. I have no regrets that I instead wound up in Maine with the truly dream job of representing workers and other folks whose civil rights have been violated.

But, I am thinking wistfully about Ben & Jerry’s. And not because I missed out on the free daily ice cream they provided employees. The reason is the depressing news about the intergalactic distance between the pay for CEOs in the US and the pay for teachers, snowplow drivers, and the other ordinary but vitally important workers.

A new study reports that people in the US believe that a chief executive should make about 7 times the pay of an unskilled worker and they estimate that CEOs actually make about 30 times as much. The truth is much worse. They actually make over 300 times as much as ordinary workers. Chief executives took home on average a bank vault of $11.7 million in 2013, while the average employee earned $35,293. And it gets even worse, Forbes reports that in 2013 the top 25 hedge fund managers took home, on average, almost a billion dollars each.

Americans are right that CEOs should not make more than 7 times what is paid to unskilled factory workers. As the new study confirms, this moral conviction represents a world-wide consensus. No moral or economic justification exists for the extreme overcompensation of the top .1% of Americans at the expense of the hard-working majority.

About thirty-five years ago, a couple of counterculture entrepreneurs in Burlington, Vt., founded Ben & Jerry’s ice cream company. Ben Cohen and Jerry Greenfield promised their employees that the pay ratio between the highest salaried executive and lowest paid worker would be no greater than 5 to 1.They kept to their pay scale for 16 years until Cohen was set to retire and the ratio was tweaked to 7 to 1 to attract new talent, and ultimately to 17 to 1 over the course of a half dozen years more. The company was then taken over by Unilever in 2000, and the commitment to pay equity was silently abandoned.

The current CEO of Unilever made $7,960,000 in 2013. To be true to the 7 to 1 ratio Americans support, Ben & Jerry’s lowest paid employees should make $1,137,143. Put another way, Ben & Jerry’s should pay its entry level workers $547 hour. Puts the current US minimum wage of $7.25 in perspective.

The research proves that this moral consensus over pay equity transcends income, religion, and other ideological factors. So, given this rare common ground, we should act together. Let’s vote for candidates who support raising the minimum wage, increasing income taxes on annual income over $1,000,000, and removing tax breaks for corporations for paying CEOs and other top officials over $1,000,000.

I leave it up to you whether to give up Ben & Jerry’s ice cream.

“Help Me Obama!” Wage Raise Postponed for America’s Neediest

Read it here.

Quick. What’s the fastest growing occupation in America? IT programmer? Nope. Hospitality worker? Nope. Ready to cry uncle? Ok, I’ll give you a clue. These folks work with aging baby boomers and the chronically ill.

If you said health care professional, you’re getting hot. Actually, it’s home health care aide.

Now guess who are among the lowest paid workers in America? Did I hear you say home health workers? You must be smartening up. According to the Bureau of Labor Statistics, for caring for some of our most vulnerable populations, on average a home health aide is rewarded with the princely sum of $10.01 per hour, or just under $21,000 per year. That’s below the poverty level for a family of four and just above it for a family of three. And most of these jobs don’t come with health care benefits.

Who do you think fills these jobs? Over 91% of home health aides are women. Over half are women of color. 25% are immigrants. And 20% are single moms.

These demographics go a long way to explaining why the pay is so low for these critical workers. To be fair, it’s also true that these entry level positions often do not even require a high school degree.

But, perhaps most important of all, incredibly these positions are not covered by the federal minimum wage and overtime laws. You heard that right—thanks to a misguided federal ruling some 40 years ago, home health care workers and personal aides are classified as “companions”—in effect babysitters who are not entitled to the most basic of protections.

Which is why so many of these hard-working people were excited a year ago when the Obama Administration promised that effective January 1, 2015, or less than three months from now, employers would be required to at least pay these good-hearted workers the federal minimum wage of $7.25 plus overtime. (Maine is one of 15 states where home care workers already are covered by the state minimum wage law.)

But something funny happened to the home health aides on their way to the bank; before they could cash the government’s promissory note, the states cried fire (well, actually, they cried poverty). Last week, bowing to claims that some elderly would be unable to afford such care and that Medicare costs could increase, the Obama Administration caved and delayed implementation of the law for at least six months and possibly another year.

It’s been a bad few years for home health workers. Earlier this year, the Supreme Court ruled that unions could not require publicly-funded home health workers to pay fair share dues (a substantially reduced fee) to unions even though a majority of workers had voted to organize.  Now, the Obama Administration has dealt these women and minorities a sucker punch, delaying an increase in their wages.

There’s a lot wrong with this picture. Not the least of which is, when are we going to start paying some of our hardest working citizens whom we entrust with the care of those dearest to us a living wage?

Not So First Class? Airport Workers Fight For A Living Wage

Read it here

July 4th, one of the biggest travel days of the year, is Friday, only three days from now. And for many of us that means one thing: summer travel. My two-year-old has been asking for days (sometimes multiple times per day), “Today do we get on the airplane?” We’re headed down to the Jetport later this week to fly to Philadelphia for a long-awaited family reunion.

But while millions of us are taking time off of work for a July 4 vacation, millions more are reporting for their shifts at airports, toll booths, and car rental agencies to support all that travel. The US travel industry generates about 15 million jobs. And many of those jobs are in the airline industry.

The airline industry may generate a lot of jobs, but that doesn’t mean they’re decent jobs – at least not anymore. Airports have been called “cities of secret poverty.” As airport jobs have been increasingly subcontracted out, low-wage airport workers have seen a 15% drop in pay over the past decade (and a shocking 45% wage drop in some positions, like baggage handlers).

Airport workers are far more likely than the average American to live in poverty.One recent report on the Philadelphia airport found that subcontracted airport workers, the vast majority of whom were African American, earned an average of just $16,000/year. These poverty wages meant that a full 75% of airport workers had trouble paying their bills and 20% went hungry last year.

What’s more, wage theft is rampant for this vulnerable group. Almost 50% of Philadelphia airport workers reported they were not paid fully for the hours they worked, and 30% reported not being paid overtime. Somehow, though, airline executives aren’t hurting – the CEO of US Airways, which has its hub in Philly, earns an estimated $2,640 per hour (yes, per hour).

Recently, airport workers and activists have launched efforts to reverse these disturbing trends. In New York City, local airport workers and union supporters have rallied, petitioned and marched for fair pay, working toward a minimum wage of $10.10/hour.

And a high-profile battle raged last fall over Seattle’s efforts to raise the minimum wage in SeaTac, the city that includes the Seattle-Tacoma airport. Effective January 1 of this year, Seattle voters approved a referendum to enact the country’s highest living wage, $15/hour. There have been dire predictions about the change, with headlines like “Seattle set to destroy economy with highest minimum wage increase in the world.”

But so far, there’s no evidence that the sky is falling in SeaTac. A few months after enactment, the Seattle Times reported a few minor changes in SeaTac, like some airport businesses instituting a “living wage surcharge” for airport parking spaces, but none of the predicted catastrophes.

The biggest change, by far, has been for the workers. Vicky Castro, a 23-year-old cashier at a parking lot in SeaTac, said her 60% pay raise is going toward college savings. “I really want to go full force in school,” she said. “I don’t want to be a cashier forever.”

Isn’t This Rich?: Walmart CEO Says He’s Just Another Associate

Read it here

Walmart employs over 2 million associates (!!!) making it the world’s largest private employer. That’s as large as the population of the world’s 50 smallest countries—combined!

Two weekends ago when I was driving back to Maine from a zydeco festival in New Jersey (I’m a huge New Orleans music aficionado), I passed a number of Walmart trucks on the highway. They all were painted with the company’s succinct logo: “Save money. Live better.”

Nice slogan. But the reality is that the only ones saving money and living better are Walmart honchos—certainly not its employees.

It has been well-documented that despite its revenues and size, Walmart’s largesse does not extend to the man and woman on the ground floor. The average full-time associate (defined by Walmart as 34 hours per week) earns $8.81 per hour, or barely more than the minimum wage. That computes to $15,500 annually, or below the poverty line for a family of two. As a result, a group called Walmart Moms introduced a resolution at the retail giant’s annual meeting earlier this month asking the company to pay a full time wage of $25,000.

There are hidden costs to the taxpayer to Walmart’s poverty wages. While customers may save a buck or two at the cash register, we pay for it dearly in other ways.

Because Walmart’s wages are so low, several studies have concluded that taxpayers subsidize Walmart in the form of corporate welfare benefits (e.g food stamps, WIC, etc.) to the tune of over $1 billion annually here in the USA. Wages are so poor at Walmart that last November a Walmart store started a food drive for its associates to insure they could have a decent Thanksgiving dinner. Apparently the food drive was an annual tradition!

Which is why Walmart CEO Doug McMillon’s recent statement that he’s “just another associate” is so rich. You see, McMillon made $9.5 million last year. And that’s not really the full picture. Including stock options—a key part these days of any exec’s compensation— McMillon actually made $25.6 million. With that kind of money, McMillon certainly isn’t on food stamps, and he shouldn’t be having any problem making ends meet.

Of course, McMillon isn’t the only CEO making big bucks. Only 35 years ago, in 1979, the average CEO made 29 times more than the pay of an average employee. Estimates today place that number in the US anywhere from 354 to 475 times the pay of the average worker. Whatever the number, income inequality in the US is huge and growing by leaps and bounds.

Things in Maine are a little bit better according to the Portland Press Herald. While pay for hospital executives is stratospheric, executive pay “only” rose 44% over the last five years in Maine (or roughly 9% annually), to $1.65 million.

“Just another associate.” As one wag put it, that’s like saying Kate Upton is just another model. Or to put it in local terms, that’s like saying Tom Brady is just another football player. Big Papi is just another baseball player. And George Mitchell was just another Senator.

Next time you happen to be shopping at Walmart, be sure to ask for “just another associate.” Who knows, maybe Doug McMillion (oops, I meant McMillon), will be waiting on you.

Minimum Wage Debate Heats Up; Is It Time for Portland to Help Lead the Way?

Read it here.

On Tuesday, my colleague Carol Garvan explored the importance in “On the Job” of tipping in the hospitality industry. I know most schools let out this week, but class, let’s try to focus and stay on topic and continue the discussion about the important efforts underway to increase the minimum wage.

Here in Maine, our fair governor last year already predictably vetoed a bill that would have raised the statewide minimum wage from $7.50 to $9 hour, saying we “should aim higher than the minimum.” I’m not sure how increasing the minimum isn’t aiming higher, but that’s our governor. Perhaps we should take pride in the fact that wages in the Second Congressional District are the lowest in the Northeast and among the lowest in the nation according to a recent report from Oxfam America, the anti-hunger group.

Elsewhere, as my favorite bumper sticker I saw this week said, “It’s time to turn LePage.” Back in January, in his State of the City address, Portland mayor Michael Brennan announced his support for increasing the minimum wage in Maine’s largest city.   Since then, Mayor Brennan convened an all-star panel in March representing various interests from the Chamber of Commerce to the Catholic Diocese to public interest advocacy groups to discuss the issue. The panel hopes to present a proposal this September.

Consensus is a good thing.  But you know, and I know, that the Chamber is NEVER going to endorse a minimum wage hike. It already is on record (despite research to the contrary) as saying what it always says—that a minimum wage hike is not a good idea. Employers won’t hire new employees, they’ll cut jobs, blah blah blah. If it’s like recommendations from most study committees, I suspect the Minimum Wage Advisory Committee (MWAC) report will gather dust on the shelves of City Hall.

Meanwhile, despite Maine’s time-honored motto “I lead” Dirigo motto, while the MWAC fiddles and diddles, the rest of the country is passing Portland and Maine by. Last February, with one stroke of the pen President Obama increased the federal contract minimum wage to $10.10 per hour. Across the country, Seattle, Washington raised its minimum to $15 per hour, the highest in the country! (Maybe there is hope for Mayor Brennan’s model; Seattle’s mayor also convened a blue ribbon panel). Voters in San Francisco will be voting on a similar $15/hour proposal. (I guess that’s why they call it the Left Coast).

Closer to home, Massachusetts legislators have agreed to push for an increase in the minimum wage to $11/hour over 3 years. Just last week, our northern New England neighbor to the west, Vermont, enacted legislation to raise the minimum wage to $10.50/hour in a series of steps by 2018. In both Massachusetts and Vermont, future increases will be indexed to the cost of living.

The poverty line today for a family of four is almost $24,000. A minimum of even $10.10/hour still doesn’t meet the poverty line unless you are single. That’s why it is time for Portland—and Maine—to raise the minimum wage.