HONOLULU — The state House of Representatives’ Labor and Public Employment Committee will vote today on a bill that would raise the state’s minimum wage by $2 over the course of two years, with the first increase in January 2014.
If passed, Senate Bill 331 Draft 2 would increase Hawai‘i’s minimum wage from $7.25 to $8.25 on Jan. 1, 2014, and twice more to $9.25 by Jan. 1, 2016, after which the wage would be fixed to the consumer price index.
Since being introduced in January by Democratic Sen. Clayton Hee, SB 331 has continued to progress, despite opposition from small businesses.
After clearing two Senate committees, the bill — amended to delay the increase to 2014 — was handed over to the House March 5 for further work, and has since been referred to two House committees.
Proponents say the legislation would assist Hawai‘i residents in dealing with the rising cost of living. But to those opposed to the bill, an increase in wages would place additional burden on local businesses and lead to lay-offs.
The last time Hawai‘i saw an increase in its minimum wage was in 2007, when it went from $6.75 to $7.25. The federal minimum wage is also $7.25, and there are 19 states with minimum wages higher than Hawai‘i’s.
Senate Minority Leader Sam Slom, a Republican, was the sole opponent to the bill, repeatedly voting against it. He said raising the minimum wage would lead to higher unemployment.
Senate Vice President Ron Kouchi voted in favor of the bill at the Senate Ways and Means Committee Feb. 27 and at Third Reading March 5. But he said in its current form, the bill is not ready to be adopted.
“I think it’s worthwhile to gather more information,” he said Monday. “That’s all I voted for now.”
Some of those submitting testimony in favor of the legislation include the state Department of Labor and Industrial Relations, the Department of Human Services and the American Civil Liberties of Hawai‘i.
Partial support also came from TS Restaurants Hawai‘i, the company behind Duke’s and Keoki’s Paradise on Kaua‘i, and other restaurants on Maui and O‘ahu. The company employs approximately 1,400 Hawai‘i residents.
“We are in support of the intention to increase wages for the working poor, but request the following amendments,” wrote Melanie Bailey of TS Restaurants, adding that there should be a corresponding increase in tip credit. “An increase in the tip credit will enable restaurants to raise pay for non-tipped employees, creating more equity in wages.”
Without a corresponding change in the tip credit, Bailey said “we will be giving an increase to the wrong group of employees. Menu prices will rise and the tipped staff will receive another increase as their tip percentages increase.”
Testimony against the bill came from the Hawai‘i Food Industry Association, The Chamber of Commerce of Hawai‘i, the National Federation of Independent Business Hawai‘i, Foodland Super Market and the Kaua‘i Chamber of Commerce, which comprises more than 450 local businesses.
“I am writing this letter in opposition of Senate Bill 331,” wrote Randy Francisco, president and CEO of the Kaua‘i Chamber. “I have called and spoken to nearly 30 small business members of the Chamber to get their input. Their responses were indicative to me of what I already knew and which was reaffirmed.”
Francisco wrote that the majority of local businesses on Kaua‘i already pay above the minimum wage because “it is the right/pono thing to do,” that it is important to recognize a person’s experience, and that employers understand that training is an important and commensurate step in hiring and development.
“In general, the businesses contacted strongly felt that they understand why there is this minimum wage legislation taking place,” he wrote. “However, for them, realistically, they are above the minimum and, not at the minimum.”
A date has not yet been posted for when the legislation will be heard in the House Finance Committee.
A similar bill, House Bill 53 — which died without ever being heard by a House committee — proposed increasing the minimum wage to $8.25 starting in July, and $8.75 beginning in 2014.
• Chris D’Angelo, lifestyle writer, can be reached at 245-3681 (ext. 241) or firstname.lastname@example.org.