House and Senate lawmakers advanced bills Thursday that would increase the state’s minimum wage to $15 an hour for many workers in the years ahead and also would offer
a tax credit to small businesses to try to cushion the impact of the wage increases on businesses.
Increasing the state minimum wage to a “living wage” is one of the top priorities of the state Democratic Party this year, and supporters of the bills crowded the House and Senate hearing rooms Thursday to urge lawmakers to boost the minimum pay to provide relief to working families that are struggling with Hawaii’s high cost of living.
The proposals were
opposed by the Chamber
of Commerce Hawaii, the
Hawaii Food Industry Association and other business organizations. Food Industry Association Executive Director Lauren Zirbel warned an increase would cause employers to eliminate jobs.
“In a lot of these places where the minimum wage has been raised to $15 an hour and over, we’re seeing just a massive influx of self-checkout, and you have to take into consideration, at what wage does it not become possible to employ a human person when the job can be done by a machine?” Zirbel said.
“I guess our question is, ‘Is there a training wage? Is there place for that in our society? Do we think that there are employees who would benefit from being trained?’ That’s what the minimum wage provides,” she said. “It’s not meant to be a living wage. It never was and it isn’t.”
That was disputed by Democratic Party activist Bart Dame, who said the minimum wage was a New Deal creation of President Franklin D. Roosevelt. “He explicitly said it was so that no worker would suffer from a substandard standard of living. It was not set up as a training wage,” Dame said.
House Labor and Public Employment Chairman Aaron Johanson approved
a measure to create a two-tiered minimum wage to
assist employers who provide health insurance to their workers.
For employers who provide health coverage, the minimum wage would increase from $10.10 today to $10.50 next year, followed by annual 50-cent increases until the minimum reaches $12.50 in 2024.
However, employers who do not provide health coverage for their workers would see steeper increases in the wage floor. For those companies the minimum wage would increase to $11 in 2020, followed by $1-per-year increases each year until the minimum wage reaches $15 in 2024.
Later in the day, the Senate Committee on Labor, Culture and the Arts used a different approach, approving a separate bill to increase the minimum wage to $12 in 2020 and to $15 in 2023.
Senate Labor Committee Chairman Brian Taniguchi said he also planned to rewrite the bill to include a tax credit of up to $50,000 per year to help offset the cost of the minimum wage increase.
Only companies that have 50 or fewer employees and gross revenue of $4 million per year or less would be eligible for the credit, Taniguchi said, and the tax credit would end after five years.
Both the House and
Senate bills will have to clear additional committee hearings and floor votes
before they can become law.
Honolulu Mayor Kirk Caldwell also weighed into the minimum wage debate Thursday by urging state lawmakers at another hearing to increase the minimum wage to $15 an hour and to authorize the state Department of Labor and Industrial Relations to increase the minimum wage as the consumer price index increases.
“Although I understand that increasing the minimum wage will have an
economic impact on businesses, will result in increased labor costs to the City and County of Honolulu, and is not the silver bullet to address the income needs of Hawaii’s people, I truly believe that we need to at least begin to move forward on how to better improve the financial stability of our residents and local families, many of which are faced with leaving their island home,” Caldwell said in written
testimony.
