YAKIMA, Wash. -- Dave Tompkins, owner of North Town Coffeehouse in Yakima and Selah, found ways to cover the increase labor costs that came with the passage of Initiative 1433 last fall.
It meant, however, that customers pay 5 percent more; his more senior employees got smaller raises; and Selah residents lost an evening hangout after Tompkins cut evening hours at his business there.
So he welcomes a trio of minimum wage bills — Senate Bill 5530, Senate Bill 5532 and Senate Bill 5541 — proposed by Sen. Michael Baumgartner, R-Spokane. Under one of those bills, employers outside King County would have a lower minimum wage.
“It’s a little bit unfair to press some of the economic standards that are probably reasonable in the Seattle area on Eastern Washington,” he said.
This year’s minimum wage increase — from $9.47 to $11 an hour —represented a 16.1 percent jump. By the year 2020, hourly wages will increase to $13.50 an hour under I-1433. Concerns from business owners and nonprofit executives like Tompkins were the motivation behind these proposed bills, Baumgartner said in a phone interview on Monday.
The bills are “a response to the realities on the ground of the tremendous burdens wage increases are placing on employers, particularity in Eastern Washington,” he said.
All three bills provide exemptions that would reduce the minimum wage employers, including nonprofits and those outside the Seattle area, would have to pay.
SB5530 and SB5532 propose reducing the minimum wage this year to $9.53 an hour, the amount employers would have paid this year had I-1433 not passed.
Under both bills, the wage would increase annually based on inflation.
Under SB5530, that wage would apply to employers located in any county with fewer than 1.5 million residents — essentially every county except King County. Those in King County would continue to pay the wages outlined in I-1433.
Senate Bill 5532 would extend a similar exemption to all nonprofits statewide.
Tom Gannon, executive director of Yakima Specialities Inc., a nonprofit that employs disabled residents to provide various services, isn’t opposed to a minimum wage increase, but felt this recent one hit his organization a bit hard.
With the increase, annual payroll will rise about $60,000, said Gannon. With the organization’s already tight profit margins, that’s a sizable increase.
No one has been laid off, but Gannon said he can’t rule it out with future increases.
“We’re trying to figure it out,” he said. “I wish they would have (increased wages) at smaller increments.”
Baumgartner said the need for a nonprofit exception to minimum wage requirements was apparent when he met with the executive director of the Union Gospel Mission in Spokane. The director told him the minimum wage would reduce the number of jobs at the mission, including those that are held by participants in the mission’s drug and alcohol treatment program.
The third bill, SB5541, is another attempt by Baumgartner to pass a teenage wage. The bill proposes that employers pay workers under the age of 18 a lower minimum wage.
Current law states that those under 16 be paid 85 percent of the minimum wage. This bill extends that provision to all workers under 18.
Baumgartner said that the higher minimum wage has made it challenging for employers to hire younger workers.
“We have a generation of teenagers that are losing their chance to learn a solid work ethic,” he said.
All three bills have passed through the Senate’s Commerce, Labor & Sports committee, but Baumgartner admits that getting the bills through the Senate will be far more challenging.
Still, he said, proposing these bills seems to be the best option to resolve concerns rather than trying to repeal or amend Initiative 1433, which would require a two-thirds vote in both the state House and Senate.
“(I hope ) business owners or nonprofits would talk to some of the Democrats (and say), ‘Hey, this is really hurting,’” he said.