The minimum wage mess: what hath we wrought?

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Governor Kate Brown signs the bill to raise Oregon’s minimum wage, March 2, 2016

If you listen just to Democrats in the Oregon Legislature, the just-signed law upping the minimum wage is an unalloyed victory for all.

Tell that to Oregon universities that are faced with big pay increases and to the students who aren’t going to get a job because their school can’t afford to pay them.

According to The Oregonian, Oregon’s new minimum is likely to lead to cutbacks in student hiring or in the number of hours they’re allowed to work, and possibly higher tuition to cover added costs.

At the University of Oregon, the annual wage increases will translate into an estimated $2.3 million in additional wages

In the 2017-19 biennium, $3.4 million in the next funding cycle and $6.1 million by the 2021-23 biennium.

With similar impacts expected at Oregon State University, the school could be looking at reducing the number of student jobs by 650 to 700 positions by FY2019 to cut costs, said OSU spokesman, Steve Clark.

Small businesses across the state are agonizing over the minimum wage increases, too. They’re not going to be talking about ‘What do we do to expand? What do we do to hire more people?’,” said Anthony K. Smith, Oregon state director for the National Federation of Independent Business.

“They’re going to be making some very difficult decisions, none of which are going to help them grow. They have to decide whether to reduce hours for employees, raise prices on customers, make a reduction in their workforce, relocate their business, or maybe even close their doors.

Then, of course, Oregon’s minimum wage changes will contribute to the increased hodgepodge of pay rates in the Pacific Northwest.

If you are an employer in the Pacific Northwest, the minimum wage you will have to pay your employees early next year could, depending on the type and specific location of your business, the age of the employee, and other factors, be any one of the following: $8.05, $9.25, $9.47, $10.15, $10.50, $12.00, $12.50, $13.00, $15.24, $10.35, $11.15, $14.50, $15.00, or $15.24.

If you have to pay prevailing wage rates, your minimum wage rate will be even more expansive. In Oregon, for example, if an employer chooses to include the fringe rate with the basic hourly rate, the minimum hourly wage will be $57.26 for a boilermaker, $52.36 for a dredger and $34.31 for a Highway & Parking Striper.

Clearly, the plethora of minimum wages is going to generate maximum confusion for employers and employees alike. What a mess.

Want to know the whole bewildering picture? See below.

FEDERAL

2016 Federal hourly minimum wage: $7.25 an hour

Federal (sub) Contractors hourly minimum wage

Rate: $10.15. Calculated annually based upon cost of living and rounded to the nearest multiple of $0.05

WASHINGTON

2016 Washington hourly minimum wage outside Seattle, SeaTac and Tacoma: $9.47

  • 14- and 15-year-olds may be paid 85% of the minimum wage ($8.05).
  • Businesses may not use tips as credit toward minimum wages owed to a worker.
  • Under Initiative 688, approved by Washington voters in 1998, the state makes a cost-of-living adjustment to its minimum wage each year based on the federal Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) (www.ssa.gov). The state’s minimum wage is recalculated each year in September. Th4 new wage takes effect the following year on January 1.

2016 Seattle hourly minimum wage

A wage includes salary, hourly pay, commissions, piece-rate, and non-discretionary bonuses. Wages do not include tips or payments towards medical benefits. However, payment toward medical benefits can reduce employers’ minimum wage requirements temporarily until 2018.

Small Employers – 500 or fewer employees

 To calculate employer size, count the employer’s total number of individual employees worldwide. For franchises, count all employees in the franchise network.

All small employers are required to pay minimum compensation. Small employers can meet this requirement in two ways:

  • Pay hourly minimum compensation rate; or
  • Pay hourly minimum wage and make up the balance with employee tips reported to the IRS and/or payments toward an employee’s medical benefits plan. For an employee’s medical benefits to qualify toward the minimum wage, the plan must be the equivalent of a “silver” level or higher as defined in the federal Affordable Care Act. An employer cannot pay a reduced minimum wage if the employee declines medical benefits or is not eligible for medical benefits.
  1. Hourly Rate

Small employers pay hourly minimum compensation rate based on the following schedule:

  Minimum Compensation
2016 (January 1) $12.00/hour
2017 (January 1) $13.00/hour
2018 (January 1) $14.00/hour
2019 (January 1) $15.00/hour
  1. Tips and/or Medical Benefits

Small employers pay an hourly minimum wage and reach the minimum compensation rate through employee tips reported to the IRS and/or payments toward an employee’s medical benefits plan. If the tips and/or payments toward medical benefits do not add-up to the minimum compensation rate, the small employer makes up the difference.

  Minimum Compensation Minimum Wage
2016 (January 1) $12.00/hour $10.50/hour
2017 (January 1) $13.00/hour $11.00/hour
2018 (January 1) $14.00/hour $11.50/hour
2019 (January 1) $15.00/hour $12.00/hour
2020 (January 1) $15.75 $13.50/hour
2021 (January 1) $16.49 $15.00/hour

In 2025, small employers will pay the same minimum wage rate as large employers and will no longer count employee tips and/or payments toward an employee’s medical benefit plan toward minimum compensation. The City of Seattle will calculate percentage changes to the minimum wage based on the Consumer Price Index (CPI).

Large Employers: 501 or more employees

To calculate employer size, count the employer’s total number of individual employees worldwide. For franchises, count all employees in the franchise network.

Large employers can meet Seattle’s minimum wage requirements in two ways:

  • Pay hourly minimum wage; or
  • Pay reduced hourly minimum wage if the employer makes payments toward an employee’s silver level medical benefits plan. For an employee’s medical benefits to qualify toward the minimum wage, the plan must be the equivalent of a “silver” level or higher as defined in the federal Affordable Care Act. An employer cannot pay a reduced minimum wage if the employee declines medical benefits or is not eligible for medical benefits.
  1. Hourly Rate

Large employers who do not pay towards an employee’s medical benefits plan pay hourly minimum wage based on the following schedule:

  Minimum Wage
2016 (January 1) $13.00/hour
2017 (January 1) $15.00/hour
  1. Medical Benefits

Large employers who do make payments toward an employee’s medical benefits plan pay a reduced minimum wage based on the following schedule:

  Minimum Wage
2016 (January 1) $12.50/hour
2017 (January 1) $13.50/hour
2018 (January 1) $15.00/hour

Once Seattle’s minimum wage reaches $15.00/hour, payments toward medical benefits no longer impact employees’ minimum wage. In subsequent years, the City of Seattle will calculate percentage changes to the minimum wage based on the Consumer Price Index (CPI).

SeaTac Minimum Wage 

Rate: $15.24 for workers in and near Seattle-Tacoma International Airport.

 Tacoma, WA hourly minimum wage

11/04/15 – Tacoma, WA voters approved a $12 city minimum wage phased in over two years. The new minimum wage will apply to most employees who work 80+ hours per year within Tacoma city limits and begins with an increase to $10.35 an hour on February 1, 2016, Jan.1, 2017: $11.15; Jan. 1, 2018: $12.

 

 

OREGON

Current:  $9.25

 Tier 1 (the Portland urban growth boundary)

July 1, 2016: $9.75

July 1, 2017: $11.25

July 1, 2018: $12

July 1, 2019: $12.50

July 1, 2020: $13.25

July 1, 2021: $14

July 1, 2022: $14.75

 

Tier 2 (Benton, Clackamas, Clatsop, Columbia, Deschutes, Hood River, Jackson, Josephine, Lane, Lincoln, Linn, Marion, Multnomah, Polk, Tillamook, Wasco, Washington and Yamhill counties)

 

July 1, 2016: $9.75

July 1, 2017: $10.25

July 1, 2018: $10.75.

July 1, 2019: $11.25

July 1, 2020: $12

July 1, 2021: $12.75

July 1, 2022: $13.50

 

Tier 3 (Malheur, Lake, Harney, Wheeler, Sherman, Gilliam, Wallowa, Grant, Jefferson, Baker, Union, Crook, Klamath, Douglas, Coos, Curry, Umatilla and Morrow counties)

 

July 1, 2016: $9.50

July 1, 2017: $10

July 1, 2018: $10.50

July 1, 2019: $11

July 1, 2020: $11.50

July 1, 2021: $12

July 1, 2022: $12.50

 

Milwaukie hourly Minimum Wage for city employees

10/22/15 – The Milwaukie City Council adopted a $15 minimum wage for all city employees. The resolution passed unanimously, putting in place a $15 minimum wage for not only full-time employees of the city of Milwaukie, but also part-time and seasonal workers, as well as interns.

Prevailing Wage Rates

In January and July of each year, Oregon’s Bureau of Labor and Industries publishes the prevailing wage rates that are required to be paid to workers on non-residential public works projects in the state of Oregon. Quarterly updates are published in April and October.

REGION #2

Clackamas, Multnomah and Washington Counties

Under the Davis-Bacon Act, employers can either choose to pay the fringe benefits as additional cash wages (which would result in an effective hourly wage of $38) or provide a “bona fide” benefit plan. Benefits that might be included in such a plan are retirement accounts (401(k) or pensions), medical insurance, vision insurance, dental insurance and life insurance.

 

Basic hourly rate             Fringe rate

Boilermaker               $33.92                           $23.34

Dredger                       $39.08                           $13.28

Fence constructor

(non-metal)               $24.10                         $10.12

(Metal)                          $20.50                         $ 5.09

Highway & Parking

Striper                            $26.11                          $ 8.20

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An abuse of power: Oregon Democrats and the short session

When Governor Brown signed the new minimum wage law on March 2 she hailed it as an example of Oregon’s collaborative spirit. Far from it.

The Democrats have been using this year’s short session to run the Legislature like an authoritarian one-party state. That’s what happens when one party is in control for so long.

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In one case, the Democrats steamrolled Republicans and rammed a minimum wage bill, SB 1532, through the Legislature in just one month.

The Senate passed the bill 16-12, with the vote going strictly along party lines. The House vote was 32-26, with every Republican again voting no.

Under this major law that will impact workers and employers across the state, the base state minimum wage will rise to $9.75 on July 1. Wages will then rise at different rates in in three geographic areas, with the Portland area reaching $14.75 in 2022.

Then there’s what The Oregonian has called “one of the most far-reaching pieces of energy legislation the state has ever seen.”

On March 1, the Democrats rammed through the House on almost a strict party-line vote, the latest version of a controversial bill that would end the use of coal to provide power to Oregonians within two decades and expand the use of renewables to 50% of the power supply by 2040. Republicans then repeatedly failed to derail the legislation, after which all but one Democrat voted to pass the bill, overwhelming the no votes of 12 Republicans (one didn’t vote).

In this case, it wasn’t only the Republicans that were shut out of the process; so was the Oregon Public Utility Commission. The Oregonian reported that state utility regulators say they were shut out when it came time to craft the legislation and when members of the Commission tried to voice their concerns publicly, the governor’s office muzzled them.

To top it off, Democrats have abused the short Legislative session itself.

When voters approved Measure 71, providing for annual legislative sessions, in 2010, there was a general expectation that the short sessions would deal with emergencies and lower-impact bills, leaving the longer sessions for comprehensive and high-impact bills where deliberation and public input would be required.

Democrats have cast that approach aside this short session and run amok with major partisan legislation.

Apparently its true, to slightly rephrase Mark Twain’s observation, that “No man’s life, liberty, or property are safe while the Oregon Legislature is in session.”

 

 

Hillary and The Donald: Self-inflicted wounds

With Super Tuesday voting and other primaries and caucuses behind us, Donald Trump and Hillary Clinton are the clear leaders in the Republican and Democratic races for their party’s presidential nominations.

But they are both damaged candidates and the parties have only themselves to blame for their success.

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Democrats have known for years that Hillary would be a seriously flawed candidate.

 “She has always been awkward and uninspiring on the stump,” a senior Democratic consultant once told the Washington Post. “Hillary has Bill’s baggage and now her own as secretary of state — without Bill’s personality, eloquence or warmth.”

 While her damaging e-mail scandal may be relatively new, Hillary has been associated with decades of personal and political contretemps, leading to a clear case of Clinton fatigue among the populace.

Equally troubling to the Democratic Party should be Hillary’s trust gap.

In a July 2015 Quinnipiac University national poll, 57 percent of respondents said Clinton is not honest and trustworthy, one of the worst scores among all the top candidates at the time. And her scores have gotten worse. In a subsequent Quinnipiac poll, 61 percent of respondents said Clinton is not honest and trustworthy.

In an August 2015 Quinnipiac University poll, “liar” was the first word that came to mind more than others in an open-ended question when voters were asked what they think of Clinton, followed by “dishonest” and “untrustworthy”. (“Arrogant” was the first word that came to mind for Trump, but that doesn’t seem quite as toxic)

In January 2016, a poll produced for ABC by Langer Research Associates put Hillary 12 points behind Bernie Sanders, 48-36 percent, in being seen as more honest and trustworthy, a deterioration from 6 points behind in Dec. 2015 and equal to Sanders in October 2015.

But Hillary’s problems as a candidate go even deeper.

“Voters see her as an extraordinarily cynical, power-hungry insider,” James Poulos said in The Week on Feb. 2. “She is out for herself, not out for Americans. Voters know it.”

This ties in with a long-held and widespread perception that Hillary and her family are just plain greedy, what with them hauling off $190,000 worth of china, flatware, rugs, televisions, sofas and other gifts when they moved out of the White House, taking money from all sorts of unsavory people and foreign countries for their Foundation, and charging exorbitant amounts for speeches.

David Axelrod, a political consultant who helped steer Obama to the presidency, noted in his book, “Believer”, that Hillary has two other main weaknesses: she’s a polarizing rather than a “healing figure,” and she has a hard time selling herself as the “candidate of the future” given her checkered past and long political resume.

And then, as Josh Kraushaar wrote in The Atlantic before Jeb Bush dropped out, “…pundits and donors alike are vastly overrating the prospects of two brand-name candidates for 2016 — Hillary Clinton and Jeb Bush — and undervaluing the reality that the current political environment is as toxic as it’s ever been for lifelong politicians.”

Then there’s Trump

That, of course, takes us to Donald Trump, the Republican Party’s “Nightmare on Park Avenue.”

Isolated in their cocoons, party officials (and the political press) assumed an establishment candidate would emerge the victor. They denied to themselves and others for months that Trump would be a viable candidate for the Republican nomination.

Nobody was more smug in this assumption then Jeb!

He started early, rebuilding political connections, building a professional staff and laying the groundwork for a “shock and awe” fundraising blitz. But he faltered early and never regained his balance. He watched helplessly as his fund-raising advantage become a disadvantage, defining him as the establishment favorite when the Republican base was looking for a change agent.

Political leaders also overestimated voters’ desire for solid, traditional, steady candidates and too quickly dismissed Trump as a long-term threat. “Reality TV will gather a lot of interest and a lot of people enjoyed the celebrity of that, but for the last 14 years, I’ve had to live in the real world and deal with real world issues and come up with real world solutions,” former Texas Gov. Rick Perry said in mid-2015. “And that’s what the people I think of this country want out of the next president of the United States.”

Meanwhile, confident that Trump’s bombast, misstatements and insults would doom him, Republican Party leaders watched incredulously as he rolled over establishment candidates.

“Until recently, the narrative of stories like this has been predictable,” Matt Taibbi wrote in Rolling Stone. “If a candidate said something nuts, or seemingly not true, an army of humorless journalists quickly dug up all the facts, and the candidate ultimately was either vindicated, apologized, or suffered terrible agonies… That dynamic has broken down this election season. Politicians are quickly learning that they can say just about anything and get away with it.”

As Karen Tumulty wrote in the Washington Post, “Will Trump eventually cross a line — or do the lines no longer exist?”

The make-up and size of the Republican candidate field also has worked to Trump’s advantage.

There’s no love lost, for example, between most members of Congress and Ted Cruz. And with so many Republican candidates (17 at one point), voter preferences were atomized for too long and even now none of the remaining candidates are willing to drop out, preventing the emergence of a single challenger to Trump.

So here we are, facing the possibility of a Clinton-Trump election.

Just goes to show that Clarence Darrow was right. “When I was a boy I was told that anybody could become President; I’m beginning to believe it,” he said.