Can a NC city set a minimum wage higher than the state's?
In a comment thread below, Percy Walker asked a good question: "Are you sure a N.C. city can have a higher minimum wage than the state minimum wage under N.C. law?" I've read that the CA has been voicing similar concerns which aren't entirely off base. I asked an attorney, Jim Boyett, who has been a leader in getting this campaign up and running for his opinion, which he summarized as follows:
Thanks to Percy and Sam for asking the question. Keep 'em coming.
At the risk of breaking what I've observed to be a blogging norm, I will admit that I don't know definitive answers to all of the questions/concerns that have been raised about a minimum wage increase in Greensboro. I will be spending some of my free time over the next few months trying to seek out answers and opinions when they are available. But what I'm learning is that no one knows exactly how a higher minimum wage would affect the economy of Greensboro. People can make educated predictions, but no one knows for certain.
What I do know for certain is that it would be extremely difficult for me, a single, childless, healthy woman renting a one-bedroom apartment in Greensboro, to cover my modest living expenses on $9/hour or less, even if I were working a full time job. It would be downright impossible for me to do so if I had a child and/or significant medical bills. (For one set of estimates on living wages in Greensboro and other cities in 2006, check out this website, sent to me by Cara Michele.)
Beyond that, it is all hypothetical. But since some Greensboro leaders are currently struggling to come up with a "brand" for the city, I think it would be a courageous and logical starting point to say that we are a city where anyone who works full time will not live in poverty. (Someone else can probably make that sound more catchy.)
The best way to answer the question is that there is no legal opinion on point because this has never been done in North Carolina. The best legal guess is that Cities have the power to create their own minimum wage based upon the fact that the General legislative power was granted to Cities in 1971. Further, the only appellate level court to consider all the arguments against a city adopting its own minimum wage was the New Mexico Court of Appeals in the case of New Mexicans for Free Enterprise VS The City of Santa Fe. That Court found that the City of Santa Fe had the power to create a minimum wage higher than that of the Federal and State Government.
Thanks to Percy and Sam for asking the question. Keep 'em coming.
At the risk of breaking what I've observed to be a blogging norm, I will admit that I don't know definitive answers to all of the questions/concerns that have been raised about a minimum wage increase in Greensboro. I will be spending some of my free time over the next few months trying to seek out answers and opinions when they are available. But what I'm learning is that no one knows exactly how a higher minimum wage would affect the economy of Greensboro. People can make educated predictions, but no one knows for certain.
What I do know for certain is that it would be extremely difficult for me, a single, childless, healthy woman renting a one-bedroom apartment in Greensboro, to cover my modest living expenses on $9/hour or less, even if I were working a full time job. It would be downright impossible for me to do so if I had a child and/or significant medical bills. (For one set of estimates on living wages in Greensboro and other cities in 2006, check out this website, sent to me by Cara Michele.)
Beyond that, it is all hypothetical. But since some Greensboro leaders are currently struggling to come up with a "brand" for the city, I think it would be a courageous and logical starting point to say that we are a city where anyone who works full time will not live in poverty. (Someone else can probably make that sound more catchy.)
posted by Jill Williams at
11:51 AM
20 Comments:
By the logic implied by Mr. Boyette, a city could also impose it's own penalties for violations of law that occur within it's boundaries. I find that a difficult position to sell. A city could not have its own murder statute with it's own penalties, or pass a system of taxation that is in conflict with state law, or decide that people should drive on the left side of the road within the city limits and be immune from prosecution by non-city entities.
Sam,
I'm not a lawyer, so I don't want to venture too far into these waters, but it seems to me that you are implying that this ordinance would be "in conflict with the state's law." As I see it, it is not. The state's law is about a minimum wage and does not specify a maximum minimum wage. Greensboro would not be in conflict with the state, but instead would be complying with the state law and holding employers to an even higher standard. Again, it seems that there is not a precedent for this in NC, so we can't really know. Am I as a non-attorney missing something significant here?
I hate to be on the heartless side of this debate, but Jill said:
What I do know for certain is that it would be extremely difficult for me, a single, childless, healthy woman renting a one-bedroom apartment in Greensboro, to cover my modest living expenses on $9/hour or less, even if I were working a full time job.
No doubt. However, being the enterprising person you are, you would work two jobs or you would work one job and look for a better job or you would work one job and go back to school or you would take on roommates. I'm quite certain that in a modest amount of time, you would be making more than $9/hour. I know. I've been there.
Thanks for commenting, David. One concern I have about your logic is that our society depends on work done by people who are being paid less than $9/hour. While some "enterprising" individuals might be able to work their way into better compensated positions, the fact that our standard of living is made possible by this work being done means that, to me, this labor should be compensated with a more reasonable wage. Otherwise, those of us who find ourselves in better-paid positions are perpetuating a system where some are doomed to poverty. And, though I can tell I'm going sound like a broken record, I can't get past this conviction that people who work full-time jobs should not have to live in poverty.
...our society depends on work done by people who are being paid less than $9/hour.
Our society depends on all types of work done by all types of people. The rates for the work depend on where an employer is able to attract qualified candidates.
For example, let's say you want your house painted and you've budgeted the equivalent of $9/hour to pay the painters. If you can't find qualified house painters willing to work for $9/hour this doesn't mean society folds its tent and goes home. It means that you either pay more to have your house painted, you lower your quality threshold for the job or you defer the decision.
But, what if someone comes along and mandates that all house painters be paid $15 an hour? All of a sudden your budget is blown and even if you can scrape the funds together by allocating them from someplace else, the $15/hour job is going to be of the low quality variety. What will you do? Likely, you'll not paint your house and then what will have happened to the house painting market? Will the folks involved be better or worse off?
As for people not having to live in poverty, poverty is a relative concept. The poor in the US are not the same as the poor in Ethiopia. If you work full-time here and are reasonably competent and dependable and have a stable family situation, you'll not live in poverty for long.
I know this whole campaign is well-intentioned, it's just that in the end you're going to hurt the people you aim to help.
It would be in conflict with state law because the power over wages is conferred on the Labor Commissioner by statute. I don't believe you could legally set up an alternative wage scheme than that which is governed by the wage and hour division.
You may also have some equal protection issues under the state constitution based on claims of freedom to contract.
Finally, a good way to address the problem of low wages would be to tackle the illegal immigration issue which is responsible in large part for keeping wages down.
"If you work full-time here and are reasonably competent and dependable and have a stable family situation, you'll not live in poverty for long."
Wow.
Sam,
Thanks for your concern about these legal issues. Although I wasn't a part of the conversations, my understanding is that folks from our committee tried to get help from the city attorneys in setting up this citizens initiative, but were told that the city attorneys couldn't help us navigate the process because it would be a conflict of interest. So, I guess if it gets to that point, we'll see what a judge has to say, given that there are no precedents of which I am aware for this kind of an initiative in NC.
My immediate reaction was to stock a survival bunker, but I've been working my way through it and am finding:
It is a reasoned, unhysterical debate.
It's already happened in various places, in various flavors.
There is already substantial data.
There is a lot of information available.
I'd be most interested next in surfacing issues relevant to Greensboro's unique economic conditions. For that, I'd recommend a visit with a local subject matter expert.
What's surprising about that statement, CM?
"What's surprising about that statement, CM?"
That you wrote it. And that you apparently believe it. Perhaps part of the work of the Greensboro Minimum Wage Campaign can be to take on some of the stereotypes about poverty. I hope so.
Peace, CM
I hope I'm not stereotyping by saying that if you are a dependable employee, you delay the decision to have children and you stay married that you have a good chance to get out of poverty even if you start out at the current minimum wage. These are just facts, right?
I know the above doesn't apply to everyone. Bad things happen to good people. Sometimes medical bills bankrupt families. Sometimes you simply can't continue to live with your husband or wife for whatever reason. Sometimes your boss screws you. Sometimes you're mentally ill.
But, in general terms, there are proven methods to greatly improve your odds of doing well. I know we can go back and forth with stats all day, but look at this from Los Angeles County from the 2000 Census. 53% of female headed households no husband present with children under 17 are in poverty while 20% of married couple households with children under 17 are in poverty.
This is the low hanging fruit of the problem. Direct energies toward getting people to buy in to making themselves desirable to employers (or better yet becoming entrepreneurial themselves) and having as stable a family situation as possible and you'll do far more good than getting the minimum wage for Greensboro raised with all the unintended consequences you're going to create.
David: It would have been lovely if you had said all of that to begin with. [*grin*] I certainly agree that if you get married before having children, and if you delay both marriage and children until you're a little older, and if you further your education or your skills, and if you're a dependable and stable employee, then you have a much better chance of avoiding or escaping poverty.
But there are stable, intact families with at least one full-time worker (sometimes more) who continue to struggle with poverty because of other issues, for example, medical or mental health issues within the family -- as you pointed out in your more detailed comment.
I guess my concern is with making blanket statements that could be perceived as assigning blame to folks who are still poor. (And I'm not saying you meant it that way.) Are there people whose choices or behaviors negatively contribute to their own financial circumstances? Of course. Are there people who are doing their best and yet they're still poor because of circumstances (and perhaps even systems) beyond their control? Absolutely. Does the community have an obligation to help? As a Christian, the answer for me is obviously, "YES!" (In both cases, actually. And the help given should address the issues involved.)
The way that we help is open to discussion, as well as the "who helps?" (individuals, Church, government) question. Two of the leaders whose thoughts I respect in this area are John M. Perkins and Ron Sider.
David Boyd said:
"For example, let's say you want your house painted and you've budgeted the equivalent of $9/hour to pay the painters. If you can't find qualified house painters willing to work for $9/hour this doesn't mean society folds its tent and goes home. It means that you either pay more to have your house painted, you lower your quality threshold for the job or you defer the decision.
But, what if someone comes along and mandates that all house painters be paid $15 an hour? All of a sudden your budget is blown and even if you can scrape the funds together by allocating them from someplace else, the $15/hour job is going to be of the low quality variety. What will you do? Likely, you'll not paint your house and then what will have happened to the house painting market? Will the folks involved be better or worse off?"
I've heard this argument every time raising of the minimum wage is discussed. Yet when the wage is raised, this scenario doesn't actually come about. Why is that? Could it be because it was never true?
Regards,
Tony
Why don't you think the scenario comes about? You don't think employers make decisions based on what their labor costs are going to be?
David, you wrote earlier:
"...house painting market? Will the folks involved be better or worse off?"
What you were implying was that if wages went up, house painters would be out of work. THIS is what DOESN'T happen when the minimum wage goes up.
If you can provide statistics to support your statement, please do so.
Regards,
Tony
Then why not raise the minimum wage to $20/hour? Why stop at $9.36 (the highest national rate of all time, btw)? There must be some acknowlegement in a minimum wage limit of economic reality.
Interestingly enough, there was an article in the Burlington paper today (unposted as far as I can tell due to their backwards way of thinking) that had quotes from a national manufacturing firm who had taken Alamance County off its list of potential sites to open a plant due to the higher wages demanded by folks in Alamance County. Davidson County in NC and a couple of sites in Georgia and elsewhere were still in the running.
As far as stats, the WSJ article linked to above has two esteemed economists going back and forth in the aftermath of the Chicago decision to reject this type of increase. I'm sure that whatever stats I can Google, you can find a rebuttal to and vice versa. However, I will say that the incredible economy we've had since 1991 masks a lot of mistakes. However, it will not mask this proposed new rate in Greensboro which will be $2.00 higher than in surrounding communities. Greensboro will be at an economic disadvantage and the poor who are not mobile are who you will hurt.
If you really want to get money to the poor in Greensboro, what you might want to do is give it to them a la the earned income tax credit. While this has its own issues and drawbacks, at least it's more intellectually honest than interfering more grossly with the free market for labor.
Thanks for sharing part of the Burlington paper's article, David. I'd like to read it, but it sounds like you've summarized it well. I am not sure that I have a problem with Greensboro not being attractive to businesses that are looking to find the cheapest labor market in the country. In reality, Greensboro is not going to attract those businesses anyway. I'd like for us to focus on making Greensboro an attractive location for other reasons than a desperate workforce. I'm no economist, but I'm not sure how it helps a community to bring in a business that keeps its workers in poverty and eligible for government subsidies.
Regarding the earned income tax credit, again, I'm no economist, but it seems to me that poverty is a complicated issue and that it can't be solved by using only one tool. I'm sure that the EITC is helpful, but I don't think its existence absolves us of our responsibility to figure out what a reasonable minimum wage should be.
The nice thing about something EITC-like is that it spreads the responsibility for getting money to the poor across all taxpayers instead of just on certain employers. It also handles the question of teenage employment or part-time employment where the person working the minimum wage job is not responsible for providing for a family. The money from an EITC-like device is distributed more directly to the poor than will a minimum wage increase and will have less potential harmful economic effects.
Of course, you have to be prepared to answer the questions of wealth-redistribution which is what the EITC is, but the potential unintended consequences are less.
David wrote:
"Then why not raise the minimum wage to $20/hour? Why stop at $9.36 (the highest national rate of all time, btw)? There must be some acknowlegement in a minimum wage limit of economic reality."
Reductio ad absurdum
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