Berkeley City Council considers proposal for minimum wage increase

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The introduction of a new minimum wage proposal at a Thursday City Council meeting — originally held to consider a previously proposed ordinance — will once again extend the discussion on the future of Berkeley’s baseline pay.

Although the Commission on Labor presented an updated version of their January minimum wage proposal, the debate surrounded a regional wage ordinance submitted the day of the meeting by Councilmember Laurie Capitelli. If passed, the ordinance — which will see a first reading Tuesday as voted on by the council — will eventually exceed the estimated Berkeley living wage for 2020.

“My goal in trying to bring this forward is to, number one, raise the minimum wage — number two, to raise the minimum wage to a living wage as quickly as is practical,” said Capitelli at the meeting. “We’ve tried to anticipate some of the concerns … some of the unintended consequences. We tried to make it a gradual increase so that we don’t overwhelm small businesses.”

Under Capitelli’s ordinance, the Berkeley minimum wage will increase to $10 by Aug. 1, 2014 — a jump of 11.11 percent from the state’s minimum wage. Then, by the first of each year thereafter, the steady increase would be dictated by a fixed amount until Jan. 1, 2020, when the total of $15.25 per hour would exceed the estimated $15.02 Berkeley living wage. According to a spreadsheet Capitelli circulated at the meeting, once the minimum wage matches the living wage by 2021, increases would be deferred to annual cost-of-living adjustments based on inflation from then onward.

According to Capitelli’s plan, no health care provisions would be tied to the ordinance, nonprofits and government youth programs would see unique exemptions and there would be no differential treatment for large and small businesses. In contrast, the Commission on Labor’s two-tiered proposal would increase minimum wage for small businesses to $10.74 per hour and $13.34 per hour for businesses with at least 50 employees.

While still assessing Capitelli’s proposal, the meeting attendees pushed for the city to establish a minimum-wage hike in some capacity or another. Ken Jacobs, chair of the UC Berkeley Labor Center, spoke to the council about the necessity for local legislation.

“There is a reason to have higher minimum wages in our urban areas,” Jacobs said to the council. “The cost of living in San Francisco, Oakland and Berkeley is not the same as the appropriate minimum wage in Fresno or Bakersfield. Even if we had federal action, there would be a reason for cities to act.”

Chamber of Commerce CEO Polly Armstrong, however, said the plan still posed too sudden of a wage increase for the Berkeley business community and found the introduction of Capitelli’s proposal at the special meeting “discouraging” without prior consultation.

“Tonight, you have a brand new, uncirculated proposal in which we have no input, and I ask you please not to rush,” Armstrong told the council. “We want to continue our involvement in balancing the retention of jobs and locally owned businesses with the obvious needs of our workers to be paid a fair and living wage.”

The council also hoped to alleviate concerns over the way in which a new minimum wage would apply to tipped employees. According to Councilmember Jesse Arreguin, however, the city attorney’s office said California Labor Code preempted the council to adopt a “tip credit” toward an employer’s minimum-wage obligation.

Capitelli said he hopes to have his regional minimum wage proposal go through a second reading by the end of May.

Jeff Landa covers city news. Contact him at [email protected] and follow him on Twitter @JeffLanda.