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Calif. Dems Join Unions in Push for $15 Wage

SACRAMENTO, Calif. (CN) - California's minimum wage could spike to $15 per hour under an agreement between lawmakers and a host of labor unions touted by Gov. Jerry Brown on Monday.

If approved by both the state Senate and Assembly, California's minimum wage would become the highest in the nation and feature annual increases for at least the next six years.

Brown said the plan will cost $20 million to implement during its first year but that it also includes a clause that allows a governor to freeze the next year's increase if there is a predicted budget deficit.

"It's a matter of economic justice. It makes sense," Brown said.

Lawmakers said the plan could benefit an estimated 5.6 million Californians, nearly 33 percent of the state's total workforce. The state's minimum wage was raised to $10 per hour in January while the federal floor remains $7.25 per hour.

Senate President pro Tempore Kevin de Leon, D-Los Angeles, said the proposal is the result of compromise between lawmakers and that it's time to "restore" the American dream for Californians.

"I'm pleased that we have a deal in place that will raise living standards for millions of Californians, while also spurring new demand for goods and services and helping businesses thrive," de Leon said in a statement.

Lawmakers introduced the plan along with representatives from California's most powerful unions, including the United Healthcare Workers West, Teamster Union International and the Service Employees International Union United Long Term Care Workers.

Brown's proposal comes less than a week after state officials announced a similar minimum-wage initiative will be on the November ballot. The initiative, sponsored by the SEIU United Healthcare Workers West - one of California's largest labor unions - would likely be dropped from the ballot if lawmakers approve Brown's proposal.

The proposal is expected to require just a simple majority in both of the Democrat-controlled houses in order to pass.

Critics claim raising the Golden State's minimum wage to $15 per hour will stifle economic growth and inherently target small business owners.

Assembly Republican Leader Chad Mayes said his party is concerned that the six-year plan will only help a small number of Californians while indirectly raising the state's infamous cost of living.

"We have a responsibility to build a better, more affordable state for all Californians. We must work together to create common-sense solutions that will eliminate this burden," Mayes said of Brown's proposal.

The state's nonpartisan financial analyst says raising the minimum wage would have an uncertain impact on the state's economy.

"Our best estimate is that this proposal would lead to a net change in combined state and local revenues ranging from a loss of hundreds of millions of dollars to a gain of over $1 billion," the Legislative Analyst's report states.

Small businesses with fewer than 25 workers will have an additional year to meet the $15 per hour wage increase. Once wages reach $15 per hour, the state could increase the minimum wage each year by up to 3.5 percent to adjust for inflation.

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