$15 Minimum Wage Gains N.J. Senate Committee Approval

NJ.com — May 17, 2016

By Samantha Marcus | NJ Advance Media for NJ.com

TRENTON — The state Senate Labor Committee on Monday approved a bill that would gradually increase New Jersey's minimum wage to $15, the first vote on the way to a showdown with Gov. Chris Christie which is likely to end in a public referendum to sidestep his expected veto.

The lengthy legislative hearing pitted advocacy organizations, labor groups and workers hoping to lift up low-income employee wages against business and industry associations who warn the hike will force jobs costs and price increases.

The $15 minimum wage has the backing of state Senate President Stephen Sweeney (D-Gloucester) and state Assembly Speaker Vincent Prieto (D-Hudson) who at separate news conferences Monday said working New Jerseyans deserve a livable wage.

The proposed update would increase New Jersey's $8.38 minimum wage by 80 percent. The measure is the product of a deal Sweeney and Prieto reached in February to raise wages. Prieto wanted a new law that would raise the wage all at once, while Sweeney proposed a public referendum to raise wages $1 at a time.

Under the bill (S15), the minimum wage would hit $10.10 on Jan. 1, 2017, and then by at least $1.25 an hour until 2021. After 2021, annual increases will be tied to changes in the consumer price index.

Prieto said Monday that he would "love it to be $15 today," but the yearly steps will give businesses time to adjust.

The committee approved it 3-1.

The Democratic leaders say they expect Christie will veto the bill, in which case they will attempt to place the wage hike on the 2017 general election ballot when voters select a new governor.

New Jersey's minimum wage is already controlled by the state Constitution. Democrats went that route after Christie in 2013 vetoed a minimum wage bill that he said would hurt the economy. Voters agreed to amend the state constitution to increase the minimum wage by $1 to $8.25 an hour and then adjust annually based on the Consumer Price Index. Wages rose 13 cents in January 2015 and did not increase in 2016.

Sweeney said it's clear now that amendment didn't go far enough.

"It wasn't enough money," he said. "We recognize now that we need to go much further."

The annual take-home pay for a full-time worker earning the minimum wage in New Jersey is about $17,430. The United Way of Northern New Jersey has estimated a single adult in New Jersey would need to earn $13.78 an hour to meet his or her basic needs, and $19.73 per hour for "better food and shelter, plus modest savings."

New Jersey Policy Perspective, a left-leaning Trenton think tank, has estimated 975,000 people would benefit from the wage hike. Of those, 91 percent are older than 20 years old, 61 percent are full-time workers and 28 percent have children.

But the cost to businesses is much greater than $15 an hour, Michael Egenton, vice president for government relations at the state Chamber of Commerce, told the Senate committee. Combined with unemployment insurance, worker's compensation and other costs, the real bill is $23 an hour, he said.

Punctuating the chamber's point, LeTorre Hardware owner Victor LaTorre said "at $15 an hour, I'm not sure my business could survive."

The answer isn't to artificially raise the minimum wage to a level the state can't support, argued Michele Siekerka, president of the Business and Industry Association.

"You come in at one wage, you build your skills, you get increases and you rise up the corporate ladder. That's the American dream," she said.

On the other side, certified nursing home assistant Ella Moton said that on $11.59 an hour she isn't able to afford to take her clothes to the laundromat and can't always afford to keep the lights on. The bump in pay, she said, would ease her worries and "drastically" improve her life.

Phyllis Salowe-Kaye, executive director of New Jersey Citizen Action, called the legislation an opportunity for New Jersey to become a leader in the national movement toward higher wages.

"Our economic system should reward hard work with something other than poverty," she said.

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