Surprising Support for a Minimum Wage Increase

President Obama’s second term is two months old. On Thursday, Seyfarth & Shaw LLP’s Wage & Hour Litigation Blog provided a useful breakdown of the Administration’s recent actions and ongoing intentions in the area of wage-and-hour regulations.

By far the highest-profile Obama proposal in this area is his call to raise the minimum wage from $7.25/hour to $9.00/hour, and index it to inflation. (Notably, earlier in his presidency Obama proposed a $9.50 minimum wage, but never in so prominent a venue as a State of the Union speech, where his call for $9.00 came this year.)

Last week, Obama nominated a new Secretary of Labor. BuzzFeed reported that the nominee, Tom Perez, is a sign of Obama’s commitment to the minimum wage hike:

Tom Perez, assistant Attorney General for civil rights under Eric Holder, was formally nominated by the president to replace Hilda Solis as the Secretary of Labor. In an East Room ceremony attended by a number of big names from the civil rights and labor communities, Obama hinted that the selection of Perez was part of the push for a rise in the federal minimum wage [….]

On Thursday, the proposed hike gained a surprisingly corporate backer when Howard Schultz, the CEO of Starbucks, went on CNBC to voice his support. The Atlantic Wire points out, however, that Schultz himself may stand to gain from the increase: Starbucks pays its workers well by industry standards; if its competitors are forced to play catchup in the form of a higher federal mandate, Starbucks “gains a competitive advantage.” That said, it strikes us as a win-win that a company might be rewarded by the market for treating its workers decently!

The Seyfarth & Shaw post goes on to detail the other ongoing wage-and-hour initiatives of the Obama administration, including adjustments to the rules on home health care workers and a plan to survey employees about their knowledge of and experience with issues like worker misclassification; the post is worth a full read.

Check back with this blog for continued analysis of these emerging regulatory changes. Contact The Harman Firm today with any questions about employment law, wages you were unfairly denied, or discrimination you have suffered.