RICHMOND -- Despite vociferous opposition from business leaders, the City Council late Tuesday voted to take another step toward establishing one of the highest local minimum wages in the region.

"I'm going to support this ... But having said that, I do this with mixed feelings and some skepticism," said Councilman Tom Butt. "Frankly, I don't know whether this is going to work or not."

The council unanimously directed staff to come back in two weeks with an ordinance drawn up with at least seven special exemptions to a new local minimum wage. Exemptions to the ordinance, crafted by Butt and councilman Jim Rogers, include not paying higher minimum wages to workers under age 18, those at businesses with fewer than 10 employees and employees who are regularly tipped.

The ordinance is the latest iteration of a minimum wage hike that seemed like a foregone conclusion last month when a majority of the council put the brakes on Mayor Gayle McLaughlin's push to enact a phased-in wage hike to $12.30 by 2017 without a staff study into possible effects.

As word spread and opposition mounted, McLaughlin's coalition splintered and City Manager Bill Lindsay was directed to reach out to the local business community to solicit feedback.

The feedback came in the form of a staff report and more than 20 speakers Tuesday.

City staff reported that 53 local businesses responded to a survey in the past two weeks and only 23 said they would comply with the law without exploring other options, including reducing their workforce, cutting hours or considering moving to a nearby city.


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Even council supporters said they were moving forward cautiously and making exemptions to reduce possible impacts.

"There is a serious threat of job loss," Rogers said.

Nathan Trivers, who owns the Up & Under Pub in Point Richmond, said the ordinance imperils his business and if forced to pay higher wages to some of his 35 employees, he will either have to lay off workers or face closure.

"I don't know what sword I will have to fall on," Trivers said.

But other local residents and some experts urged the council to move forward with the wage hike and to reduce the lengthening list of exemptions.

Ken Jacobs, chairman of UC Berkeley's Labor Center, said the exemptions create harmful incentives that could cause discrimination against younger workers and sap the law's effectiveness.

"Simplicity is vital" in wage ordinances, he said.

The council ultimately split the difference among experts, pro-wage hike residents and unions and the concerns of business owners and industry groups, including the local Chamber of Commerce.

Staff estimated 2,000 to 4,000 local jobs pay minimum wage and some will be exempted by the proposed ordinance.

The proposed law sets a transition period beginning with the effective date of the ordinance, usually 30 days after passage, and ending Dec. 31, during which the minimum wage would be $9.

The wage would rise to $9.60 in 2015, $11.52 in 2016 and $12.30 in 2017, making it the highest in the state if no other cities adopt larger increases.

The ordinance would peg the minimum wage to the Consumer Price Index for the Bay Area each Jan. 1, beginning in 2018.

The state's minimum wage is set to rise to $9 per hour in July and to $10 per hour in January 2016.

McLaughlin said she was disappointed with the array of exemptions authored by Rogers and Butt but supported the ordinance because she didn't have the votes for a stronger law.

"I have considerable problems with this, but I will vote for it because I believe it will move us forward," McLaughlin said.

Contact Robert Rogers at 510-262-2726 or rrogers@bayareanewsgroup.com. Follow him at Twitter.com/SFBaynewsrogers.