On the heels of City Council’s vote to approve a trend-setting minimum wage ordinance, some in town are now awaiting the Economic Apocalypse, foretold in campfire ghost stories by a few employers in a failed effort to dissuade Council from mandating that employees be paid more than the store-window cat.
Possibly worried that workers would earn more than they could responsibly manage, a handful of employers appeared before Council to register their concerns which, as seen on TV and filtered through a generous glass of local Chardonnay, come down to four points.
Employees such as bartenders and wait-staff who receive customer tips already take home far more per hour than the minimum wage. If employers couldn’t credit those tips against the mandated minimum wage, employees would get a windfall. Never mind that such a tip credit is, per the City attorney, apparently illegal.
With Council’s thumb on the wage scale, un-tipped employees earning more than the new minimum would feel devalued and disrespected if lower-paid co-workers got a raise. That would increase pressure to raise everyone’s pay in order to preserve workplace tranquility.
To safeguard profit margins, any increase would likely be passed along to customers in the form of higher prices. This could drive customers out of town to patronize businesses that pay employees less. (Apparently, when other costs increase – supplies, taxes, utilities, rent, etc. – local employers do not pass such increases along to customers, sparing them the long drive to Petaluma for a cheaper burrito.)
And finally, increasing the City’s minimum wage ahead of the existing State minimum wage schedule will make local employers less competitive with . . . well, with other local employers paying the same minimum wage.
To their credit, no businessperson claimed that minimum wage earners who can’t afford to live in Sonoma anyway would fritter away their newfound fortune on food, and gas for the round-trip to work from out-of-town, where housing is more affordable than living under Sonoma’s Ig Vella bridge.
Nor was any Councilmember so impolitic as to note that – since 1916 – there have been dozens of minimum wage increases in California and each time employers cried (a) The-Sky-Is-Falling, (b) Socialism! and (c) We’ll Go Bust. But nothing happened. Chardonnay in hand, I waited for sober, data-driven business people to bury Council in binders-full of examples of laid-off employees, shuttered businesses, lost profits, and women who miscarried as a result of all – or any – of the minimum wage hikes since 1916. Still waiting.
But as the Chardonnay drained, there occurred a profound question whose answer could determine the future economic direction of our fair City: Can or should Sonoma continue to welcome or coddle enterprises whose lowest-paid employees could never afford to be their regular customers?
With the new ordinance, prices at some businesses in town might indeed go up a smidge to help employer bottom lines. But if “We’re All In This Together,” who’s to begrudge a few extra kernels for the flock of hard-working employees who faithfully lay all those Golden Eggs, into employer pockets and the City’s treasury?