Fast-food workers appear to have won their “Fight for 15” in New York State.
The state Wage Board said Monday that it will recommend a “substantial increase” in the minimum wage paid to fast-food workers in the state. The wage increase has been supported by the Cuomo administration but faced strong opposition from restaurant owners and business groups who said the measure would cost jobs.
The board did not specify the wage it would recommend but said a $15-an-hour wage is consistent with what it found would be the lowest possible rate to meet New York’s Self Sufficiency Standard. The board also said it will look for ways to incentivize fast food corporations to offer employees more consistent hours and more opportunities for full-time work. All three members of the board said they were in favor of recommending the increase.
“This board believes there needs to be a substantial increase in the hourly wage of fast-food workers,” said Mayor Byron W. Brown, the board chairman.
The recommendation follows a strong push by labor unions and social justice groups across the state.
The Wage Board heard often tearful public testimony from workers and restaurant owners at four hearings, including one in Buffalo earlier this month. Hundreds of fast-food workers showed up at those meetings, and dozens spoke, outlining the difficulties of surviving on the state’s $8.75-per-hour minimum wage. Workers spoke of rationing food until payday, sharing rooms and beds to save money on rent, and having to turn to public assistance to make ends meet.
Once the board makes its official recommendation, the state labor commissioner can accept, reject or modify it. If the commissioner decides to raise the minimum wage for fast-food workers, he can do so without legislative approval because of a labor law provision that allows raises for individual occupations.
The statewide board includes Brown; Kevin P. Ryan, founder of shopping website Gilt; and Michael Fishman, secretary-treasurer of the Service Employees International Union. Brown represents the public interest on the board, while Ryan represents business interests, and Fishman represents labor. There is no representative from the restaurant industry.
Fishman called workers’ previous testimony about their current working conditions “disturbing” and said the board would have to put safeguards in place to ensure fast food companies wouldn’t try to circumvent any new laws.
“I don’t think the industry will correct itself in any way,” Fishman said.
Advocates for the wage increase celebrated, but critics howled. Many called it a ploy by Cuomo to garner votes and appease voters on the left who have been unhappy with Cuomo’s failure to follow through on campaign promises. Cuomo has failed to get other income-equality measures through the Legislature, and pushing a wage increase through with the Wage Board would pacify unions and the Working Families Party, they said.
Acting State Labor Commissioner Mario J. Musolino, who empaneled the Wage Board, is a Cuomo appointee. Rallies supporting the Fight for 15 were attended by Democrats such as Assemblyman Sean M. Ryan and State Sens. Marc C. Panepinto and Timothy M. Kennedy, all Buffalo Democrats, and Lt. Gov. Kathy Hochul.
The Employment Policies Institute, which receives funding from the restaurant industry, has called the Wage Board a “kangaroo court” and accused Cuomo of using it to gain political favor among working-class voters.
“The public hearings just officially ended and they’ve already made up their minds,” said Michael Saltsman, research director at EPI. “That doesn’t inspire confidence that they’ve taken the kind of careful consideration one would hope would be involved in the process.”
Critics said the board’s suggestion that it would move to regulate the hours an employee works, to mandate restaurants’ scheduling practices or to require premium pay for part-time workers would extend well beyond its legal powers.
The opposition also said the wage hike would cost jobs and result in higher prices for consumers. “This is likely going to end up hurting the very people it is intended to help,” said Matthew Haller, a spokesman for the International Franchise Association, a trade organization
Unshackle Upstate, a business group, said the increase would especially hurt young, low-skilled workers just entering the workforce.
“As if running a business in New York isn’t hard enough already, other employers will now have to wonder whether they will be the next target of the governor’s wage board,” Greg Biryla, executive director of Unshackle Upstate, said in a news release.
The New York State Restaurant Association, which opposes much of what the board has recommended so far, said any significant wage increases would have to be phased in over a lengthy period of time so restaurants can prepare for large labor cost increases. It urged the board to clearly define fast-food establishments as multistate, national operations rather than small businesses. It also warned that urging to offer full-time work instead of part-time hours would cause a hardship for workers who need flexible scheduling.
“We are certainly not opposed to a minimum wage hike. In fact, we were in favor of a mild one,” said Dan Garvey, chairman of the association and a manager for the Roycroft Inn in East Aurora. “The capriciousness of just selecting one particular segment of an industry is what I find to be a little dizzying.”
Jerry Newman, a distinguished teaching professor emeritus at the University at Buffalo School of Management, worked undercover in the fast food industry for his book, “My Secret Life on the McJob.” He said he sympathizes with fast food workers, but said if the measure goes through, it would be put the entire fast food industry in jeopardy.
“You can’t plan an economy that finely,” he said. “This is a social experiment and an economic experience and no one knows what the outcome will be.”
The board will spend the coming weeks crafting a fine-tuned definition of who would be affected by the new legislation. It currently defines “fast-food chains” as “limited service restaurants where customers order at the counter and pay in advance, which are large chains with multiple locations nationally,” and defines “fast food workers” as those who “prepare food and serve customers at such establishments.” Both the board and its opposition agree that the definition is too vague and would affect more than just giant fast-food corporations.
New York State’s overall minimum wage is set to increase to $9 per hour starting Dec. 31.