Berkeley votes to phase in minimum wage increases

By Lisa Tsering

The Berkeley City Council approved revisions to its contentious minimum wage ordinance late in the evening of Nov. 10 after a rancorous special meeting at Longfellow Middle School.

“Si se puede! Stand up! Fight back!” shouted around two dozen protesters demanding a higher minimum wage. Many of the protesters were organized by the Service Employees International Union Local 1021, and had marched for higher wages in Sacramento earlier in the day and rallied in Oakland in the afternoon.

The new proposal will increase the minimum wage to $15 per hour by 2018 for larger businesses employing more than 55 full time workers, and will allow smaller businesses to phase in “tiered” increases, reaching $15 in 2020.

The current minimum wage in Berkeley, which took effect Oct. 1, 2015, is $11 per hour. Last year, the Berkeley City Council voted to increase the minimum wage annually to $12.53 by October 2016, a hike of 13.9%. The city’s Labor Commission is calling for a higher wage than that (annual increases up to $19, to take effect in 2020), and has called for local enhancements to California’s new paid sick leave amendment.

The revisions to the minimum wage proposal agreed on Nov. 10 were not enough, Sam Frankel, chair of the city’s Commission on Labor, told Berkeleyside. “I am very, very disheartened. I think that asking low wage workers to wait until 2020 for $15 an hour is an absolute insult.”

“Berkeley will have one of the most progressive minimum wage policies in the United States if adopted,” read the revision, which was put forward by council members Laurie Capitelli, Lori Droste, Linda Maio and Darryl Moore and passed by a vote of 7-2.

“As it is currently written, the current version of the Minimum Wage Ordinance lacks a long-term solution to the fundamental problem of working people living in poverty due to stagnant wages,” it reads.

In her comments from the dias, Droste said it was vital that Berkeley coordinate its minimum wage ordinance with those of other nearby cities. “It’s very important to ask them to match our commitment to $15,” she said.

A separate item on the evening’s agenda, about a proposed paid sick leave ordinance (BMC 13.100), was deferred until January.

Nearly 65 community members took turns speaking to the council during the four-hour-plus meeting, expressing their support of or dissent against adopting a higher minimum wage in Berkeley.

Most of the dissenters were the owners of small businesses.

Jess Carter, owner of Easy Creole, detailed how the wage hike would affect his restaurant by describing how he has lost money in the past year since the minimum wage went from $10 to $11. “We raised prices 10%, and we saw a 15.7 drop in customers,” said Carter.

Terry Regan, a travel agent who owns Berkeley Northside Travel, said that with a higher minimum wage he would no longer be able to offer his two-year training program to new agents. “I am one of the last travel agents in Berkeley and you will put me out of business. You will destroy the small businesses of Berkeley,” he said forcefully. “You will be responsible.”

Bette Kroening, co-owner of Bette’s Oceanview Diner, and a former member of SEIU, explained that she has been in business for over 34 years. “Many of my staff has been with us for 20 or 30 years. I offer people a place to have a career, with medical and dental coverage, paid vacations, profit sharing and a 401 (k). We are nothing without the people who are our staff.

“But $19 an hour [a proposal by Berkeley’s Commission on Labor in September to take place in 2020] would wipe us out. Thirty dollars for bacon and eggs is kinda out of the question.”

“These extreme initiatives go too far and end up hurting the workers it intends to help,” said Jessica Lynam of the California Restaurant Association.

Polly Armstrong, Berkeley Chamber of Commerce CEO, said, “We are so proud of Berkeley businesses … Listen to them. Listen to the people you know.”

Councilman Kriss Worthington took strong issue with Armstrong’s comment, calling it “the eeriest comment of these entire proceedings” while protestors muttered “Cronyism!”

“I’m listening to the people I know,” said Worthington, a pro-labor progressive.

Supporters of the wage hike included Steve Gilbert, a retired SEIU member who banged on the podium as he said, “There are too many families who work, and work, and work, and cannot keep their heads above water. In Oakland, we raised the wage 36% in one shot – and saw a 2% increase in employment and a 13% drop in unemployment.”

Larry Bradshaw, SEIU Local 1021’s San Francisco vice president, said that companies opposed to the wage hike “will have to modify how they do business. I’m a paramedic – every day, I see people have to choose between buying their prescription medicine and food … We are tired of leadership from the front so we are going to lead from the back.”

One speaker said of the opposition to a higher minimum wage, “This is starting to look like climate-change denial.” Another speaker, who didn’t give her name, compared the current minimum wage to the system of slavery. “160 years ago, the South seceded because they thought they needed slaves. We have to ask ourselves: morally, do we want to be a city with a plantation lifestyle renamed as capitalism?”

Matthew Lewis, director of local affairs for the Office of External Affairs VP for the Associated Students of the University of California, said that a higher minimum wage would raise spending power – a sentiment echoed by several other UC Berkeley students who spoke.

Capitelli said, “This [revision] is grounded on reality and good research; everyone agrees that $12.53 is not enough – the disagreement was how much and how quickly it would take effect.”

Other changes in the proposal include ensuring service charges in the hospitality industry are paid directly to workers; and incorporating a Cost of Living Adjustment based on the local Consumer Price Index after a minimum wage floor is reached.

The revision also officially defines the size of a small business at 55 or fewer full time employees, counts franchises at the size of their parent companies, and categorizes nonprofits as small businesses regardless of size.

In 2019, the City Council hopes to see small and large businesses’ wages merge, with no further tiered wage hikes to take place after that time.

In order to address concerns surrounding the livelihood of small businesses, which make up half of all Berkeley’s businesses, “The proposal mirrors approaches from Emeryville, Los Angeles and Seattle in that we have recommended a tiered approach,” read the revision.

The constant shouts, coughs, boos and hisses from protesters at the back of the auditorium rankled councilwoman Susan Wengraf, who said at the end of the meeting: “I heard from small-business owners last week. They were really heartfelt stories. I’m disturbed at the antagonism in this community between labor and business.”