Chicago introduces living-wage

[Fischkoepfin 1]

Having been a long-time supporter of the living-wage campaign, I was thrilled to read this article this morning. Let's hope other cities will follow; people shouldn't need to work 3 jobs to support their families.

July 27, 2006

Chicago Orders ‘Big Box’ Stores to Raise Wage

By ERIK ECKHOLM

After months of fevered lobbying and bitter debate, the Chicago City Council passed a groundbreaking ordinance yesterday requiring “big box” stores, like Wal-Mart and Home Depot, to pay a minimum wage of $10 an hour by 2010, along with at least $3 an hour worth of benefits.

The ordinance, imposing the requirement on stores that occupy more than 90,000 square feet and are part of companies grossing more than $1 billion annually, would be the first in the country to single out large retailers for wage rules.

A gallery packed with supporters of the bill broke into cheers as the measure passed, by a vote of 35 to 14, after four hours of intense speeches and debate.

“This is a great day for the working men and women of Chicago,” said Alderman Joseph A. Moore, the measure’s chief sponsor. Mr. Moore said he had had inquiries about the ordinance from officials in several other cities.

An Illinois retailers’ group said it would challenge the measure in court, and Mayor Richard M. Daley, who opposed the measure, has not said whether he will veto it.

Wal-Mart’s response to the Council’s action was swift and blunt.

“It’s sad — this puts politics ahead of working men and women,” John Simley, a Wal-Mart spokesman, said in a telephone interview. “It means that Chicago is closed to business.”

Wal-Mart will still open its nearly completed branch on Chicago’s West Side in September — the company’s first store in the city — but any future plans “will likely change,” Mr. Simley said.

In arguing that Wal-Mart and other companies can easily afford to meet the new standards, proponents of the measure pointed to Costco, which says it already pays at least $10 an hour plus benefits to starting workers around the country.

In existing stores in the Chicago area, Wal-Mart pays entry-level wages of about $7.25 an hour but its average pay is $11 an hour, a company spokesman told The Chicago Tribune. The company has not revealed details of its benefits.

With this ordinance, Chicago has opened a contentious front in the growing national movement, led by labor and poverty groups, to raise the incomes of bottom-rung workers through local minimum wage and “living wage” legislation. Some economists say such measures will stifle development and deprive consumers of access to cheap goods, but many poverty experts say that local efforts elsewhere to raise wages have not choked off growth and that the expanding, low-paying retail sector can be safely pressed to raise pay.

“We’re very confident that retailers want and need to be in Chicago, and the question for the city is what kinds of jobs they will bring,” said Annette Bernhardt of the Brennan Center for Justice at the New York University Law School, which helped draft the Chicago bill and has done economic studies of its likely impact.

The Illinois Retail Merchants Association condemned the measure as likely to hamper job creation and a form of illegal discrimination, and said it would challenge it in court.

Mayor Daley said earlier that the ordinance could impede growth and tax revenues. He did not say yesterday whether he would veto it, but he would have to persuade two aldermen to switch their votes to avoid an override.

Some politicians and residents in neighborhoods where new Wal-Mart, Target or Home Depot stores are planned also spoke out against the measure, fearing a loss of jobs, and leaders of black churches dueled over the benefits and risks.

The bill was the object of a fierce lobbying battle over recent months, with unions and community groups flooding aldermen with petitions, post cards and telephone calls and retailers doing the same.

In a meeting with several black aldermen, Target officials warned that passage of the measure could cause the company to cancel or delay three stores planned for the city’s South Side, the aldermen told reporters.

Yet the proposal had strong appeal, especially in the city’s lower-income black and Hispanic wards.

“The working people were overwhelmingly in favor of this law, and this was conveyed to the aldermen,” said Madeline Talbott, chief organizer for Acorn, a community group that campaigned for the bill.

Alderman George Cardenas, who voted for the ordinance, said: “We had to make a stand. This is good for people and good for the country.”

The bill comes at a time when many large retailers are increasing their presence in large cities.

The drive to raise state and city minimum wages has grown out of frustration with Congress, which has left the federal minimum wage at $5.15 an hour since 1997. At least 22 states have enacted somewhat higher minimum wage laws.

San Francisco; Albuquerque; Santa Fe, N.M.; and Washington have across-the-board minimum wage ordinances for all but the smallest businesses. Those in San Francisco and Santa Fe have set levels near that in the Chicago bill without driving out retailers, Ms. Bernhardt said.

Ms. Bernhardt said large retailers had saturated suburban markets and had powerful incentives to move into urban areas.

Under the bill, minimum wages in the covered stores would rise to $9.25 in 2007 and to $10 in 2010, and be indexed to inflation after that. Benefits would have to total $1.50 an hour in 2007 and $3 in 2010.

Smaller retailers would remain subject to the state minimum wage of $6.50 an hour.

A legal brief prepared recently for the Illinois Retail Merchants Association said the bill would violate equal protection guarantees in the Constitution, but a legal analysis by the Brennan Center at New York University said there was ample precedent for selective imposition of minimum wages by size of business.

The bill would affect 35 stores already in Chicago, including branches of Kmart, Target, Toys “R” Us and stores like Sears and Lowes. Support for the idea started taking off two years ago when Wal-Mart said it would open its first store in the city in 2006, in the poor Austin ward on the West Side.

Shia Kapos contributed reporting from Chicago for this article.

Copyright 2006 The New York Times Company

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[Hilarious Clinton 452]

good

[MHandMB 0]

I hope other cities will follow suit.

[mrc 0]

Yeah. The biggest company to come out publically against it, so far, has been Wal-Mart. This is the same company that has always perpetuated to pride itself on helping the little guy and taking care of its employees. What a joke.

Wal-Mart is just mad because if this passed, I'm sure it would follow in other places. Then mom and pop stores could once again compete with them and they couldn't bully around smaller chain stores any longer.

Edited July 27, 2006 by mrc

[incanada1234 0]

Nothing like telling a business how they have to run.

[Fandango 1,439]

Then mom and pop stores could once again compete with them and they couldn't bully around smaller chain stores any longer.

Why would they have any employees if one could make more at Wal-Mart?

Mom and Pop better get some rest, they's gonna need it.

[Artegal 1]

Yeah they will raise the minimum wage--and then import millions of undocumented workers--who will then work for less than the minimum wage off the books without paying FICA, medicaid, or income tax. Oh well.

[Veiled Princess 1]

South Carolina is trying to raise minimun wage from $5.15... which is has been stuck at since I was a teenager to a whopping $6.00 an hour!!!! Woo Hoo... seems like a lot of nothing when compared to Chicago now doesn't it???

I don't see a problem with this at all... there is no reason a person should have to work 80 hours a week or two or three jobs just to feed his/her family. The minimum wage nationwide should be at least $10 an hour like Chicago...

I'm not telling how much I make BUT if I had to live off $10 an hour or less I would seriously consider just giving up and collecting welfare.

[incanada1234 0]

Why would they have any employees if one could make more at Wal-Mart?

Mom and Pop better get some rest, they's gonna need it.

Yeah they will raise the minimum wage--and then import millions of undocumented workers--who will then work for less than the minimum wage off the books without paying FICA, medicaid, or income tax. Oh well.

[KarenCee 3]

Personally I think this is a great idea. If businesses like Wal-Mart would pay their employees a decent wage then no one would have to implement a base wage like this. It's not a matter of telling a business what to do...it's taking care of the single parent...or the one having to work two or three jobs to make ends meet. What's so wrong with that? It's time those of us who work our a$$es off get a break financially.

[incanada1234 0]

Personally I think this is a great idea. If businesses like Wal-Mart would pay their employees a decent wage then no one would have to implement a base wage like this. It's not a matter of telling a business what to do...it's taking care of the single parent...or the one having to work two or three jobs to make ends meet. What's so wrong with that? It's time those of us who work our a$$es off get a break financially.

It's a free country. No one's FORCING anyone to work at WalMart. If people don't like what they pay, go work somewhere else.

[KarenCee 3]

Personally I think this is a great idea. If businesses like Wal-Mart would pay their employees a decent wage then no one would have to implement a base wage like this. It's not a matter of telling a business what to do...it's taking care of the single parent...or the one having to work two or three jobs to make ends meet. What's so wrong with that? It's time those of us who work our a$$es off get a break financially.

It's a free country. No one's FORCING anyone to work at WalMart. If people don't like what they pay, go work somewhere else.

You are correct...but some people have a hard time finding anything and taking a job, even if it's at WalMart, to feed their families is their only option. I'm sure, of course, you being the most intelligent person around, won't have any problems finding a top notch job making lots of money and won't have anything like this to worry about.

[Reba 2]

South Carolina is trying to raise minimun wage from $5.15... which is has been stuck at since I was a teenager to a whopping $6.00 an hour!!!! Woo Hoo... seems like a lot of nothing when compared to Chicago now doesn't it???

I don't see a problem with this at all... there is no reason a person should have to work 80 hours a week or two or three jobs just to feed his/her family. The minimum wage nationwide should be at least $10 an hour like Chicago...

I'm not telling how much I make BUT if I had to live off $10 an hour or less I would seriously consider just giving up and collecting welfare.

North Carolina is in the process to try and pass a minimum wage hike to $6.15, and as soon as it was announced, our employer (hubby and I worked for the same guy, I've since quit) was already grumbling that he can't afford it and will have to close down

More likely, he won't be able to afford his 16 weeks of vacation every year, and might have to downsize is $100,000 RV.

[Canuck Carrie 1]

It's a free country. No one's FORCING anyone to work at WalMart. If people don't like what they pay, go work somewhere else.

When's the last time you were in small city, USA? In my town, Walmart is the largest employer besides the Air Force.

[KarenCee 3]

South Carolina is trying to raise minimun wage from $5.15... which is has been stuck at since I was a teenager to a whopping $6.00 an hour!!!! Woo Hoo... seems like a lot of nothing when compared to Chicago now doesn't it???

I don't see a problem with this at all... there is no reason a person should have to work 80 hours a week or two or three jobs just to feed his/her family. The minimum wage nationwide should be at least $10 an hour like Chicago...

I'm not telling how much I make BUT if I had to live off $10 an hour or less I would seriously consider just giving up and collecting welfare.

North Carolina is in the process to try and pass a minimum wage hike to $6.15, and as soon as it was announced, our employer (hubby and I worked for the same guy, I've since quit) was already grumbling that he can't afford it and will have to close down

More likely, he won't be able to afford his 16 weeks of vacation every year, and might have to downsize is $100,000 RV.

That's the whole issue right there....employers don't want to pay more money, they have those expensive houses and vacations to pay for. Just makes me feel so bad for them (sarcasm here).