State Senate spurns minimum wage increase

Posted: Thursday, May 16, 2002

The state Senate on Wednesday rejected a proposed increase in the state's minimum wage.

However, Sen. Pete Kelly, a Fairbanks Republican, said he may bring the measure up for another vote today and try to amend it.

Also, the Senate approved a bill Wednesday that would let remote seafood processors deduct room and board from their workers' pay even if that drops their take-home pay below minimum wage. That bill also is subject to a reconsideration vote today.

If the minimum-wage bill does not pass the Senate, a ballot measure raising the wage will go before voters this fall. Labor activists collected signatures to get the question on the ballot after growing frustrated with lawmakers' failure last year to raise the wage. Lawmakers must pass a bill that's substantially similar to the citizens' initiative in order to keep it off the ballot.

The House passed such a a bill earlier this year, which would raise the wage from the current $5.65 per hour to $7.15.

But several senators said Wednesday they don't like a provision in the bill that calls for the wage to continue going up with the Anchorage consumer price index.

"It probably is time we adjust the minimum wage up, but to tie it to this mechanism is where the fatal flaw is," said Sen. Gene Therriault, a North Pole Republican.

Therriault said some economists believe the consumer price index overstates inflation, and it would be better for the Legislature to review the wage periodically and make adjustments as needed.

Sen. Johnny Ellis, an Anchorage Democrat, praised the automatic increases in the bill, but voted against it anyway.

"I think it's important enough for the voters to decide at the ballot box," Ellis said. "I think it increases the level of debate."

There is speculation that Republicans would like to keep the minimum-wage issue off the ballot and Democrats would like to keep it on because the measure could draw working-class voters to the polls, who are more likely to vote for Democrats.

Ellis dismissed suggestions that he voted against the measure to improve Democrats' chances in the fall, saying not all supporters of a minimum-wage increase would vote Democrat.

Kelly said he may try to amend the bill to remove the automatic cost-of-living increases. With that change, the bill would probably not be deemed similar enough to the citizens initiative to keep it from the ballot. Still, doing so could take some steam out of the ballot measure, Kelly said, because the Legislature would have acted to raise the wage.

The Senate also passed a bill that would protect some seafood processing plants from the effects of a minimum-wage increase.

The bill would let remote processors deduct $15 a day from workers' checks for meals and lodging. They could deduct more if the higher cost is reasonable and doesn't generate a profit for the employer.

Assuming workers log an eight-hour day, a $15 deduction would more than wipe out any benefit they would see from proposed minimum wage increase.

The deduction could be made only for days when employees work eight hours. The bill would take effect 90 days after it is signed, even if the minimum-wage measure does not pass.

Those voting for the minimum-wage increase were Democrats Kim Elton, Lyman Hoffman, Georgianna Lincoln and Donny Olson and Republicans Dave Donley, Rick Halford and Randy Phillips.

Those voting for the bill allowing the wage deduction for fish plant workers were Democrats Hoffman, Lincoln and Olson and Republicans Alan Austerman, John Cowdery, Lyda Green, Loren Leman, Phillips, Ben Stevens, Robin Taylor and Gary Wilken.



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