Minimum wage reform: Businesses ambivalent about increase

In June 2013, Connecticut Gov. Dannel Malloy signed into law one of the nation’s highest minimum wages, increasing the state’s wage floor from $8.25 per hour to $9.00 by Jan. 1, 2015. This three-part series looks at the impact this law will have on workers, local businesses and politicians. This is part 3 in a series of articles examining the effect of the wage increase on the people who earn the minimum wage, the employers who are bound to it and the politicians whose political terrain is being shaped by the issue. Read parts 1 and 2 here.  

As Connecticut’s minimum wage increases from $8.25 to $8.70 this year, most business owners in New Haven have not expressed concerns over how to pay their workers.

While an estimated 70,000 to 90,000 workers out of Connecticut’s total workforce of 1.7 million earn the minimum wage, the workers at 15 New Haven businesses interviewed are compensated above the $8.70 value. Claire’s Corner Copia Owner Claire Criscuolo said that the restaurant has always paid its employees above the minimum wage, adding that she makes her own judgements about what her workers should be paid as opposed to picking wages based on government standards. Dishwashers at Claire’s are paid more than almost all other staff members. Criscuolo declined to reveal the wages of workers at Claire’s.

“In our opinion, you either do the right thing or you don’t,” Criscuolo said. “We’re able to pay our workers what we do, because our customers support us and we couldn’t do that if they weren’t willing to pay the prices. Everyone is in this together.”

Out of 20 business managers or owners interviewed, 18 said that the change will not affect any of their workers’ compensation, including restaurants, clothing stores and other retail shops. A few of the establishments interviewed included Denali and J. Press. The majority of managers and workers did not comment further than to say that the wages of their workers would not change under the new law.

Many legislators at the state and national level have supported the bill, not only because they believe it will positively affect local families, but also business and local economic development.

“Raising the minimum wage isn’t just good for workers — it’s good for business too,” Connecticut House Majority Leader Joe Aresimowicz said in a statement. “A higher minimum wage would inject dollars into our economy as folks spend increased earnings at local businesses.”

However, the Study’s Director of Operations Anthony Moir said that the hotel’s restaurant, Heirloom, would be slightly affected by the shift in minimum wage. Servers and certain staff members who work in the hotel’s restaurant will see an increase in their salary. He added, however that their base salary does not reflect tips, which form a major part of their compensation. Nevertheless, the majority of the hotel’s staff is paid above minimum wage and will not be impacted by the new law.

Under the prior rate of $8.25 an hour, an employee working 40 hours per week earned $17,160 per year. As of January 1, 2014, a Connecticut resident working full time at minimum wage will make $18,096 per year.

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