Why Is our Minimum Wage so Low?


KMG Blog Pic 060214 FINAL

Last month the fair wage movement gained substantial momentum when fast food workers in 150 cities and 30 countries staged a walk-out strike on May 15th. This was not the workers’ first round in the fight – in November 2012, 200 workers from fast food chains in New York City walked out and created a ripple in the equal pay movement. Last month’s efforts in the restaurant industry once again highlight the growing wage inequality in this country.

But what would be the practical effects of a wage increase for not only fast food workers but across industries? The biggest argument against minimum wage hikes would be the inevitable increase in the cost to customers. Yes, you’d pay more for your kid’s happy meal. However, an increase in minimum wage very well may lead to a decrease in the number of people relying on public assistance. In Maine, those programs include TANF and food stamps. One recent study found that 50% of fast food employees were relying upon some form of public assistance – a helping hand to the tune of $7 billion per year.

The restaurant industry is the biggest culprit of wage theft, which is a term to describe a variety of wage violations – refusal of overtime pay, unpaid wages, withholding tips, misclassifying employees as independent contractors, and more. Recent studies have found that nearly 60% of wage theft violations occur in the restaurant industry. Because of the egregious violations, the industry has been a natural platform for voices arguing for a minimum wage increase as well as general awareness of other wage violations.

As of today, Maine’s minimum wage is $7.50 per hour and the federal standard is $7.25 per hour. Cities across the country, however, are slowly seeing the benefits of raising minimum wage standards above state and federal guidelines. In Portland, for instance, Mayor Michael Brennan established a minimum wage advisory committee several months ago to study the impact of increasing the minimum wage within city limits. While no recommendation has been made to date, it’s refreshing to see that the dialogue has arrived in this State. I certainly hope the discussion continues and more people gain awareness of the need for fair wages. Maine workers deserve no less.

About the author: Kate Gatti is an associate at McTeague Higbee, focusing her practice on workers’ compensation and personal injury.  She can be reached at 207-725-5581 or kgatti@mcteaguehigbee.com.

Maine at Work

About Maine at Work

Karen Bilodeau and Ben Grant are attorneys at the workers' rights law firm McTeague Higbee. With experience in both state and federal courts including national litigation, they have particular prominence in labor and employment litigation, workers' compensation, and construction accidents. They use this blog to educate Mainers about their workers' and individual rights in a number of different legal matters. For more information, go to www.mcteaguehigbee.com.