As congressional Democrats push to raise the federal minimum wage to $15 an hour, it’s worth asking where that figure came from. Why $15 (more than double the current federal rate of $7.25) and not, say, $10, $12, or even $16?
Unions picked $15 a decade ago because it was a “firm round number” that would help with organizing. The goal was not necessarily for workers to make that much, however, and, at least initially, they even offered a way around it. It worked like this: The unions pushed friendly local government leaders to raise their minimum wages to $15. These local ordinances included a major exception: Employers could avoid paying the minimum wage if those workers were unionized. In other words, the high minimum wage was intended as an incentive to get employers to not only drop opposition to unions but to seek them out so the companies could negotiate deals to pay workers less.
This all began with the Service Employees International Union’s push in 2012 to organize service sectors that had previously resisted unionizing. It launched protests involving retail workers in Chicago, coffee shop workers in Seattle, and fast food workers in New York City. The New York effort got significant media attention for the sheer novelty of protests at brand-name franchises such as McDonald’s and Taco Bell. “Nationally we decided to resource this fight for $15 in the fast food sector to start with,” said David Rolf, the former president of Seattle-based SEIU Local 775 and one of the key organizers of the campaign, in a 2016 speech. Rolf authored a history of the movement, The Fight for $15.
“It’s a bold moral aspirational goal, along the lines of the eight-hour day,” Rolf told the Northwest Labor Press in April 2016. “It was a firm round number that workers felt motivated and inspired by.” The fast food protests failed to attract enough workers to organize the restaurants. But the idea did catch on with local progressive-minded voters. A $15 minimum wage became the major issue in SeaTac, Washington, where voters passed a $15 minimum wage ballot initiative in 2013 by a mere 77 votes. That inspired other liberal city and state leaders to pursue it as well.
SeaTac’s minimum wage ordinance included the following language: “All of the provisions of this chapter, or any part hereof, including the employee work environment reporting requirement set forth herein, may be waived in a bona fide collective bargaining agreement, but only if the waiver is explicitly set forth in such agreement in clear and unambiguous terms.”
In other words, unions can negotiate away their members’ right to be paid the minimum wage. That gave businesses a major incentive to accept collective bargaining. The Service Employees International Union knew the exemption was in there and intended to use it as a negotiating tool with employers. Asked in a 2013 radio interview if this was intended to “incentivize” employers to accept unions, Rolf replied, “We always want to offer an olive branch and a high road approach to employers of conscience who would prefer to have direct and honest dealings across the bargaining table with a union that their employees vote for. So, yes.”
That explains why unions pursued a rate as high as $15, something other progressives weren’t doing at the time. The common assumption on the Left at the time was that a $15 minimum wage was untenable.
“Substantively, we have not supported $15 — you will get a fair number of liberal economists who will say it will lose jobs,” Neera Tanden, then-president of the Center for American Progress, privately warned Hillary Clinton’s 2016 presidential bid.
Read the full article at The Washington Examiner.