A panel formed at New York Governor Andrew Cuomo’s behest is expected to vote this week to raise the minimum wage for fast-food workers to $15 an hour, said a person familiar with the plan.
The three-member wage board will probably take the action at its July 22 meeting in New York City, said the person, who spoke on the condition of anonymity because the decision isn’t final. Cuomo has indicated that the labor commissioner, who has final say, will follow the board’s advice.
The board was created in May to sidestep the legislature, where Cuomo’s effort to raise the $8.75 minimum wage for all workers has been stymied by Republicans who control the Senate. The higher wage for fast-food employees probably will be phased in over years, said the person.
“The three members on the board are in agreement that there should be a substantial increase,” Byron Brown, the board’s chairman and mayor of Buffalo, said at a June 29 meeting in Albany.
The expected move follows nationwide strikes by employees of McDonald’s Corp. and other fast-food chains who demanded a $15 hourly wage. New York spends $6,800 in public assistance per fast-food worker annually, or $700 million a year, more than any other state, Cuomo has said.
“I want to get out of the hamburger business,” Cuomo said in a speech May 7 in Manhattan’s Union Square to hundreds of union workers. “I don’t want the taxpayers of New York subsidizing the profits of McDonald’s anymore.”
Cuomo is using a power he has under state law to circumvent the legislature; he couldn’t persuade the Senate to back his proposal to raise the minimum to $10.50 per hour and $11.50 in New York City. The Democratic-controlled Assembly had sought a $15 rate for the city.
The 57-year-old Democrat has said boosting wages, rather than smothering companies that pay them with rules and taxes, is his answer to a national debate over how to narrow the divide between rich and poor. In New York, entry-level fast-food workers earn an average of $16,920 annually, he has said.
Melissa Fleischut, who heads the New York State Restaurant Association, said the group asked the board to phase in any increase. She said the move to raise wages in only one segment of the restaurant business is unprecedented.
“The concern is how is the the rest of the industry going to react,” Fleischut said by phone. “Independent restaurants may feel pressure on them to increase their wages for dishwashers and other workers because they could go to McDonald’s, and, if you talk to McDonald’s franchise owners, they say they’re not going to be hiring.”