Minneapolis City Council Passes $15 Minimum Wage Ordinance

July 01, 2017 06:17 PM

The Minneapolis City Council voted Friday 11-1 to raise the minimum wage to $15 an hour.

As a result, Minneapolis has become the first city in the state to raise wages that high.

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During the city council’s two-hour debate Wednesday, members discussed the effect the ordinance would have on larger and smaller businesses.

RELATED: Minneapolis City Council Continues to Debate Minimum Wage Raise

The council ultimately voted to amend the proposed ordinance to extend the amount of time businesses would have to implement the new minimum wage.


Implementing the Ordinance

The new $15 minimum wage ordinance in Minneapolis will be implemented under a tiered phase-in period for both small and large businesses. The phase-in period for large businesses will last five years. That period will be extended to seven years for small businesses.

According to the city, large businesses are defined as having more than 100 employees. Small businesses are defined as having 100 or fewer.

Here is the city's chart showing how the ordinance will be phased in:

Jan. 1, 2018 - Large businesses - $10; Small businesses - no increase

July 1, 2018 - Large businesses - $11.25; Small businesses - $10.25

July 1, 2019 - Large businesses - $12.25; Small businesses - $11

July 1, 2020 - Large businesses - $13.25; Small businesses - $11.75

July 1, 2021 - Large businesses - $14.25; Small businesses - $12.50

July 1, 2022 - Large businesses - $15; Small businesses - $13.50

July 1, 2023 - Large businesses - $15 (indexed to inflation); Small businesses - $14.50

July 1, 2024 - Large businesses - $15 (indexed to inflation); Small businesses - $15


Now, the ordinance states businesses with more than 100 people would have five years to raise wages to $15 per hour.

Meanwhile, businesses with fewer than 100 people would have seven years to reach the new minimum wage.

The council also decided to move away from tip credits, which would have meant workers – mostly in the service industry – would have had to include tips in their wages. Many restaurant owners and employees have argued they support the higher wage but wanted tips counted toward the $15.

“Let me tell you this much: If tipping were abolished completely, and it were just the $15 per hour, there’s no one that would do my job. Not a single person,” Allison Rose, who is a bartender, said.

On Friday, many shared their perspectives on the new ordinance.

Valeria Solovjos said she has supported the wage increase and has been pushing council members to raise the minimum wage for four years.

"I think it's important for people to make $15 an hour now," she said.

However, Solovjos said she isn't pleased about the amount of time businesses have to get to the $15 per hour wage.

"How good will that be years from now when the economy starts to rise and costs go up?," she asked, adding that "$15 in 2024 won't be enough."

Meanwhile, college student Tyler Vasseur said the wage increase is "probably one of the biggest victories in Minneapolis in decades," but added that workers shouldn't have to wait until 2024 to make more money.

"I think the bigger issue is that big businesses like McDonald's and Target make billions in profit every year. They can pay $15 tomorrow," Vasseur said.

Others expressed concern about what a $15 per hour minimum wage could mean for smaller businesses.

Council member Blong Yang said he has received many letters from small business owners who are concerned they might have to shutter their businesses.

"I cannot support this ordinance because I simply do not believe it is good policy," Yang said.

He went on to say "We don't have a technical assistance problem in Minneapolis; we have a capital problem and this minimum wage increase makes the capital problem worse for people who want to start businesses in North Minneapolis."

Credits

Rebecca Omastiak & Cleo Greene

Copyright 2017 - KSTP-TV, LLC A Hubbard Broadcasting Company

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