The House DFL is intent on passing minimum wage increase legislation this session. See HF0092 for their 'show-and-tell' version of the bill. The upshot of HF0092 is that "every large employer must pay each employee wages at a rate of at least $7.50 an hour beginning August 1, 2013."
Each year thereafter, "the commissioner" will calculate "an adjustment of the wage rates" based on "the percentage increase in the rate of inflation by the Consumer Price Index for all urban consumers."
What's worse is this part of the bill:
2.5(d). No employer may take any action to displace any employee, including a partial
2.6displacement through a reduction in hours, wages, or employment benefits, in order to
2.7hire an employee at the wage authorized in this paragraph.
Remember that that's the show-and-tell legislation. Here's the language from the delete-all amendment that's expected to be in the final bill:
1.14 (b) Except as otherwise provided in sections 177.21 to 177.35, every large employer
1.15 must pay each employee wages at a rate of at least
1.20 (i) $8.35 per hour beginning August 1, 2013;
1.21 (ii) $9.45 per hour beginning August 1, 2014;
1.22 (iii) $10.55 per hour beginning August 1, 2015; and
1.23 (iv) the rate established under paragraph (d) beginning January 1, 2016; and
1.24 (2) every small employer must pay each employee at a rate of at least:
1.25 (i) $6.50 per hour beginning August 1, 2013;
1.26 (ii) $7.75 per hour beginning August 1, 2014;
1.27 (iii) $9.00 per hour beginning August 1, 2015; and
(iv) the rate established under paragraph (d) beginning January 1, 2016.
2.2 (c) Notwithstanding paragraph (b), during the first 90 consecutive days of
2.3 employment, an employer may pay an employee under the age of 20 years a wage of $4.90
2.4 an hour. No employer may take any action to displace any employee, including a partial
2.5 displacement through a reduction in hours, wages, or employment benefits, in order to hire
2.6 an employee at the wage authorized in this paragraph at least:
2.7 (1) $6.07 per hour beginning August 1, 2013;
2.8 (2) $7.24 per hour beginning August 1, 2014;
2.9 (3) $8.41 per hour beginning August 1, 2015; and
2.10 (4) the rate established under paragraph (d) beginning January 1, 2016.
2.11 No employer may take any action to displace an employee, including a partial
2.12 displacement through a reduction in hours, wages, or employment benefits, in order to
2.13 hire an employee at the wage authorized in this paragraph.
This DFL legislation will prevent businesses from making employment adjustments once this goes into effect. Their only 'adjustment' will be to move to another state or shut its doors entirely.
If this bill passes and gets signed into law, people should expect:
- youth unemployment to skyrocket starting in August, 2013.
- overall unemployment to jump starting in August, 2013.
- hours and benefits to get cut prior to August 1, 2013.
This will cripple Minnesota's economy. General fund revenues will be lost because unemployment will jump. Employers will move.
If Gov. Dayton and the DFL want to cripple Minnesota's economy, they're on the right path. If the DFL wants to give Minnesota's entrepreneurs the incentive to leave the state, this minimum wage hike is the perfect incentive for that.
Thus far, the Dayton/DFL/special interest economic blueprint for the state is higher taxes on entrepreneurs, higher unemployment for people in the hospitality industry and lots of incentives for entrepreneurs to leave Minnesota.
That isn't a recipe for success. That's a recipe for disaster.
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