Minnesota House votes to raise minimum wage

The Minnesota House on Friday moved to vault the state's minimum wage from one of the nation's lowest to the highest.

"The more people who are making more money, the better," said DFL Rep. Ryan Winkler of Golden Valley, sponsor of the measure which would raise the state's current $6.15 hourly wage floor to $9.50 by 2015, making good on a key DFL promise to help the state's lowest-paid workers.

A more modest bill that would raise the minimum to $7.75 an hour, slightly above the current federal standard of $7.25, is set for a Wednesday vote in the Senate, where even some Democrats are concerned about the impact of steep pay hikes on small businesses.

"I understand the impact that this potentially can have on, you know, small hardware stores and little mom-and-pop cafes, family-owned businesses that might have a few employees," said Senate DFL leader Tom Bakk, of Cook. "I think $9.50 is too much. … I'm kind of concerned about overreaching on this."

Gov. Mark Dayton, however, has said he would welcome a measure to lift the minimum wage to between $9 and $9.50 an hour and House leaders hailed their vote as a victory for ordinary people.

The Minnesota minimum applies only to a relatively small number of workers whose jobs are exempted from the federal wage standards. At least 93,000 Minnesota workers now earn $7.25 an hour or less. Bumping the state minimum to $9.50 would give about 350,000 workers a raise.

Once the bill passes both bodies, the House, Senate and governor will likely compromise on a wage increase.

Washington state now pays the most — $9.15 an hour. That state's minimum also rises with inflation.

The Minnesota House bill also would tie wage increases to the cost of living, so the rate would rise over time, whether or not lawmakers voted increases.

Once it's fully phased in, the House bill would allow small businesses to pay their employees $8.50 an hour and permit all businesses to pay young people a training wage of $8 an hour. Right now, the state allows similar tiered wages.

A series of business groups — including retailers, small businesses, restaurateurs and nursing homes — protested the House move.

They say the increase would cripple employers' flexibility and could cause businesses to scale back the number of jobs they provide.

"You cannot have one state that is higher than the surrounding states," said Davids, whose southern Minnesota home is about 14 miles from the Iowa border. Iowa's minimum wage is $7.25 an hour and rises with the federal rate.

On the House floor Friday, Republican members said the wage bill created a "war on work."

"This is really another unemployment bill by the Democrats," said Rep. Steve Drazkowski, R-Mazeppa. "This is not the place for the government to even be."

Lawmakers tried to change the bill to allow employees who average $12 an hour in wages plus tips, to earn $7.25 an hour in wages. If the employees failed to average $12 an hour, they would get the state minimum of $9.50 an hour.

The move, backed by the Minnesota Restaurant Association, failed to pass on a tie vote.

About 115,000 Minnesota employees, including agricultural workers, are exempt from the federal law that mandates overtime for employees after 40 hours.

At those businesses, employees only get overtime after working 48 hours.

On an overwhelming bipartisan vote, the House decided that agricultural workers should continue to get paid extra only after 48 hours of work.

Rep. Pat Garofalo, R-Farmington, said the need to exempt certain businesses from the changes highlighted how flawed Democrats' plans are.

"We're seeing the consequences on a one-size-fits-all approach," he said. "This is a colossal unfunded mandate on the small businesses of Minnesota. … Money doesn't grow on trees."