The movement for a higher minimum wage is encountering stiffer resistance after two years of mostly success. The opposition is coming at the state level and in traditionally liberal regions, suggesting that the tide is turning in the movement.
On Thursday, Maine legislators amended pending legislation that would raise the rate to $12 an hour, up from the current rate of $9, to restore an exception for tipped employees, such as waiters, allowing them to be paid as little as $5 an hour.
"I'm very optimistic that the full House and full Senate will approve the amended bill," Republican state Sen. Roger Katz, sponsor of the amendment, told the Washington Examiner.
The exception would blunt the impact of the state's higher rate, approved by voter referendum last year, because most minimum wage earners are in the service industries. Activists for a higher minimum wage have fought to exclude the exceptions in laws across the country.
"The Republican-led attempts to undermine every aspect of this law are deeply disappointing, as is the fact that some Democrats joined in voting to cut wages for tipped workers," Amy Halsted, campaign manager for Mainers for Fair Wages, a union-backed group, told the Portland Press Herald.
The minimum wage movement suffered another blow when Baltimore Mayor Catherine Pugh vetoed legislation in February that would have raised the city's rate to $15 an hour, up from the state minimum of $8.75, despite having campaigned for a higher minimum the previous year. Pugh said she realized the increase would hurt the city's economy.
"I believe it is in the best interest of the city that we follow the state," she said.
Just before that, the county executive of Montgomery County, Md., a wealthy suburb of Washington, also blocked an increase to $15 an hour.
Late last year, Ohio Gov. John Kaisch, a Republican, signed bipartisan legislation taking away the power of local governments to set their own minimum wage. The legislation followed an effort to get a $15 minimum wage in Cleveland, an effort fought by longtime Democrat Mayor Frank Jackson.
Mike Whatley, director of state and local government policy for the National Restaurant Association, which generally opposes the higher rates, said activists had plucked the long-hanging fruit when they got traditionally liberal places such as Los Angeles, San Francisco and New York City to adopt $15 rates. Other regions are taking a "more measured approach."
"You see it more and more from politicians of all stripes. They are taking a hard look at the economic impact of this," Whatley said.
The stalled efforts come as reports are trickling in that $15 minimum wage increases in other regions are causing economic problems – well before the full rate has been phased in.
A study by the University of Washington last year on Seattle's increase to $11 an hour — the rate is set to rise to $15 by 2021 — found that the region's low-income workers were marginally worse off because of it.
"The city's low-wage workers did relatively well after the minimum wage increased, but largely because of the strong regional economy. Seattle's low-wage workers would have experienced almost equally positive trends if the minimum wage had not increased. Although the minimum wage clearly increased wages for this group, offsetting effects on low-wage worker hours and employment muted the impact on labor earnings," the report said.
The Wall Street Journal reported this month that the number of permits for new restaurants in New York City, where the minimum wage is $11, has fallen 16 percent since 2013. The wage was raised from $9 at the end of last year and will increase to $13 in December.
Some workers are becoming more active in the opposition. In addition to the usual coalition of business owners and trade associations, the restoration of the tipping exception in the Maine legislation was pushed by the restaurant workers themselves – the very people activists for the higher wage say they are fighting for.
Tipped employees in Maine are guaranteed at least the equivalent of the minimum wage under current law. The exception only kicks in for the worker if $5 an hour plus tips exceeds $12 an hour. That allows employers to reduce labor costs while allowing the workers to earn more – something the minimum wage activists were trying to prevent.
"There are days where I make up to three times the minimum wage, so to end up working for a set wage could hurt me financially," said Taylor, a Caribou barista who joined the activist group Restaurant Workers of Maine.
When Maine legislators held a hearing in April on the tipping exception, restaurant workers pushing to include it in the legislation substantially outnumbered people calling to see the exception removed. That tipped the scales in building support for the exception, Katz said.
"The restaurants didn't want it taken away. The servers didn't want it taken away. The customers didn't want it taken away," Katz said.