Mayor Gray’s veto yesterday of the living wage bill was disappointing for several reasons. In his letter to Chairman Mendelson, Gray reaffirmed statements he’s made in the past that he “strongly believed that all District residents should earn a living wage.” Later he wrote that he looked forward to passing “a reasonable increase to the District’s minimum wage for all workers.” To address critics who might see this as political cover, the mayor could have then committed to a specific minimum wage proposal or a timetable to introduce legislation. He did neither.
But the DC Council has a final opportunity to help DC retail workers and send a message to the mayor that it is not either/or but both: On Tuesday, the Council should override the mayor’s veto to pass the Large Retailer Accountability Act and then quickly work in upcoming sessions to increase the minimum wage.
The mayor’s veto was also disappointing because many of the statements he presented as facts in his letter distort the issues District families working full-time in retail face. We urge the five councilmembers who have not voted for the bill in the past’Yvette Alexander, Muriel Bowser, David Catania, Mary Cheh, and Tommy Wells’to read the mayor’s letter and his numbered statements with these points in mind:
- This is a true living-wage bill, focusing on employers who, because of their size, can exert downward pressure on wages in a local labor market. This legislation would raise the starting wage to $12.50 an hour for retailers whose parent companies gross more than $1 billion annually and have stores in the District larger than 75,000 square feet’compared to the current minimum wage of $8.25, which keeps many who even work full-time in poverty. Thousands of workers in DC will benefit: DC retail employees are three times more likely than other workers to be in poverty, according to an Economic Policy Institute analysis.
- A living wage can benefit employers by reducing employee turnover, which lowers costs and increases productivity. DC has an example of such a model in Fort Lincoln: Costco, whose executives say the company’s average wage of $20 an hour, engenders employee loyalty and productivity.
- The bill applies to national retailers grossing $1 billion with stores in DC larger than 75,000 square feet who have collective bargaining agreements in place in which management and employees mutually decide that negotiated compensation should replace the minimum $12.50 an hour in this legislation. It is an agreement, not an automatic exemption for unionized workplaces.
- The bill will help the one-in-ten DC retail workers who are in poverty. A retail worker earning minimum wage and working 40 hours a week brings home $330 a week or $17,000 per year. That is a more than $2,000 below the federal poverty level of $19,500 for a three-person household.
- The bill will help underserved parts of the District, by allowing workers a chance to afford to buy the products that they sell. A recent House of Representatives report showed that at minimum wages, workers at large retail superstores like Wal-Mart often have to rely on public benefits for health care and food assistance to make ends meet. That totaled more than $900,000 in taxpayer-funded programs used by employees in one Wisconsin Wal-Mart.
- The District remains an attractive market for retailers. As stated in the Washington, DC Economic Partnership’s 2012/2013 report: “There is significant demand for retail in DC.” DC’s ratio of shopping center square feet per person is 8.2 compared to 27.8 in the surrounding area. Large retailers have a great opportunity to profit in the District, as anyone shopping at the Columbia Heights Target or Ward 5 Costco can attest. It might be an effective threat for Wal-Mart to pull out of the Skyland development in Ward 7 if the bill becomes law, but it certainly doesn’t make economic sense for the retailer to ignore the residents of Hillcrest, Fairfax Village, and Hill East.
For all these reasons, the Council should override Mayor Gray’s veto Tuesday.
