Bill to raise the state minimum wage moves to House floor

01/28/2016 10:08 PM

FRANKFORT — The state’s minimum hourly wage would raise to $10.10 in less than two and a half years under a bill that passed out of a House committee on Thursday.

House Bill 278, sponsored by House Speaker Greg Stumbo, would increase Kentucky’s current minimum wage of $7.25 an hour to $8.20 this July, $9.15 in July 2017 and $10.10 in July 2018. The increase would not apply to businesses that have a recent average annual gross volume of sales of less than $500,000.

Currently, the state minimum wage in Kentucky is tied to the federal minimum wage rate at $7.25 per hour.

Both Lexington and Louisville have raised their minimum wage to $10.10 per hour and $9 per hour, respectively.

Twenty-nine states and Washington, D.C., now have a minimum wage above Kentucky’s minimum wage and the federal minimum wage, according to the National Conference of State Legislatures.

Stumbo, D-Prestonsburg, told members of the House Labor and Industry Committee that the bill is really about helping workers at the low-end of the pay scale in the state and provide them with a livable wage.

“It tries to create a living wage for people who are in these positions,” Stumbo said. “It’s an attempt to bring some equity to the people who are stuck at the bottom of our socioeconomic scale.”

Representatives from the Kentucky Chamber of Commerce, Kentucky Retail Federation and the Kentucky Office of the National Federation of Independent Business cautioned legislators about how the bill could have an adverse effect on small businesses as well as low-end wage earners themselves.

Tod Griffin, president of the Kentucky Retail Federation, warned legislators about the unintended consequences of the bill.

“They might reduce hours for their existing staff,” Griffin said. “They could reduce future wage increases. They might be forced to let a few employees go or not fill position vacancies.”

Rep. Jeff Greer, who owns a small business with four employees and pays his employees above the minimum wage, disputed the business leaders’ claims that increasing the state’s base hourly wage to $10.10 per hour will adversely affect small businesses.

“If you can’t pay that in today’s economy, I think that you need to go back to school and take a management course,” said Greer, D-Brandenburg.

Rep. Adam Koenig, who was one of six Republicans who voted against the bill, reminded Stumbo that workers earning minimum wage are eligible for government assistance programs to supplement their income.

“I think we have Medicaid, and probably food stamps,” said Koenig, R-Erlanger.

Stumbo responded by saying that in the end, it costs the taxpayers more money because businesses don’t pay workers a living wage.

“When you allow employers to pay those type of wages, the taxpayers of Kentucky subsidize the lives of those workers because they’re eligible for food stamps, eligible for aid for families with dependent children and a bunch of programs out there that we the taxpayers fund,” Stumbo responded.

The bill passed by a party-line vote of 13-6.

HB 278 now goes to the full House for consideration.


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