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Hospitality industry launches campaign against minimum wage hike

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Minnesota restaurant, resort and hotel owners descended on the state Capitol Monday in an effort to convince lawmakers not to increase the state's minimum wage, MPR News reports.

Bills under consideration in both houses of the Legislature would raise the minimum wage to as high as $9.50 an hour, and lawmakers also may include automatic increases tied to the rate of inflation. Minnesota's current minimum wage is $6.15 an hour. But almost all Minnesota employers must pay their workers the federal minimum wage of $7.25.

The three trade groups are part of the Hospitality Minnesota coalition, which sent some 270 members to the Capitol for a rally and visits with lawmakers as part of its lobbying day, KARE reports.

"We are not opposed to an increase in the minimum wage," said Dan McElroy, executive director of Hospitality Minnesota, according to KARE. "We think it needs to be done thoughtfully and taking into consideration the environment in our region."

McElroy said the $9.50 minimum wage would make the hospitality industry less competitive, and would force some businesses to lay off employees and raise prices, WCCO reports.

The businesses urged lawmakers to make some changes to the proposals, including dropping the cost-of-living increase provision. They also want a lower minimum wage for teens and young adults who are usually hired for entry-level jobs, according to WCCO.

In addition, restaurant owners are calling for a "two-tier" minimum wage structure for servers who are paid tips. One tier would be whatever the new minimum wage is for servers who are paid less than $12 an hour when their tips are included. Servers making more than $12 an hour including tips would be paid the current, lower minimum wage.

The bill’s author, Rep. Ryan Winkler, DFL-Bemidji, said it's unlikely that will pass, according to WCCO.

“The hospitality association has been pushing this tiered tip for the last year or so,” he said. “They didn’t have a lot of success last year, but I guess you can’t blame anyone for trying.”

Dick Henke, who owns the Malt Shop in south Minneapolis, told WCCO he’s worried about the proposed minimum wage increase.

“We either have to raise our prices and figure out a way to absorb it, or we have to change our concept to a concept that requires less labor,” he said.

A House-Senate conference committee is working to reconcile differences between the minimum wage bills passed by the two chambers.

Research does not support the conclusion that increasing the minimum wage will force employers to cut jobs, MPR reported.

Gov. Mark Dayton has said he supports an increase in the minimum wage, and President Obama has called for the federal minimum wage to be increased to $10.10 an hour.

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