MIDDLESEX, Vt.—Gov. Peter Shumlin yesterday signed a law requiring businesses in Vermont to pay workers a minimum wage of $10.50.
The kicker? Shumlin, a Democrat, staged the signing at the Red Hen Baking Co., a local organic business that won’t be affected by the legislation because it has no minimum-wage workers.
“[This is a time] in America’s economy where the gap between those who have and those who don’t has never been wider … working families should be paid a fair wage,” Shumlin said in front of the bakery.
“If you work for the federal minimum wage right now, you make $7.25 an hour. … If you work 40 hours a week at the federal minimum wage, you don’t bring enough money home at the end of the week to feed your family. You live in poverty.”
On hand to tout the governor’s labor policy was Randy George, owner of the Red Hen Baking Co. The breadmaker’s popular bakery and local café boasts 40 employees, including bakers, chefs, baristas and delivery workers.
“I’m here representing the small business community,” George said. “As a business owner, if I’m going to attract skilled people and keep them, we have to exceed [the minimum wage]. So we don’t even look at the minimum. Our goal is to get to a livable wage for most, and eventually all, of our full-time employees.”
The store owner said paying higher wages increases employee retention, which in turn reduces costs associated with turnover and novice mistakes.
When asked how many of his workers would be affected by the mandatory wage increase, George said, “None, absolutely none.”
He said that although Red Hen Baking Co. has no minimum wage workers, a higher livable wage, if enacted, would place a serious financial strain on his company.
“If we suddenly had to pay everybody $15 an hour, that would be a huge impact. That would be very difficult.”
Vermont’s grocers strongly opposed the bill because of the high number of minimum-wage employees across the industry. Other opponents of the law included independent stores such as the iconic Wayside Country Store in West Arlington, Vt., which may close for good because of the wage hike.
State Rep. John Moran, D-Wardsboro, who supports both a minimum wage hike and a higher livable wage, said, “Look at the big box stores. Look at Walmart and McDonald’s. There’s no future there, but the employees shouldn’t not get paid for trying to earn a living.”
State Sen. Kevin Mullin, R-Rutland, agreed the time was right for higher wages, saying, “The business community has recognized that people need to make a fair wage.”
Mullin admitted the law could have a negative impact on independent stores, but he said such businesses are under a wide range of negative financial pressures already.
“It’s not an easy time to be in that business because of stiff national competition. It’s not just wages, but every expense of business,” he said.
But William Daley, owner of the Vermont Country Deli in Brattleboro, said a higher minimum wage will mean “fewer jobs, slower job growth and higher unemployment for lower-skilled workers.” Daley predicted businesses would be forced to close or slow their expansion once higher labor costs began to eat into profitability.
Despite such warnings, Shumlin said raising the minimum wage was a moral imperative.
“The president called for a higher minimum wage, and this do-nothing Congress has not acted. So instead, we’ve had governors across America trying to do the right thing.”