Mainers Vote to Boost Minimum Wage

Nov 9, 2016

Minimum wage workers in Maine are going to get a raise.

By a solid margin, voters supported the ballot measure that will boost the current $7.50 an hour minimum wage to $12 an hour by 2020. It will also increase tipped workers’ base wages, which some in the restaurant industry say will increase costs and change the culture of hospitality.

With the passage of Question 4, workers in Maine will finally get an honest day’s pay for an honest day’s work, says Amy Halsted, the campaign manager for Mainers for Fair Wages.

“In order for the American dream to be real, if you work 40 hours a week, you should be able to take home enough to support yourself and your family,” she says.

Speaking to supporters who gathered at Stroudwater Distillery in Portland on Tuesday night, Halsted chalked up victory to Mainers motivated by the lack of a minimum wage increase for eight years.

“If the Legislature fails to act year after year after year while more and more Mainers continue to struggle in poverty, people band together to do something about it,” she says.

According to the Maine Center for Economic Policy, the passage of Question 4 will translate into a raise for 1 in 3 Mainers, between current minimum wage earners and those who earn above, but will get a boost from employers who want to keep wages competitive.

The raise is incremental, starting with a bump to $9 an hour in 2017 and increasing $1 per year till it’s $12 an hour by 2020.

But not everyone in Maine is happy that the ballot question passed.

“There’s that pent up demand for a minimum wage increase, which I understand, but that was no reason to throw the restaurant industry under the bus,” says Greg Dugal of the Maine Restaurant Association.

Dugal says Question 4 plunges the restaurant industry into uncharted territory because it eliminates the tip credit. That’s what allows employers to pay tipped employees half the minimum wage, in order to offset earnings in tips.

Starting next year, tipped workers will get annual increases until their base pay matches the adjusted minimum wage.

“The actual cost of the elimination of the tip credit for an average restaurant in Maine is going to cost the average restaurant about $180,000 over the time frame that this occurs,” Dugal says.

Dugal doubts many voters knew that the minimum wage ballot question also eliminates the tip credit. Now, he says, restaurants will have to make tough decisions that could significantly change the dining experience.

“They may have to reduce their staff size, their benefits, they may have to go to different models, counter service, using technology like iPads,” he says.

Dugal says the Restaurant Association will explore options to reinstate the tip credit. But some tipped employees, like Ali Monceaux, a server in Portland, are thrilled to leave the tip credit behind.

“That means that I will no longer be working for $3.75 an hour and relying solely on the gratuity and generosity of strangers to pay rent, to pay heat,” she says.

Next year, Monceaux’s base pay will increase to $5 an hour.