Restaurant assault on minimum wage

SALEM - The assault on minimum wage guarantees picked up steam March 10 when restaurant officials tried to convince legislators that House Bill (HB) 2793 wasn't really about the minimum wage at all.

More than 250 waiters, waitresses, farmworkers and other low-wage workers came to the State Capitol in a show of opposition to the bill. The huge turnout required many people to watch the proceedings on closed circuit TVs in other rooms.

If approved, HB 2793 would take away the last two increases in Oregon's voter-approved minimum wage, reducing it from $6.50 to $5.50 per hour for workers who earn $4.50 an hour or more in tips and are newly-hired or re-hired after Jan. 1, 2000.

Mike McCallum, executive vice president of the Oregon Restaurant Association (ORA), led a list of people signed up to testify before the House Business and Consumer Affairs Committee. He showed several charts trying to illustrate his point that "tip credits don't apply unless a worker is earning in excess of $10 an hour for both tips and wages and that is not minimum wage."

The bill also establishes a sub-minimum wage for youth under 18, including young farmworkers whose families rely on the income to help meet family needs.

When McCallum tried to convince the committee to join 43 other states which have such credits, Representative Dan Gardner, D-Portland, retorted, "Well, there are only two states that don't allow people to pump their own gas. Does that mean we have to join the 48 that do?"

Gardner, a member of Electrical Workers Local 48, continuously challenged statements made by various people testifying on behalf of the bill. McCallum attempted to show that the tip credit would allow management to provide raises to "back of the house" kitchen workers. Gardner asked for statistics comparing the front and back workers, but McCallum said such statistics were not available.

"Adjusted for inflation, minimum wage is lower than it was in 1976," said Salem waiter Alan Kirby. "Each time it is raised, businesses act like it is the end of the world. Maybe they need to look at the way they run their businesses."

"This will be the most important vote of this session," said Representative Diane Rosenbaum, D-Portland, who chaired the Minimum Wage Coalition that put the measure on the ballot in 1996. She is a member of Communications Workers Local 7901. "It says how we treat working families and how we treat the will of the voters."

Voters passed the minimum wage measure 56 to 44 percent.

"With a two-tiered pay system," Rosenbaum argued, "people will work side by side, do the same work, but have different rates of pay."

Restaurant owner and State Representative Jackie Winters, R-Salem, called the bill's required changes "repairs" similar to adjustments the Legislature made with property tax-cutting Measure 5 a few sessions back.

"This bill is definitely a substantive change," countered Senator Tony Corcoran, D-Cottage Grove and a member of the Oregon Public Employees Union. "If these guys say it isn't about minimum wage, it is about minimum wage."

Restaurant server and cook Nellie K. Fuleki, of Portland, said in prepared testimony that "tips are like commissions, money you can't always count on. If wages are cut, then on slow days the hourly wage won't be enough to cover (family expenses)."

"Businesses want more and more money," she added, "without realizing their employees have their own businesses to support - their families."

During the hearing, a study paid for by the ORA and conducted by University of Oregon professor James Terborg came under attack. Terborg maintained that he had evidence showing increases in the minimum wage have led to reductions in restaurant workers. However, the Oregon Employ-ment Department's figures show restaurant employment has actually been on the rise since 1995.

Under questioning Terborg admitted that he was acting as a paid consultant of the ORA and that his study included only 207 of 5,000 restaurants in the state. He refused to disclose how much he was being paid.

Opponents of the bill also tried to hold a rally on the front steps of the Capitol, but when they went to reserve the space they were told the front and back steps had already been reserved for that morning by the ORA rally.

As it turned out, the ORA did not hold a rally, or even a short meeting on either steps. "It appears the ORA reserved the Capitol's facilities to prevent their opposition from using these same facilities," said Irv Fletcher, president of the Oregon AFL-CIO, in a letter to the Legislative Administrator Dave Henderson.

"The apparent deceptive practice of the Oregon Restaurant Association to interfere with the use of a public facility by citizens of this state is unethical and underhanded," Fletcher said. "Their dishonesty in reserving the Capitol steps to prevent others from exercising their democratic right to assemble should not go unnoticed."

(Editor's Note: Special Correspondent Neil Heilpern and the Oregon AFL-CIO's Legislative Update contributed to this report.)

March 19, 1999 issue

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