House votes to roll back minimum wage

SALEM - For the first time in 22 years - since the elimination of tip credit by the Oregon Legislature in 1977 - a sub-minimum wage for restaurant workers has passed the House.

House Bill 2793-A was approved 34-26 on March 24. Thirty-two Republicans joined Democrat Kurt Schrader of Canby and Independent Bob Jenson of Pendleton in supporting the Oregon Restaurant Association's (ORA) bill.

Two Republicans, Bob Montgomery of Cascade Locks and Lane Shetterly of Dallas, joined 24 Democrats opposing the bill. According to local newspaper reports, Shetterly and Montgomery were the only two Republicans in the House who did not receive $5,000 campaign contributions from the ORA.

Last legislative session a similar sub-minimum wage bill was narrowly defeated on the House floor 30-30. Then, the ORA handed out $1,000 checks to those who voted its way.

HB 2793-A also allows a reduced minimum wage rate for employees under 18 years of age for the first 60 calendar days of employment.

For tipped workers, when hourly tips average $4.50, employers could revise the minimum hourly wage from the current $6.50 to $5.50, starting Jan. 1, 2000. As tips increase, employers could continue applying them, up to 50 percent of the minimum wage.

"They are frozen in their combined wages and tips," Representative Dan Gardner, D-Portland, argued during hearings before the House Business and Consumer Affairs Committee.

"Actual wages paid would never increase until the minimum wage is $11 an hour, some 20 years in the future."

The legislation provides a maximum $1,000 civil penalty against employers who violate the lae, but Gardner argued penalty payments are being steered in the wrong direction. The bill sends that money to the state education fund, but "not one cent goes to the employee."

The bill prohibits employers from laying off workers or lowering hours, wages or benefits, so they can hire new employees at lower rates.

Youth returning to work for former employers would be credited with the duration of their previous employment and not be forced to start the 60-day count from day one.

Gardner unsuccessfully attempted amending the bill to allow workers who bring identical skills from one job to another to be exempt from the 60-day lower minimum wage rule.

Representative Diane Rosenbaum, D-Portland, who chaired the Minimum Wage Coalition that passed the minimum wage ballot measure in 1996, said on the House floor that "in the State of Oregon 770,000 voters' fundamental democratic rights are under assault. That is the number who voted in favor of Ballot Measure 36 in the November 1996 election."

Measure 36 passed in 49 of the 60 House lawmakers' districts.

The bill now goes to the Senate where a close vote is expected. Key votes in that chamber are John Lim, R-Gresham, and May Yih, D-Albany. Republicans control the Senate 17-13. Republicans Verne Duncan and Lenn Hannon have indicated they will oppose the bill.

Democratic Governor John Kitzhaber told reporters that he doesn't support the measure in its current form.

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

April 2, 1999 issue

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