Wisconsin Labor Commission Representatives heard testimony Monday from business owners and worker associations debating a bill that would, according to its opponents, abolish the freedom of Wisconsin cities to establish a local minimum wage.
The bill addresses a concern in the business community that as communities across the state follow Madison's lead and independently raise city, village, town or county minimum wage laws, the resulting legal patchwork will generate economic instability. Small businesses near community fringes would be unfairly disadvantaged against competitors in neighboring municipalities who are not required to pay higher wages, business owners said.
\Municipalities are acting to the detriment of local businesses,"" said Steve Davis, Wisconsin Restaurant Association board chair and Oshkosh restaurant- owner.
Advocates say the bill would provide desired uniformity. However, opponents argue the bill would undermine the authority of local democracy in places like Madison and Milwaukee, where the cost of living is significantly higher than surrounding areas. Unskilled workers, labor organizations and local representatives indicate that many workers depend on minimum wage jobs to support their families and standard of living.
Madison currently enforces a citywide minimum wage of $6.50 per hour. The Madison City Council approved a measure to incrementally increase this number to $7.75 by 2008. State representatives agreed that the current state minimum wage of $5.15 per hour, which has been frozen for seven years, needed to be raised.
Davis pointed out wages are often the single largest expense for a small business. He urged the commission to pass the bill and ""end the chaos evolving across the state.""
Ald. Austin King, District 8, spoke in defense of the local minimum-wage increase he worked to pass. King asserted the authority of local democracy by summarizing Madison's support of the city minimum wage increase.
""I'm frankly offended that I have to be here,"" King said. ""This body is the last refuge of the sore loser,"" he added, referring to the business interests the city trumped in several political and legal disputes.
Tim Metcalf, president and owner of Metcalf Sentry Foods said the Madison minimum wage increase will ultimately force him to pay a 19 percent net wage expense increase as workers higher on his employment ladder demand comparable increases to entry-level workers.
He calculates that this will result in an increased cost of $300,000 to $500,000 per year.
""I have no idea how I'm going to fund it. I will have to cut my growth."" Metcalf said. ""If you cut my ability to reinvest, you stop my ability to create jobs.""
City of Madison lobbyist Mario Mendoza said the city's goal has been to address the needs of the working poor. About 5,600 people in Madison earn between $5.15 and $6.50 per hour and are often forced to look for additional jobs according to Mendoza.
