New York board backs $15 minimum wage hike for fast-food workers

NEW YORK (WABC) -- The push for a higher minimum wage gained momentum on both sides of the country Wednesday, with a New York labor board endorsing an eventual $15 an hour for the state's 150,000 fast-food workers and the huge University of California system announcing the same raise for its employees.

The recommendation that the minimum wage be raised to $15 an hour for New York's fast food workers was music to their ears, and ultimately, money in their pockets.

Workers gathered Wednesday to watch a state panel recommend raising the wage. Jorel Ware works at McDonald's in Times Square, and makes $8.75 an hour.

"My mother helps me out a lot. Without my mother, I'd be homeless," he said.

Raising the minimum wage has become a national concern. This year the state legislature blocked Governor Cuomo's proposal that would have increased pay for all workers.

In response he formed a panel to specifically address pay for those working at fast-food restaurants, many of whom live below the poverty line.

"New York State alone we pay $700 million while McDonald's is making $4 billion. It's absurd to me," said Cuomo.

The $15 minimum would be limited to companies or franchise owners with 30 or more locations. The increase would be phased in by the end of 2018 in New York City and by 2021 in the rest of the state.

A life changing adjustment, say some workers.

"It means I can live comfortably, stress-free, be able to pay my bills, be able to go shopping, food, clothes, laundry, actually live normal again," said fast-food worker Jackie Jordan.

But not so fast, says a lawyer hired by restaurant owners. Randy Mastro questions the legality of the governor's wage board, and argues that the proposed increase burdens franchise owners.

"Many of them fear they won't be able to survive with a 66 percent increase imposed on them by the state," said Mastro.

Los Angeles, Seattle, San Francisco, Oakland and Berkeley have all approved phased-in increases that eventually will take their minimum wage to $15 an hour, or about $31,200 for a full-time job. On Tuesday, Los Angeles County, the nation's most populous county, voted to craft a law to raise the minimum to $15 over five years.

New York would become the first state to take such a step for a specific industry. The state minimum wage is now $8.75 an hour and is set to rise to $9 at year's end.

Many workers say the increase would allow them to cope with the high cost of living, though restaurant owners say it will lead to higher prices and fewer jobs.

At the University of California, UC's hourly wage earners - a group that includes students and full-time employees working in dining halls, dorms and bookstores or as gardeners, housekeepers and custodians at campuses and hospitals - currently make the state minimum of $9 an hour.

Napolitano said she will boost that to $13 in October for employees who work at least 20 hours a week and raise it some more in stages to $15 by the fall of 2017.

UC has nearly 240,000 students and is California's third-largest employer, with a staff of 195,000. About 3,200 UC employees and a much larger but undetermined number of workers hired by university contractors will receive the higher wage, UC spokeswoman Dianne Klein said.

"I just thought it was important for a public university to plant the flag here for low-wage workers and a more livable wage," said Napolitano, who was President Barack Obama's homeland security secretary before she assumed leadership of the University of California nearly two years ago.

The higher minimum-wage argument has gained traction amid concerns over the shrinking middle class and rising income inequality.

Supporters argue a higher wage floor will help lift the working poor into the middle class. Opponents warn businesses will have to raise prices, shed jobs or cut employees' hours. Sixteen states have passed laws barring local governments from setting their own minimum wage.

Democrats, including presidential front-runner Hillary Rodham Clinton, have said they support a higher federal minimum wage, which is currently $7.25 per hour.

Vice President Joe Biden was scheduled to promote a higher minimum wage during a stop Wednesday at a washroom equipment manufacturer in Los Angeles.

Wal-Mart, the nation's largest private employer, announced early this year that it is raising wages for a half-million employees to at least $10 an hour by next February.

The $15 minimum has become the rallying cry of labor groups nationwide who argue the base wage hasn't kept up with inflation.

University of California officials estimated that the raises for workers directly employed by UC will cost $14 million a year, a fraction of the system's $12.6 billion annual payroll. Klein said UC also predicts contractors will pass some of the cost of higher wages onto the university.

Napolitano's minimum wage plan does not need approval from the governing Board of Regents, who on Wednesday were scheduled to consider a 3 percent cost-of-living increase for campus chancellors, medical center directors and other top executives.

(Some information from the Associated Press.)