Senate leadership scales back proposal to raise R.I. minimum wage

By Katherine Gregg
Journal Political Writer

PROVIDENCE — Despite the push in some quarters to match Massachusetts by putting Rhode Island on a path to a $15-an-hour minimum wage, the Senate Labor Committee was unwilling to go that far, approving instead an election-year bill to raise the $10.50 minimum by $1 on Oct. 1.

The committee approved the scaled-back bill on a 4-to-2 vote on the same day it held the first hearing of the year on the latest push by Rhode Island unions and low-income advocacy groups for a minimum-wage hike. The legislation now goes to the full Senate for a vote.

At the current $10.50 an hour, a minimum-wage worker in R.I. makes $420 for a 40-hour workweek, or $21,840 a year. Put another way: a $12.75 an hour minimum wage worker in Massachusetts today makes $90 a week more than a minimum wage worker in Rhode Island.

“For a low-income person, for a lot of people, $90 a week is a lot of money, and we are getting further and further behind our neighbors, particularly Massachusetts, and even Connecticut,″ George Nee, president of the Rhode Island AFL-CIO, told the lawmakers. He said retail stores and fast-food outlets in Massachusetts “can find a way to make sure these people are being paid $12.75 [while] our people in R.I. are being paid $10.50.”

According to information that the Economic Progress Institute presented state lawmakers, that $10.50 an hour represents $5,200 a year less than the standard of need for an adult living in Rhode Island — meaning individuals and families earning the current minimum wage cannot afford “the cost of basic necessities.”

Of the “many thousands of Rhode Island workers who stand to benefit from the proposed increase,″ the institute told the lawmakers, “well over half are women.″

“We estimate that 25,000 to 30,000 Rhode Islanders are currently earning minimum wage,″ said Department of Labor & Training spokeswoman Angelika Pellegrino. “Twenty-nine states and the District of Columbia have minimum wages higher than the [$7.25] federal minimum. As of January 1, 2020, Rhode Island has the 14th highest minimum wage in the country.”

In New England, Massachusetts currently mandates $12.75 an hour; Maine $12; Connecticut $11 (scheduled to increase to $12 later this year) and Vermont $10.96, she said. New Hampshire, with no minimum wage of its own, requires the $7.25 federal minimum.

Ahead of Wednesday’s hearing, the National Federation of Independent Business warned that any increase in the minimum wage would result in “fewer entry level jobs, cuts in hours for workers.”

The statement by the NFIB state director in Rhode Island, Christopher Carlozzi, was aimed at the original version of the bill, introduced by key members of Senate President Dominick Ruggerio’s leadership team, including Senate Judiciary Committee Chairwoman Erin Lynch Prata and Senate Majority Whip Maryellen Goodwin. That version called for a series of increases, including a 75-cent increase on July 1, on the way to a $15-an-hour minimum wage by Jan. 1, 2024.

“A $15-an-hour minimum wage will have a devastating effect on Rhode Island small businesses, crowding young and unskilled workers from the workforce,″ Carlozzi said.

“Other areas of the country with similar wage hikes experienced the elimination of entry-level positions, fewer jobs for younger workers and a reduction in hours and shifts. Rhode Island will be no different,″ he predicted, as the NFIB has done each year.

“This wage hike will have a particularly negative impact on the hospitality industry, resulting in higher menu prices for consumers, job reductions and an increase in automation. Expect to see more ordering kiosks or tablets as you walk in the door of the local restaurant.”

It is unclear if that has actually happened in past years, as Rhode Island lawmakers incrementally increased the minimum wage from $7.40 an hour in 2007 to $7.75 in 2013, $8 in 2014, $9 in 2015, $9.60 in 2016, $10.10 in 2018 and $10.50 on Jan. 1, 2019.

In the 24 hours leading up to the hearing, the Senate Labor Committee removed from its agenda a proposal, sponsored primarily by Sen. Ana Quezada of Providence, that would have raised the minimum wage to $15 by July 1, 2024, and the hourly minimum wage for employees receiving gratuities from $3.89 to $15 by Jan. 1, 2028.

That left the bill introduced by Lynch Prata and other members of Ruggerio’s leadership team, which was rewritten. Instead of an incremental march to $15 an hour, it would raise the state minimum wage to $11.50 an hour on Oct. 1.

A similar bill passed the Senate last year, then died in the House.

House Speaker Nicholas Mattiello said in June: “The proposal is still under consideration, but we may hold off until the future. The House is concerned that the economy is not doing as well as it should be, and raising the minimum wage would further impact some businesses.” House leaders have voiced more openness to a minimum wage hike this year.