Seattle Mayor Ed Murray has proposed a $15 municipal minimum wage, which would be phased in over several years. The state of Washington already has the highest state minimum wage in the country at $9.37 an hour.
"I think that this is an historic moment for the city of Seattle," Murray said in a statement announcing the wage increase. "We're going to decrease the poverty rate. Throughout this process, I've had two goals: to get Seattle's low-wage workers to $15-per-hour while also supporting our employers, and to avoid a costly battle at the ballot box between competing initiatives. We have a deal that I believe accomplishes both goals."
Meanwhile, a bill to raise the federal minimum wage failed a test vote Wednesday in the Senate, stalling its advance.
Seattle businesses with fewer than 500 workers nationally will be given seven years to reach the required $15 minimum if they do not offer health insurance or allow employees to accept tips.
Businesses that allow tips or offer healthcare coverage will have five years to meet the new standard. The $15 per hour compensation can include a combination of tips, health coverage and wages.
Larger businesses must pay workers the new minimum wage within three years. Businesses offering company-sponsored healthcare coverage have four years to meet the new minimum wage. Once the $15 minimum is reached, future pay increases will be tied to the national rate of inflation.
Other cities and states that have raised, or are in the process of raising, local minimum wages include California, Connecticut, Delaware, Hawaii, Maryland, Minnesota, New York, West Virginia and Washington, D.C. San Francisco initiated a $10.74 minimum wage at the beginning of the year, while Santa Fe instituted a $10.66 beginning wage on March 1.
The non-partisan Congressional Budget Office says an increase of the federal minimum wage to $10.10 by 2016 would boost real income by some $5 billion for families living below the federal poverty level moving some 900,000 people above the poverty line. But the CBO also says the increase could reduce total employment by about 500,000 workers.
--Written by Hal M. Bundrick for MainStreet