Arizona's minimum wage hike: $12 by 2020?

PHOENIX — Arizona voters could get a chance this November to set the minimum wage for workers at $12 an hour by 2020.

Or $9.50.

Or perhaps just whatever $8.05 an hour now plus inflation by that point equals.

A group began gathering signatures this past week to put that $12-an-hour option on the ballot.

That’s less than the deal approved by California lawmakers to take that state’s minimum wage to $15. But Tomas Robles, executive director of Living United for Change in Arizona, said he believes this is a fair compromise, something that will help workers but not break businesses.

That’s not the assessment of Steve Chucri. He’s the executive director of the Arizona Restaurant and Hospitality Association.

Chucri’s group never wanted the original 2006 measure which created a state minimum wage higher than what federal law requires. Voters thought otherwise, approving the initiative by a margin of close to 2-1.

That law set the base state minimum wage at $6.75 an hour at a time when the federal government required employers to pay just $5.15.

History of Arizona's minimum wage

Year State Federal

2006 $5.15 $5.15

2007 $6.75 $5.85

2008 $6.90 $6.55

2009 $7.25 $7.25

2010 $7.25 $7.25

2011 $7.35 $7.25

2012 $7.65 $7.25

2013 $7.80 $7.25

2014 $7.90 $7.25

2015 $8.05 $7.25

2016 $8.05 $7.25

  • Sources: Industrial Commission of Arizona, U.S. Department of Labor

But the real teeth in the measure has been the requirement for annual automatic inflationary increases, versus the requirement for Congress to act for changes in federal law. The result is a state minimum of $8.05 an hour, versus $7.25.

The initiative, if approved, would provide an immediate boost to $10 an hour in January, eventually reaching $12 by 2020. By contrast, if the current law remains in place, inflation might put the minimum wage only in the $9 range.

Robles said LUCHA spoke with not only workers who want a $15 minimum like the one being adopted in California but also small businesses to gauge their ability to handle an increase.

“We saw that $12 was a happy medium,’’ he said. Plus, like the current law, the measure would mandate future inflationary increases.

The initiative also has something not in current law: A requirement for paid sick leave of 40 hours a year for employees of companies with 15 or more workers. For smaller firms, the paid time off is 24 hours.

Campaign consultant Bill Scheel figures there are about 779,000 Arizonans now earning below $12 an hour, or about a quarter of the state workforce. He also estimates that about 934,000 Arizonans are in jobs where there is no paid sick leave.

Backers need 150,642 valid signatures by July 7 to qualify for the ballot.

Chucri’s organization has all but conceded that there is public sentiment for a higher minimum wage. But his organization has an alternate proposal, one crafted to better suit its members.

It would hike the minimum to $9.50 an hour by 2020 -- or about 50 cents an hour more than what inflation is likely to make the minimum wage under the existing law.

More to the point, it also would repeal a provision in the 2006 voter-approved law that specifically allows local governments to require employers in their jurisdiction to pay more. That would short-circuit discussions already taking place in several communities to enact “living wage’’ ordinances or mandate things like paid time off.

“From a business standpoint, to have this patchwork of wages, city by city, is really the death knell for business,’’ he said.

Chucri said he tried to cut a deal with labor organizations to find a wage they could support but eliminate the local option.

“We couldn’t get high enough for them,’’ he said. So, in the end, Churci took his proposal to lawmakers who are moving to put his $9.50 alternative on the November ballot, eliminating the need to get signatures.

The measure has been approved by the Senate Appropriations Committee but still needs action by the full Senate and House.

Chucri said that $2.50 an hour difference between the two proposals may not sound like much expense for a business.

But over a normal year, that’s $5,200. Multiply that times 40 employees at a typical restaurant and the annual price tag exceed $200,000.

The issue of paid time off also created heartburn for the industry.

He said restaurants certainly don’t want people coming to work if they’re sick, spreading their germs. But he worries that the language is too broad.

For example, it includes not only physical illness but also mental illness or heath condition. It also covers preventative medical care, care for family members as well as time off for victims of domestic violence to get services and medical or psychological attention.

“If someone needs time off, then great,’’ Chucri said. “But our concern is when you’ve got a packed house on a Friday night and three servers decide to go and do something and use a sick day, that’s tough, that’s very tough.’’

The possibility of dueling measures on the November ballot creates an interesting legal scenario.

If both are approved, the general rule is that any conflicts are resolved with the one that gets more votes takes precedence. But the law also says that if there is no conflict between measures, then those provisions can also take effect even if it came in second.

In this case, that would mean that the sick leave proposals would become law even if the restaurant industry-backed measure got more votes, as long as both were approved.

Churci said, though, it could end up just as likely that voters would be confused and reject both of them, leaving the 2006 law in place.