$13 Minimum Wage for Chicago Big Box Retailers?
The Chicago City Council is considering passing legislation that would require “big box” retailers like Wal-Mart, Target and Staples to pay all employees at least $13 an hour.
Opponents of Wal-Mart Stores Inc.’s expansion into inner cities are scoring early success with a new tactic, enlisting support for a proposed local ordinance requiring giant retailers to significantly raise the minimum wage and help pay for health benefits. Advocates of the so-called living wage or big-box ordinance, which advanced to a vote by the Chicago City Council next week after being passed by its finance committee Wednesday, say its approval would set the stage for similar actions in other U.S. cities. “These proposals are really about whether it’s reasonable to ask some of the largest and most successful companies in the country to balance growth and profits with paying a living wage,” said Paul Sonn, deputy director of the poverty program at the New York-based Brennan Center for Justice, who helped draft the ordinance.
Retailers, however, argue such ordinances would cause them to locate new stores elsewhere and force layoffs at existing outlets in the affected areas. The Chicago initiative, mirroring one under consideration by the Washington, D.C., city council, comes with Wal-Mart preparing to open its first local store on the West Side in September after winning a heated zoning battle.
The ordinance would require operators of large stores in the city to pay their workers at least $10 an hour in wages plus another $3 in fringe benefits. That’s significantly above Illinois’ minimum wage of $6.50 and roughly double the federal minimum wage of $5.15. If enacted, it would be one of the nation’s first industry wage laws, following one adopted last November for large hotels in Emeryville, Calif., on San Francisco Bay. Supporters say it would raise pay for tens of thousands of local residents working for employers such as Wal-Mart, Target Corp. and Staples Inc.
“I believe it is an important step that we’ve taken to speak on behalf of the working people, not only of our area but generally of the United States,” said Chicago Alderwoman Freddrenna Lyle, a co-sponsor of the proposed ordinance, following the 15-6 vote by the finance committee. “We’re basically saying that labor has a right to be paid a wage which allows them to not just live but to sustain themselves and improve themselves,” she said.
That’s a laudable notion but a rather asinine thing to attempt via legislation. According to the piece, “The ordinance’s backers dispute that argument and maintain that big-box retailers still will open stores in inner cities regardless because rural and suburban areas are saturated.” But, of course, they won’t. Wal-Mart and Target, at least, operate on incredibly tiny margins and big volumes. They’d simply be better off bypassing any city that had such a law in place.
Assuming they weren’t stricken by the courts.
Labor and employment law expert Jim Hendricks said the ordinance would be unlikely to withstand legal scrutiny as a “blue law,” or one that singles out specific types of businesses. “You can’t say you’re just going to do it for some employers,” said Hendricks, based in Chicago for the firm Fisher and Phillips. “I’m sure it’s going to get challenged if they’re foolish enough to pass it.”
One would think.
via emailer Paul J