Birmingham, Alabama City Council recently approved a measure to increase the city’s minimum wage to $10.10 per hour. However, less than an hour later, Alabama Governor Robert Bentley signed a new bill prohibiting cities and towns from setting their own minimum wage.
The 23-11 vote in the Alabama state legislature and the governor’s signature essentially voids Birmingham’s ordinance mandating the higher minimum wage, according to the city’s legal department.
Birmingham council member Jonathan Austin criticized the new Alabama law and said the fight will continue.
“It’s certainly is unfortunate, if it stands up, it is a loss for those who deserve to earn a livable wage in the city of Birmingham, and, for that matter, the state of Alabama. But the state obviously disagrees.”
Among those who supported the new Alabama minimum wage bill was state Senator Jabo Waggoner. He said increasing the minimum wage would hurt economic development and force some businesses to close.
“We want businesses to expand and create more jobs – not cut entry-level jobs because of a patchwork of local minimum wages causes operating costs to rise. Our actions today will create predictability and consistency for Alabama’s economy, which benefits everyone.”
Yet, some lawmakers disagree and think the current minimum wage of $7.25 is just too low. Senator Rodger Smitherman contends raising the minimum wage would carry families out of poverty, and flood the economy with new spending.
State Senator Linda Coleman-Madison says that it’s time for the state government to be a leader on the issue and recognize the working-poor class of people. She plans to introduce a bill to make the Alabama minimum wage $10.10 statewide.
The Birmingham ordinance changing the minimum wage was actually approved by city council members in August 2015. Under the measure, the city’s minimum wage would increase to $8.50 by July of this year and then to $10.10 by July 2017.
However, when the city got wind of the state legislature working on a bill to repeal the Birmingham ordinance, city officials expedited the increase. Earlier this week, city council voted to make the $10.10 effective immediately.
During his State of the State address a few weeks ago, Governor Bentley called poverty one of the major problems challenging Alabama and said there are just too many citizens stuck in a cycle of poverty and dependence.
Jennifer Ardis, a spokeswoman for the governor’s office, said the bill was signed in order to maintain wage consistency and uniformity across Alabama.
The Alabama minimum wage law is not the only one in the country. In 2014, Oklahoma state legislature passed a comparable bill disallowing cities from raising their minimum wage. Arizona had a similar law in 2013, but was overturned last year.
In contrast, 29 states have increased their minimum wage above the federally mandated wage, according to the Economic Policy Institute. Additionally, 23 local governments, including San Francisco, California and Chicago, Illinois, have followed suit. Some, like Seattle, Washington’s minimum wage, are as high as $15 per hour.
The Obama administration seems to agree with the minimum wage hike at the local level as well as raising the federal level to $12. Last year, U.S. labor secretary Tom Perez told The Guardian that the government needs to take action.
“We believe that the federal floor should be $12 by 2020 [and that] would be just enough to get a family just above the poverty line. They are not going to be rich, but they will be just above the poverty line. That’s been our position and continues to be our position.”
According to the U.S. Census Bureau, Birmingham is Alabama’s largest city. It is home to nearly 212,240 residents with a per capita income of $19,650.
While the new Alabama minimum wage law prohibits local governments from increasing the rate of pay, the state has no mandated hourly amount, so employers have been using the federal standard of $7.25 per hour. Based on that figure, a person working 40 hours a week for an entire year would earn just over $15,000.
[Photo by AP Images]