Copyright © 2019 Albuquerque Journal
SANTA FE – The latest push to increase New Mexico’s $7.50 per hour minimum wage has turned into a tiff over tips.
Dozens of restaurant owners and workers on Friday urged members of a House committee to oppose a bill that would increase New Mexico’s minimum wage to $10 per hour – and even higher in coming years – and scrap a lower allowable rate for tipped employees, saying it would lead to layoffs and smaller tips for workers.
But that sentiment was far from unanimous, as other restaurant and agriculture employees – along with advocates for immigrant and low-income workers – urged lawmakers to approve the legislation.
After more than three hours of testimony and debate, members of the House Commerce and Economic Development Committee ultimately voted 5-4 to advance the measure, with majority Democrats in favor and Republicans in opposition.
“When New Mexico workers are paid a fair wage, that money is invested right back into our economy,” said Rep. Miguel Garcia, D-Albuquerque, one of the bill’s sponsors.
The proposal, House Bill 31, is one of several bills calling for a minimum wage hike that have been introduced at the Roundhouse.
It calls for New Mexico’s minimum wage to jump to $10 an hour starting in July, then increase by $1 per hour in each of the two subsequent years. Starting in July 2022, annual increases would be tied to federal inflation rates.
However, a provision in the bill that would eliminate the lower minimum wage – now set at $2.13 per hour – for tipped employees has drawn the most attention.
Critics, some of whom wore T-shirts emblazoned with a “Save our Tips” slogan, said that would have a disastrous impact for restaurants.
“Some restaurants are not going to survive this,” cautioned James Campbell, founder and owner of La Boca restaurant in downtown Santa Fe.
Some waiters also said they already make more than the minimum wage and fear their tips would be lower if the new law passes – because restaurants would increase prices.
“This bill hurts employees who currently make many times minimum wage level and puts small restaurants out of business, period,” said Jennifer Rios, general manager and co-owner of Restaurant Martin in Santa Fe.
But backers suggested that some of the criticisms were overstated and suggested the current system is subject to abuse.
“In no way will tips go away,” said Garcia, who said federal law stipulates that tips belong to employees. “And in no way will employers pick up the tips.”
The bill also appears to have the backing of Gov. Michelle Lujan Grisham, as one of her Cabinet members testified in support of it on Friday.
Citing updated numbers, State Department of Workforce Solutions secretary-designate Bill McCamley said more than 160,000 New Mexico workers – most of them women – would get pay raises starting in July under the proposed legislation.
“The governor feels very strongly that no one should work 40 hours a week and live in poverty,” McCamley said.
One agricultural worker who spoke in favor of the legislation, Aldo Carrasco of Roswell, said employers in his part of the state have long benefitted from “cheap Mexican labor.”
“I’ve always hoped for a living wage in my district,” he testified.
However, the concerns of restaurant owners and industry trade groups appeared to resonate with some lawmakers, several of whom urged Garcia to work with opponents to come up with a compromise.
In response, Garcia said he did not want to make amendments to the bill in the House, but suggested changes could be on the horizon.
“This legislation is not a done deal,” Garcia said. “This is a starting point.”
Some New Mexico cities have already enacted higher municipal minimum wages. Santa Fe’s minimum wage recently went up to $11.40 per hour, Las Cruces has a $10.10 per hour minimum wage and Albuquerque’s is $9.20 – with a lower base wage for tipped employees and those who get certain benefits.
The bill approved Friday would not pre-empt the local ordinances whose minimum wages are higher than the new state wage, meaning no employees’ wages would be reduced under a statewide wage hike.
Meanwhile, New Mexico would not be the first state to require employers – including restaurants – to pay their workers the full state minimum wage before tips.
Seven states already do that, according to U.S. Department of Labor data.
House Bill 31 is now slated to go to the full House for consideration, but Rep. Antonio “Moe” Maestas, D-Albuquerque, the commerce committee’s chairman, said he would request an additional hearing in the House Appropriations and Finance Committee.
New Mexico’s minimum wage was last increased in 2009. Lujan Grisham’s predecessor, former Republican Gov. Susana Martinez, vetoed several wage hike bills during her eight years in office.