Wednesday Jolt: The Tunnel and the Minimum Wage
THIS POST HAS BEEN UPDATED: The day's winners and losers.
Today's first loser: The proposed Alaskan Way Tunnel project.
And then, yesterday, deputy tunnel project manager Matt Preedy, with the Washington State Department of Transportation (WSDOT), told city council members that WSDOT "cannot say with confidence" that Seattle Tunnel Partners, the tunnel-boring contractor, "is going to meet their overall timeline" of completing tunnel construction within 16 months, given the latest delays.
Preedy also revealed that STP now plans to replace the entire tunnel boring machine's bearing, which helps turn the machine's massive cutterhead, as opposed to simply fixing the seals that protect the bearing—a far more complicated operation that involves shipping in an extra bearing that is currently being stored at a facility run by the company that built the machine, Hitachi-Zosen, in Japan.
"Obviously, we're very disappointed in the overall schedule," Preedy said, adding that STP has "not done enough overall construction yet" for the state to know whether their schedule was realistic.
"They need to get a lot more progress made before I can say with any confidence that they’re going to meet their timeline," Preedy said. He also told the council that the utility relocation required to build the tunnel "didn't go as planned" and resulted in electrical outages that lasted for several days.
Today's second loser: Mayor Ed Murray's minimum-wage proposal, which could fall apart thanks to business-friendly changes drafted by city council central staff in advance of the first public hearing on the legislaiton tomorrow.
The original proposal, which a group of business and labor representatives hashed out over several months as part of Mayor Murray's task force, would increase the minimum wage in Seattle to $15 an hour over several years, depending on business size, with an eventual increase to $18.13 an hour for all businesses in 11 years. (And it would give low-wage workers a raise right away—to $10 or $11 an hour next year.) The proposal also allows employers to temporarily include things like tips and health care as part of their workers' "total compensation" when calculating a $15 minimum wage, but it also requires that wage to increase over time, indexed to the rate of inflation.
The new proposed concessions include: Allowing large nonprofit organizations such as Swedish Hospital and the Gates Foundation to phase in the $15 minimum over time; allowing employers to phase in higher wages gradually, over time; and creating a sub-minimum "training wage."
The new possible concessions outlined in a council memo obtained by PubliCola include: Allowing large nonprofit organizations such as Swedish Hospital and the Gates Foundation to phase in the $15 minimum over time; allowing employers to phase in higher wages gradually, over time; and creating a sub-minimum "training wage," set at 85 percent of the new minimum for all new employees.
The training wage idea, other than current state standards for programs certified by the Department of Labor and Industries that allow training wages for programs serving employees with cognitive disabilities or trainees enrolled in vocational or educational apprenticeship programs, was anathema to the labor advocates who signed off on Murray's deal. The council recommendations could change the criteria by, for example, allowing employers to pay teens or new employees less than the minimum for a defined period.
The new proposals give fodder to city council member Kshama Sawant and her 15Now movement, which is pushing for an immediate increase in the minimum wage to $15 an hour for all workers except at businesses with fewer than 250 workers, which would be phased in to $15 over three years.
UPDATE: Eight members of Murray's task force—representing the left contingent—sent a letter to the council tonight reiterating support for the original compromise and criticizing council staff for reintroducing a series of business-friendly amendments that could disrupt the compromise.
Here's the letter:
Dear Council members:
As members of Mayor Murray’s Income Inequality Advisory Committee (IIAC), we have stood behind the Mayor’s proposal as a compromise solution negotiated in good faith between business, labor, nonprofit, and community representatives. We are very concerned that the City Council’s Central Staff is presenting options to the Council to weaken the Mayor’s proposal for Seattle 100,000 low wage workers. The options the Central Staff contemplates in a memo dated May 22nd to the Select Committee on Income Inequality and Minimum Wage – including training wages, longer phasein periods, and exemptions are options that the IIAC considered and rejected as part of the negotiated settlement. Reconsidering these options would cause major disruption to the compromise negotiated at the IIAC.
If changes are being considered to the proposal, public opinion favors changes that strengthen the proposal for workers. Many of our colleagues in the progressive community have raised concerns about the Mayor’s proposal that are not reflected in the Central Staff’s document. If the Council is reviewing amendments and alterations to the Mayor’s proposal, they should also review the following options that would lift more workers out of poverty in a faster way, including:
1. Don’t count tips toward minimum compensation . Allowing employers to count tips toward minimum compensation will encourage wage theft and exacerbate the gender wage gap. 64% of the public thinks that tips should never or should only temporarily count toward the minimum wage.
2. Shorten the phasein. Big businesses can afford to pay $15 sooner. The public supports a faster phasein for big business by 51% to 35%.
3. Eliminate training wages . Very few exemptions exist under state law. The city shouldn’t allow businesses to pay lower wages to disabled workers, young workers, or immigrant workers.
4. Decrease the threshold for big businesses to 250 employees . 250 is the largest threshold in the City’s sick leave law, and businesses over that size should be able to afford to lift workers out of poverty sooner.
5. Strengthen enforcement . The enforcement mechanism in the minimum wage policy does not institute strong penalties that would discourage businesses from trying to avoid or violate the law. Enforcement should include a stronger private right of action, larger damages for violations of the law, and a robust education and outreach component.
If the Council intends to consider different options, we would expect it to consider proworker options supported by the public and not only employerfriendly options. That said, we want to be clear that we believe the Mayor’s compromise proposal remains the best way forward. Passing the bill as is would lift 100,000 workers out of poverty and put $3 billion into low wage consumers’ pockets in the first 10 years. Moreover, the compromise embodies a delicate and hardfought balance of interests. Substantial revision could result in the collapse of public support for the mayor’s proposal. We urge you to pass the deal as recommended.
David Rolf, IIAC cochair
David Freiboth, IIAC member
Nick Hanauer, IIAC member
Pramila Jayapal, IIAC member
Nicole Vallestero Keenan, IIAC member
Eric Liu, IIAC member
Diane Sosne, IIAC member
Steve Williamson on behalf of Sarah Cherin, IIAC member