As previously discussed on this blog, Washington, D.C. lawmakers had approved a bill that would require large retailers to pay their employees a living wage of at least $12.50 per hour, as opposed to the usual D.C. minimum wage of $8.25 per hour. The bill, called the Large Retailer Accountability Act of 2013 (LRAA), defined large retailers as companies that gross over $1 billion in annual revenue and operate in warehouse spaces over 75,000 square feet. The bill required only the mayor’s signature to be passed into law, however D.C. mayor Vincent Gray opted to veto the bill instead of sign it into law.
Many cite retail giant Walmart as the primary reason for the mayor’s decision to veto the bill. Walmart was in the process of expanding into the D.C. with three new stores under construction and plans for additional stores. Many politicians and neighborhood development groups expected the Walmart stores to help invigorate commercial areas that had struggled in recent years. Walmart, however, threatened to cease construction and all plans to open D.C. stores if the living wage bill passed. Other large retailers, such as Target, Home Depot, Lowe’s, Wegman’s, Autozone, and Macy’s also stated they would seriously reevaluate any plans to expand into the D.C. area if LRAA passed.
The Decision to Veto
Mayor Gray has stated that instead of fueling the economy, LRAA would have killed economic development in underserved communities that had no other quality and affordable retail options. He believes the bill would significantly harm job growth by eliminating an estimated 4,000 jobs in the first couple of years alone. Furthermore, the mayor asserted that the bill was “not a true living wage measure,” because it would only increase minimum wage for some of the workers in the D.C. area. Mayor Gray then called for a bill that may effectively increase minimum wages for all area workers, stating that would better serve the residents and employees in the D.C. area.
This veto comes at a time when the idea of a living wage is a hot topic. Employees of giant corporations such as McDonald’s and Walmart are actively expressing the inadequacy of the current minimum wage, and demanding pay increases up to $15.00 per hour. Executives of both companies have stated they cannot afford to increase wages without increasing prices or laying off huge numbers of workers. However, economists have pointed out that the CEOs of these two companies earned $13.8 million and $15 million last year, respectively. Furthermore, raising wages is said to increase customer service and decrease employee turnover, eliminating many costs related to employee hiring, firing, and training.
While the living age debate continues, all employees are entitled, by law, to receive at least the statutory minimum wage. If you believe your employer is violating wage or hour laws, call HKM Employment Attorneys to discuss your situation.
