Delaware House economics committee starts debate of bill to abolish training wage
A bill that would abolish Delaware’s current allowing businesses to pay a training wage and youth minimum wage sailed through committee after a hearing Tuesday.
House Bill 88, sponsored by Rep. Kim Williams, D-Newport, has been sent to the House of Representatives for consideration and a vote.
The bill would do away with a 2018 law, which itself was passed as part of an 11th hour compromise on the last day of the General Assembly.
HB88 is one of several bills, including a proposal to raise minimum wage to $15 and raise tip wages, that will affect the bottom line for Delaware businesses if all are passed. That seems likely to because they are heavily favored by Democrats, who hold a majority in the General Assembly.
Support for killing the training and youth wage bill fell along party lines, with Democrats for it and Republican generally against. However, two Republican legislators — Rep. Mike Ramone, R-Pike Creek, and Rep. Mike Smith, R-Pike Creek Valley — voted yes to send the bill to the floor.
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The one and one-half hour hearing before the House Economic Development, Banking, Insurance and Commerce Committee heard an emotional story from Rep. Larry Lambert, D-Brandywine Hundred about the effect of youth wages in his own life. He talked about how he and his sister lost their parents and a brother when he was just 20.
He took over care of his younger sister so she wouldn’t have to go into the foster system, Lambert said. She went to work while she was s sophomore in high school and every penny she made went to help put a roof over her head.
“This youth and training wage, as far as I’m concerned, is state-sanctioned age discrimination,” Lambert said. “We deal with the issue of pay and equity, and it affects a lot of Delawareans when we look at the weight of the gender wage gap.”
Paying younger workers less “conditions them for later on in life, when they also get paid lower wages,” he said. “It is not acceptable to keep this youth and training wage.”
Those in favor of the bill generally said it was unfair to young and starting workers; many teenagers work to help their families pay bills; teenagers should not be paid less because they are younger; all workers deserve a living wage; the bill was passed as part of an odd bargain to raise minimum wage a little; teenagers can’t save money for college on training wages; and the practice sends a negative message to workers to pay teens and starting workers that they and their work are worth less.
Those who opposed it said that many starting workers have to be taught basics like how to hold a broom or clean a toilet; employers take a risk on every new employee; there’s incredible turnover in first-time workers; first jobs teach work ethics and other important job skills that last a lifetime; a free market should control what wages are paid; and that the bill will have unintended consequences as small businesses continue to struggle with the fallout of the COVID-19 pandemic.
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Several people tried to tie the bill the minimum wage, saying that even a minimum wage of $15 an hour isn’t a livable wage. That should be closer to $30 an hour, one person said.
But Williams responded each time that her bill was not the minimum wage bill and the hearing didn’t need to take that topic up, too.
The minimum wage bill, already sent to the Senate floor, would raise the state’s $9.75 minimum wage to $10.50 on Jan. 1, 2020, and then continue raising it every Jan. 1 until it’s $15 on Jan. 1, 2o25. The youth and minimum wage now is set at $8.50.
Rep. Lyndon Yearick, R-Camden-Wyoming, asked Williams if she knew how much turnover there was for starting jobs.
She said no. “I don’t own a business,” she said.
Yearick asked if she didn’t think that being able to pay lower wages for 90 days helped offset the cost of bringing on new workers.
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“So all I’m going to say is I believe that everyone here has already made up their mind where they’re voting, and I’m not going to convince you otherwise to change your mind,” she said. “You either believe in this or you don’t. You either believe in paying people, or you don’t believe in that. So I, you know, I don’t know what else to say to you, representative.”
Yearick said he’d like to know more about how many employers actually started with minimum wage vs. a starting wage.
“I don’t think anybody can answer that. So I’m looking to address this right now,” Yearick said. “I think there’s a problem with it. But you’re right, most of us probably have our minds made up.”
Rep. Sherry Dorsey Walker, D-Wilmington South, said the state needed to think about how how lower wages affect the larger, broader community, not just the business community.
What if newly elected legislators were told they would make half of what other legislators did, just because they were new, she asked.
Smith pointed out that people know what they are being paid when they take a job, but he thinks there needs to be a fundamental discussion about getting rid of the youth and training wage if the bill to raise minimum wage is passed.
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Businesses needs some kind of protection, Smith said. They are the ones looking out for the greater community because they are involved there, Smith said.
“I think they need a little bit of cover to be able to make sure that they’re able to train the person properly.” he said. “The training wage is not used as something that’s going to be a lifelong measure.”
At least three restaurant-related speakers said the industry suffering from the pandemic couldn’t handle higher wages right now.
Susan Teiser, who owns the Centreville Cafe, talked about how much more time she has to spend with first-time teen workers, many of whom are not taught basic things like how to sweep or clean.
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Alexander Kotanides, who owns Pats Pizza in Lewes, said he worried that higher minimum wage would knock many of his employees out of federal and state aid programs they need for their families to survive. A real living wage would be at least $30 an hour, he said.
Carrie Leishman, CEO of the Delaware Restaurant Association, told legislators that restaurants were not taking advantage of young workers, but were training them about how to handle jobs.
Restaurants have lost $1.2 billion in revenues the last year and still have 10,000 workers out of a job because of COVID-19. she said. Taking away the training wage will make it harder for the restaurants to bring workers back, she said.
One mom called in to the virtual hearing to support the bill.
Dawn Alexander, who said she lives in Williams’ district, said she has a working daughter.
“Paying our children sub-minimum wage is simply unacceptable,” she said. “Teens must be valued for their efforts in the workforce. Minimum wage is just that. The minimum amount that any worker should be paid.”
