DFL candidate Margaret Anderson Kelliher's proposal announced Friday to increase the state's minimum wage by $1.50 contrasts sharply with one from Republican candidate Tom Emmer, who said earlier this week that he would reduce the minimum wage for servers and other workers who receive tips.
Minnesota is currently one of only a handful of states where the minimum wage is currently lower than the federal minimum wage of $7.25 an hour. State law says small businesses must pay workers at least $5.25 an hour, and large businesses must pay $6.15. Wages are higher in 43 states.
Kelliher said hiking the wage would make Minnesota more competitive.
"This is something that I think is a matter of fairness; it can be phased in," she said. "We're going to keep the differential between small firms and large firms."
Kelliher is running in a competitive DFL primary battle, but her minimum wage plan is directed at the Republican she hopes to face in the November general election. Earlier this week, Tom Emmer said he favors a lower minimum wage for servers and other employees who receive tips. He also said some food servers are earning up to $100,000 a year.
Kelliher said the episode showed that Emmer is out of touch.
"Tom Emmer is out there basically doing something that I think no Minnesotans would want to do, and that's stealing the tips off the table of hard working Minnesotans," she said.
Despite the criticism, Emmer hasn't backed away from his support for the so-called tip credit. He said freezing the wages of some workers to account for their tip income would help save jobs. Emmer plans to tackle the issue again next week during a town hall meeting with waiters and waitresses in Roseville. But he declined to comment for this story.
CHAMBER OF COMMERCE DISAGREES
Emmer's view on minimum wage isn't out of touch with business leaders. The Minnesota Chamber of Commerce also supports a tip credit, as well as a uniform federal minimum wage, rather than state-by-state rates.
Tom Hesse, the chamber's vice president of governmental affairs, said most Minnesota businesses are currently paying their employees the federal minimum wage or more.
"So there's really no down side to Minnesota being below. If you're involved in interstate commerce, which most businesses are, you are subject to the federal rate," he said. "In reality, Minnesota's rate is $7.25 right now -- at least most most businesses have to pay that."
Hesse said a big increase in the minimum wage would be a hardship for many struggling companies.
MIXED REACTIONS FROM OTHER CANDIDATES
Independence Party gubernatorial candidate Tom Horner offered a similar caution. In a written statement, Horner said he would be open to evaluating the minimum wage once the economy recovers. But he said this is not the time for an increase such as Kelliher has proposed.
Some of the loudest agreement with Kelliher's proposal is coming from her DFL primary rivals. Mark Dayton, says it's embarrassing for the state to have a minimum wage lower than the federal rate, and he would support a $1.50 increase. Matt Entenza said a $1.50 increase is reasonable under current circumstances. In the future, Entenza said the minimum wage should keep pace with inflation.
"I would be looking for predictability that helps employers, but also helps people that rely on that in order to pay their bills," he said.
Entenza and Dayton are also using the issue as a chance to blast Emmer. Entenza began soliciting economic advice on his website that he plans to share with Emmer. He calls the new feature "Tips for Tom."