California Gov. Brown hails deal to raise state’s minimum wage to $15

SACRAMENTO, Calif. – In a move catapulting California into uncharted national territory, Gov. Jerry Brown announced Monday a six-year plan to boost the statewide minimum wage to $15 an hour, promising that millions of low-wage workers would receive the help they desperately need.

“It’s a matter of economic justice. It makes sense,” Brown said at a news conference at the state Capitol, surrounded by Democratic leaders of the Legislature and those from some of the state’s most prominent labor unions.

The agreement would reinforce California’s position as having the highest minimum wage of any state. It also sets in motion a series of important political and policy changes. Most pressing, the brokered deal is expected to cancel two separate labor-sponsored efforts at placing a wage hike initiative on the November ballot.

The plan, expected to be voted on by the Legislature before the end of the week, would raise the statewide minimum wage by 50 cents on Jan. 1 to $10.50 an hour. From there, it would rise to $11 in 2018 and subsequent dollar-a-year increases ending at $15 on Jan. 1, 2022.

That is a slower timetable than union leaders had proposed in their ballot measure efforts, but an agreement that they said represented real progress.

“This agreement puts a better future in the grasp of average Californians,” said Laphonza Butler, president of the statewide council of the Service Employees International Union.

For Brown, the newly minted deal represents an admission that political forces demanding a minimum wage increase were simply too strong to ignore. The governor signed the last statewide increase in 2013, but had suggested any additional increases would be a significant burden on the state as the employer of low-wage care workers for the disabled.

Brown had also previously rejected demands to “index” the minimum wage – linking its rate to future inflation pressures. The negotiated agreement announced Monday requires minimum wage increases after 2022 as statewide cost-of-living estimates also rise.

Even so, Brown did insist on including ways to stop wage hikes if the economy falters. The agreement allows for a temporary pause in the first few years of boosted salaries if California’s unemployment rate rises or if a deficit is projected in future state budgets.

The plan raises the wage “in a way that takes into account the vagaries of the capitalistic economy,” Brown said, adding, “This thing is the result of a lot of thinking.”

The governor, along with legislators and labor leaders, has been privately negotiating the details of the plan for weeks. Business groups argued that they were largely shut out of those talks, and have characterized a new minimum wage increase as designed more with an eye on political approval ratings than economic common sense.

The proposal makes one concession to small businesses, by allowing those with fewer than 25 workers an additional year to raise wages. The $15-an-hour minimum wage wouldn’t apply to those employers until Jan. 1, 2023.

Labor unions successfully won as many as three additional paid sick days for their members who work as in-home care providers. While the agreement allows some possible delays in the rollout of those extra sick days, it represents a significant victory for the unions in their negotiations with Brown and legislative leaders.

But the effect of the minimum wage hike will go much further. The Capitol news conference announcing the deal included a fast-food minimum wage worker, Holly Diaz of Humboldt County, who said the boost in her take-home pay would help her raise her 5-month-old son.

“I just want to say thank you,” she said tearfully, getting a hug from Brown as she walked away from the podium.