Businesses Push Back Against Proposed California Minimum Wage Hike

SACRAMENTO (CBS) – Some lawmakers are making a new push to raise the minimum wage in California, but businesses owners are pushing back.

California AB 10, introduced by Assemblymembers Luis Alejo and Michael Allen, would raise the minimum wage in the state from $8 per hour to $8.50 per hour.

Jeff Dawkins, a downtown Sacramento valet driver who works 7 days a week for minimum wage, said he would welcome the increased income, especially with the price of basic commodities climbing high.

“I’d definitely be in favor of that,” he said. The extra income would especially help with the costs of raising his daughter, he added.

Derar Zawaydeh, the owner of Sacramento restaurant Burgers & Brew, said the increased costs would squeeze his business and cost him much more than the simple 50 cents per hour.

“You’re talking about all the expenses associated with it in terms of taxes, in terms of workman’s comp,” he said.

The real cost is closer to 80 cents an hour, but with all his employees, that adds up to thousands in extra costs per week. That would force Zawaydeh to charge customers more, give fewer hours to employees possibly even lay off workers.

“It might increase 50 cents for an individual but you’re going to lose a good percentage of your employment,” he said.

Dawkins said he isn’t surprised that business owners feel they can’t spare the cash, but still says employees need more money.

“I personally feel like they can afford it,” he said.

The legislation would also provide for an annual adjustment of the minimum wage each year to match inflation or deflation.

(Copyright 2011 by CBS San Francisco. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed. Wire services may have contributed to this report.)


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