SACRAMENTO, Calif. (FNS) -- The California Industrial Welfare Commission, a small body made up of five governor appointees, voted unanimously last week in favor of raising the state floor on wages by $1 over the next two years. The state's minimum wage is currently $5.75 an hour, higher than the federal mandate of $5.15.
re legislative maneuvering and does not require a signature from California Gov. Gray Davis. There were three public hearings held prior to the final vote, in San Diego, San Francisco and Stockton.
"What the commission really looked at was that there seemed to be a general consensus even among the business community that there should be a minimum-wage increase," said Bill Dombrowski, president of the California Retailers Association and chairman of the IWC. "The question then was how much."
Ric Icaza, president of United Food and Commercial Workers Union Local 770, the largest local in southern California, said the hike in the minimum wage will affect all entry-level employees at unionized companies, since the union contract guarantees automatic increases that parallel the minimum wage.
He also said the increase will impact non-union companies, which also pay minimum wages for entry-level positions, with thewage hike causing Wal-Mart to tak a big hit at its California discount stores.
"The people who get hurt by this are the small retailers because they are hiring people at minimum wage," said Richard Giss, partner in the retail services group of Deloitte & Touche.
"Larger chains might well be above that, but it's still going to drive up their costs," he said. It may not have a direct impact [now] but over time, it will work its way into the salary scale."