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New Year’s Day raise for minimum wage workers on LI, in NY

Veronica Ramos of Uniondale, right, a McDonald's manager,

Veronica Ramos of Uniondale, right, a McDonald's manager, rallies with supporters of raising fast-food workers' wages at Nassau Community College in Garden City on Thursday, June 18, 2015. Credit: Barry Sloan

Workers earning the minimum wage on Long Island and throughout the state get a raise on New Year’s Day, as New York boosts the minimum legal pay rate for most workers by 25 cents an hour, to $9.

Tipped workers, state employees and fast-food workers get bigger increases.

The increases follow a momentous year for wage debate in the state, as protests and pressure to raise wages clashed with predictions by some business groups that the raises would lead companies to reduce the number they employed.

A separate pay rate for fast-food workers at large chains was established by the state and is being challenged by restaurant owners in court.

Gov. Andrew M. Cuomo has pushed for the pay raises. The new $9 minimum translates to less than $19,000 a year.

“You cannot support a family on $18,000 a year in New York State, not to mention have a decent living,” Cuomo has said.

For tipped workers, such as waiters, the minimum will rise to $7.50 an hour on Jan. 1, from the current $4.90, $5 or $5.65 an hour depending on the type of establishment.

For state employees working outside New York City, Cuomo has ordered an increase to $9.75 in the minimum wage. It will be $10.50 for those working in the five boroughs, where living costs are higher.

Fast-food workers at chains with 30 or more restaurants nationally will get a pay raise to $9.75 from $8.75.

Both the state and fast-food workers are scheduled to receive additional increases over 5 1⁄2 years outside New York City to $15. Such workers in the boroughs will reach $15 in three years.

The governor’s office says that the pay increase will affect about 10,000 state workers and about 200,000 fast-food workers, including 24,000 on Long Island.

New York is the first state to enact a $15 minimum wage for state workers, and Cuomo ultimately wants that minimum to apply to all workers in the private and public sectors.

Labor leaders have praised Cuomo’s actions. Some business organizations and Republican political leaders have opposed the higher wages as potentially damaging to small businesses as well as job creation.

The Long Island Association, the largest business group here, contended last month the Island could lose nearly 23,400 jobs, and residents could pay $54.4 million more in property taxes as local governments pay higher wages, if the state minimum wage is raised to $15 per hour for everyone.

To reduce the impact, the LIA wants more tax deductions for businesses and an exemption from the minimum wage or offsetting tax credit for companies with annual sales of less than $500,000. The LIA hasn’t taken a position for or against the increase.

Early in December, the National Restaurant Association, representing fast-food restaurants, filed a court appeal of the state order raising pay for workers at fast-food chains, contending the move was arbitrary and illegal. The issue is pending.

The 25-cent-an-hour increase in the basic minimum wage isn’t likely to have a big impact, said Martin Melkonian, an associate professor of economics at Hofstra University. “I don’t think it will make a big difference in the costs to employers,” he said. “I think it will make a slight difference to employees in the sense that 25 cents is a decent raise for them, and they will likely spend it, and that will provide a stimulus [to the economy] to some degree.”

The federal minimum wage has been at $7.25 an hour since 2009. The higher rate set by New York applies in the state.

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