Thousands in St. Louis likely to see wage drop with new law

By JIM SALTER Markets Associated Press

Thousands of workers in St. Louis will likely see smaller paychecks starting Monday, when a new Missouri law takes effect barring local government from enacting minimum wages different than the state minimum.

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The law is drawing protests in St. Louis and in Kansas City, where a recent vote approving a higher minimum wage is essentially nullified without ever really taking effect.

The impact is direct in St. Louis, where the minimum wage had increased to $10 after the Missouri Supreme Court sided with the city in a two-year legal battle. Days after the Supreme Court ruling, Missouri's Republican-led Legislature passed a statewide uniform minimum wage requirement. The state minimum wage is $7.70 per hour. Republican Gov. Eric Greitens declined to veto the bill, allowing it to become law.

An estimated 35,000 St. Louis workers saw pay raises after the court ruling, and the city's plan had called for the minimum wage to increase to $11 per hour in 2018.

State Sen. Dan Hegeman, a Republican from rural northwest Missouri, said the higher minimum would force some employers to either cut jobs or move.

"You end up having fewer jobs and you do a disservice to the workers," Hegeman said. "In my heart of hearts, I really think it hurts people in the long run."

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Supporters of the higher wage say it's virtually impossible to live on $7.70 an hour. In St. Louis, a campaign was launched last month to pressure businesses to keep the $10 minimum wage.

Organizers said more than 100 businesses signed an online petition agreeing to do so. But many of those are small employers. Fast-food restaurants including McDonald's Corp. and Taco Bell are among the companies where employees say they expect their wages to drop back to the statewide minimum.

"I was just getting caught up on my bills and was able to start getting things for my child," said Gennise Mackey, 25, who earns minimum wage at a Taco Bell, and was among about 50 fast-food workers, union leaders and others who staged a protest Thursday at a McDonald's in north St. Louis. "Now, it's going to be a big setback. The cost of living is going up and they expect us to live on $7.70?"

Messages seeking comment from McDonald's and Taco Bell were not returned.

In Kansas City, the City Council on Aug. 17 adopted a resolution encouraging employers to voluntarily comply with the wage adopted by voters on Aug. 8. Voters in Kansas City approved a measure that would increase the city's minimum wage to $10 an hour, even with the knowledge it couldn't be implemented because of the state law.

"A living wage is the foundation for strong families and strong communities," councilman Jermaine Reed said at the time. "We are urging Kansas City businesses to show the rest of the country that the will of people should not be ignored and take this opportunity to pay their workers fairly."

The Economic Policy Institute, a Washington-based research nonprofit, said in a report released Saturday that Republican-controlled state legislatures increasingly use pre-emption laws to supersede local law. The institute cited 33 labor and employment pre-emption laws passed by state governments since 2010.

Among them was a law passed in Alabama that nullified a 2015 Birmingham ordinance that would have raised the city minimum wage to $10.10 by July 2017. In Iowa, Republican Gov. Terry Branstad in March signed a pre-emption law, nullifying wage hikes in two counties and stopping implementation in a third county before it could take effect. The statewide minimum wage in Alabama and Iowa is $7.25 per hour, the U.S. minimum.

The effort toward a higher wage continues in Missouri. A group called Raise Up Missouri is gathering signatures to put a ballot initiative before voters in November 2018 to raise the minimum wage statewide to $8.60 per hour in 2019, with 85-cent raises each year after that until the wage gets to $12 an hour in 2023.

Twenty-nine states and the District of Columbia have minimum wage rates above the U.S. minimum, according to Economic Policy Institute data.