Kristen Deptula and her husband bought the Canalside Inn in RehobothBeach, Delaware, in October 2019, with little clue that the summer season wouldbe primarily a bust owing to Covid-19.
The innkeepers were able to get support from the federal governmentthrough the Paycheck Protection Program. Deptula also attributes another move —providing their employees a $15 per hour minimum wage — to the company'sability to weather the pandemic.
That wage is far more than the state's current minimum wage of $9.25per hour. Deptula, a native of Washington state, had seen the higher rate workin Seattle.
Deptula explained, "It was just something I thought was adecent practice." Once Gov. John Carney approves a bill passed by thestate legislature earlier this month, Delaware will gradually progress toward a $15 per hour state minimum wage by 2025.
The action comes as a quest to raise the federal minimum wage from$7.25 to $15 per hour met a snag when it was left out of the final AmericanRescue Plan Act. The House of Representatives, on the other hand, authorizedit.
Other states, however, have raised their minimum wages. After votersadopted a ballot initiative last November, Florida is in the process ofprogressively increasing the minimum wage to $15 per hour by 2026. Minimum wages are now higher in 22 states than in Delaware.
However, it remains to be seen if the Diamond State's expectedattempt to raise that rate will be enough to force federal adjustments.
Michael Saltsman, managing director of the Employment PoliciesInstitute, said, "I don't think the Delaware vote changes the dynamic awhole lot."
It Is Vital Tool For Recovery
Nonetheless, organizations such as Business for a Fair Minimum Wage,a network of businesses, owners, and executives, applaud the Delaware decision.
People can't afford the necessities when the cost of living rises,according to Alissa Barron-Menza, vice president of Business for a Fair MinimumWage. The main issue, she explained, is that businesses require clients who canbuy their goods and services.
According to the Massachusetts Institute of Technology's living wagecalculator, making ends meet on $9.25 per hour in Delaware can be difficult. Itdemonstrates that an individual worker without children in that state needs toearn at least $15.32 per hour to fulfil all of their basic needs.
The Delaware Restaurant Association pushed for a one-year delay inthe state's minimum wage to give restaurants and other small businesses moretime to recoup from income losses caused by Covid-19. The bill, however, waspassed without that adjustment.
The minimum wage was first enacted to help the suffering economyduring the Great Depression, according to Barron-Menza.
“As we continue to emerge from the pandemic in this present economy,we need that same type of boost,” Barron-Menza added. “When working peoplecan't afford even the most basic necessities, it's awful for business and communities.”
Costs That Aren't Yet Known
The so-called tipped minimum wage for service workers and bartendersis not included in Delaware's pay boost, which has been a subject ofcontroversy in the campaign for a higher standard pay rate.
Though some labor groups have campaigned to abolish the separatetipped minimum wage entirely, Saltsman noted that certain service workers andbartenders have objected because they don't want their tips jeopardized.
According to Saltsman, a higher minimum wage is not necessarilymutually beneficial.