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At least some fast-food workers make less than the minimum wage during their initial days manning the fryer.
The state’s minimum-wage law allows companies to pay workers without relevant job experience less than the required $9 hourly wage for up to 160 hours, making it cheaper train them or to hire teens for summer jobs.
That exemption is one of many used by the state or other cities with their own wage laws that architects of a measure to hike San Diego’s minimum wage left out.
City Council President Todd Gloria, who has championed the increase, has said limiting exceptions here would make enforcement less complicated and ensure more workers get an increased wage.
The current proposal to hike San Diego’s minimum wage to $11.50 over three years would close the workers-in-training loophole to businesses in the city. At least a couple companies are trying to persuade city leaders to change that.
Chris Duggan of the California Restaurant Association said fast-food businesses including McDonalds worry losing the exemption could translate into fewer hires, or force businesses to increase pay for more seasoned workers who make more than $9 an hour but would be paid roughly the same as trainees under the city proposal.
It’s unclear how many businesses in the city currently rely on this exception, which still mandates that firms pay at least 85 percent of the minimum wage to new workers. These companies aren’t required to report the practice to the state’s Department of Industrial Relations, which polices the state’s minimum wage.
They simply need to be able to defend their decision to pay that rate if the state investigates or someone files a complaint, said Kathleen Hennessy, a spokeswoman for the industrial relations office.
The Center on Policy Initiatives, a left-leaning think tank that’s helped City Council President Todd Gloria craft the minimum-wage proposal, is squarely opposed to the state-level exemption and wants to keep it out of the city measure.
“This sub-minimum wage for new workers is bad policy in that it excludes many seasonal and part-time workers, and workers in high-turnover industries from receiving a fair minimum wage for much or all of their employment,” CPI policy analyst Robert Nothoff said. “It also creates counter-productive incentives for employers to increase workforce turnover in order be able to pay more of their employees the sub-minimum wage.”
CPI believes there aren’t many companies that pay lesser wages to trainees who’d otherwise make minimum wage but state numbers aren’t available to back up that contention.
A Gloria spokeswoman said Wednesday he may still be open to adding that element if advocates can demonstrate substantial benefits but he prefers only limited exemptions.
“The language proposed by Council President Gloria was developed to be consistent with state law while not creating an abundance of exemptions that would keep the minimum wage increase from reaching as many people as possible,” a spokeswoman Katie Keach said.
Gloria’s proposal does include some other exemptions that exist at the state level, though.
Workers who are mentally or physically handicapped or those who work at homeless shelters can be paid less than the minimum wage under state law. They’d also be exempt in the current version of the city measure. More than 690 workers and 92 shelters across the state are licensed to sidestep the minimum wage, Hennessy said.
Students who work as camp or program counselors can be paid less than the minimum wage too.
Gloria’s measure did add one exemption for participants of youth employment programs such as Urban Corps of San Diego County.
Nothoff said that loophole was meant to alleviate concerns that teen jobs tied to city-funded programs might be slashed after a minimum-wage increase.
Most of the other minimum-wage exceptions that remain on the books in the local measure still require approval from the state.
But what may be the most frequently used loophole to the minimum wage – the one applied to workers in training – could be on its way out.