OKC Legislator Proposes to Raise Subminimum Wage (Okemah News Leader)

State Rep. Mike Shelton said Monday he intends to introduce legislation next year that would raise the subminimum wage for service-sector employees whose meager salaries are supplemented with tips.

Under the Fair Labor Standards Act, workers younger than 20, workers who earn tips, and some other categories of employees, can legally be paid below-minimum hourly wages, Shelton related.

Any employer whose workers receive tips is required to pay a minimum wage of $2.13 per hour, provided that amount plus the tips received by those workers equals at least the federal minimum wage of $7.25/hour. That equates to $290 per week for a full-time, 40-hour employee.

Shelton, D-Oklahoma City, proposes to raise the subminimum wage from $2.13 per hour to $4.25 an hour over a three-year period: 62 cents per hour the first year, then 75 cents each of the next two years.

Records of the Oklahoma Employment Security Commission show that last year, more than 51,700 workers employed as counter attendants, waiters and waitresses, non-restaurant food servers, dining room and cafeteria attendants, dishwaters, plus restaurant and coffee shop hosts and hostesses, received an average annual wage that ranged from $17,250 ($331.73/week) to $18,780 ($361.15/week).

From that paycheck, Shelton noted, the workers had to deduct taxes and then pay for transportation, fuel, insurance, tires and batteries; food; housing and utilities (water, trash, electricity and/or natural gas); and perhaps child care.

Restaurant Opportunities Centers United, based in New York City, contends that the seven states which do not have a subminimum wage, plus the 22 states that have elevated their subminimum wage above $2.13/hour, “maintain thriving industries and strong employment.” A state-by-state examination of sales in the restaurant industry over the last three years “shows that per capita sales increase as the tipped minimum wage increases,” ROC United says.

According to the Oklahoma Policy Institute, the Sooner State has the fourth-highest share of low-paying jobs in the United States, and one of every three jobs in Oklahoma is in an occupation where median annual pay is below the federal poverty line.

Between 2008 and 2012, the institute reported, a little over 67,000 Oklahomans worked full-time at or near $7.25 per hour, and the largest group – almost 73 percent of them – were heads of households or married to a head of household.

Earlier this year the Republican-dominated Oklahoma Legislature passed, and Republican Governor Fallin signed, a measure that prohibits municipalities from establishing a mandatory minimum wage. Nevertheless, some Native American tribes, which are sovereign entities, pay their employees more than the federal minimum wage.

An executive order signed by Principal Chief Bill John Baker will raise the Cherokee Nation tribal minimum wage to $9.50 per hour, a half-dollar per-hour increase, effective Oct. 1; as a result, nearly 400 employees will realize an increase of about $1,000 per year. Cherokee Nation Businesses, the tribe’s business arm, pays its 600 employees $9.36 per hour; however, the CNB board of directors voted to match the tribe’s $9.50/hour wage, also effective Oct. 1. In addition, all employees – approximately 1,000 of them – receive health, dental and life insurance, a 401(k) matching plan, paid vacation and sick leave, educational reimbursement, and a year-end bonus, regardless of wage status.

The Cheyenne and Arapaho tribes will increase the minimum wage for 20 to 25 employees to $9 per hour this year.

The Osage Nation raised its minimum wage to $11.50 per hour in October 2013.

The Seminole Nation observes the federal minimum wage, a spokesperson said, and a Chickasaw Nation spokesperson declined to say what that tribe’s minimum wage is.

It is not known what minimum wage the Choctaw Nation of Oklahoma pays. However, President Obama announced in January that the Choctaw Nation was one of the first five “promise zones” designated in the U.S. A promise zone is intended to bolster private investment in economically distressed communities.


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