Many small business owners are concerned with how raising the minimum wage will affect their business. For many small businesses, employee wages are a large percentage of expenses. Recently, there has been much coverage in the media concerning the “fight for fifteen,“ a movement in New York and California to raise the minimum wage to $15 for fast food workers. The New York State Wage Board voted unanimously for the increase, which will be implemented gradually. Currently, New York’s minimum wage is $8.75 per hour, which will increase to $9.00 per hour on December 31, 2015.
While some cities have already implemented or are slowly ushering in wage increases, experts are not certain what kind of effect a nationwide large-scale minimum wage increase would have on the economy, according to a recent New York Times article. However, while many workers feel that an increase would help them rise to meet the cost of living, research done in 2003 by the Heritage Foundation suggests that raising the minimum wage will not curtail the current poverty level.
While there may be benefits to increasing wages, such as reduction in employee turnover and improvement in work performance, many fear that implementing a minimum wage requirement as high as $15 could put smaller companies out of business. Smaller business owners fear they could be forced to higher fewer employees, raise prices, or cut hours to compensate for the increase. In fact, the American Legislative Exchange Council forecasts that emerging businesses will suffer by having to increase payroll expenses. In addition, inexperienced and less educated workers may suffer by employers being more inclined to higher experienced workers due to the increase in minimum wage.
If you are in the process of starting a small business, or need guidance along the way, contact an attorney who is experienced in dealing with small businesses. Call Bellavia Blatt, PC at (516) 873-3000 or (631) 224-7000.