Seattle celebrity chef and James Beard Award winner Tom Douglas does not approve of the $15 minimum wage law. Douglas supports a minimum wage increase. He has even put his money where his mouth is by raising the wages of his kitchen (or back-of-the-house) employees. But, he has been vocal about his frustration over the direction that Mayor Ed Murray and the city council were headed without much thought for the economic consequences of their clearly political vote.
Douglas wrote last year of Seattle’s $15 minimum wage experiment,
“I would be lying to say that I’m not concerned with the outcome of this national experiment happening in the Seattle market. It is also not lost on me that our City Council and Mayor’s office have very little small business experience. While they have budgets to live by, they are not playing with their own cash… They might get voted out of office for their actions and decrees, but they won’t go bankrupt. It is inherently easier to spend other people’s money than the gut check of investing your last dime into a dream.”
Douglas also called the $15 minimum wage potentially the “most serious threat to our ability to compete so far.” As a business owner who employs more than 500 workers, Douglas must follow the “fast-track” implementation of the $15 minimum wage law. That means he raised the minimum wage to $11 an hour in his restaurants on Wednesday. By 2017, he must increase the minimum wage to $15 an hour.
He initially chose to deal with the serious threat to his businesses—Douglas owns 14 Seattle-based restaurants and employs more than 800 people—by applying a 2 percent minimum wage surcharge, which he referred to as a “2% Wage Equality Surcharge (WES) for funding the Mayor’s Seattle livable wage initiative.”
Douglas wrote in a letter explaining his decision that he and his team “felt the most competitive and least intrusive” way to deal with the $15 minimum wage law is to “implement a [2 percent] surcharge equal to the increase in wages until all restaurants in Seattle are on the same playing field.” The letter is well worth a read (check it out here). It includes lines like: “15NOW ended up being $11 in April, 12.50 in 2016, $13.50 in 2017… Why were the boisterous $15NOW folks not picketing the Mayor’s and the city council’s offices for their failure to act, and why was Ms. Sawant being arrested lying in the streets of Seatac and not Seattle?”
According to the Seattle Times, Douglas has since removed the 2 percent surcharge—and the letter from his website. He has, instead, decided to reconcile the added costs by raising menu prices as suggested by many blog commentators who felt that his decision was “political.” Douglas also backed down from his “political comments” after receiving a plethora of negative reviews on various community sites.
It appears that, in Seattle, liberals don’t only want to dictate how businesses do business through their demands. They also want to dictate how businesses comply with their demands.
It’s disappointing to watch Douglas being forced to back down from his decision—and his comments—due to pressure from the very well (union) organized minimum wage crowd. It’s difficult to watch him feel the need to re-track his “political” comments just because they were not received well by liberals with extreme demands. But, those of who support free markets believe it’s his right to do what he wants with his business, because it is his business.
Restaurant owners are responding to the $15 minimum wage law using various strategies. Douglas will raise menu prices. Ivar’s restaurants will increase menu prices, eliminate tipping and pay a flat $15 minimum wage. Ivar’s expects, under the new policy, its employees will make the same amount of money. And, as the Seattle Times reports, Pho Cyclo Café is “cutting its hours and moving toward more automation.”
