State Attorney General Bob Ferguson is not happy with the fact that businesses in SeaTac and Seattle are complying with the respective cities’ $15 minimum wage law by adding a visible surcharge to their customers’ bills revealing the cost of covering the higher mandated wages. The added surcharge improves transparency by allowing customers to see why prices have increased. It’s that transparency that Ferguson appears to have a problem with. The Washington Policy Center,
“State Attorney General Bob Ferguson has issued regulations directing business how to charge customers and how they must spend money collected through the minimum wage surcharge.
“The Attorney General says business owners:
- Must disclose the surcharge;
- Must make the disclosure clear and easy to understand;
- May not characterize the surcharge as a tax or government mandate; and
- Must use the funds to pay the salary costs mandated by the $15 wage law”
The first two regulations are not an issue. After all, businesses want to ensure that customers know they are “adding the surcharge as a result of the new wage laws, not simply to pad their own profit.” It’s the last two regulations the present serious problems to basic freedoms.
The third rule is very likely a violation of free speech. The reality is that the $15 minimum wage is a government mandate. And, the surcharge is a result of that government mandate. The Washington Policy Center,
“Just because the government does not require employers to charge customers a surcharge to cover the cost of the $15 minimum wage mandate does not mean employers are being deceptive when they do. Actually, they are just being honest: “You see a surcharge on your bill because of the $15 minimum wage law.” That is not only a normal use of free speech as a basic civil right, it’s being upfront with customers.”
But, it is the fourth rule that is perhaps the most concerning of them all. The rule reads, “No Misappropriation: If a surcharge description is provided to consumers, then revenue generated from that surcharge must be used as described. For example, if it is communicated to consumers that a surcharge funds employee health coverage or wages, those funds should not be used for another purpose.”
As the Washington Policy Center points out, the regulation “seems to dictate that the entirety of the surcharge must be used for the purpose for which it is specified; meaning if a business is charging a minimum wage surcharge, all of that surcharge revenue must be passed to the employees.” That means if the “surcharge brings in more revenue than needed to cover the increased wages, then that extra revenue must go to employees.” Here’s what Ferguson had to say about it:
“Businesses are legally permitted to impose surcharges related to minimum wage increases. But if they choose to do so, my office will ensure that workers get the benefit as advertised…”
David Rolf, the president of the local SEIU 775, also had his say:
“The Attorney General’s guidelines are an important reminder that surcharges described as helping cover employee wages or benefits should be going to that purpose…
“The Attorney General’s guidelines provide clear principles for business conduct and will help make sure workers are aware of potentially unfair practices.”
In other words, if an employer “fails to pass along every penny of the surcharge to workers (or can’t prove that every penny has been passed along) it seems they could be in the crosshairs of the AG and organized labor.” The Washington Policy Center,
“As a union executive, Rolf’s concern for workers over ‘unfair practices’ is hypocritical since his union pushed for an exemption from the $15 minimum wage law in SeaTac. Rolf’s own union members in this city don’t benefit from the very mandate he wants to impose on others.
“The Attorney General’s rule creates a record-keeping nightmare for employers, who would be forced to make ongoing calculations to determine whether their surcharge is generating any revenue beyond the cost of the increased wages and if so, ensure every extra penny is distributed to employees.”
Beyond the regulatory burden the rules add on businesses, Ferguson’s dictations miss the point of the added surcharge. The Washington Policy Center,
“But a surcharge to offset the costs of paying all workers a higher minimum wage is not the same as a service charge that is added for specific services performed by an individual employee or employees. According to the RCW, a ‘service charge’ is defined as ‘a separately designated amount collected by employers from customers that is for services provided by employees…’ The law further clarifies that ‘service charges are in addition to hourly wages paid or payable to the employee or employees serving the customer.’
“A minimum wage surcharge is not for the specific services provided to a customer by an employee or employees, nor is it in addition to the hourly wages paid to workers. It simply helps offset the extra cost imposed by the government’s own $15 wage law.”
Ferguson’s regulations would make it difficult for employers to use a surcharge. It is a clear political effort to “restrict speech and suppress criticism of the $15 wage law.” And, it is an effort to “prevent people from understanding how the mandate increases consumer prices, creating a burden that falls hardest on the poor and on working families.” As the Washington Policy Center puts it,
“It is one thing to back a $15 wage law that sets a price control on labor, but it is something else entirely to use regulatory power to prevent people from knowing the true effects of the mandate once it is in place. The $15 wage law makes it illegal for consenting adults to agree to work for $14.99 or any lower wage. Now it looks like the Attorney General is trying to make it harder for people to learn about how that ban affects workers, business owners and consumers.”
If a surcharge description is provided to consumers, then revenue generated from that surcharge must be used as described.
Horrors! If a restaurant puts a “minimum wage surcharge” on a patron’s bill, the patron should have no reason to believe the entire amount — or any part thereof — might actually go toward paying the minimum wage increase. It could just as easily go to risibly failed efforts to reverse the minimum wage law itself, or as donations to the WPC. (The latter would be an excellent use for all funds collected from every such “minimum wage surcharge” — just ask the WPC.)
Given the recent result of Tom Douglas’ minimum wage surcharge, we can confidently expect this issue to resolve itself. (Although, to be fair, we did get his admission that he needed no more than a $1 surcharge on one of his restaurants’ $50 meals.)
Only at a web site which approvingly quotes the Freedom Foundation and the WPC would a directive to ‘do as one says’ get an angry protest. Thanks for the laughs.
Back on you’re wheel Hamster, you’re rambling again.
Once again, in a free market society, why is it anyone’s business how an owner responds to this social experiment?
Because of those pesky laws quoted in the post. (Oh, and we do not, and never have, lived in a “free market society.”)
So you’re Canadian? Why the hell are you trolling this site? They also have a free market society in Canada, so you should consider moving somewhere that shares your Socialist ideals. I believe we are making nice with Cuba now. So many options.
Really, comrade? Tell me Jefferson’s views on minimum wage and union representation. I don’t remember Washington’s letters mentioning the IRS, the SEC, the FTC or any of the other alphabet soup agencies. You must have taken different indoctrination…um.. history classes than I did.
Tell me Jefferson’s views on minimum wage and union representation.
He owned slaves, so I’d say his views on such matters were very clear indeed. Those views are not the ones we hold today — see the Thirteenth Amendment, for example.
I don’t remember Washington’s letters mentioning the IRS, the SEC, the FTC or any of the other alphabet soup agencies.
And Congress, in the 1790’s, debated whether or not the US should have a Navy. (Where in the constitution does it mention an Air Force?)
We’ve never had a “free market” because the states have always had the power to issue corporate charters, and to revoke those charters if the businesses don’t behave as the chartering government so requires. We’ve had state government regulation of corporations in this country for as long as we’ve had corporations.
He’s a paid union shill. He has AstroTurf written all over him.
So what you’re telling me is throughout the history of this country, if anyone wanted to bring goods to a free market, they absolutely have to have had a government-sanctioned corporate charter? On the shingle over the door it didn’t say “Paul Revere, Silversmith, inc.” Corporations were tiny fraction of our free market economy. Corporate Charters were also issued by monarchs, the very thing the founders were trying to get away from. You just want to think the benevolent guiding hand of big government has always been there to steer us along path they have decided for us. Sadly for you, that’s not the case.
Air Force is in the constitution right between Welfare and SNAP, just below Medicare. You can find it.
Look, I don’t know how much of “Johnny Tremain” you mistook for actual history, but the Jamestown colony itself was a private enterprise run by a chartered corporation:
This charter for the Virginia Company of London, written in 1606, allowed the company to send people to North America and start the colony of Jamestown
Chartered corporations, regulated by the government, operated in this country from our very origins.
Corporations were tiny fraction of our free market economy. Corporate Charters were also issued by monarchs, the very thing the founders were trying to get away from.
Well, then, our Founders didn’t do a very good job! From the first page of the link I had earlier provided:
Starting in the 1790s, corporations became key institutions of the American economy, contributing greatly to its remarkable growth.
(You know, the 1790s — when the Founders actually ran our government? Those 1790s.)
Air Force is in the constitution right between Welfare and SNAP, just below Medicare. You can find it.
Well, yes, the Preamble to our Constitution specifically lists to “promote the general Welfare,” as a reason for our government to exist, but I’m afraid there’s nothing in there about an Air Force. So, you can continue to use our Air Force as your big example of unconstitutional government run amok. (It certainly uses plenty of taxpayer money!)
Who is Johnny Tremain? What government issued the charter and regulated the Virginia Company of London?
“Starting in the 1790s, corporations became key institutions of the
American economy, contributing greatly to its remarkable growth”
Exactly what percentages are “key institutions” and “contributing greatly”?
“In 1776, Adam Smith wrote in the Wealth of Nations
that mass corporate activity could not match private entrepreneurship,
because people in charge of others’ money would not exercise as much
care as they would with their own”
What government issued the charter and regulated the Virginia Company of London?
I’d guess it was a Royal Charter. One of the big changes we Americans made was to have legislatures issue corporate charters, taking that power away from the executive.
Exactly what percentages are “key institutions” and “contributing greatly”?
Try reading the article.
“In 1776, Adam Smith wrote in the Wealth of Nationsthat mass corporate activity could not match private entrepreneurship,
because people in charge of others’ money would not exercise as much
care as they would with their own”
I have some news for you: between 1776 and 1789, a revolution brought radical change to the political situations in Britain and America. Starting in 1790, Americans brought radical change to their business situation, chartering thousands of new corporations.
No entrepreneur, no matter how talented or hard-working, ever produced a big ol’ jet airliner in his private shop. Our wealth comes mainly from government-chartered, government-regulated corporations, and this has always been true here in these United States.
If modern technology had been available, you can bet your ass Bill Boeing would have produced a “big ol’ jet airliner” in his private shop.
Given your total ignorance of all economics outside of the Soviet kind, your views on corporations are not surprising. At the CPUSA meetings you probably never hear that small business is the engine and the lifeblood of our economy and always has been.
If modern technology had been available, you can bet your ass Bill Boeing would have produced a “big ol’ jet airliner” in his private shop.
God, what hopeless ignorance of engineering and economics this shows. Even with our “modern technology,” building a jetliner requires thousands of skilled laborers, engineers, entire chains of suppliers, and a corporate structure to manage it all.
When Bill Boeing decided to go into the “aeroplane” business, the very first thing he did was to form a corporation, the Pacific Aero Products Co. That’s how American business succeeds.
Given your total ignorance of all economics outside of the Soviet kind, your views on corporations are not surprising.
My view that privately-owned corporations are responsible for most of the great wealth and prosperity we Americans have long enjoyed is somehow “economics of the Soviet kind”?
At the CPUSA meetings…
Keep on bashing that straw man, you look tough and macho doing so, trust me on this.
… never hear that small business is the engine and the lifeblood of our economy and always has been.
So, the CPUSA does not believe things which are not true? That’s a rather interesting criticism of them.
Let us know when you’ve got that jetliner ready to roll out of your garage.
How about a surcharge to stay in business
Funny that the SEIU freedom fighter is suggesting that WPC might get donations — unlike the forced illegal deductions unions take from their employees.
The WPC’s web site has a link on the front page for ‘donations’, so it’s not exactly a big secret. I was noting they could themselves profit from the lawbreaking they’re trying to justify.
What lawbreaking?
What lawbreaking?
Our state’s existing laws clearly require every business to use all funds collected from a surcharge to be applied to the stated reason for that surcharge. The WPC clearly does not want this enforced, which means they are trying to justify businesses breaking these laws.
You sure spent an awful lot of time and trouble spewing hot air with a keyboard. Let’s get back to basics. Let the restaurants charge what the market will bear and let them pay the employee enough so they will work there
Let’s get back to basics.
I agree. We’ve had enough of the “State’s meddling labor union thugs … interfering” in a private business owner’s decisions on how to store raw foods, how to cook them, and how to clean up afterwards. (Do you know those jack-booted thugs even assign a letter grade to the kitchens they raid? The State treats businesses like schoolchildren!) It’s time to let the free market decide which restaurants are clean enough to operate.
I know you’ll object, because keeping the State from meddling in our private decisions is too simple for you.
Don’t be another in a very long line of run-ofthe-mill disingenuous liberal jerks. You know exactly what I was alluding to in my previous post, so refrain from your typical leftist “twisting” of what I wrote. I would hope you could be above such machinations, but maybe I’m wrong.
Don’t be another in a very long line of run-ofthe-mill disingenuous liberal jerks.
Perhaps if you spent a little less time on name-calling rants, you could explain how health, safety, and sanitation regulations compare to minimum wage laws. They’re all examples of government regulation of private business. You seem to believe the wage laws are not justified; do you believe the same about those other government regulations?
I would hope you could be above such machinations, but maybe I’m wrong.
I’ve made this comparison elsewhere in this very thread, so you have no one but yourself to blame for your surprise at my making it again.
End the end We Pay.
A leftist trying to hide the results of an ill-conceived mandate? Say it isn’t so.
So, you’d be happy with paying a “minimum wage surcharge” which simply lines the manager’s pocket? Or should a surcharge with a stated purpose go entirely for that purpose?
It doesn’t really matter what you call it because in the end, it’s still a price increase brought about by the stupid “15 not right NOW and not for everybody” mandate. You just want a “Bureau of Surcharge Enforcement” bringing more regulations, more government agents and more taxes to support it. It’ll be glorious, comrade.
Dodge and deflect, as usual. Apparently, you’re happy with business owners blatantly lying to their own customers. And lying is what will be required to show economic damage from rising minimum wages — since Seattle started raising our minimum wage, it has passed the greater New York City area, to become second only to San Francisco in the number of restaurants per capita.
There’s no need for new regulations or enforcement agencies, as this post itself reveals. All that is needed is for opponents of raising the minimum wage to tell the truth. Whether government action is required for them to do that is the only question.
I don’t care if business owners “blatantly lie” to their customers. A business owner can put a “my customers are dirtbags” surcharge on his prices and if he thought that it wouldn’t be economic suicide, what’s it to you? If the customers feel their being lied to and still patronize the business, they’re idiots. If I think a business owner is lying to me, if he’s ugly, charges too much, has bad breath, or anything else that offends me, I’m free to go elsewhere. That’s the way our market based economy works. Or at least until the government steps in to “help”
If the customers feel their being lied to and still patronize the business, they’re idiots.
So, we shouldn’t dine at any restaurant which announces a “minimum wage surcharge,” then? That seems rather harsh. I’d rather go to a place which tells me — truthfully! — how much of my bill goes toward compliance with a law I fully support. The AG’s guidance helps assure that will be the case.
I don’t care if business owners “blatantly lie” to their customers.
Well, the state of Washington does so care, as the citations from the RCW show. (Perhaps you could file an initiative to revoke those laws? Ask your state legislators to remove those laws? Let us know how those work for you.)
That’s the way our market based economy works. Or at least until the government steps in to “help”
So, a business should be free to charge their customers for services not rendered, and laws to prevent such fraud are undesirable big government. You know, I’ve met actual socialists who didn’t have such negative views of business.
I don’t give 2 shakes what restaurant you dine at. How are you going to tell if they’re being truthful or not? Are you going to demand to look over a restaurant’s books to see if they’re “lying to you” before you make a reservation? Look for gold seal saying agents from the Bureau of Surcharge Enforcement have investigated and deemed the establishment “compliant”? Thankfully we have the AG’s “guidance”on this issue.
Of course you fully support 15 not right NOW and not for everybody!, it’s a mandate. Anything that increases government’s grip on more and more of citizen’s lives, you’re giddy about. You’re just waiting for the day when ALL businesses are State businesses. It’ll be glorious, comrade!
“So, a business should be free to charge their customers for services not
rendered, and laws to prevent such fraud are undesirable big
government. You know, I’ve met actual socialists who didn’t have such
negative views of business”
Sswwiiinnnggg and a miss there, comrade. Take a moment and parse out your statement. If you feel a business can charge somebody for nothing and laws to prevent this are bad(nice hyperbole, by the way), how on earth can this even remotely be a “negative view of business”? It sounds to me more like a negative view of government and I know you haven’t met any actual socialists with that view. That would be like a suckling pig with negative view of momma’s teat.
How are you going to tell if they’re being truthful or not?
In the front window of the restaurant is a certificate, issued by the Health Inspector, to show the restaurant’s compliance with the sanitation code. How do I know that certificate is real?
… it’s a mandate.
Just like the requirement to follow the health and sanitation code, which also increase the cost of doing business. Obviously, the only reason anyone could ever possibly favor such a mandate is their desire to see “the day when ALL businesses are State businesses.”
Sswwiiinnnggg and a miss there, comrade.
Yes, that describes your reading comprehension pretty well. You’re the one saying businesses should be free to lie to their customers, which is a very negative view of business indeed.
I hate to break it to you, but all businesses today have a “sales tax” on their charges, but they pay an amount on total revenues, not the number quoted on each sale. Are we all being lied to?
Are you confusing the B&O tax with the sales tax? Because the AG’s guidance mentions that as well:
For example, if a surcharge (including a “Living Wage” surcharge to offset the cost of paying workers a higher minimum wage) is placed on a restaurant bill, it is subject to retail sales tax and retailing B&O tax.
Under any other circumstance, if someone suggests I run my business in a certain way, my response is “buy it and you can run it any damn way you want to”. Does this suggest that our AG and the union has the resources to buy every small business out there that they wish to control? Under a truly Socialist society perhaps, but this isn’t a country that believes in that form of government. If you are going to impose a fruitless minimum wage on businesses, you need to realize they will adjust. My solution is to raise my prices and let the consumers know that they need to not elect small minded politicians or bend to unions with their own agenda that frankly will hurt their membership in the long run.
Want to “shift income”? Bag all of the consumer taxes that hurt the poor and middle class and replace it with an income tax. This suggestion is based upon an article from Money Magazine that the progressive state of Washington has the most regressive tax system of all fifty states.
Want to improve a persons life? Quit screwing around with education. Increase the number of school days from the antiquated agrarian 180 day per year to say 200. That would be a start since each and every country that has better results than the United States requires a greater than 200 day school year. Kids in China attend school 260 days per year. Considering there are only 261 business days in a year, they obviously value education better than us.
Back to the pinheads that think a $15 minimum wage social experiment, either buy and run a business or shut the hell up.
Under any other circumstance, if someone suggests I run my business in a certain way, my response is “buy it and you can run it any damn way you want to”.
So, that’s your response to the inspector from the local Health Department? How’s that working out for you?
Pithy retort! I wouldn’t put the Health Department in the same category since their rules are things we should already know in our industry. They do however help with reinforcing rules to the high school dropouts we employ. Speaking of my opinions on education, I’ve noticed that you don’t share your wisdom regarding the topic. Is it too close to home for you, Tensor?
I wouldn’t put the Health Department in the same category since their rules are things we should already know in our industry.
True enough, but they’re telling you — sometimes in great detail — exactly how you will run the kitchen in your restaurant. (And there’s no need to speculate on how many businesses have closed due to the health code, since the government publishes the list of places closed and reasons why.)
Seattle’s Paid Sick Leave Law was proposed and pushed by Makini Howell, owner of the Plum Bistro and other restaurants. It’s not a coincidence that a successful restaurant owner wanted sick employees to stay home.
Does the AG have the power to “Issue regulations”?
Does the AG have the power to “Issue regulations”?
No, and the AG has not done so here. The claim the AG has “issued regulations” was a factual error made in the linked post at the WPC, quoted in this post without acknowledgement that the WPC’s claim was dead flat wrong.
The AG has issued guidance, based upon the applicable laws (RCW 19.86.020, RCW 49.46.160, and RCW 82.04.070) which protect consumers and employees from fraud by businesses. In particular, the first line of RCW 49.46.160 requires, “[a]n employer that imposes an automatic service charge related to food, beverages, entertainment, or porterage provided to a customer must disclose in an itemized receipt and in any menu provided to the customer the percentage of the automatic service charge that is paid or is payable directly to the employee or employees serving the customer.”
It’s this requirement, to disclose to customers exactly how much of a “minimum wage surcharge” is actually going to the employees, which has the knickers of the WPC and Shift in such a huge twist. They believe a business which chooses to charge customers more money to pay an increased minimum wage should not actually have to pay those minimum-wage employees any of the money so collected, and should not have to reveal this intentional non-payment to the customers who supplied the funds. Our laws are very clear on these points, and, contrary to what the WPC and Shift want, our laws require this honesty from any business which collects a surcharge. The AG was simply pointing this out.
My impression is that the concern for businesses is having to keep records to “prove” the monies went only to employees. And regarding “our laws require this honesty from any business”, is the AG planning to go after that person who said “If you like your (health insurance) plan, you can keep your plan.”
My impression is that the concern for businesses is having to keep records to “prove” the monies went only to employees.
That was indeed the fourth of the four points of guidance given by the AG, and the one most protested by the WPC and this site. (We can all understand the great shock and horror exhibited by the WPC at the very thought of punishment for lying.)
… is the AG planning to go after that person who said “If you like your (health insurance) plan, you can keep your plan.”
Go ask the AG. Given that the topic of this guidance is for-profit business practices within the state of Washington, I imagine you’ll get some version of “No,” along with a reminder of what happened the last time a Washington AG joined legal action in that direction.
There could also be a surcharge to reflect the cost of complying with the regulations that money collected will be used to pay for the extra costs of minimum wage.
There could also be a surcharge to reflect the cost of complying with the regulations that money collected will be used to pay for the extra costs of minimum wage.
Sure, so long as the money actually goes for that purpose. Otherwise, the business has violated the applicable anti-fraud statutes in Washington state’s laws.
Or, the restaurant could just raise prices, as restaurants do all of the time, without specifying any particular reason for it.
Obviously, government people don’t accept responsibility or blame for the economic carnage they cause.
… government people don’t accept responsibility or blame for the economic carnage they cause.
What “carnage” would that be?
If you are unaware of how the minimum wage causes unemployment, I suggest taking an econ course (and not from socialist Sawant at SSCC).
Or you could drive around parts of Seattle and see the “for lease” signs on vacant properties. Many small marginal businesses in Seattle have shut down,
either going out of business or moving to outlying areas.
Of course, you don’t feel the pain, because probably you are a highly paid government employee, and feel self-righteous about the damage your job causes.
You didn’t answer my question. How many jobs have been lost in Seattle? How has our economy been negatively impacted? “Carnage” implies a lot of damage, and the best you can do is some vague hand-waving about how “marginal” businesses have failed, as if such a result must be the fault of government. You give no numbers, no estimates of economic impact, nothing but empty words. Seattle’s elected “government people” don’t make policy based on such hot air, and you might not want to wait for an apology for that.
If you want to take a look around Seattle, you can count the construction cranes across the skyline. Is all of that construction part of the “carnage”?