The bill would establish a minimum wage exceeding that of all State laws except Alaska, Washington, Connecticut, and Massachu setts. The bill would be applicable to some employment exempted in most States, particularly domestic services which are excluded in all the 15 States having laws applicable to both men and women. The bill's provisions would place the District of Columbia at a competitive disadvantage in its market area since neither Maryland nor Virginia have minimum wage laws in effect. This proposal would create some cumbersome procedures and rules for employers subject to the Federal wage and hour law. If enacted, the bill would adversely affect the economy of the District of Columbia. It would, we think, curtail employment opportunities for the handicapped, the aged, students, and other marginal members of the labor force. It would seriously affect the ability of many institutions for the aged, infirm, and handicapped to provide their much needed services. Mr. Chairman, let me briefly comment on these points. May I submit for the record tabulations headed "Minimum Wage Legislation," "Minimum Wages Rates," and "Exemptions" which review provisions of State laws now in effect. (The tables referred to follow :) MINIMUM WAGE LEGISLATION There are 30 States (including the District of Columbia) in which minimum wage laws are in effect at this time. The laws of four additional States (Illinois, Kansas, Louisiana, and Oklahoma) permit the issuance of wage orders. No orders are in effect in these four. The following table indicates how the rates are set and the coverage: NOTE.-Of the 29 States in which minimum wage laws or orders are in effect, coverage in 15 of them includes men and women.(*) Source: Women's Bureau, U.S. Department of Labor. MINIMUM WAGE RATES For States with coverage for both men and women: State: Alaska Connecticut__ Hawaii_. Idaho_. Maine... Massachusetts-----. New Hampshire‒‒‒‒‒‒ New Mexico_. New York______ North Carolina_. Pennsylvania_-_-_ Rhode Island__. Vermont__‒‒ Washington_. Wyoming--- $1.75. Basic hourly minimums $1.25 (allowance for gratuities 35 and 40 cents less per hour). $1.15 ($1.25, Jan. 1, 1964). $1. $1 (tips, gratuities, and commissions included in computation of wages). $1.25 ($1 ushers, ticket sellers, and takers, 75cent service). 75 cents to $1 (90 cents to $1.15, Jan. 1, 1964; 80 cents (70-cent service). (Allowance for gratuities by wage orders 15 to 35 cents less per hour.) 75 cents (85 cents, Jan. 1, 1964). (Any person receiving tips or gratuities as the principal part of his wage is exempt from coverage of the law.) $1 (allowance for gratuities, 35 cents less per hour). $1 and $1.25 (allowance for gratuities, 40 cents $1 (50, 55, and 75 cents by wage orders for serv- 75 cents. Source: Women's Bureau, U.S. Department of Labor. EXEMPTIONS Domestic service: Specifically exempted in the 15 States having minimum wage laws affecting both men and women. Educational, charitable, religious, etc., institutions—Continued State Continued New Hampshire--- North Carolina____. Pensylvania. Vermont -- Employees in nonprofit hospitals, orphanages, and homes for the aged (other than laundry employees, nurses aids, or practical nurses). Public or private nursing home for the aged and/or infirm, hospitals of every kind and character both public and private, and eleemosynary institutions primarily supported by public funds; activities of an educational, charitable, religious, or nonprofit organization where employer-employee relationship does not, in fact, exist and services are rendered voluntarily. Services in a religious community or charitable institution. In public-supported nonprofit organizations (except laundry employees, nurses aids, and practical nurses). Hawaii and New York. No provision. Source: Women's Bureau, U.S. Department of Labor. Mr. PRESS. (a) Seventeen States have no minimum wage laws on the books. (b) Four States--Illinois, Kansas, Louisiana, and Oklahoma-have laws permitting the issuance of wage orders, but none are in effect. (c) Of the 29 States having minimum wage laws, 14 cover only women or women and minors. (d) There are but 15 States having coverage for both men and women. Nine of them specify minimum wages between 75 cents and $1 per hour. Only four States provide wages of $1.25 or more. (e) All of these 15 States excempt domestic service. Every day the District of Columbia becomes a smaller portion of the economic entity which is Metropolitan Washington. This District's population is now little more than one-third of the total city's and will be less than one-fourth of it by 1980. Business volumes are increasing notably in nearby Maryland and Virginia, while some are declining and others barely holding their own here in the central city. We, therefore, believe the District should endeavor to maintain rules, regulations, and costs of doing business which are compatible and as closely as possible uniform with those in the rest of Metropolitan Washington. Land costs, building costs, workmen's compensation costs, minimum wages for women, the application of some taxes and the complexity of many regulations have cumulatively caused many employers' business judgment to either remove their operations in whole or in part from this jurisdiction. These factors, plus others currently the subject of much attention, are increasingly raising questions concerning the desirability of District of Columbia locations for many business and professional operations which are not required to or have little need to remain in the central city. The enactment of S. 860 or similar provisions on top of the unfavorable conditions already present will add another unfavorable factor to this cumulative business picture which many District of Columbia enterprises evaluate from time to time when considering plans for new plant and quarters. They are encouraged to do this by suburban business experience showing among other things that in some lines of activity more competent personnel at comparable or lower costs can be more easily recruited and retained in nearby Maryland and Virginia than in the District of Columbia. The District has progressively become more and more dependent on taxes from business for its revenue. This will continue as Government and other tax exempt agencies occupy more of its area. The Commissioners, and I am happy to say, the Congress have recognized the essentiality of maintaining relatively comparable property and general business taxes in the District with the surrounding areas. That has been beneficial. In most cases wages and salaries are the biggest cost of doing business. Since the board of trade is the major community agency, in fact the only one in the District of Columbia, attracting new employing enterprises to our community, we can speak with some authority concerning the importance of a competent employees supply at wage levels comparable with competitive areas to those considering locations here. Business has the facility and must utilize it in many cases if it is to be competitive and survive, to choose locations where it can best operate. Many Washingtonians because they place too much reliance on Government as our major employer do not fully appreciate the importance of the competitive conditions for private employers to the economic health of the Federal city. In our judgment, S. 860, if enacted, would reduce the District's attractiveness as a place in which to conduct many kinds of business. I stated that enactment of this bill would curtail employment opportunities for students, the aged and the handicapped. That would be true with respect to people with very limited skills and abilities. We have no reliable estimate of the number of such people, but conclude as a result of informal observation that this is a fair-sized group. We believe that many of this group will face hardship if they are unable to receive the modest earnings now available to them. To be sure some would be better off under the proposed law since some employers would pay them the higher wages. But in our judgment a significant number of jobs now held by those of extremely limited ability would no longer be available to them if wages were set at a minimum of $1.25 an hour. The survey of earnings conducted by the Labor Department at the request of this committee showed that in the summer of 1962 in the categories surveyed 33.2 percent of all nonsupervisory employees worked less than 40 hours a week; 23.7 percent worked less than 35 hours; and 5.6 percent less than 15 hours. It is indicated that the hourly earnings of those working less than a full week are lower than those working full time of 40 hours or more. This would seem to support the conclusion that many of those on a less than full week schedule and on hourly rates of a dollar or less are either handicapped or are merely working part time to supplement family income. We would anticipate that the proposed minimum wage rate, ignoring basic economic pricing influences related to supply and demand, would force a significant number of these people out of the labor market. It would appear that with respect to the handicapped and those of very limited abilities it is better that they be usefully occupied at some economic figure than not be employed at all. May I also invite the committee's attention to the substantial added costs this bill would engender for a number of private welfare and charitable agencies. I am informed, and Mr. Gunther, had he been here, would have been able to speak with authority on this subjectthat some such institutions now experience difficulty meeting their budgets to care for the ailing and aged needy. In summary, I referred to the problems which some of those covered by the Federal law would experience if this bill were to become law. Representatives of some of the affected business categories have reviewed such situations for the committee's information. At this time, with the committee's approval, I would like to present the chairman of our subcommittee on minimum wages to outline problems with which retailers would be faced. This business category, as the committee knows, is a very large employer in the District. I am sure Mrs. Sisco, who is assistant vice president for personnel of Woodward & Lothrop, will give the committee pertinent information respecting this matter. Senator MORSE. We are very pleased to have Mrs. Sisco present. STATEMENT OF MRS. JEAN HEAD SISCO, ASSISTANT VICE PRESIDENT FOR PERSONNEL AT WOODWARD & LOTHROP Mrs. SISCO. Thank you. I am Mrs. Jean Head Sisco, assistant vice president for personnel at Woodward & Lothrop and I serve as chairman of the Subcommittee on Minimum Wages of the Metropolitan Washington Board of Trade. Woodward & Lothrop is a retail department store incorporated in the District of Columbia. Our store has approximately 5,000 employees, 3,000 of which are employed in the District of Columbia and the remaining 2,000 in our Maryland and Virginia stores. I call the committee's attention to the interstate employment of our stores' personnel because it is representative of the distribution of employees between the District, Maryland, and Virginia of the other large retail establishments in the Washington area. I would like to bring to the attention of this committee some of the difficulties that S. 860 would present to the retail merchants' group which constitutes a sizable segment of private employment in the District of Columbia totaling over 40,000 persons. When Congress amended the Fair Labor Standards Act on May 4, 1961, a section of the bill covered a large part of the retailing industry for the first time. In this bill, Congress took into account some of the special problems which faced the retail industry. Consequently, the amended bill staggered on a 4-year basis both the increases in minimum wages and the hours worked before overtime provisions were applicable. Provision was also made for exemption of individuals whose regular rate of pay was in excess of one and one-half times the minimum hourly rate and who received more than one-half of their compensation as commission. The Wage and Hour Division of the Department of Labor has spent many months in hearing testimony of both business and union groups |