Raising Maine’s minimum wage

The Policy: Raising Maine’s minimum wage


Maine’s minimum wage of $7.50 an hour ($15,600 a year for a full-time job) is not enough to live on, much less raise a family or plan for the future. That’s why the Maine People's Alliance, Maine Small Business Coalition and Maine AFL-CIO launched a citizens’ initiative to put an increase in the minimum wage on the 2016 ballot.  We hope lawmakers stand with us when discussing this issue at the door, and will not undermine the law once voters approve it.


The initiative would:

o      Increase the minimum wage to $9 an hour in 2017 and then by $1 a year until it reaches $12 by 2020;

o      After 2020, the minimum wage would increase at the same rate as the cost of living; and

o      The subminimum wage for tipped workers (currently $3.75 an hour) would increase to $5 an hour in 2017 and then increase by one dollar a year until it matches the minimum wage for all other workers by 2024.


Who are Maine’s minimum wage workers?

·      Women: Women are almost seven in ten minimum wage workers and eight in ten tipped workers in Maine. Nearly one-third of all working women in Maine would get a raise if the minimum wage rose to $12 per hour by 2020.

·      Adults: More than six in ten Maine workers who would get a raise under the initiative are at least 25 years old, and more than one-third are 40 or older.

·      Parents: Of the workers who would benefit from raising Maine’s minimum wage to $12 per hour, one in five have children. More than a quarter of working mothers in Maine would get a raise under the $12 initiative.


Raising the minimum wage to $12 by 2020 will directly help more than 150,000 Mainers. When this referendum passes:

·      Close to 90,000 workers whose families do not currently make enough to reliably pay for food, housing, heat, transportation, and health care will see an average increase in income of nearly $4,000.

·      Over 52,000 children will benefit from one or both parents getting a raise.


Low-Wage Workers in Maine Need a Raise

     Maine’s minimum wage hasn’t increased in six years, even though the cost of living has increased every year.

     Studies show there are not enough living wage jobs to go around; since the recession, too many of the jobs that have been created are part-time, low-wage jobs. Many workers find themselves forced into working minimum wage jobs because there isn’t any alternative.

     More than half of African-Americans in Maine live in poverty, the highest of any state in the nation. Raising wages for all will help many working Black Americans get out of poverty and have a shot at the American Dream. Literally 50% of Black Mainers would get a raise if this referendum passed.

     Even with tips, the average tipped worker in Maine still only makes $8.72 an hour, not nearly enough to support a family. Nearly 1/3 of women working for tips are moms and 64.3% of them are single mothers supporting their children entirely on tips.





Boosts Wages and Job Growth

     The 13 states that increased their minimum wage at the start of 2014 saw significantly higher job growth than those states that did not raise the minimum wage

     Many small business owners already pay their workers significantly above the minimum wage. Many more small business owners want to raise wages, but are forced to compete against big out-of-state box stores who pay poverty wages.

     Raising wages will put more money in working Mainers’ pockets, which they’ll spend at local businesses, growing local economies. Visit mainesmallbusiness.org/ to see a list of hundreds of business owners who support this initiative.


Eliminating the Subminimum Wage for Tipped Workers


Currently, tipped workers make a subminimum wage of just $3.75/hour from their employer, and are expected to make the rest of their wages in tips. MPA supports one fair wage for all minimum wage workers and full elimination of the sub-minimum wage for tipped workers.


Who are tipped workers in Maine?

·      Restaurant servers: the majority of tipped workers are restaurant servers, who make an average of just $8.72 an hour including tips.

·      Women: 82% of restaurant servers in Maine are women, many supporting children.

·      Working poor: tipped workers in Maine are three times as likely to live in poverty as the rest of the working population (24% of tipped workers vs. 8% of all working Mainers).


Why eliminate the subminimum wage for workers who receive tips?

·      Unpredictable earnings: Varying from shift to shift and from season to season, workers just can’t rely on steady tips – and they should get a fair base wage like everyone else.

·      Sexual harassment: Tipped workers, the vast majority of whom are women, are much more likely to experience sexual harassment on the job than other workers because they depend on tips from their customers to make ends meet. According to recent surveys, 9 out of 10 women working for tips said that they have experienced harassment in their workplaces, and 37% of all sexual harassment complaints to the EEOC come out of the 7% of Americans working in restaurants.

·      It works in other states: Seven states (Alaska, California, Minnesota, Montana, Nevada, Oregon and Washington) have one minimum wage that applies to all workers.  A tipped worker in these states gets the “regular” minimum wage plus tips, and these seven states (in which over 1 million tipped workers live):

o   maintain higher restaurant growth rates and higher restaurant sales per capita

o   have menu prices are no higher than in other states

o   experience rates of tipping by customers are no different than in other states (in fact, they are slightly higher)

·      The current system is broken: Under federal wage rules, when tips are not enough to bring a worker’s average wage up to the full minimum wage, the employer is supposed to make up the difference by “topping up” the employee. But this complex system is systematically violated. Several years ago, the Wage and Hour Division of the US Department of Labor conducted nearly 9,000 investigations in the restaurant industry and found and 84% non-compliance rate.

·      The public supports one fair wage: a majority of Maine voters support raising the minimum wage and eliminating the subminimum wage for tipped workers. The same is true nationally; a recent National Employment Law Project poll showed that 71% of Americans favor increasing the minimum wage of tipped workers to match the regular minimum wage.


There's Momentum for Action

     In the last election, four states overwhelmingly passed ballot measures to increase the minimum wage (Alaska, Nebraska, Arkansas and South Dakota—all rural and somewhat politically conservative states).

     Poll after poll shows that a majority of Mainers—from across political parties—support increasing the minimum wage.

     National Democrats have proposed legislation to bring the nation-wide minimum wage up to $12 by 2020 and eliminate the sub-minimum wage for tipped workers.


Additional Resources


More information can be found at:

Fair Wage Maine

National Women’s Law Center

National Employment Law Project

Economic Policy Institute

Restaurant Opportunities Centers United