Guest: Consider health insurance in minimum

Originally published April 16, 2014 at 5:38 PM | Page modified April 17, 2014 at 10:41 AM

GENE Knutson was serving on the Bellingham City Council in 2002 when it adopted a living-wage requirement for businesses seeking city contracts. The law requires contractors to pay their workers a higher hourly wage if the contractors don't provide health-care benefits.

The differential makes sense, Councilmember Knutson says, because it rewards employers who 'give their workers more money to get health care.'

Bellingham is not alone in drawing this distinction.

A 2011 survey by the National Employment Law Project identified that 89 of 125 local or regional governments with living-wage laws include health-care benefits in calculating their minimum hourly wage requirements.

The City of Seattle should do the same.

Some advocates for a $15-per-hour minimum wage in Seattle oppose including health-care benefits because the benefits don't pay the rent. That's shortsighted.

Nobody needs health-care benefits - until they do. Then, health-care costs can quickly consume major chunks of the take-home pay required to pay rent, buy groceries and secure all other necessities. That's why the nation is engaged in such a major effort to expand access to health-care insurance.

Some advocates for a $15 minimum wage in Seattle argue that including health care redefines the minimum wage. This line of thought runs exactly backward.

The minimum wage in Seattle would be redefined by a $15 proposal that does not consider health care. The one-size-fits-all approach casts an extremely wide net that would result in snags like those documented in a recent survey of the Seattle industrial base.

The survey was conducted by the Manufacturing Industrial Council of Seattle at eight Seattle industrial firms that collectively employ about 1,100 people in metal fabricating, machining, logistics and seafood production.

All pay more than the minimum wage. All provide full-time work. All regularly pay overtime. All provide benefits, including health care. All provide realistic opportunities for wage growth with production workers routinely working their way up to pay ranging from $20 to $30 per hour.

And, some earn far more than that. At one company, production bonuses bring annual production pay to $70,000 to $100,000 per year. At another, a worker who started out fileting fish now makes $40 per hour as an assistant manager. A colleague used his job at the same seafood company to help pay for education that, after 20 years, enables him to make $60 per hour as a member of the firm's IT department.

These industrial career opportunities bring added value to the wider community. They provide beginning jobs for people with a wide range of abilities, experiences, education levels and English skills. They also generate goods and services that are sold primarily to customers outside the region. That export revenue comes back to Seattle and adds to our economic pie.

Those are profoundly good things for the people of Seattle. Yet, because the jobs at the companies surveyed provide beginner pay that averages $11.33 per hour, all would run afoul of the 15 Now proposal.

Factoring in employer-paid benefits would provide beginning compensation worth $15.70 per hour.

Raising their operating costs would add to the reasons why they might opt for alternative locations where costs are lower - and that includes suburban cities adjacent to Seattle.

Taking these companies out of the 15 Now target-zone would allow the city to focus its attention on how to best aid the low-wage, part-time employees in Seattle who most need help.

The extreme rhetoric that surrounds this issue may seem like a symptom of fractured modern politics. It isn't. This issue stirs human emotions that first cropped up with Cain and Abel, when one brother possessed more than the other.

Gene Knutson says passions also ran high in Bellingham 12 years ago when the City Council adopted its living wage requirement. 'It was a rough battle,' he says. 'We nearly had fist fights.'

One more reason to think about health-care benefits.

Dave Gering is executive director of the Manufacturing Industrial Council of Seattle.

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