(June 30, 2004) California Chamber-opposed “job killer” legislation to increase the state’s minimum wage has passed by the Senate Labor and Industrial Relations Committee.

AB 2832 (Lieber; D-Mountain View) increases the cost of doing business by, among other provisions, increasing the state minimum wage to $7.25 in 2005 and to $7.75 in 2006 making California’s minimum wage the highest in the nation.  Employer costs would rise by at least $2.08 billion annually, raising costs to consumers and driving employers to other states.

The Chamber has labeled AB 2832 a “job killer” because it will have a negative impact California’s recovering economy and cause businesses to cut jobs and close their doors in addition to moving out of the state to avoid the high cost of doing business in California.

”This bill will increase costs once again for California’s businesses,  who are already are shouldering the burden of the state’s skyrocketing health care and unemployment insurance costs,” said Julianne Broyles, Chamber director of employee relations and small business. “By increasing wage costs by $2.08 billion annually, AB 2832  will create a distinct disincentive to those wishing to establish or expand a business in this state.”

The Chamber believes that rather than making California less competitive by mandating the minimum wage increase, the Legislature should focus on removing barriers to productivity and wage growth that government has imposed on the private sector.

Positive actions can include reducing costs associated with providing benefits such as health and unemployment insurance; increasing opportunities for small business formation; increasing the skills of the current and future workforce; enacting significant regulatory reform; and doing no more harm by resisting new efforts to increase either employment costs or business liability in California.

Key Vote
The Senate Industrial Relations Committee passed AB 2832 on a 5-2 party-line vote June 23.

Ayes: Alarcon (D-San Fernando Valley); Dunn (D-Garden Grove); Figueroa (D-Fremont); Kuehl (D-Santa Monica); Romero (D-Los Angeles).

Noes: Margett (R-Arcadia); McClintock (R-Thousand Oaks).

Absent/abstaining/not voting: Oller (R-San Andreas).

For more information on this bill or to view the entire “job killer” list, please visit our website at www.calchamber.com.