The Congressional Record is a unique source of public documentation. It started in 1873, documenting nearly all the major and minor policies being discussed and debated.
“FAIR MINIMUM WAGE ACT OF 2007--Continued” mentioning the U.S. Dept of Labor was published in the Senate section on pages S1488-S1490 on Feb. 1, 2007.
The publication is reproduced in full below:
FAIR MINIMUM WAGE ACT OF 2007--Continued
Mr. HARKIN. Madam President, I rise to discuss an amendment I have filed to eliminate a provision that was added to the minimum wage bill regarding employee leasing firms, also known as professional employer organizations, or PEOs.
I have fought for a clean minimum wage bill, on the grounds that workers have been waiting 10 long years for this raise. During that time, businesses have seen record profits and productivity--and that has been equally the case in States and regions that have raised the minimum wage. Yet now we are being asked to include this aggressively anti-worker PEO provision in order to pass a minimum wage increase in the Senate.
For my colleagues and others who may not know what a PEO is, let me explain. It is an organization that handles administrative details for workers who actually do work for another company. For example, I might technically be employed by Tristate PEO, but I actually show up to work every day at Main Street Construction Company. Companies use PEOs so they don't have to handle the tax-and-benefits paperwork for many of their workers.
The language in the PEO provision, however, seeks to make these PEOs the ``employer of record'' for tax purposes. PEOs have sought to become the ``employer of record'' under various laws because they would like to be able to tell employers that the PEOs can independently take care of payroll taxes, workers' compensation, unemployment insurance, and the like. However, in the past, PEOs have misrepresented what jobs are covered by workman's compensation--for instance, by characterizing construction workers as clerical. Under current law, legal responsibility for employer obligations typically remains partly or wholly with the worksite employer.
Making a PEO the sole employer makes the evasion of labor and employment standards much easier. The National Employment Law Project and other worker-rights advocates have concluded that the language now in the bill would make it harder for employees to go to an arbiter and get unpaid overtime, unemployment insurance benefits, or workman's compensation benefits if the PEO collapses. And this is by no means hypothetical. Such collapses have happened not just with small, fly-by-
night operations, but with large PEOs like Administaff and Simplified Employment Services, SES.
For example, when SES allowed health insurance premiums to go unpaid and then went bankrupt, it left employees like Melanie Martin out in the cold. She said ``We trusted him to pay our insurance premiums, and now I'm stuck with a $7,000 surgery bill. Every time I think about this, I cry.''
In 2004, when MidAtlantic Postal Express in Roanoke, VA, went bankrupt, the U.S. Treasury wasn't the only one left holding the bag. Employees were left wondering where to turn for thousands of dollars in back pay. Victory Compensation Services was the PEO handling the workers' pay and benefits, and admitted that workers had no workman's compensation coverage even though MidAtlantic had paid Victory premiums. But Victory blamed MidAtlantic for the unpaid payroll.
Now, let's say that you are newly unemployed trucker who is owed
$7,000 in back pay. This is a complicated mess for a worker to try to navigate just to get a paycheck that he or she is owed.
This is part of a larger, systemic problem. Working people in the United States feel less and less empowered in our you're-on-your-own society. Seventy percent of families are headed by either dual-income couples or a single parent. The housing bubble is bursting. Globalization is sending American jobs overseas. Pensions are being frozen at an unprecedented pace. The national savings rate has actually gone into negative figures. Women are working an average of 500 more hours more per year than in 1979. But productivity has increased 70 percent since then. People are working harder and getting paid less.
In this context of economic anxiety, we shouldn't be making it even harder for workers to organize, negotiate or enforce contracts, or fight for their rights under law. But that will be the sure-fire result if the final bill has this PEO provision in it.
I urge my colleagues to strip this provision from the bill. We must not sacrifice worker rights in exchange for this modest and long-
overdue increase in the wages for those at the lowest rungs of the economic ladder.
Mr. LEVIN. Madam President, I have long supported an increase in the minimum wage. I am pleased that, with the leadership of the new majority in Congress, this minimum wage increase will be passed by a bipartisan majority.
In 1996 Congress raised the minimum wage by 90 cents an hour in two steps to $5.15 an hour. That increase was enacted more than 10 years ago. Since then, the real value of that wage has eroded by 21 percent and the nearly 5.5 million workers earning the minimum wage have already lost all of the gains from the 1996-1997 increase. Since then, Gallup polls have shown that 86 percent of small business owners do not think that the minimum wage affects their business, and nearly half of small business owners think that the minimum wage should be increased. Since then, 29 States, including Michigan, as well as the District of Columbia have recognized the importance of keeping our working families out of poverty by increasing State minimum wages.
Unfortunately, since the 1970s, poverty has increased by 50 percent among full-time, year-round workers. Currently, 37 million Americans, including 13 million children, live in poverty. As the most prosperous nation in the world, our minimum wage should be a living wage, and it is not. When a father or mother works full time, 40 hours a week, year-
round, they should be able to lift their family out of poverty. A full-
time minimum wage laborer working 40 hours a week for 52 weeks earns
$10,700 per year--more than $6,000 below the Federal poverty guidelines for a family of three.
I believe that a full-time minimum wage job should provide a minimum standard of living in addition to giving workers the dignity that comes with a paycheck. These lower paid workers, many of whom have entered the workforce due to the welfare reform, should be rewarded for entering the workforce, not penalized by a poverty wage. A higher minimum wage has the potential to ensure that lower paid workers will be protected from falling into poverty and possibly back on the welfare rolls. The minimum wage increase during the recession in 1991 provided much needed income to poor people and helped to increase spending in the economy. 58 percent of the benefit of the 1996 increase went to families in the bottom 40 percent of income groups. Over one-third of the benefit went to the poorest families--those in the bottom 20 percent of income groups.
Today the real value of the minimum wage is $4.00 below what it was in 1968. To have the purchasing power it had in 1968, the minimum wage would have to be at least $9.37 an hour today, not $5.15. According to the United States Department of Labor, over 60 percent of minimum wage earners are women; almost 40 percent are minorities, and nearly 80 percent are adults. These hardworking Americans deserve a fair deal.
In addition to the long overdue minimum wage provision, this bill contains a package of tax provisions. I am pleased that these include a number of measures to crack down on abusive tax dodges, including an improvement to current law to end the tax benefits received by companies that reincorporate and set up shell headquarters in offshore tax havens.
I am also pleased that the bill extends the work opportunity tax credit, which allows employers credit against wages for hiring workers from targeted groups such as recipients of public assistance, qualified veterans, and ``high risk'' youth. I have heard from a number of Michigan companies that the WOTC program is important to them in their hiring members of these targeted groups, and I am pleased that this provision will be extended through the end of 2012.
I am also pleased that the tax provisions would put in place a limit on the amount that corporate executives and other highly paid employees can place tax-free into deferred compensation plans. Under current law, public companies cannot deduct more than $1 million per year for compensation paid to their top officers. However, compensation that is
``deferred,'' meaning the employee doesn't have immediate access to it, is not subject to this $1 million limit; so deferred compensation packages have become a main way that company executives can get multi-
million dollar compensation packages while their companies continue to take a tax write-off.
We have seen these excessive packages time and again in recent stories about runaway executive compensation totaling tens of millions of dollars. Tens and even hundreds of millions of dollars have been salted away in this fashion for corporate executives, and companies have simply found another way to game the system by excluding this
``deferred compensation'' from those individuals' income for the year. It is more than time for Congress to put an end to this game which has fueled excessive executive pay.
This bill would set a limit on the amount of compensation that could receive tax deferral at the lower of $1 million annually or the average of the previous 5 years compensation. The ability of corporate executives to defer tax on up to $1 million in compensation is still a significant benefit that stands in stark contrast to the minimum wage we are attempting to raise for those at the lowest end of the pay scale.
It is only right that those who are at the low end of the pay scale who work hard should receive a fair wage and be able to support their families. These people do not always have the leverage to negotiate a fair salary. This bill to increase the minimum wage will help to move them to a more livable wage.
Mr. INHOFE. Madam President, I will unavoidably miss the final vote on the minimum wage bill but I come down here now to ask unanimous consent that the Record reflect, immediately after the vote, my announcement that I would have voted against this bill.
In so doing, I remain consistent on the issue. Government is best when it is does not pick winners and losers--when it does not competitively advantage one group of people over another or one set of States over another.
Senator DeMint offered an amendment to equally and fairly increase the minimum wage by $2.10 for each State over what the wage is today.
The fact that the liberals voted against the DeMint amendment is proof that their bill as now constituted is really about damaging the competitiveness of middle America--the so-called red States, disparagingly called `'fly-over country'' by liberals--compared to the liberal fringe States.
Without this amendment, the underlying legislation would partially exempt minimum wage workers in higher-cost States that already have State minimum wage rates greater than the Federal level of $5.15 an hour, and completely exempt minimum wage workers in highest-cost States that have State minimum wage rates near $7.25 an hour.
The DeMint amendment would increase the Federal minimum wage equally for workers in all States at the same rate as H.R. 2 would increase the minimum wage from the current Federal minimum wage rate.
Senator Kennedy's arguments against this amendment have been both confusing and contradictory. On the one hand, he said that we need a one-size-fits-all mandate, and then he said that Massachusetts has a higher cost of living.
I will not stand for people in Washington, DC, damaging the competitiveness of Oklahoma against other States. If Oklahomans vote to change our own laws, that is one thing, but we are not going to buckle under to DC and the liberal fringe States.
Thus I would vote nay.
I ask unanimous consent that the following chart be printed in the Record.
There being no objection, the material was ordered to be printed in the Record, as follows:
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Current Kennedy Proposal DeMint Proposal
MinWage --------------------------- $ Wage --------------------------- $ Wage
State In 2007 2008 2009 Hike 2007 2008 2009 Hike
Effect $5.85 $6.55 $7.25 $0.70 $1.40 $2.10
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Alabama....................... $5.15 $5.85 $6.55 $7.25 $2.10 $5.85 $6.55 $7.25 $2.10
Alaska........................ 7.15 7.15 7.15 7.25 0.10 7.85 8.55 9.25 2.10
Arizona....................... 6.75 6.75 6.75 7.25 0.50 7.45 8.15 8.85 2.10
Arkansas...................... 6.25 6.25 6.55 7.25 1.00 6.95 7.65 8.35 2.10
California.................... 7.50 7.50 8.00 8.00 0.50 8.20 8.90 9.60 2.10
Colorado...................... 6.85 6.85 6.85 7.25 0.40 7.55 8.25 8.95 2.10
Connecticut................... 7.65 7.65 7.65 7.65 -- 8.39 9.10 9.80 2.15
Delaware...................... 6.65 6.65 7.15 7.25 0.60 7.35 8.05 8.75 2.10
District of Columbia.......... 7.00 7.00 7.55 8.25 1.25 8.70 9.40 10.10 3.10
Florida....................... 6.67 6.67 6.67 7.25 0.58 7.37 8.07 8.77 2.10
Georgia....................... 5.15 5.85 6.55 7.25 2.10 5.85 6.55 7.25 2.10
Hawaii........................ 7.25 7.25 7.25 7.25 -- 7.95 8.65 9.35 2.10
Idaho......................... 5.15 5.85 6.55 7.25 2.10 5.85 6.55 7.25 2.10
Illinois...................... 6.50 7.50 7.75 8.00 1.50 7.20 7.90 8.60 2.10
Indiana....................... 5.15 5.85 6.55 7.25 2.10 5.85 6.55 7.25 2.10
Iowa.......................... 5.15 5.85 6.55 7.25 2.10 5.85 6.55 7.25 2.10
Kansas........................ 5.15 5.85 6.55 7.25 2.10 5.85 6.55 7.25 2.10
Kentucky...................... 5.15 5.85 6.55 7.25 2.10 5.85 6.55 7.25 2.10
Louisiana..................... 5.15 5.85 6.55 7.25 2.10 5.85 6.55 7.25 2.10
Maine......................... 6.75 7.00 7.00 7.25 0.50 7.45 8.15 8.85 2.10
Maryland...................... 6.15 6.15 6.55 7.25 1.10 6.85 7.55 8.25 2.10
Massachusetts................. 7.50 7.50 8.00 8.00 0.50 8.30 9.00 9.70 2.10
Michigan...................... 6.95 7.15 7.40 7.40 0.45 7.65 8.35 9.05 2.10
Minnesota..................... 6.15 6.15 6.55 7.25 1.10 6.85 7.55 8.25 2.10
Mississippi................... 5.15 5.85 6.55 7.25 2.10 5.85 6.55 7.25 2.10
Missouri...................... 6.50 6.50 6.55 7.25 0.75 7.20 7.90 8.60 2.10
Montana....................... 6.15 6.15 6.55 7.25 1.10 6.85 7.55 8.25 2.10
Nebraska...................... 5.15 5.85 6.55 7.25 2.10 5.85 6.55 7.25 2.10
Nevada........................ 6.15 6.85 7.65 8.25 2.10 7.85 8.55 9.25 2.10
New Hampshire................. 5.15 5.85 6.55 7.25 2.10 5.85 6.55 7.25 2.10
New Jersey.................... 7.15 7.15 7.15 7.25 0.10 7.85 8.55 9.25 2.10
New Mexico.................... 5.15 5.85 6.55 7.25 2.10 5.85 6.55 7.25 2.10
New York...................... 7.15 7.15 7.15 7.25 0.10 7.85 8.55 9.25 2.10
North Carolina................ 6.15 6.15 6.55 7.25 1.10 6.85 7.55 8.25 2.10
North Dakota.................. 5.15 5.85 6.55 7.25 2.10 5.85 6.55 7.25 2.10
Ohio.......................... 6.85 6.85 6.85 7.25 0.40 7.55 8.25 8.95 2.10
Oklahoma...................... 5.15 5.85 6.55 7.25 2.10 5.85 6.55 7.25 2.10
Oregon........................ 7.80 7.80 7.80 7.80 -- 8.50 9.20 9.90 2.10
Pennsylvania.................. 6.25 6.25 6.55 7.25 1.00 6.95 7.65 8.35 2.10
Rhode Island.................. 7.40 7.40 7.40 7.40 -- 8.10 8.80 9.50 2.10
South Carolina................ 5.15 5.85 6.55 7.25 2.10 5.85 6.55 7.25 2.10
South Dakota.................. 5.15 5.85 6.55 7.25 2.10 5.85 6.55 7.25 2.10
Tennessee..................... 5.15 5.85 6.55 7.25 2.10 5.85 6.55 7.25 2.10
Texas......................... 5.15 5.85 6.55 7.25 2.10 5.85 6.55 7.25 2.10
Utah.......................... 5.15 5.85 6.55 7.25 2.10 5.85 6.55 7.25 2.10
Vermont....................... 7.53 7.53 7.53 7.53 -- 8.23 8.93 9.63 2.10
Virginia...................... 5.15 5.85 6.55 7.25 2.10 5.85 6.55 7.25 2.10
Washington.................... 7.93 7.93 7.93 7.93 -- 8.63 9.33 10.03 2.10
West Virginia................. 5.85 5.85 6.55 7.25 1.40 6.55 7.25 7.95 2.10
Wisconsin..................... 6.50 6.50 6.55 7.25 0.75 7.20 7.90 8.60 2.10
Wyoming....................... 5.15 5.85 6.55 7.25 2.10 5.85 6.55 7.25 2.10
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22 States--Fully Impacted.
18 States--Partially Impacted.
10 States--Not Impacted.
