(UPI) — Thousands of workers in St. Louis could see their wages cut by $2.30 cents per hour after a law passed by the Republican-led state Legislature takes effect on Monday.

Two months ago, the Democratic-controlled St. Louis city council passed a local ordinance raising the minimum wage in the city to $10, from the statewide wage of $7.70. In response, the state passed a law that supersedes the city.

The city law went into effect earlier this year after the Missouri Supreme Court ruled that because there was no statewide banning a minimum wage, the city was free to go higher if it chose. After the ruling, an estimated 30,000 minimum wage workers received raises that amount to about an extra $200 per week, according to the St. Louis Post-Dispatch.

Now that the state has stepped in, workers face the prospect of losing out on the extra money — and employers are faced with the awkward decision of whether to cut workers’ pay.

Missouri’s minimum wage is lower than neighboring Illinois, but still 45 cents higher than the federal minimum wage of $7.25.

You Might Like
Learn more about RevenueStripe...

Some small business owners said they would keep employees at the higher rate in order to maintain employee morale.

“People would be angry and then they wouldn’t do a good job and they’d be resentful,” said Harman Moseley, who owns a chain of four movie theaters, three of which were affected by the citywide wage increase.

Moseley said the wage hike caused his payroll to increase about $100,000 per year across the four theaters. After minimum wage workers went from $7.70 to $10 per hour, he was forced to give managers a raise to keep their wage higher than the workers they were overseeing.

Larger corporations, especially fast food chains, have been largely silent about how they plan to handle the minimum wage reduction. A group representing 15 McDonalds franchisees has not said whether workers’ wages will return to $7.70 per hour starting Monday.

In Kansas City, Mo., the state’s second-largest city, voters approved a $10 per hour minimum wage in a referendum on Aug. 8, but it only took effect last week. Employers there are expected to be able to maintain the $7.70 wage despite a nonbinding resolution by the city council urging employers to abide by the $10 wage voluntarily.

Missouri is not the first state to experience a clash with municipalities regarding the minimum wage. What is unique in St. Louis, however, is the fact the raises were allowed to go into effect before the state stepped in.

Copyright 2016 United Press International, Inc. (UPI). Any reproduction, republication, redistribution and/or modification of any UPI content is expressly prohibited without UPI’s prior written consent.

—-

This content is published through a licensing agreement with Acquire Media using its NewsEdge technology.

No votes yet.
Please wait...