Birmingham Fights, Loses in Minimum Wage Battle

Published on February 26, 2016

Alabama Governor Robert Bentley yesterday (2/25/2016) signed a law (HB174) prohibiting local government entities from requiring minimum wage and other workplace benefits.

Previously, the Birmingham City Council had enacted a citywide minimum wage that would have increased to $10.10 per hour over two years, but the State of Alabama threatened to take action to prevent municipal governments from enacting wage and benefit laws.

Knowing that the State was moving to block its municipal powers, the City of Birmingham didn’t back down. In fact, the City revved the engines and passed a new ordinance establishing the minimum wage rate of $10.10 per hour effective immediately. Birmingham’s Mayor William Bell signed the ordinance in a rocket-blast timeline.

But it was too little, too late.

In a foretaste of things to come, Alabama Attorney General Luther Strange released a statement informing businesses that they need not comply with the ordinance, which he finds is “an unreasonable restriction on the conduct of business.”

Then on Thursday, February 25, 2016, the Senate passed the moratorium curtailing municipal powers in regard to affecting workplace pay and benefits. Alabama is not alone. Missouri and Oklahoma are among the states that have passed similar laws narrowing municipal powers.

What’s Next for Alabama Minimum Wage Workers?

Alabama minimum wage workers will have to rely on the state legislature to establish a statewide minimum wage rate. Alabama is one of a handful of states that has no official minimum wage, and therefore, the federal minimum wage of $7.25 has been the standard.

Although the Obama administration has been an active proponent of increasing the federal minimum wage rate to $10.10, Congress has taken no action to increase the rate beyond $7.25 an hour.

Alabama minimum wage workers, what’s your best bet? Find a job for a government contractor for an immediate pay raise. In 2014 President Obama issued Executive Order 13658 establishing a minimum wage for federal contractors, which just increased to $10.15 per hour in 2016.

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