04/15/1997 01:38 PM Senate L&C

                                                                               
            SB 162 MINIMUM WAGE FOR TIPPED EMPLOYEES                          
                                                                              
  CHAIRMAN LEMAN  called the Senate Labor and Commerce Committee               
 meeting to order at 1:38 p.m. and announced  SB 162  to be up for             
 consideration.                                                                
                                                                               
  MR. FLANAGAN,  Deputy Commissioner, Department of Labor, opposed SB
 because it basically reduces wages effective October 1 and                
 every time thereafter that the federal minimum wage, and then                 
 resultantly, the State minimum wage which is 50 cents higher, is              
 increased.  He said he had met with the proponents of the bill and            
 done research based on information provided to them by employers in           
 the form of their U.I. tax reports.  He said there is much talk               
 about servers making $40,000 per year he didn't doubt that in                 
 certain high end restaurants in Anchorage, but he is concerned                
 about servers at the lower end like the fast food types of                    
 restaurants.  Their research indicates that for every server making           
 $40,000 per year there are several making a whole lot less.  In               
 1995, 5,900 persons in Alaska earned the majority of their wages              
 that year in Alaska, including reported tips, as waiters and                  
 waitresses.  They found that 1,500 of these were employed as                  
 servers in all four quarters of the year and made an average of               
 $12,213.  Seventy five percent of the 1,500 earned less than                  
 $16,139.  They found that many, if not most, Alaskan waiters and              
 waitresses would not meet anyone's definition of highly paid                  
 employees.  They don't question what was some testimony from the              
 higher end restaurants, but those people are a very small minority            
 of the people employed out there as waiters and waitresses.                   
                                                                               
 Number 66                                                                     
                                                                               
  MR. JOHN BROWN,  Fairbanks, said he is shocked by this bill and it           
 is so anti-worker that it takes the cake.  To try and say that the            
 people in the service industry are overpaid boggles his mind.  He             
 said there is no protection for the kind of abuse that will likely            
 go on if this bill passes.  He could see employers coercing their             
 employees into working for tips, even if they don't make the $5.75.           
 He said there was a whole room full of people with him who would              
 like to testify against this and other anti-worker bills.                     
                                                                               
 Number 161                                                                    
                                                                               
  CHAIRMAN LEMAN  noted that this committee had never stated that the          
 workers in Alaska are overpaid and it's not his intent that this              
 would result in the abuse of workers.                                         
                                                                               
  SENATOR JERRY MACKIE  noted that he had mixed feelings about this            
 bill, but would make a motion to move it from committee with                  
 individual recommendations.  There were no objections and it was so           
 ordered.