The minimum wage for New York City will reach $15 per hour by the end of December 2018, according to the State budget agreement reached in Albany on the cusp of Thursday's midnight deadline. Governor Andrew Cuomo praised the decision, one he's been rigorously campaigning for under his late father's name since September. "Remember, the minimum wage law was passed by FDR," Cuomo stated on Thursday. "He was a great Governor of New York."
The budget also secures paid family leave for workers who have been at a job for at least six months, starting in 2018 and eventually reaching 12 weeks. Compensation will start at 50% of the employee's average weekly income, and will max out at about $850 per week by 2021. Mayor de Blasio recently mandated six weeks of 100% paid parental leave starting in 2016, for city workers.
The minimum wage in New York City is currently $9 per hour. As recently as last February, Cuomo dismissed the possibility of a $13 minimum wage, calling the proposal a "non-starter." Since then, gradual increases to a $15 minimum wage have been secured for fast food workers in New York, as well as City and State employees.
But while most workers in NYC can expect $15 within three years, on par with Cuomo's campaign promise (NYC businesses with fewer than 10 employees get an extra year to catch up), the new budget makes a more conditional promise to workers who live elsewhere in the state. Westchester County is scheduled to reach a $15 minimum wage in six years, by the end of 2021, and Upstate workers can expect a minimum of $12.50 per hour by the end of 2020. From there, Cuomo said on Thursday, the minimum wage will be "indexed" to $15.
"At what index? At an index to be determined as the appropriate calibration at the time by the Division of Budget," he said. This too is conditional, since the budget also gives the state authority to "suspend the scheduled increases" starting in 2019, if the "economic conditions warrant it."
Cuomo described these conditions as a "safety valve" on Thursday, adding that, "You want to increase it at the right rate and, if the economy turns, you want to be able to pause it." State labor and budget analysts, both part of the executive branch, will have the final word. The concessions made for a speech with conflicting messages, as Cuomo argued that an increased minimum wage will stimulate the economy, while conceding that "people have a fear that it could have a negative impact."
Indeed, the hike was vehemently opposed by business groups who argued that employers will cut hours and lay off employees to afford paying wages. “This increase is still too much for many businesses,” the Business Council of New York said in a statement. “The last thing employers need is higher state-imposed costs.”
Many economists have challenged this argument, and a 2015 report by NYC Comptroller Scott Stringer noted that the hike could help small businesses attract and retain workers.
Setting the schedule for fast food worker wage increases last summer, the Cuomo-appointed Fast Food Wage Board made the case for faster increases in NYC, where the cost of living is considerably higher than upstate. However, according to the National Employment Law Project, by 2021 Upstate workers in cities like Syracuse and Buffalo will need at least $15 per hour to cover basic living expenses.
The finalized budget is also notable for what it lacks, specifically any hint of the modest ethics reforms Cuomo introduced in his State of the State address: limiting legislators’ outside income, adopting a publicly funded campaign finance system, and closing a loophole that allows LLCs to donate lots of money to candidates. Cuomo called the reforms "important" at the time, acknowledging that last year both the Senate and Assembly heads were found guilty of corruption. He's since failed to walk the walk.
As predicted, the budget also backs off of proposals that would have shifted millions in City University of New York and Medicaid spending to the City.
The State also authorized $1.5 billion for Phase II of the Second Avenue Subway, albeit gradually, over the course of the next eight years. As for the "record $8.3 billion of State support" for the MTA's 2015-19 Capital Plan reiterated in the budget draft, William Henderson, director of the watchdog group Permanent Citizens Advisory Committee to the MTA, said on Friday that the commitment is still being punted. "They came through with the authorization to spend the money," he said. "We still don't know where the money is coming from."