Undeterred in his pursuit to improve the lives of thousands of minimum wage workers in Guam, Vice Speaker Benjamin J.F. Cruz introduced Bill No. 312-33 (COR) recently, continuing his previous effort to incrementally raise Guam’s minimum hourly wage to $10.10 by January 2018.
“No one who works a full-time job should have to live in poverty—which is why I fought to raise the minimum wage two years ago, and why I introduced Bill 312 to finish what we started,” said Cruz, who introduced his much-anticipated measure despite bureaucratic delays in the release of the Independent Economic Impact Statement (EIS).
The EIS was part of the unanimous, bipartisan compromise implemented to allay concerns of both private and public sector stakeholders who were critical of Bill No. 316-32 (LS), Cruz’s original measure to boost Guam’s minimum hourly wage to $10.10 in three annual 95-cent increments. After days of public hearings and a threat of a veto, a pared-down version reducing the increase to a single dollar was passed and enacted into law as Guam Public Law 32-178.
As an assessment on the effects of the 2015 minimum wage increase, the EIS was required by P.L. 32-229 to be transmitted to Speaker Judith T. Won Pat no later than April 30, 2016. However, despite having more than a year to find funding, prepare a Request for Proposal, and conduct the study, both the Guam Economic Development Authority and the Guam Department of Labor—the entities assigned to ensure the conduct of the EIS—have yet to complete the statement.
“Thousands of working families have been patient, but I won’t allow delay to equal denial,” said Cruz, who notes that funding for the EIS was found only after he filed Freedom of Information Act requests to both entities in January. “These families need a raise, and the forces that oppose them can’t win by simply kicking the bureaucratic can down the road.”
Picking up where P.L. 32-178 left off, Bill No. 312-33 (COR) repeals and reenacts a section of the Minimum Wage and Hour Act of Guam’s Fair Labor Standards (22 GUAM CODE ANN. §3105), requiring employers to pay workers an hourly rate of no less than $9.20 by Jan. 1, 2017 and $10.10 by Jan. 1, 2018.
“When employers don’t pay the people who work for them a decent wage, taxpayers pick up the tab,” said Cruz, referring to the devastating effects of low wages. “We pay $56 million a year in Earned Income Tax Credits to underpaid employees—many of whom are in the private sector. It’s no wonder that tax refunds are slower than they should be.”
Contrary to the predictions of an economic apocalypse that surrounded discussions of P.L. 32-178, Cruz notes that—with or without the study—unemployment and overall inflation on Guam have decreased since the enactment of the wage increase last year. According to the most recent Bureau of Labor and Statistics employment report, Guam’s economy has witnessed an additional 1,220 private sector jobs in December 2015, compared to the previous year. Similarly, economist Joseph Bradley predicted a 3% to 4% economic growth in his latest forecast, suggesting an environment conducive to a second wage increase for Guam since the federal minimum wage was increased to $7.25 in 2010.
“If you take an honest look at the facts, you will find that, contrary to what opponents have contended, raising the minimum wage will not eradicate jobs, incite massive inflation, or spur the use of public benefits,” said Cruz. “By giving minimum wage workers and their families a raise, we recognize right as well as reality.”