LEBANON, Maine — A couple of days after Maine’s new minimum wage went into effect, Stephanie Harding, owner of Dee’s Route 202 Diner, made some difficult decisions.
She laid off one employee, reduced evening hours at the tidy diner a few miles from the New Hampshire border — which meant a reduction in hours for several employees — and she herself took an outside job.
The restaurant is primarily a breakfast and lunch spot, open seven days a week, with select evening hours — in the winter, Dee’s Route 202 Diner has been open for supper Tuesday, Friday and Saturday evenings. This Tuesday, the evening special was meatloaf, potatoes, corn, a beverage and dessert for $7.99.
But Tuesday and Saturday nights haven’t seen a robust turnout, and so Harding announced on Monday that going forward, at least for the remainder of the winter, the only supper night would be Fridays.
“I’m not against a raise in the minimum wage,” Harding said Tuesday. But she said the cumulative effect — $1.50 an hour this January and $1 per hour for each of the following years until 2020 — may well spell the death knell for the diner going forward. While cooks at the restaurant make more than the minimum, dishwashing and waitstaff jobs pay the minimum, she said.
“I can probably adjust to $9 an hour ($5 for tipped waitstaff)” she said. “But $1 each year until it hits $12, I can’t keep up with that,” she said. “My prices would have to go through the roof.”
These days, Dee’s Route 202 Diner employs about nine people. One worker, whose hours were reduced, got a second job elsewhere to make ends meet, she said. And Harding herself, who worked as a medical assistant for many years before buying the diner 1 1/2 years ago, returned to her former profession last week, leaving her employees to handle the diner operation most of the time.
“My employees are awesome,” she said. And, she said, she wants to keep them employed.
Peter Gore, vice president of government relations with the Maine State Chamber of Commerce, said he’s seen at least 15 bill titles submitted by members of the 128th Legislature to address the minimum wage in some form or another.
“We hear from our small business members (who) are very concerned about this,” said Gore. He said business owners will “probably” increase some prices at the $9 per hour minimum wage, and look at how many hours people are working. When it jumps to $10 an hour in January 2018, they will “definitely” make adjustments, he said, and above that, they’ll likely get out of business, Gore predicted, adding that some restaurant owners have talked about selling now, because they don’t believe the industry will be profitable in the future.
He said the Maine State Chamber of Commerce would support the restaurant industry and efforts to restore a tip credit.
As the 128th Legislature convenes, lawmakers will be looking at the minimum wage law approved by voters 55.5 percent to 44.5 percent Nov. 8. While specific details aren’t available on most of the bills — their titles range from very general terms to address the minimum wage, to adjusting the wage for tipped workers and a host of others, including establishing a different minimum wage for students and for farm workers.
Sen. Justin Chenette, D- Saco, said he’d submitted a bill that would have included a training wage for interns — there’s no mandated law at the moment — and a training wage for 14-17 year-olds that would be about $1 less than the current minimum, but plans to withdraw it because another lawmaker has submitted a similar bill. He said he’s heard from businesses that employ teenagers in the summer — like coastal amusement parks, faced with raising their prices because of the increased minimum wage from $7.50 to $9 per hour for non-tipped workers.
While Chenette has reservations about a training wage, “It’s worth talking about,” he said.
He predicted the minimum wage issue will be one of the top conversations among legislators this session.
Rep. Heidi Sampson, R-Alfred, has submitted a bill that would seeking an exemption to farmers and seasonal employers from the minimum wage requirement. As well, she said, it would also exempt 14-18 years old if they are claimed as dependents on their parents tax forms.
Sanford Springvale Chamber of Commerce President Rick Stanley said he’d expected feedback from members since the minimum wage law went into effect but so far, the phone has been silent and there have been no emails on the subject. Stanley said said many employers in the area pay above the minimum to get qualified workers, which could account for the silence. And with the beginning of the year, he said, perhaps employers haven’t stopped to take a breath to voice their concerns with the local chamber.
East of the Maine Turnpike, Biddeford+Saco Chamber of Commerce+Industry Executive Director Craig Pendleton said employers are planning ahead.
They’re examining what happens to payroll when the minimum wage reaches $12 an hour in 2020, he said, and those who pay currently more than the minimum wage are looking to determine how to remain a “good paying, high wage” company, because as the minimum increases, wages for higher-paid employees tend to increase as well.
Pendleton said the lack of a training wage has a significant impact on companies like summer amusement parks that tend to hire teenagers.
“We could debate till the cows come home whether $12 an hour was the right number, but the vote happened, and now, people are dealing with it,” said Pendleton.
Back at Dee’s Route 202 Diner in Lebanon, “We’re keeping our heads above water,” Harding said. She plans to open the diner Wednesday and Friday evenings for the summer, come mid-April. but — has reservations about what happens when the summer ends.