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Guam minimum wage hike would bring untallied costs

May 6, 2014

HAGATNA, Guam (AP) — Hundreds of Guam government employees are among the thousands of workers who stand to earn more under a proposed minimum wage hike.

Legislature Vice Speaker Benjamin Cruz introduced the measure, Bill 316. It would raise the minimum wage from $7.25 to $10.10 over three years.

Costs for public schools would rise by at least $600,000 a year to bring lower-paid employees up to the new minimum, the Pacific Daily News reported (http://bit.ly/1g69xeN ).

Over the three years, 442 employees in the Department of Education and 142 workers in executive branch agencies would benefit from the raise.

The bill doesn’t include a financial impact statement, so its full costs are not clear. Cruz estimates the raise would affect 23,000 people islandwide, mostly in the private sector.

The costs to the Guam Department of Education would top $616,000 before any non-minimum-wage employees sought raises, said Taling M. Taitano, deputy superintendent of finance and administrative services at the department.

“I would suspect employees, particularly those already making close, but more than the minimum wage amounts, would hope for an upward adjustment,” Taitano said.

A raise in the minimum wage would follow $15 million in pay raises for GovGuam employees that took effect in February.

While business leaders have criticized Cruz’s bill, saying it doesn’t do enough to forecast the effects on government revenues, Cruz has responded that such studies were not an issue in the previous round of raises.

Cruz also argued that the potential education cost increases are but a fraction of a percent of Guam’s fiscal 2015 budget of $700 million.


Information from: Pacific Daily News: http://www.guampdn.com

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