​New York's fast-food workers to get $15 minimum wage

Last Updated Sep 10, 2015 6:11 PM EDT

ALBANY, N.Y. - New York state will gradually raise the minimum wage for fast-food workers to $15 an hour -- the first time any state has set the minimum that high.

Gov. Andrew Cuomo's administration formally approved the proposal Thursday, and the Democratic governor announced the decision at a labor rally with Vice President Joe Biden.

The approval comes after a panel created by Cuomo in July voted to hike the base pay for the roughly 200,000 fast-food workers in the state to $15 an hour.

In an op-ed piece published in the New York Times in May, Cuomo said the board convened by the state's labor commission would examine whether the minimum wage in the fast-food industry is sufficient to provide for the life and health of its workers.

Cuomo on Thursday said he'll work to make the $15 minimum apply to all employees -- a promise that comes as more and more cities around the country move toward a $15 minimum wage.

"Every working man and woman in the state of New York deserves $15 an hour," the governor said. "We're not going to stop until we get it done."

Biden predicted New York's move would galvanize efforts across the country.

"You're going to make every single governor in every single state in America look at themselves," he said at the rally in New York City. "It's going to have a profound impact."

He said he and President Barack Obama also remain committed to raising the federal minimum wage to $12 an hour.

The wage hike for fast-food workers in New York will be phased in over three years in New York City and over six years elsewhere in the state. It will apply to employees at large chain restaurants.

So far, the cities of Los Angeles, Seattle and San Francisco, and the California cities of Oakland and Berkeley have approved phased-in increases that eventually will take their minimum wage to $15 an hour, or about $31,200 a year.

New York's increase was recommended by an unelected Wage Board created by Cuomo -- a tactic that allowed the governor to circumvent the legislature, where proposed minimum wage increases have recently stalled in the Republican-controlled state Senate.

Fast-food workers say the current $8.75 wage forces many into poverty and isn't sufficient to cover rent, medical care and rising costs of living.

As would be expected, worker advocates praised Cuomo's move.

"This is a landmark victory for workers and a harbinger of change to come across the country," Sriram Madhusoodanan, director, Value [the] Meal campaign at Corporate Accountability International, said in an emailed statement. "It's now clearer than ever that people will no longer allow corporations like McDonald's (MCD) to get away with poverty wages."

A group of restaurant owners is considering a legal challenge to the increase. Republican lawmakers unhappy with how the increase was decided held a hearing on the process Thursday.

Pat Pipino, owner of a Ben & Jerry's ice cream shop in Saratoga Springs, said some franchise owners could be forced out of business by the increase. He predicted that others may be forced to raise prices or cut positions to absorb the higher labor costs.

"By executive fiat, with the stroke of a pen, our financial model goes to pot," he said.

The federal minimum wage of $7.25 an hour has not budged since 2009, but since the start of 2014, 14 states have boosted their hourly rate, and the effective minimum wage has increased in 26 states and the District of Columbia. The minimum pay tops the federal mandate in 29 U.S. states.

The numbers come from the Economic Policy Institute, which in July published an interactive map that shows where things stood as of July 10.