By Gintautas Dumcius

STATE HOUSE NEWS SERVICE

STATE HOUSE -- Surrounded by lawmakers, labor leaders and ballot activists who pushed for a higher minimum wage, Gov. Deval Patrick on Thursday signed into law a three-step increase in the wage floor to $11 per hour by 2017.

Under the law, the minimum wage will rise to $9 per hour on Jan. 1, 2015, up from the current $8 per hour. The last increase in the minimum wage occurred in 2008, up to $8 from $7.50.

The bill also includes unemployment insurance reforms, aimed at reducing costs for businesses, and an increase in the minimum wage for tipped workers from $2.63 to $3.75 per hour by 2017.

Advocates of the law say it will provide a 38 percent increase in wages to 600,000 workers.

Patrick said the law will bring a "little relief to the working poor," who he said will "recycle" the money back into the economy.

Opponents, including the Retailers Association of Massachusetts, say the increase will hurt small businesses.

"This is a one-sided piece of legislation that largely ignores the pleas of the small businesses for balance, and instead ensures that Massachusetts will continue be one of the most expensive and difficult places to operate a retail business in the nation," Jon Hurst, president of Retailers Association of Massachusetts, said in a statement. "The failure to meaningfully address our frequently abused and loophole-ridden unemployment insurance system is especially frustrating.


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It is a missed opportunity that will hurt businesses of every size for many years to come."

Hurst said he was disappointed that the legislation does not address an "outdated" requirement that retailers pay employees time and a half when they work on Sundays, "setting the minimum wage for stores on 52 Sundays at $16.50" and contributing to a disadvantage that brick-and-mortar retailers face competing against online sellers. "Communities across Massachusetts should worry about the future of their downtowns and the small businesses that make them unique and special," Hurst said, claiming lawmakers had "turned a deaf ear" to businesses.

Senate President Therese Murray (D-Plymouth) said Massachusetts passed the first minimum wage bill in the country in 1912. "Today, we take another step forward, by passing the highest minimum wage bill in the country," she said. "There are too many people living paycheck to paycheck."

In her area, she said, which includes Plymouth, Kingston and Pembroke, the bill will affect 12,400 people. "That's pretty awesome," she said.

The bill-signing, held in Nurses Hall, was also attended by House Speaker Robert DeLeo, Attorney General Martha Coakley and national AFL-CIO chief Richard Trumka, and Massachusetts AFL-CIO head Steve Tolman.

Murray and Patrick listed a "livable wage" as a future priority. "A minimum wage is and this minimum wage is great progress, but it's not a livable wage," Patrick said. "There are still issues about how we expand opportunity in every corner of the Commonwealth."

Addressing ballot activists who packed Nurses Hall, Patrick urged the coalition to stay together.

"Keep pressing each other and your leadership," he said. "Keep looking ahead, and above all, keep in mind the people for whom the American dream is still just a dream, but who deserve their chance for themselves and their families to dream along with the rest of us."

While the ballot activists, under a coalition called Raise Up Massachusetts, have dropped their minimum wage initiative, they are still pushing to place on the November ballot an initiative guaranteeing earned sick time for workers whose employers do not provide that benefit. After initially scheduling a rally for Thursday, the group plans to rally outside the State House on Monday before delivering their signatures to the secretary of state's office.

In the ballot question, the coalition had pushed to index the minimum wage to inflation. The Senate had approved the indexing measure while the House had not and the indexing provision did not survive conference talks.

The ballot initiative has become a popular tactic among activists clamoring for movement on their issues from Beacon Hill lawmakers.

"It has to be an option," said Lew Finfer, co-chair of Raise Up Massachusetts, before the bill-signing. "It's a lot of work for everyone. You have to be organized."

He pointed to a 2005 effort to put universal health care on the ballot as a factor for lawmakers to pass a health care reform law, which eventually became a model for federal health care reform efforts.

"It can't be done regularly, because it's so much work," Finfer said. "But it's good that people are able to do it."

Sen. Dan Wolf (D-Harwich) called the ballot initiative process an "effective tool."

"It really helped build statewide consensus" on the minimum wage increase, he said.

The bill's unemployment insurance reform efforts were hailed, with the Greater Boston Chamber of Commerce saying it will lead to unemployment insurance cost relief for employers for the "first time in over a decade."

"Under this bill, nearly all employers in the Commonwealth will see UI cost savings in 2015, with the vast majority experiencing an average savings of more than 25 percent. Most other employers will see an average savings of more than 15 percent," said Paul Guzzi, president and CEO of the chamber, in a statement. "These savings will strengthen our competitiveness, create jobs, and lead to new economic opportunities for many. We applaud the Legislature and the Governor for their work on this issue."