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Business Leader Worries Dallas’ Minimum Wage Will Be Imposed on Private Sector

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Dallas Skyline | Image by AP Photo / Tony Gutierrez

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(The Center Square) – The city of Dallas raised the minimum wage it pays to its employees to $15.50 an hour in 2021 and in its August budget proposed hiking it to $18 in 2023.

Annie Spilman, Texas’ state director of the National Federation of Independent Business, thinks the city will try to impose that increased minimum wage on private businesses, more than doubling the state minimum of $7.25 that hasn’t changed in 14 years.

“The city is doing this as a camel’s nose under the tent,” Spilman said in an email to The Center Square. “They’re planting the seed in preparation to enforce this on private employers.”

She’s not alone in criticizing the city, which for its part has not confirmed or denied her suspicion. Dallas has, however, unsuccessfully tried a similar tactic before.

“Instead of giving more money to a select few, the city of Dallas should help every resident by lowering taxes, cutting fees, and reducing the cost of government,” said James Quintero, policy director at the Texas Public Policy Foundation. “Everyone needs a helping hand right now.”

The Center Square was unable to get a reply from the city media relations department on whether City Hall intends to extend that minimum wage beyond its workforce.

Already, Dallas has been beaten in court when it created and then tried to have private employers follow with a paid-sick leave law. That ended in a federal district courtroom in March 2021, with ESI Employee Solutions, Hagan Law Group and the state of Texas all triumphant upon the shoulders of the Texas Constitution.

In the failed attempt, Dallas mandated in 2021 that private businesses that worked at least 80 hours within the city of Dallas in a year were entitled to paid sick time for work completed within city limits. That included part-time, salaried and season employees.

Dallas, which has a living wage policy requiring private contractors that do business with the city pay their workers $17.82 an hour, encouraged others to follow suit when it raised the minimum wage. Of its 15,387 budgeted positions in fiscal year 2022, 37 make $15.50 an hour – a mix of part-time and full-time employees.

“The city is one of the largest employers in Dallas, and as such, it is important we set a good example for others in the private and public sectors,” the city stated in its 2021 budget about raising its minimum wage to $15.50 an hour.

The previous city budgets said the minimum wage was designed “to attract and retain the best talent” and to ensure “the city is an employer of choice.”

Spilman said hiking the minimum wage would be bad for private businesses and consumers.

“A government-mandated wage increase would ultimately affect the consumers,” Spilman said. “If a small business cannot absorb the cost of the mandate, they will have to increase the cost of their products and services. How can their customers absorb the increased cost in the retail and services market when they’re already paying high costs due to inflation and supply chain issues?”

The city bases its minimum wage on the Massachusetts Institute of Technology living wage index. Texas adopted the federal minimum wage rate of $7.25 an hour in 2008.

In 2021, the U.S. Bureau of Labor Statistics reported that 1.1 million workers in the U.S. were paid at or below the federal minimum wage of $7.25 an hour. That’s 1.4% of all hourly paid workers in the U.S.

Among the city’s workforce, Dallas has many earning lofty salaries.

City Manager T.C. Broadnax was the highest paid Dallas employee in 2021 with a gross pay of $436,621. Cheryl Alston, a pension fund administrator, had a gross pay of $335,075 and was the second-highest paid employee in 2021, according to city documents obtained through an open records request.

There were 29 employees of the police and fire department who had gross pay of $200,000 or more in 2021. A fire deputy chief had gross pay of $265,754 due to $106,623 in overtime.

One driver in the fire department had base salary of $89,349 but made $134,611 in overtime and finished with gross pay of $239,350.

The city of Dallas median household income was $55,747 in 2020 and 18% of its residents were living at or below the poverty level, according to the U.S. Census Bureau.

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