Many employers around the country already stressed with the challenges of 2020 are now facing minimum wage changes that will radically change their business. In this holiday season, changing minimum wage in a way affects the “least of these”. As we think about the lowest paid workers in our organizations, the topic of minimum wage is a complicated one.
Some predict that many of those workers will get laid off because organizations especially small ones can’t afford to pay more. On top of that, when wages are increased at the bottom, they need to go up throughout the structure. Let’s look at this multi-dimensional issue from several perspectives.
First, can businesses afford to pay more? One could argue you can always pay more however if you increase expenses you must increase revenue in order to maintain your business and generate a small profit. So, yes, you can pay more. You must look at your business model and see if you can increase efficiencies, lower other costs, or raise prices. Second, internal equity must be reviewed.
As businesses, we do a lousy job of this. Are you paying people fairly? Is it equitable how pay is distributed? Top management and owners of businesses need to take a hard look at this. It isn’t easy to rectify past ills and sometimes requires compensation experts to plan and implement change. Third, how do we justify our workers unable to pay food and lodging because we haven’t increased their wages. Remembering Maslow’s hierarchy of needs, food and lodging and basic security is at the bottom of the pyramid. Maybe just maybe workers will be more motivated, more productive and create more profit for the business if they are paid more and have less stress. These are just a few of the issues that employers need to consider.
Join us on Tuesday, December 8th to learn about how to address these issues and others. Click HERE to register for this complimentary webinar.