Dunkin’ Brands CEO Nigel Travis does not agree with the recent decision by New York state’s wage board to increase the minimum wage of fast-food employees to $15 an hour over the next three to five years, stating the negative effect it will have on future hirings and small businesses.
While Travis said he supports “reasonable increases” to the minimum wage, the proposed hike represents a 71 percent increase in the current minimum wage in New York of $8.75 an hour, CNN Money reported.
“It’s going to affect small businesses and franchises,” Travis said. The CEO of Dunkin’ Donuts and Baskin Robbins also hinted that the wage increase would prevent his company from hiring future employees, due to the higher costs.
He also argued that fast-food employment is meant as a starting point for workers and positions are usually filled by teenagers during the summer or while still in high school. With the new wage increase, any employee working at a fast-food restaurant with 30 or more locations will receive higher wages in increments to the wage peak of $15 an hour.
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While Mario Musolino, New York’s labor commissioner still has to approve the increase, it is widely expected that it will pass. The wage board itself was created by Democratic New York Gov. Andrew Cuomo, who used a loophole in existing laws to raise the wage without having to go through the state Senate, currently controlled by Republicans.
The increase in the minimum wage will be raised in increments, with New York City reaching $15 by 2018 and the rest of the state by July 1, 2021, The New York Times reported.
While those who have advocated for a higher minimum wage for fast-food employees praised the decision, employees in other industries were not as cheerful.
“There’s clearly a new standard for the minimum wage, and it’s actually a living wage for the first time in many, many decades,” Bill Lipton, the director of the state’s Working Families Party, said shortly after the decision was made on July 22.
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The restaurant industry does not agree with the state singling out one group of employees. “We continue to say that we think it’s unfair that they singled out a single segment of our industry,” Melissa Fleischut, the director of the New York State Restaurant Association, said about the decision.