Op-Ed: Tax the big businesses that won’t pay Connecticut workers a living wage

If you work a full-time job in Connecticut, or anywhere in the United States for that matter, you should be able to afford the basics you need to live – housing, enough to eat, heat, transportation to work, and a little savings.

But every day there are people, mothers, fathers, and grandparents, who work 40 hours a week for some of the wealthiest corporations in this country – Walmart, McDonald’s, Dunkin’ Donuts to name a few – and still live in poverty. These workers skip meals so their children can eat. They don’t turn on the heat in winter because they worry about not being able to pay the bill.

Walmart investors were disappointed a few weeks ago when the mega-corporation only managed to bring in $4.09 billion in one year’s income.

It is disappointing that a business model can rely on paying poverty level wages to employees.  These companies should be embarrassed. We can’t let them get away with it.

Connecticut taxpayers pick up the tab for assistance programs needed by low-pay, full-time workers.  It’s time for us to stop subsidizing these corporations. It’s time they redesign their business models to pay their employees a wage they can live on without subsidies from taxpayers.

It’s great that CT and other states are raising the minimum wage, but there is more we should do. A new report by the Alliance for a Just Society, released by Connecticut Citizen Action Group this week, shows a living wage for a single adult in Connecticut is about $19 an hour. For a single parent with a school-age child, that climbs to almost $29 an hour.

Workers at Walmart and McDonald’s in Connecticut make $9 or $10 an hour.

The Alliance’s “Families Out of Balance” report is part of its 2014 Job Gap Economic Prosperity series. The national organization has produced the study since 1999. The calculations they use are modest; $29 an hour for a single parent and child is a no-frills lifestyle.

However, $29 an hour does budget for putting some small savings aside every month. That’s critical. When low-wage workers can’t even cover their daily expenses, there is no chance of saving enough to go to college for more education – and get a better job. Saving for retirement is impossible. Any small emergency, illness or accident means financial ruin for a minimum wage worker.

When working families can’t afford to pay for necessities, they end up relying on various forms of public assistance to help put food on the table. Connecticut taxpayers pick up the tab for assistance programs needed by low-pay full-time workers, whether it’s food and necessity assistance, fuel assistance, subsidized pre-school, health care, earned income tax credit or another state program for the poor.

Each Walmart in Connecticut costs taxpayers $1 million in social programs, according to Americans for Tax Fairness. Some big box businesses pay lawyers to find loopholes in the system so they can avoid paying their fair share in taxes, while others inform employees how to use state and federal assistance programs knowing full well they aren’t compensating employees adequately. It’s time for us to stop subsidizing these corporations. It’s time they redesign their business models to pay their employees a wage they can live on.

There are answers. I’m supporting a bill that would raise the hourly pay for low-wage workers at large corporations like Walmart or franchisors like McDonald’s. If these companies don’t up their workers’ wages, then they should reimburse the state instead.

The fee will be $1 per hour, per worker, payable to the state Labor Commissioner. They can easily avoid the fee by paying their employees a minimum of $11.90 per hour instead. HB 5069 applies to companies with more than 500 employees.  We’ve listened to small businesses who rightly complain they are trying to stay afloat and are paying taxes that subsidize the profits of large corporations instead of being invested in our communities and their businesses.

If companies with 500 or more employees decide they don’t want to pay a fair wage, then they must repay Connecticut taxpayers for supporting their corporate bottom line. Let’s put that tax money back into our economy, to be spent in our own cities and neighborhoods. Our tax dollars cannot be used to help make large, profitable corporations and their investors even richer.

Rep. Peter Tercyak

If huge companies don’t want to pay their employees a fair wage, shame on them, but under this new law we will make sure they reimburse the taxpayers of Connecticut.

State Rep. Peter Tercyak has served New Britain’s 26th Assembly District since 2003, is chair of the Labor Committee, and is a registered nurse.