Senate Democrats nix 'Plan B' on minimum wage hike

Top Senate Democrats are pulling a plan to penalize large corporations that don't have a $15 per hour minimum wage, two sources confirmed to The Hill.  

Senate Finance Committee Chairman Ron WydenRonald (Ron) Lee WydenDemocrats' reconciliation bill breaks Biden's middle class tax pledge Missouri education department calls journalist 'hacker' for flagging security flaws on state website Democrats weigh changes to drug pricing measure to win over moderates MORE (D-Ore.) and Senate Budget Committee Chairman Bernie SandersBernie SandersOn The Money — Progressives play hard ball on Biden budget plan The Hill's Morning Report - Presented by Altria - Biden: We will fix nation's problems Left doubles down on aggressive strategy MORE (I-Vt.) floated their "Plan B" after the parliamentarian ruled that a straight increase of the federal minimum wage to $15 per hour didn't comply with arcane budget rules that govern what can be included in the coronavirus relief bill.  

Under the backup plan, outlined on Friday by Wyden, large corporations would get a 5 percent tax penalty if they paid workers less than a certain amount, with the amount of the penalty increasing over time. Democrats were also looking at giving tax incentives to small businesses to raise their wages. 

ADVERTISEMENT

But Democrats have dropped the effort, with one source familiar telling The Hill that there were concerns that working out the details could slow down the overall coronavirus bill. Democrats want to get the bill to President BidenJoe BidenMcAuliffe holds slim lead over Youngkin in Fox News poll Biden signs bill to raise debt ceiling On The Money — Progressives play hard ball on Biden budget plan MORE's desk before unemployment benefits expire in a matter of weeks. 

"We worked through the weekend and it became clear that finalizing Plan B with the caucus would delay passage and risk going over the jobless benefits cliff on March 14," the source said.  

A source close to Sanders confirmed that he was also not moving forward with offering the idea as an amendment to the coronavirus bill, which he initially pledged to do on Thursday night. 

"He is dedicated to raising the minimum age to $15 an hour and is working on strategies to get it done," the source added. 

The decision, which was first reported by The Washington Post, is the latest setback for progressives, who were hoping to use the coronavirus relief bill to raise the minimum wage to $15 per hour.

ADVERTISEMENT

The House passed the sweeping $1.9 trillion legislation over the weekend with the minimum wage hike included. But because of the parliamentarian's ruling — and neither the White House nor key Democrats willing to ignore that advice — the language is expected to be stripped out this week when the Senate takes up the COVID-19 bill.

Even if the parliamentarian had ruled for the $15 per hour minimum wage, it would likely have faced changes in the Senate because the proposal does not have the support of 50 Democratic senators. Sens. Joe ManchinJoe ManchinOn The Money — Progressives play hard ball on Biden budget plan Schumer, McConnell headed for another collision over voting rights Overnight Energy & Environment — Presented by ExxonMobil — Climate divides conservative Democrats in reconciliation push MORE (D-W.Va.) and Kyrsten Sinema (D-Ariz.) have voiced opposition, and there were ongoing conversations among a broader group about things like tipped workers and how to structure in the increase. 

Neither Manchin nor Sinema had publicly weighed in on the backup plan, but the White House gave the Plan B a publicly cool reception

"Our focus will be on the urgent priority of getting this package passed and delivering the relief that is so desperately needed — $1,400 rescue checks for most Americans, funding to get this virus under control, aid to get our schools reopened and desperately needed help for the people who have been hardest hit by this crisis," a spokesperson said on Friday.