Competition Corporate America Customer service Employees Management The Slight Edge

If you pay your people minimum wage, you are an idiot.

Earlier today, I got an urgent email warning me about the recent minimum wage hike.

The Fair Labor Standards Act increased the federal minimum wage in three steps:

  • July 24, 2007, $5.85 per hour
  • July 24, 2008, $6.55 per hour
  • July 24, 2009, $7.25 per hour

If you have employees in your store making minimum wage, you MUST increase their pay rate immediately! If you have already paid them for time worked after July 24 you must calculate the difference between their old rate and the new rate and give them a paycheck to make up the difference!

Heads up – You should only have to do this if you are an idiot.

Yep, I said it. An idiot.

  • If you want someone who can’t get a better job anywhere else, pay minimum wage.
  • If you want someone who will spend your management’s time absorbing your training, and then run off without giving notice to take a job that pays 50 cents more per hours, pay minimum wage.
  • If you want someone who has no reason to treat your customers well, since there are lots of other minimum wage jobs out there, pay minimum wage.
  • If you wonder why they are disloyal, show up late, leave without giving notice, or don’t seem to care, pay minimum wage.

By now, someone is probably thinking “you sappy liberal weasel, money isnt going to change those behaviors”, you are absolutely correct. Well, maybe not entirely correct – I’m not a sappy liberal:)

Will paying those people a better wage change that behavior? I seriously doubt it.

So why pay more?

  • Paying more allows you to be far more selective about who you hire.
  • Paying more allows you to expect more and better performance from the ones you DO select.
  • Paying more allows you get a better ROI from your people because they stay longer, learn your business and don’t waste your training dollars (and time!)

All those things mean better service to your clients, and less employer hassles for you. I hope you know what that means.

Again: If you pay your people minimum wage, you are an idiot. So there:)

Need an example? Defying the “stupid fast food restaurant” mindset, a local drive up burger joint that has no sit down service, strictly a drive up window (2, actually) pays $7.50 an hour unless you happen to show up on time to each of your shifts for the last 2 weeks and actually work in a productive manner. Then they pay you $8 an hour. By the way, these numbers were from before minimum wage went up last month.

Minimum wage is now $5.85. Don’t be an idiot.