Thousands of employees in Portland started making up to $7 more an hour Thursday because of a city law triggered by Gov. Janet Mills’ state of emergency declaration in advance of Hurricane Lee. The ordinance, updated in a 2020 referendum, includes a clause on hazard pay during a declared emergency that bumps up Portland’s minimum wage by 50%.

Mills’ declaration means that all private, non-remote employees in Portland have been making at least $21 an hour since Thursday, while tipped workers are making at least $10.50 an hour.

The hurricane was expected to hit Down East Maine this weekend, but the trajectory has since changed, though Maine is still under a tropical storm warning. The coast of Maine and beyond are expected to battle winds from 35 mph to 50 mph, beach erosion and flooding rains. A Mills’ spokesman said the emergency declaration will stay in place until the impacts of the storm are fully assessed.

The controversial law has put business owners and advocates at odds with employees and labor advocates. Labor organizers feel that hazard pay is a way to compensate employees for putting themselves at risk by working in an emergency. But some feel that it is detrimental to business owners, particularly those who can’t afford to run a business with more expensive payrolls, but can’t afford to temporarily close up shop, either.

This is only the second time Portland’s hazard pay law has gone into effect. The minimum wage referendum – which included hazard pay stipulations – was passed by voters in November 2020. But a court order prevented the hazard pay portion of the law from going into effect until Jan. 1, 2022. Just three days into the new year, the Portland City Council repealed its COVID-19 emergency order and the higher wages quickly came to an end.

RISK AND REWARD

This time around, labor advocates feel that workers deserve the extra pay while facing the risk of leaving their homes during a time when state officials are urging residents to shelter in place.

“An increase in pay isn’t going to stop you from being injured. But it does reflect the fact that workers are being asked to go above and beyond yet again, and those who are willing to do it should be compensated,” said Jared Shedlock, a trustee with the Southern Maine Labor Council. “Business owners are making the choice to stay open. The people that they’re relying on to carry out that business calculation should be compensated in some small way for their willingness to go out into the storm and serve the public who are looking for whatever service we’re talking about.”

But Quincy Hentzel, executive director at the Portland Regional Chamber of Commerce, is concerned about those heightened costs.

“For some businesses, it will be an increased financial burden on them,” Hentzel said. “Some of these businesses really have catastrophic impacts to their business with the increased wage, when you’re dealing with child care, you’re dealing with health care providers. You don’t want those businesses to not be able to provide the services that they provide.”

The regional chamber was opposed to the 2020 referendum for fear that this exact situation would occur.

“A state of emergency could be passed for any reason in the state of Maine and even though there’s probably going to be little impact in Portland (Saturday) with the rain and the wind, it triggers the emergency wage in Portland,” she said. “We had concerns around this referendum for this very reason.”

Even so, the chamber and the Maine chapter of the Democratic Socialists of America, which sponsored the city referendum, are united in spreading the word to inform employees about their rights and businesses about the potential liabilities.

“We believe that the city needs to be alerting businesses and employees about this. If not, it’s putting business owners and employees at risk,” Maine DSA’s Sophie Garner said.

The city sent out a hurricane warning on Thursday night, but did not alert the community about the hazard pay laws until Friday morning.

“Essentially, this makes it so workers don’t know their rights and businesses are liable for paying triple damages if they’re unaware that they need to pay this,” Garner said.

If businesses don’t pay their employees at least $21 an hour, they can face a handful of civil penalties. The city can force an employer to pay back wages and fine them at least $100 for each day of the violation. Employees can additionally sue their employers for the violations in a civil court.

It’s impossible to predict what kind of damage there will be in the storm’s wake and how long the emergency declaration will last.

Mills was partly motivated to declare the state of emergency because Maine can subsequently access the federal resources that residents need “to fully respond and recover,” according to spokesperson Ben Goodman.

‘ALREADY STRUGGLING’

Tamara Gallagher, owner of The Growing Tree Childcare in Portland, is worried by that uncertainty. The daycare is always closed over the weekend, and it will be closed on Monday, too, if the emergency declaration is still in place. She believes she has no other choice. The families she serves can’t afford to pay more money and she can’t afford to front the costs of a higher payroll for her 22 employees. And while temporarily closing can help her avoid some immediate damage, the long-term damage could be severe.

“We’re already struggling enough with how high our costs are. So it’s a lose-lose situation for everybody. I think what will end up happening is if I close, parents will just find child care out of Portland. I would leave, too,” Gallagher said, adding that she believes at least half of the families sending children to her daycare would leave if she was closed for a longer period.

It’s already led Gallagher to think about the alternatives and the worst-case scenarios. She questions whether she will have to sell the building Growing Tree Childcare operates out of if the hazard pay goes on much longer.

With a downgrade from a hurricane to a tropical storm, Gallagher and Hentzel held some hopes: Gallagher that the state might offer financial assistance to essential businesses like child care providers, and Hentzel that there’s not much storm damage and the emergency will be lifted.

Maine DSA organizer Leo Hilton believes everyone should get used to these storms.

Hilton helped the Maine DSA in its 2020 referendum campaign. While the risk of the COVID-19 pandemic initiated the action, he said it’s climate change that motivated him and other organizers to pursue hazard pay laws.

“This kind of storm is so clearly linked to climate change … nothing is going to be a greater crisis in our lifetimes,” Hilton said. “The same provisions that exist to protect people from illnesses like the coronavirus can serve in the same way to protect people from disasters that are going to face our community with climate change.”

Note: This story has been updated to clarify that Portland’s hazard pay bumps workers up by 50%. This is time and a half, or 150% of a minimum wage worker’s base normal rate.

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