Starting Sept. 2, the minimum wage at King Arthur Flour of Norwich became $15 per hour, a $2.50, 20% increase from the previous minimum wage of $12.50. The new minimum applies to all workers including seasonal, part-time and full-time employees.
“The company has opted to increase its minimum wage because it believes it is the right thing to do for current and future staff and it will help workers live in Vermont comfortably for many years to come,” said Suzanne McDowell, co-CEO and chief human resources officer for King Arthur Flour.
“It’s important to note that nothing is being reduced or taken away due to this increase in wages. We've heard of other employers who pay for wage increases by taking away from other benefits. We are absolutely not doing that. We plan to continue to offer our employees all the great benefits that we always have,” she said.
“Wages are just part of our total compensation, as a 100% employee-owned company, benefit-eligible employees share in the value of the company in the form of a robust retirement benefit. The company also offers profit sharing, employer-matched 401k, and a tiered benefit package so that the lowest paid workers pay less for their health insurance programs,” she said.
According to McDowell, employees who work at least 20 hours a week (81% of the total workforce) are eligible for company-paid benefits.
The company has 365 employees (327 in Vermont) including 117 who work at the bakery, cafe-restaurant and retail store in Norwich. This wage increase affected 70 employees, about 20% of the workforce, according to McDowell. In addition, 28 employees, whose pay was already above the $12.50 minimum, also received pay increases due to the change in the base pay.
King Arthur Flour is holding a job fair this weekend, on Saturday, Sept. 7, at its Norwich facility.
“We are currently hiring for full-time and part-time seasonal help in our Norwich and Baker Berry cafés, warehouse, manufacturing, and customer service and anyone hired will start at the new minimum of $15,” McDowell said.
Like many employers in the Upper Valley, King Arthur has had a difficult time finding employees.
“Yes, it has been challenging to find employees. Not only do we feel that the increase in our base pay is simply the right thing to do for our current employee owners, but we hope this will bring even more people to our company and the state. We want them to feel like they can comfortably make a life here for many years. This includes students fresh out of college who are getting their foot in the door, as well as more seasoned workers looking for a fresh start,” she said.
“The job market in the Upper Valley is very tight and employers are having a hard time finding employees,” said Tracey Hutchins, president and CEO of the Hanover Area Chamber of Commerce. HACC represents 300 Upper Valley businesses (75 in Vermont). According to Hutchins, most companies in her service area pay well above minimum wage. “There may still be some mom and pop businesses that pay minimum wage but not many,” she said.
Vermont Governor Phil Scott praised the move by King Arthur Flour.
“I appreciate King Arthur Flour’s commitment to Vermont and its employees. King Arthur’s wage increase demonstrates that we have a business community in Vermont that cares about its workers and will invest in them,” Scott said.
Advocates in Vermont have tried unsuccessfully for several years to pass legislation to mandate a $15/hr. starting pay. The current minimum wage is $10.78 Vermont and $7.25 in New Hampshire.
“Simply put, no one questions that we have an ongoing and growing problem with income inequality, and that over the last 50 years the minimum wage has actually lost ground to inflation. Low-income workers have not shared proportionately in our increased productivity and our improved economy,” said Sen. Michael Sirotkin, D-Chittenden County, the lead sponsor in the Senate legislation that would mandate a $15 minimum wage. Sirotkin estimates that a livable wage for a single person in an urban area is $18/hr.
Last winter, the House and Senate could not agree on legislation but Sirotkin is optimistic for passage next winter.
“The differences between the House and Senate versions were very small. I expect there will be early action to come to agreement,” he said.
Governor Scott opposed the legislation presented last winter and could do so again next year.
“I want Vermonters’ wages to rise, but I don’t believe mandating an arbitrary increase is the right approach. I believe the negative economic impacts, including job losses, hour reductions and disadvantaging Vermont small businesses and businesses in the more rural parts of our state will quickly outweigh the intended benefits. Instead, I believe we should continue to focus on strengthening the economy and let market forces drive wage increases, which is what we’re seeing at King Arthur Flour.”
“I’ve supported, and voted for, minimum wage increases tied to growth in the economy in the past. I’ve said I’ll listen to any proposals, but I believe it’s critical to weigh the positive and negative economic impacts of these proposals. And we must consider how those impacts vary from Chittenden County, which is doing well, to every other county in the state,” Scott said.
King Arthur Flour, once a family-owned company, transitioned to an employee-owned business in 2004. In 2007, it became one of the original Certified B Corp. companies, a corporate governance structure that balances employee welfare with profit motive.
“While King Arthur Flour is a national brand, we're not that big of a company. We like to think of ourselves as a mighty mid-sized company that also happens to be 100% employee owned. So this is a fairly big lift for us as a company. We hope other Vermont companies will join us,” McDowell said.