Seattle restaurateur raises pay, opposes wage mandates

Tom Douglas, Seattle’s most celebrated restaurateur, has a bit of an anti-government streak.

He surprised liberal Seattle by opposing the mandatory sick-leave law the city passed in 2011 — the one that has since become a “do you care about workers?” litmus test in the mayoral campaign.

Douglas lobbied against the city’s increased parking rates. And he is not a fan of government mandating a $15-an-hour “livable wage,” as many unions and liberal organizations are calling for this political season.

“I’ve got some crazy business ideas, but I’m just not for government intervention in that way,” Douglas told me the other day. “A lot of businesses that are only starting out couldn’t handle that.”

As usual, though, he’s got a crazy idea of his own. Maybe a better one.

Starting this pay period, Douglas is raising the minimum wage for cooks and bakers in the kitchens of his 16 local restaurants to, coincidentally, $15 an hour. Previously a cook started at around $12 an hour — so this is a 25 percent boost in the kitchen base pay scale, overnight.

He’s also raising the minimum wage for dishwashers from $10 per hour to $12 — a 20 percent increase.

He calls it his “Cooks and Chefs Minimum Wage Initiative.” It will cost, he projects, $1.3 million in its first year. (He’s not raising wages for waiters, who get paid primarily in tips.)

“Cooks are an undervalued, awesome profession,” Douglas enthused. “I’ve always been in a labor-intensive business that unfortunately hasn’t paid very well. I decided after 25 years, I was in a position to try to change that.”

Douglas said he didn’t get the idea from the livable-wage movement. For years he has worked with the Food Lifeline meals program and was dismayed to find that “60 percent of the people in line at the food banks have jobs.”

He came to realize that “some of my own employees are a missed paycheck away from being in that line.”

Douglas had planned a major wage increase for his lowest-paid employees last year but delayed it due to the city’s sick-leave ordinance. That law was not as much of a burden as he thought it might be, though it ended up costing his company $350,000 in the first year.

So this year, with his hot new restaurants in South Lake Union, Douglas had the means to go big on wages.

Beyond just helping his own employees, Douglas has an audacious, Utopian goal: To tilt the market in his entire industry.

“My goal isn’t to force anyone to do this,” he said. “I couldn’t have done it back when I was starting out. So no, I don’t support a $15 minimum-wage law for my industry.

“But take McDonald’s. It seems to me that once you can open restaurant after restaurant after restaurant, then you can start to take better care of your employees.

“So if by raising what I pay I can hire away some of their better employees, over time maybe they’ll have to pay closer to what I pay. Same with other successful restaurants. That’s how it spreads.”

Douglas mentioned Costco, which famously pays more than its competitors. Costco insists higher wages make it a superior company, but it’s not evident Costco has helped drive pay up in other stores. Wal-Mart has hardly rushed to copy it.

So call this Tom Douglas’ crazy generosity experiment. Can setting an example — backed by sheer force of personality — lift other boats? No government intervention needed?

“I don’t know — I realize they’re probably not teaching this approach in business school!” Douglas laughed. “I’m not exactly the best capitalist ever.”

Still, with the way the political winds are blowing, it seems his fellow capitalists around here have a choice. You can follow Tom. Or you can take your chances with the government.