Minimum Wage Case

Running head: MINIMUM WAGE CASE 1

A problem must attract the attention of policy makers for it to be addressed from a policy

direction (Cliff Notes, 2017). An issue has to gain dominance in the public first before it can

receive the attention from the government and other policy makers. The public on one side is the

originator of public policy issues which require solutions from the government of the day

through the elected leaders. The public must keep the government sensitized on what bothers

them to get it act and failure to do so might lead to situations where the former continue to suffer

without the knowledge of the latter.

Problem definition and analysis takes lead in the process of analyzing a policy and setting

the agenda. Low pay per hour and lack of paid sick-leave should be looked into by gaining

insight into data and factual information from both employers and employees. The Mayor

representing the government had to work together with the union workers and business

community to clearly define the minimum wage. Union of workers might have started the fight

due to high cost of living which lowered their purchasing power and thus their agitation might

have been aimed at acquiring it back. The business community’s objection to the raise might

have been occasioned by diminishing profit margins and thus aimed at stabilizing their

businesses. Ed Murray, the Mayor, had to strike a delicate balancing act between raising the

living standards of the union workers through higher wages and safeguarding the economic

conditions of larger taxpayer; the business side. He required the support of the union workers in

his reelection after four years and at the same time resources to run the City Council which came

in way of taxes from the business side. A clear definition of a problem helps unearth underlying

factors that may not be visible from a casual look.

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Once a problem has been defined, approaches into solving it can be sought.

Brainstorming is an effective way to obtain input from a group of people spontaneously to solve

problems and generate new ideas (Business Balls, 2017) Interest groups, the government and

courts form part of those involved in formulating a policy. Policy formulation has to have a

tangible objective (Cliff Notes, 2017).

After a policy has been formulated, it moves to the implementation stage. This stage is

overseen by a different institution(s) other than the one in the previous stage. Rules and

procedures for affecting the policy are formulated by the implementing authority based on the

policy.

The last step in policy formulation is evaluation and termination. Evaluation is

ascertaining the effectiveness of a policy in solving the problems that brought it into existence. A

cost-benefit analysis is usually employed for economic policies while public good is used for

those intended to benefit the public (Cliff Notes, 2017). Policies that become obsolete, fail to

work or lose importance to the interest groups that brought them are terminated. This is in line

with the use and disuse theory as asserted by Lee Sun-ho, “Use” means denotes what is under

our control while “disuse” means no longer put to use (2014)

Strategies for Agenda Setting

Good corporate governance ensures transparency, accountability and corporate control in

a business (Fang, 2014). Accountability to the government due to tax obligations and fairness to

employees through payment of wages should be promoted. Public listing of business is one way

to accomplish corporate governance. Disclosure to all stakeholders promotes trust which is

critical for the future growth of any firm. The business side should have included employees’

representatives to their boards of management to champion the rights of employees which would

MINIMUM WAGE CASE 3

create mutual understanding. The board of governors must balance between the interest of all the

stakeholders and the profit objective of the business (Fang, 2014). Corporate governance

promotes the coexistence of the interests of all stakeholders without one party’s success at the

peril of the other due to the recognition that they are all mutually interdependent.

Repatriation of profits is another underlying issue in low minimum pay. Large

corporations taking back their profits to their mother countries become categorized together with

nascent businesses by the government. The government should regulate repatriation of profits by

foreign companies to enable a clear reflection of their profits thus compel them to increase the

minimum pay. Foreign companies should also be regulated to protect giving unskilled and low

skill jobs to the local populations and importing skilled labor (Pandy, 2014). Striking a balance

between the cadres of workers will increase the minimum wage.

Leadership

Leadership involves envisioning of future, motivating people into the vision and capacity

building to enable actualization of the dream (Mind Tools, 2017). Ed Murray was a charismatic

leader which explains his legacy of success in the various leadership positions held. As asserted

by Mind Tools, the distinguishing characteristic of a charismatic leader from an ordinary leader

is their ability to get those under them to see the business in the future (2017). Ed Murray was

able to grasp that minimum wages had to rise thus made the issue of raising wages among his

first agenda when he became the mayor. According to Balanced Scorecard Institute, strategic

planning involves setting priorities, focusing resources, setting of required outcomes and

adjusting the organization to be in line with an environment constantly changing (2017).

Strategic planning is done by the top level management while the middle level management

MINIMUM WAGE CASE 4

conducts tactical planning. Tactical planning involves breaking down the strategy into short-term

departmental plans.

Ed Murray set a clear timeline and parameters for the negotiating team to follow then left

it to the team to decide on how to engage each other in agreeing on the minimum wage. The

team was given four months and had to limit their discussion to raising the minimum wage only

which ensured focus in the negotiations (Houser, 2013). Strategic leadership involves filling gaps

between new developments and practicality through provision of prescriptive remedies (Wise

Toast, 2017). Ed Murray was thus a strategic leader judging from his blending of laissez fair

technique and semi-autonomous democratic leadership which ensured he did not lose control of

the negotiating team yet leaving them with room to make decisions independently.

Use of scientific data from his political poll to inform decision making in strategic

planning helped the Mayor understand the general public’s perception on the wage issue. With

68 percent of the participants voting for the increase, the wisest decision was to back their call.

Additionally, by raising the income of the City Council workers through an executive order

when he assumed office, Ed Murray’s strategy of cascading the increase to the whole city got

more traction as he was leading from the front. He left no other option to the employers but to

increase the minimum pay. His decision making was objective and guided by reasoning.

Richard Stillman explores two methods of making decisions, namely; root and branch

method (2010). The root method focuses on the objective, selects the most suitable policy, uses

reason to consider all the advantages, formulate likely ways of achieving it then select the one

yielding the biggest advantage. The branch method which is commonly used in administrative

decision making works on the assumption that objectives and means to achieve them are closely

MINIMUM WAGE CASE 5

related. Ed murray, being in charge of workers in the City Council and other publics found it

convenient to use the branch method to make decision in his administration

Budget

Having incurred a campaign spending of $2.2 million in Sea Tac where the movement for

$15 per hour won, both business and union side did not want to campaign in Seattle. The

campaign was ranked the most expensive based on per vote spending. The city was 23 times

bigger than Sea Tac which would thus, cost more to campaign. The Mayor on his part also did

not want the wage issue passed on to the voters for determination since his first priority was

housing which had become a pressing need to the residents of the city. He even offered to hire a

professional mediator for the team at $30000 just to ensure the success of the negotiations.

Lessons Learned, Recommendations, and Warranted Actions

Lessons Learned

Public policy is the setting of priority issues among a variety of problems confronting the

population. Prioritization is crucial in the determination of resource allocation since there can

exist more than one issue disturbing the public at a time. It is important to engage all the parties

in public policy formulation since their input will guarantee more in depth analysis which will

inform effective strategies in dealing with policy issues.

Popular pressure is required to clearly define a problem thus eliciting a response from the

authorities. They are the stakeholders in a policy issue who are not okay with the current state of

affairs and thus lobbying for a change. Popular pressure relies heavily on the power of the people

and not on resources such as funding to have disturbing issues addressed. The media is an

important part of popular pressure since it helps convey the message in a more concise manner.

MINIMUM WAGE CASE 6

Popular pressure cannot be wished away by those in authority or wage a war against it and thus

attention should be paid.

Conflicting parties in a negotiation should avoid having hardline stands but rather should

approach the dialogue table with an open mind. An open mind helps avoid the negotiation from

stalling thus jeopardizing a dialogue. Negotiating parties must cultivate trust among themselves

to create a conducive environment for dialogue.

Actions Warranted to be Taken Given my Assessment of the Case and its Core Problem

To end the stand-off between the business and workers union representatives in the

Income Inequality Advisory Committee, several initiatives could have been started. Firstly, the

teams must have won the trust of each other and no team should have been suspicious of the

motives of the other. Trust would have ensured mutuality of purpose in the group thus creating a

strong foundation on which to start the negotiation. Both teams should view the outcome of the

negotiation beneficial to them like for instance, a way to end wage strikes by employers and

motivation by employees resulting from the increment.

Secondly, the Mayor should have ceded from his middle ground position about the

activities of the negotiation team and make his stand be known. Doing so would offer him a solid

ground to offer the team quality leadership with his position on the issue clear. The Mayor

should also have stopped micro-managing the team through his staff to allow the members

exercise the negotiations without any external pressure.

Thirdly, there should have been proper documentation of the meetings between members

of the G-8 team to avoid confusion over agreed upon term when presenting the report to the

Income Inequality Advisory Committee. Member from both business and workers union needed

MINIMUM WAGE CASE 7

to agree on whether the disputed 500 workers figure was national or local. The stalemate would

have been over with the agreement on the figure.

Recommendations for the Actors and Organizations in the Case

Negotiations on wage and income are dependent on power and bargaining skills. Unions

have more power over wages in oligopolistic markets permitting discretion in prices and output.

Firstly, the range of bargaining can be increased from wages by reorganizing labor market and

processes of production thus improving resource mobilization. Secondly, shifting labor demand

in specific sectors using public policy would expand the resource pool from which to pay

economic befits. This would make employers and union officials to look at other ways to change

markets in specific sectors.

Carrying out the above activities would improve the efficiency of unionism from conflict,

transaction to regulatory. In conflict unionism as asserted by Rosa, the workers aim to reap

economic benefits from their employers using economic sanctions (1984). Their power to

bargain originates from their capability to halt production where employers cannot find their

replacement. Transactional unionism occurs in casual employment industries requiring on-the-

job training. Meeting the skill set needed necessitates systematically rotating trainees through

different work situations to ensure work continuity and broadness of training. Lastly, regulatory

unionism uses political action to remove constraints in the labor market.

The Mayor should have engaged the negotiating team at a closer level to offer leadership

and prevent it from drifting away from the main agenda. His office should only have been

involved in offering support to the negotiating team rather than having an underhand in its

operation. The support team from the Mayor’s office should have been experienced on labor

issues to avoid the confusion witnessed when typing the deliberations from the G-8 team.

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The business side should have empowered its representative to make decision on their

behalf. Having to consult outside then come back to the group dragged the pace of decision

making. A decision could have been reached during voting if all its members had taken part

which would have prevented union members to abstain.

Justification for Recommendation and Warranted Actions from theory and existing

literature

Laissez fair style of leadership according to Kendra Cherry leads to minimal productivity

among members of a group (2017). The leadership style is particularly ineffective when group

members do not possess the knowledge and experience required for task completion and decision

making. In the case, workers from the Mayor’s office were quite new on the job which

occasioned confusion in typing the G-8 report. Failure to receive guidelines and feedback from

the leader can lead to missed deadlines and project lacking focus (Cherry, 2017). Business team

members had to seek advice from their leaders before voting.

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References

Balanced Scorecard Institute. (2017). What is Strategic Planning? Balanced Scorecard Institute,

Business Balls. (2017, 10 09). Brainstorming for Team Building and Problem Solving - how to.

Retrieved 10 09, 2017, from Business Balls: http://www.businessballs.com/problem-

solving-and-decision-making/brainstorming-for-team-building-and-problem-solving-

how-to-109/

Cherry, K. (2017). What Is Laissez-Faire Leadership? Very Well, 1.

Cliff Notes. (2017). The Policy Making Process. Cliff Notes, 1.

Fang, B. (2014). The Demand and Need for Transparency and Disclosure in Corporate

Governance. The Demand and Need for Transparency and Disclosure in Corporate

Governance, 2.

Houser, E. (2013). Mayor Ed Murray and Seattle’s Historic Fight for $15. Evans School of

Public Policy and Governance University of Washington, 2.

Mind Tools. (2017). What is Leadership. Mind Tools, 1.

Pandy, A. K. (2014, 10 09). Foreign Direct Investment (FDI) – Advantages and Disadvantages.

Get how, 1.

Patil, V. (2016). What Are The Different Types Of Democracy? Science ABC, 1.

Rosa, J.-J. (1984). The Economics of Trade Unions : New Directions. Springer Netherlands:

Dordrecht.

Stillman, R. J. (2010). Public Administration-Concepts and Cases. Boston: Wadsworth.

Sun-ho, L. (2014). 'Use and disuse' theory in human life. The Korea Times, 1.

Wise Toast. (2017). Leadership. Wise Toast, 1.

Zkjadoon. (2016, 2 9). Discuss the Cognitive Theories of Motivation. Retrieved 10 9, 2017, from

Business Study Notes: http://www.businessstudynotes.com/hrm/discuss-the-cognitive-

theories-of-motivation/

MINIMUM WAGE CASE 10

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