The clothing retailer Gap Inc. will raise its minimum hourly rate by next year, a divisive move from other U.S. retailers that have urged legislators to maintain a federal wage of $7.25 an hour. The company will increase the amount to $9 by June and $10 in 2015, CEO Glenn Murphy said on Wednesday. The change will benefit about 65,000 workers.
Just four blocks from the White House is the headquarters of the Employment Policies Institute, a widely quoted economic research center whose academic reports have repeatedly warned that increasing the minimum wage could be harmful, increasing poverty and unemployment. But something fundamental goes unsaid in the institute's reports: The nonprofit group is run by a public relations firm that also represents the restaurant industry, as part of a tightly coordinated effort to defeat the minimum wage increase that the White House and Democrats in Congress have pushed for.
[T]he dividing line between the institute and Mr. Berman's firm was difficult to discern during two visits last week to the eighth-floor office at 1090 Vermont Avenue, a building near the White House that is the headquarters for both. The sign at the entrance is for Berman and Company, as the Employment Policies Institute has no employees of its own. Mr. Berman's for-profit advertising firm, instead, "bills" the nonprofit institute for the services his employees provide to the institute. This arrangement effectively means that the nonprofit is a moneymaking venture for Mr. Berman, whose advertising firm was paid $1.1 million by the institute in 2012, according to its tax returns, or 44 percent of its total budget, with most of the rest of the money used to buy advertisements.