UW CU hikes minimum wage to $15

University of Wisconsin Credit Union is set to increase its “foundation wage” to $15 per hour, effective August 27, in a move that will impact 25 percent of the company’s more than 500 employees.

The new base pay level is more than double the $7.25 minimum wage for the state of Wisconsin.

The $2.5 billion UW CU of Madison first established a foundation wage in 2009 in order to provide all employees with a “sustainable income,” even when prevailing market conditions would provide less, the credit union said in a press release announcing the move.

When it was first introduced, the credit union noted, the foundation wage made it possible for full-time employees to earn a “sustainable income” without securing an additional job, and also “created opportunities” for part-time employees to work schedules that are “best aligned” with school, family or other obligations.

In June of last year, UW CU unveiled plans to increase the foundation wage to $15 in a “phased approach.” The initial phase in 2016 boosted that hourly wage from $12.60 to $13.80.

“At UW Credit Union, we are dedicated to doing the right thing, and that starts with our employees,” President and CEO Paul Kundert said in a statement. “This policy demonstrates our ongoing commitment to ensuring our employees are able to earn a competitive, livable wage.”

Eric Tadsen

Lee Wiersma, the credit union’s executive vice president and chief human resources officer, commented that “providing the outstanding service our members deserve requires us to hire and retain highly-qualified employees.”

Wiersma added that a “good, competitive wage allows us to attract the right employees and helps us create an engaged and committed workforce.”

As reported in Credit Union Journal, UW CU has been in the vanguard of the fair wage movement and it is believed to be the first credit union in Wisconsin to commit to paying a minimum hourly salary of $15. Last summer Kundert said that raising the lowest wage "is very consistent with our business philosophy. As a credit union, we don't charge our members the highest price possible and we aren't trying to pay people the lowest wage possible. We think virtuous cycles work." A number of other credit unions have also raised their starting wages closer to that of a living wage, but the majority of the movement has not yet adopted that policy.

Kundert further pointed out that the total combined cost to the organization arising from the wage hike will result in an 0.6 percent increase in its annual operating budget by 2018.

The federally mandated minimum wage has remained frozen at $7.25 since July 2009. However, minimum wage laws varies widely by state. For example, in New York, the minimum wage for “big employers” (defined as companies having at least eleven workers) was raised to $11 per hour on Dec. 31, 2016. That figure will reach $15 by the end of 2018.