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Gap Hourly Wage Goes to $9 Per Hour Minimum Now, $10 by 2015

Image: Gap Hourly Wage Goes to $9 Per Hour Minimum Now, $10 by 2015

By Alexandra Ward   |   Thursday, 20 Feb 2014 10:41 AM

As politicians squabble over a national minimum wage hike, Gap Inc. raised its hourly wage for all U.S. employees to $9 this week, with plans to bump it up to $10 next year.

"To us, this is not a political issue. Our decision to invest in front-line employees will directly support our business, and is one that we expect to deliver a return many times over," Glenn K. Murphy, Gap's chief executive, said in a letter sent to all company employees Wednesday.

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The hourly wage increase will affect 65,000 of Gap Inc.'s 90,000 U.S. employees, including those at other Gap-owned brands like Banana Republic and Old Navy, according to The New York Times.

Gap, which is based in San Francisco, likely instituted the new increased hourly wage to even out the playing field for employees in different cities. For example, those who are lucky enough to work at a Gap store in San Francisco are entitled to the city's $10.74 minimum wage.

The new hourly pay "will help avoid a checkerboard of different wages in different states in which workers with several years' experience might be earning $8.50 or $9 an hour and wondering why they earn less than new hires in California who will be earning a minimum of $10 an hour," the company said in a statement.

President Barack Obama praised Gap for its decision to raise pay Wednesday and urged Congress to come to an agreement over the $10.10 national minimum wage proposal he's already endorsed.

"Right now, there is a bill in front of both the House and the Senate that would boost America's minimum wage to $10.10 an hour, and lift wages for more than 16 million workers — all without requiring a single dollar in new taxes or spending," the president said in a statement. "It’s time to pass that bill and give America a raise."

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