Despite tight budgets, dozens of Memphis-area nonprofits have figured out a way to pay their workers at least $15 an hour.

About 1,500 workers are employed by the 33 area nonprofits that responded to MLK50’s second annual Living Wage Survey. Of those workers, nearly 85 percent earn at least $15 an hour. Nearly 90 percent of the organizations that responded support a gradual increase in the minimum wage to $15 an hour.

The 2019 results both mirror and stand in contrast to the MLK50’s 2018 Living Wage Survey, which queried the area’s 25 largest employers. Half of those employers refused to answer the survey. Several sent vague answers or dodged questions about health insurance and using temporary workers. Only two supported raising the minimum wage to $15 an hour.

Like last year, most of the area’s largest and richest organizations — such as the Boys & Girls Club of Greater Memphis and Memphis Zoological Society — did not respond to multiple requests to complete the survey. (See below for a list of who did and didn’t answer.)

But other organizations that completed the survey, including those recommended by readers, seem to take seriously Dr. Martin Luther King’s commitment to economic justice.

Here are the organizations that reported paying all workers at least $15 an hour: Agape Child & Family Services, Inc., CHOICES: Memphis Center for Reproductive Health, CodeCrew, Facing History and Ourselves, First Congregational Church, Just City, Latino Memphis, Make-A-Wish Mid-South, MICAH, Mid-South Peace & Justice Center, NAACP Memphis Branch, Seeding Success, SisterReach, St. Mary’s Episcopal Cathedral, Stand for Children — Tennessee, Temple Israel, The Urban Child Institute and United Way of the Mid-South.

These organizations pay between 76 and 93 percent of their employees at least $15 an hour: Beth Sholom Synagogue, Community Legal Center, Habitat for Humanity of Greater Memphis, Jewish Community Partners, NAACP Memphis Branch, Porter-Leath and RMHC-Memphis.

These organizations pay between 57 and 75 percent of their employees at least $15 an hour: Metropolitan InterFaith Association (MIFA), Mid-South Food Bank, National Civil Rights Museum and Planned Parenthood of Tennessee and North Mississippi.

These organizations pay between 32 and 43 percent of their employees at least $15 an hour: Memphis Athletic Ministries and Restore Corps.

Nonprofit employees who serve people struggling to make ends meet should not be expected to work for poverty wages, say nonprofit leaders.

“If people on your staff are on food stamps, and [nonprofit leaders] can afford to go on vacation, you’re not doing this work right,” said Cherisse Scott, CEO of SisterReach, a reproductive justice organization with seven employees, most of whom are mothers.

In Memphis, where King was assassinated 51 years ago today in support of striking black sanitation workers fighting for fair pay, his words still ring true: “If we are seeking a home, there is not much value in discussing blueprints if we have no money and are barred from acquiring the land.”

Deciding which organizations to survey

The 2019 survey started with two overlapping lists published by the Memphis Business Journal: The 25 largest Memphis-area charitable organizations, ranked by 2016 public support, and the 25 largest Memphis-area social and human services nonprofits, ranked by 2016 program service expenses. To those lists, we added some 30 faith-based institutions, and four other organizations, including a union.

Thirty-three organizations responded. The nonprofits offer a variety of services, including feeding the poor and homeless, providing healthcare or legal services, teaching about reproductive justice, and providing college pathways and scholarships.

Key findings

At the responding organizations:

  • 84 percent of employees earn at least $15 an hour;
  • 8 percent of employees earn between $11.06 an hour (the “living wage” according to MIT’s Living Wage Calculator for a single adult in Shelby County) and $14.99 an hour;
  • 3 percent of employees earn less than a living wage, or between $7.26-$11.05 an hour.

The survey also asked about the use of temporary workers:

  • 21 percent said they have hired temps in the past year;
  • 15 percent said they hire temps on a seasonal basis;
  • 64 percent don’t hire temps.

Seventy percent said they outsource work, such as janitorial services or payroll services.

Asked if they support a gradual increase in the minimum wage to $15 an hour over the next five years — which comes to just $30,000 a year—88 percent of respondents said yes. Twelve percent declined to answer.

By comparison, the 2018 Living Wage Survey found that only two of the largest employers — Shelby County Schools, which announced plans to pay all its workers at least $15 an hour, and the University of Tennessee Health Science Center — support raising the minimum wage to $15 an hour.

Four nonprofits declined to say whether they support a gradual increase in the minimum wage to $15 an hour over the next five years. They were: Memphis Athletic Ministries, Habitat for Humanity, Make-A-Wish Mid-South and RMHC-Memphis, also known as Ronald McDonald House.

Commitment deeper than the funds available

The 2019 survey asked respondents to explain any challenges they have to paying workers at least $11.06 an hour. One organization, Jewish Community Partners, said it was“not challenging.”

But for others, like Metropolitan Inter-Faith Association (MIFA), it is. The nonprofit, which offers utility bill assistance and emergency housing to needy families and other services, pays all full-time employees a living wage, even though the grants that pay for operations make that hard.

MIFA, which was founded as a faith-based response to King’s assassination in 1968, pays 80 percent of its staff at least $11.06 an hour. Specifically, 23 percent of staff earn $11.06-$14.99 an hour, and 57 percent earn at least $15 an hour. Grants often do not cover the full cost of operations and a constant challenge is filling that gap: “MIFA is committed to annual review and ultimately achieving [a] living wage for all employees.”

Raising money for all salaries is a challenge, said Mauricio Calvo, who heads up Latino Memphis. Whether part-time or full-time, all hourly employees get paid a starting wage of $15 an hour “regardless of work experience or education,” Calvo said.

“We believe in work ethic and that if you provide all employees a livable wage, then they are able to strive in the work environment,” Calvo said.

The National Civil Rights Museum, which sits on the grounds of the Lorraine Motel where King was killed, does not yet pay all its workers $15 an hour.

Terri Freeman, the museum’s president, said the institution intends to increase its lowest wage of $13 an hour to $15, though she did not indicate how soon. She offered that part-time museum employees are eligible for a 403(b) program, a tax-deferred retirement plan similar to a 401K, but not health coverage.

“Full-time employees have a full and generous benefit package,” Freeman said. “We do use temporary employees to help fill gaps and particularly during peak season (March-August). That said, our reliance on temps has decreased significantly in the past two years.”

The survey also found:

  • 33 percent of respondents said full-time and some part-time employees are eligible for employer-sponsored insurance.
  • 55 percent said only full-time employees are eligible for employer-sponsored insurance.
  • 12 percent said no employees are eligible for employer-sponsored insurance.

“Not having access to healthcare is one of the factors that traps people in poverty. That’s problematic,” said Dr. Elena Delavega, a University of Memphis associate professor of social work who created the Memphis Poverty Fact Sheet.

A majority — 70 percent — outsource services such as janitorial services and payroll, while 30 percent do not.

Delavega worries that the use of contracted workers can allow organizations to say they pay their workers well while relying on underpaid workers they won’t have to answer for.

Outsourced workers are “not a part of the employee count,” Delavega said. “How many people are being outsourced? That’s what I would like to know. How many of them get $15 an hour? Who really qualifies as an employee?”

This issue has come up repeatedly at the University of Memphis, where United Campus Workers has urged the administration to stop using outsourced labor and instead make every worker on the campus an employee.

“Outsourcing results in lower wages,” Delavega said. “It’s a way for institutions to say, ‘Look at us, we’re paying these amazing salaries.’”

How we got here

Tennessee does not have a state minimum wage, so wages default to the federal minimum, which is currently $7.25 an hour and was last raised in 2009.

Minimum wage was established in 1938 and periodic adjustments by Congress were supposed to keep the minimum at a level that would meet a worker’s basic needs, But that floor has been allowed to languish since the 1960s, when the dollar began losing its purchasing power, according to David Cooper at the D.C.-based Economic Policy Institute.

The need for fair pay is acute in the Memphis metro area, which has fallen from first to the second-poorest large metro area in the nation, behind the Tucson, Arizona, metropolitan area. The difference is negligible, though, and not necessarily cause to celebrate, said Delavega, who credits Obama-era reforms and a national dip in poverty to the change in ranking.

A moving target — and maybe the wrong one?

While the national Fight for $15 campaign and others have prioritized $15 an hour as a goal, other organizations have their own rubric for what constitutes a living wage. For example, Dr. Amy Glasmeier, the economist who created the Living Wage Calculator, calculates $11.06 as the hourly living wage a single person would need to earn in Shelby County today.

The recommended hourly living wage increases as family size grows: For example, one adult, with one child would need to earn $22.09 an hour as a living wage. Two working adults with two children would need to earn $14.06 an hour, and so on.

Dr. Valerie Wilson, an economist at the D.C.-based Economic Policy Institute, says the term “living wage” is being usurped by the push for $15 an hour.

“Political energy is being put into the minimum wage and raising it to a specific number,” said Wilson, who heads up the institute’s Program on Race, Ethnicity, and the Economy. “We say it’s a reasonable and adequate standard of living. It varies from city to city but takes into account cost-of-living factors: housing, childcare and several other things that go into calculating the family budget. It’s also adjusted for family size.

Moving toward $15 by 2024 “would undo the erosion of the value of the real minimum wage that began primarily in the 1980s,” an analysis by Cooper found. This goal would lift the wages of 28.1 million workers, putting an extra $3,900 annually in their pockets. Advocating for the Raise the Wage Act, Cooper said two-thirds (67.3 percent) of the working poor would get a pay raise if Congress passes this bill into law.

Critics of a higher minimum wage, including U.S. Labor Secretary Alexander Acosta, contend that higher pay would mean more unemployment, but Delavega says that argument is unfounded.

“Raising the minimum wage does not result in the elimination of jobs,” she said. “This is an urban legend that will not die.”

A University of California, Berkeley study of cities that raised the minimum wage above $10 per hour backs up Delavega: Chicago, the District of Columbia, Oakland, San Francisco, San Jose and Seattle did not suffer substantial job losses when the minimum wage was raised, according to the study released in September 2018.

A May 2016 National Employment Law Project data brief found similar results: “In the nearly two dozen instances when the federal minimum wage has been increased, employment the following year has increased in the substantial majority of instances,” wrote researchers in the brief titled “Raise Wages, Kill Jobs? Seven Decades of Historical Data Find No Correlation Between Minimum Wage Increases and Employment Levels.”

Still, says Wilson at the Economic Policy Institute, a shifting focus on a minimum wage nearly double the current rate may still not be enough for workers who struggle to get by.

“Even $15 wouldn’t be considered adequate,” Wilson said. “It’s a floor. It’s a minimum.”

Who answered our survey and who didn’t

These organizations responded to the survey: Agape Child & Family Services Inc.; Alpha Phi Alpha Fraternity, Inc, Alpha Delta Lambda Chapter; Beth Shalom Synagogue; CHOICES: Memphis Center for Reproductive Health; Code Crew; Community Legal Center; First Congregational Church; Facing History and Ourselves; Habitat for Humanity of Greater Memphis; Jewish Community Partners; JUICE Orange Mound, Memphis; Just City; Latino Memphis; Make-A-Wish Mid-South; Manna House; Memphis Athletic Ministries; Metropolitan Inter-Faith Association; MICAH; Mid-South Food Bank; Mid-South Peace and Justice Center; NAACP-Memphis Branch; National Civil Rights Museum; Planned Parenthood of Tennessee and North Mississippi, Porter-Leath, RMHC-Memphis (Ronald McDonald House); Seeding Success; SisterReach; Stand for Children-Tennessee; Temple Israel; St. Mary’s Episcopal Cathedral; United Way of the Mid-South; The Urban Child Institute and Restore Corps.

These 24 organizations did not respond to requests made by email, phone and social media to complete the survey. They are: Alzheimer’s Association Tennessee Chapter, Baptist Memorial Health Care Foundation, Ballet Memphis Corp., Boys & Girls Club of Memphis, Christian Community Foundation, Church Health, Community Foundation of Greater Memphis, Dixon Gallery & Gardens, Ducks Unlimited, Good Shepherd Health, Humane Society of Memphis & Shelby County, Jewish Foundation of Memphis, Memphis Child Advocacy Center, Memphis Goodwill, Memphis Jewish Federation, Memphis Union Mission, Memphis Zoo, Merge Memphis, Methodist Healthcare Foundation, SMA (South Memphis Alliance), Teamsters Local 667, Wolf River Conservancy, Workers Interfaith Network and Youth Villages.

Three organizations reported no permanent employees: Alpha Phi Alpha Fraternity Inc. Alpha Delta Lambda Chapter, JUICE Orange Mound and Manna House.

This story is brought to you by MLK50: Justice Through Journalism, a nonprofit reporting project on economic justice in Memphis. Support independent journalism by making a tax-deductible donation today. MLK50 is also supported by the Surdna Foundation and Community Change.