Proposals to raise the minimum hourly wage for workers in this state ran aground last legislative session on the issue of the tip credit. It’s a significant matter in a service economy like Hawaii’s, where so many people at the lower end of the income scale work at hospitality and restaurant jobs in which the tip is an important chunk of the pay packet.

But that issue, while a legitimate one, should not be allowed to sink legislation to raise the minimum wage, a move that is long overdue. A compromise making some accommodation to employers is crucial to ensure that workers get a pay boost, helping them cover basic living expenses.

There are rational arguments to be made for and against the tip credit, which allows employers of tipped workers to pay them below the minimum wage. Employers and their advocacy groups say that tips can allow workers to well exceed the minimum and when they do, a credit helps to ease the cost of employment. A higher minimum wage almost inevitably boosts wages across the board, so the employer burden is significant.

However, the counterargument is that tips are paid by the clientele to reward and incentivize good service, and that such a customer bonus shouldn’t be used to subsidize the employer costs.

State Sen. Clayton Hee is proposing that the minimum be raised from $7.25 to $10.10 an hour and that the tip credit be eliminated entirely. He and several citizen groups are urging a public hearing for the proposal, Senate Bill 2609 before the Ways and Means Committee, which is chaired by state Sen. David Ige.

The bill should be given a hearing, because both sides deserve a chance to either defend the tip credit or argue for its repeal.

But ultimately it seems unlikely that the case for eliminating the credit will prevail. There is already a 25-cent tip credit allowed by law, so zeroing that out would eliminate a relief valve for the employers. And that would simply inflame the lobby against the raise, making another standoff all but certain.

Hawaii would be going backwards again.

Alongside SB 2609, Ige should resuscitate the measure that stalled last year in conference committee, SB 331. That would raise the minimum to at least $9 and preserve the tip credit at its current level.

What’s critical is that some increase be authorized, the first raise in seven years. Critics of the increase argue that this would tend to eliminate first-time job opportunities for a teen workforce, closing a critical entry point for this population.

But the fact remains that many low-wage earners are not kids. In today’s still-difficult economy, many of the people who have moved off the unemployment rolls are still underemployed. Job creation is still constrained enough within this market that many of the openings pay poorly.

In his State of the State address delivered in January, Gov. Neil Abercrombie observed that "In Hawaii, 85 percent of minimum wage earners are 21 years old or older." These are people trying to pay rent and buy food, not high-schoolers underwriting their hobbies or other niceties.

Whether or not the minimum wage increase will lead to job losses is open to debate. The Congressional Budget Office, the nonpartisan office supplying policy data to Capitol Hill, estimated that raising the wage floor to $10.10 an hour would cost about a half million jobs.

Those who have criticized the CBO on this point include the Obama administration. And in his speech, Abercrombie referenced the past four wage increases, during which jobs increased by an average of 2.2 percent over the year that followed each raise.

Hawaii can’t dismiss this risk out of hand, though; this is not the same economy that accompanied previous raises.

But there is another projection from the CBO, not to be ignored: The increase would raise about 900,000 people across the country above the poverty line.

Across the country, this issue hits women workers especially hard. Nearly two-thirds of minimum wage workers are female. The Hawaii low-wage demographic is a little different, with half of them women.

In any case, for women who are the sole support of children, a full-time job paying $7.25 an hour leaves them thousands of dollars below the poverty line, according to the National Women’s Law Center.

Regardless of gender, minimum-wage workers have waited too long for relief. Abercrombie said he is ready to deal on the tip credits. "Let’s move quickly and resolutely on this issue."

We agree. Too many people in the workforce are struggling with low pay, and they deserve action at the state Capitol.