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Above and beyond minimum wage

Pat Greenhouse/Globe Staff

John Pepper chatted with Boloco line cook Aracelly Haque.

By Taryn Luna Globe Correspondent 

Back in 2002, when the minimum wage was $6.75 in Massachusetts, Boloco founder John Pepper raised his lowest-paid workers’ pay to $8 an hour.

The decision to compensate employees more than the state minimum to wrap burritos and sweep floors was unheard of at the time — and is still rare in an industry notorious for low pay. Today, many fast-food restaurants pay the bare minimum of $8 an hour in Massachusetts, or just $16,640 a year.

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“We couldn’t figure out any other way to expect people to care about their job if we weren’t allowing them to pay their basic bills,” said Pepper. “How could we command any share of their attention when all they were thinking about was getting a second job?”

Most restaurants worry that raising wages will threaten already small margins, but Pepper thinks the opposite. His philosophy? Workers who are paid more will be happier with their lives and jobs, provide better service, and stick around.

The results have been mixed.

“It’s been anything but a straight upward line,” he admits. “But a lot of our best years coincide with our most risky moves to take care of people.”

Fast-food workers have been leading the charge in the growing movement to raise wages in low-paying industries. And their efforts have started to get results in several major cities, at airports, and among private businesses that have increased wages above state minimums.

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Pepper stepped down last year as head of the company he cofounded in 1997 but remains a co-owner. Still, his people-first approach continues.

Entry-level workers earn at least $9 an hour; the average is about $12. The company pays 60 percent of medical and 50 percent of dental coverage for anyone who works more than 30 hours a week. It also sponsors English-language classes and offers holiday and sick pay.

And although Pepper is out of the daily restaurant business, he hasn’t given up his fight for fair compensation. He’s an outspoken advocate for higher pay and is among a small contingent of business owners who applauded the state’s decision to raise minimum wage to $11 by 2017.

Still, Pepper argues that his efforts aren’t enough. “We’re still part of the problem,” he said. “We’re better than most, but the industry is terrible on this.”


Taryn Luna can be reached at taryn.luna@globe.com
Follow her on Twitter @TarynLuna.