Wisconsin's minimum wage would increase by $1.35 to $6.50 an hour under a compromise that business and labor leaders sent to the governor Monday. <

An advisory panel, appointed by the governor, voted 16-2 to recommend that Wisconsin's $5.15-an-hour minimum wage be increased 55 cents to $5.70 on Oct. 1 this year and an additional 80 cents to $6.50 on Oct. 1, 2005. <

Democratic Gov. Jim Doyle immediately endorsed the raise for between 130,000 and 160,000 workers by Oct. 1, 2005. <

"It's a matter of basic fairness," Doyle said, noting that the minimum wage hasn't been increased since 1997. <

Key lawmakers in the Republican-run Legislature vowed to fight the increase, arguing it would hurt the economy and cost some low-wage earners their jobs. <

Yet Doyle has the power to implement the pay hike unilaterally as an administrative rule, the Republican opponents acknowledged. <

The Legislature could potentially delay the boost until the end of 2006, said Reps. Steve Nass, R-Palmyra, chairman of the Assembly Labor Committee that will take up the issue next. <

Doyle, who said about two-thirds of those people making the minimum wage are women and more than half are adults, said he's confident support from business groups will convince enough Republicans to support phasing in the raise without delay. Ultimately, the Legislature would need two-thirds votes in both houses to override the governor's wish for a higher wage. <

Advisory panel members representing manufacturers, restaurateurs, grocers and small businesses endorsed the plan, along with labor leaders, two Democratic lawmakers and others. Nass and Sen. Tom Reynolds, R-West Allis, chairman of the Senate Labor Committee, dissented. <

Brandon Scholz, president of the Wisconsin Grocers Association, said his group supports the increase because of another change that is part of the deal. Teenagers will get a lower minimum wage than adults for the first time since 1996, Scholz noted. <

Doyle said he hopes the statewide increase will ease the pressure on Madison leaders to increase the city's minimum wage to $7.85 an hour. Doyle repeated his contention that the state should have a uniform minimum wage - something a separate Republican-backed bill seeks to require. <

Nass noted that 70 percent of Wisconsin employees making minimum wage work part time. Some of those jobs will be lost because of the higher wage, he predicted, and some businesses won't expand. <

But Craig Culver of Prairie du Sac, co-founder of Culver's Restaurants, said he voted for the wage hike even though it may cost him some money. He already pays most of his workers higher than minimum wage to retain "the right people, the best people," Culver said. <

On Jan. 1, Illinois plans to raise its minimum wage to $6.50 an hour, Doyle noted. The governor doesn't think Wisconsin will lose businesses to Minnesota, Michigan, and Iowa if those states keep their minimum rates at $5.15. Contact Scott Milfred at smilfred@madison.com or 252-6129. <