Other businesses, especially restaurants, plan to jack up prices and pass along the increased salaries to customers if Lingle signs the bill that would raise Hawai'i's minimum wage from $6.25 per hour to $6.75 on Jan. 1 — then increase it to $7.25 on Jan. 1, 2007.

Lingle is "considering" the measure, a Lingle spokesman said.

She has until June 27 to notify the Legislature if she plans to veto the bill and until July 12 to sign it.

If Lingle approves raising the minimum wage, "There will definitely be price increases," said Tom Jones, co-owner of two Gyotaku Japanese restaurants and past chairman of the Hawai'i Restaurant Association. "In the restaurant industry, it's already very, very difficult to maintain our profitability."

The issue of increasing Hawai'i's minimum wage has businesses across the Islands worrying about whether they will have to raise prices, swallow the increased cost or cut back on employee hours to compensate.

Hawai'i's minimum wage now ranks 10th among U.S. states and would tie for seventh if Lingle approves the increase. Washington state's $7.35 per hour minimum wage leads the nation.

Six percent of Hawai'i workers earn the current minimum wage. Nearly 45 percent of them, the largest share, work in Hawai'i's restaurant industry, according to the state Department of Labor and Industrial Relations.

Individual restaurant owners and the Hawai'i Restaurant Association argued long and loud against the pay raise during this year's legislative session.

"Raising the minimum wage just makes the bottom line higher for everyone," said Bev Harbin, president of the Employers' Chamber of Commerce. "Every time you raise the cost of anything, like wages, it just forces everything to go up."

The last time Hawai'i's minimum wage went up, Jones eliminated four jobs at Gyotaku and brought in machinery to centralize his restaurants' food preparation — increasing his costs a total of about $30,000, he said.

"I took it on the chin last time," Jones said. "This time, I will absolutely have to raise prices ... about 25 to 30 cents per menu item just to break even."

Jones even winces at the minimum-wage paycheck for his 16-year-old son, who works at Taco Bell. "I like my son to make money," Jones said. "But even I can't see paying him (the 2007 minimum of) $7.25 an hour for his first job as a 16-year-old."

The proposed increase in the minimum wage has divided restaurant workers, who say it would widen the pay gap between kitchen staff and waiters and waitresses.

Restaurants are allowed to pay waiters and waitresses 25 cents below the minimum wage because they get tips. Some kitchen staff point out that the 25 cents difference would be more equitable if it was a percentage of the minimum wage instead of a flat 25 cents. As the minimum wage increases, the 25 cents gap becomes less significant.

"I don't think people who make tips should have their minimum wage go up, too," said Gerald Ramos, a 25-year-old prep cook in training at Big City Diner in the Ward Centers. "They already make a lot more money than those who don't get tips — and it's all in cash, no deductions."

Lane Muraoka, founder and president of the four Big City Diners, isn't sure how he'll deal with a rise in the minimum wage that he estimates will cost "at least a couple hundred thousand dollars per year" for his 300 or so employees.

Muraoka said he doesn't want to increase prices "but who else is going to pay? Our margins are so slim already."

While workers such as Ramos make the minimum wage, Muraoka's waiters and waitresses earn $20 to $40 an hour, he said.

But despite the division in her own restaurant, Big City Diner waitress Mary Urata will welcome any increase.

She flashed a thumbs up and said, "It's always nice to have a little more in your paycheck."