Speak out about wage billPublished 8:52am Wednesday, April 9, 2014
Earlier this week, the Minnesota House and Senate DFL leadership agreed on legislation that will dramatically raise Minnesota’s minimum wage to $9.50 in 2016 with an inflationary increase. If passed, Minnesota will have one of the highest minimum wages in the nation. Your legislator needs to hear from you as soon as possible! The bill includes:
•$9.50 minimum wage for businesses with gross sales more than $500,000 in 2016. Phased in over three years from $7.25 currently to $8.00 in August 2014; $8.50 in August 2015 and to $9.50 in August 2016.
•$7.75 minimum wage for businesses under $500,000 in gross sales in 2016. Phased in over 3 years from $6.15 to $6.50 in August 2014; $7.25 in August 2015 and to $7.75 in August 2016. (The wage cut off has been reduced from $625,000 to $500,000.)
The $7.75 minimum wage also applies to large businesses for: a 90 day training wage for 18 and 19 year olds; all 16 and 17 year olds; and employees working under a J1 visa.
Beginning in 2018, all wages would increase annually on Jan 1, through an inflation adjustment called the implicit price deflator. The implicit price deflator is similar to the Consumer Price Index. Wage growth will be capped at 2.5 percent.
The increase could be suspended for one year by the Commissioner of the Department of Labor and Industry (DOLI) if leading economic indicators show a possible substantial economic downturn. The suspension could only be implemented after a public hearing and comment period. In better economic times, the suspended increase could be added back.
This increase is roughly the equivalent of a 3 percent increase on most businesses’ minimum employee cost. The bill makes Minnesota an outlier in the nation: only ten states index minimum wage to inflation, and none of them have a minimum wage as high as $9.50. These proposed changes will disproportionately affect small businesses in Minnesota, border communities, young people, and entry-level workers. Minimum wage jobs give young and low-skilled workers the opportunity to learn important “soft skills” that cannot be taught in schools: self-confidence, attention to detail, time management, problem solving, and communication skills. It’s critical that you weigh in by Wednesday, April 9. Contact your Senators and Representatives as soon as possible and ask them to oppose this proposal. Tell them to match the federal level of $7.25, remove the annual inflation adjustment and adopt a youth wage at the federal rate that applies to all workers under the age of 18.
Sen. Dan Sparks
Rep. Jeanne Poppe
Rep. Shannon Savik