Saint Paul, Minnesota – Today, the House passed a bill to increase the state’s minimum wage to $9.50 by 2016. The minimum wage will also be increased to inflation starting in 2018 to ensure the value of the minimum wage does not fall over time. State Representative Mary Sawatzky (DFL – Willmar) voted in favor of the bill. The bill, which passed the Senate yesterday, now goes to the Governor to be signed into law.
“In our great state, people who work hard shouldn’t be living in poverty,” said Rep. Sawatzky. “Research has shown that when lower-income people have more money in their pockets, they spend that money in their local communities which will strengthen our economy.”
Over 357,000 workers will see a raise when the bill is fully implemented. Of those workers, 45 percent have some college education and 57 percent, or 200,000 are women. The bill is expected to have significant impact on Minnesota families. Of the workers expected to receive a raise, 62,850 are parents. And 14,200 of those are the sole wage earner in their household.
“Most of the people on public assistance programs have jobs and are getting paid the minimum wage,” said Rep. Sawatzky. “By increasing the minimum wage, these families will have more money in their pockets and can hopefully get off public assistance, saving taxpayer dollars while boosting our economy.”
Details of the bill include:
· $9.50 minimum wage for businesses with gross sales over $500,000 in 2016. $8.00 in August 2014, $8.50 in August 2015.
· $7.75 minimum wage for businesses under $500,000 in gross sales in 2016. $6.50 in August 2014, $7.25 in August 2015.
· The $7.75 minimum wage rate would also apply for large businesses in the following circumstances: 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 each year on January 1st by inflation measured by the implicit price deflator capped at 2.5%.
· The indexed increase could be suspended for one year by the Commissioner of the Department of Labor and Industry if leading economic indicators indicate the possibility of a substantial downturn in the economy. The suspension could only be implemented after a public hearing and public comment period. In better economic times, the suspended inflationary increase or a lesser amount could be added back into the minimum wage rate in a subsequent year.
“We’re passing a compromise to address the concerns of small businesses,” said Rep. Sawatzky. “The bill includes a staggered increase in the wage, a lower minimum wage for small businesses, and a training wage. We’re moving in a responsible manner to raise the wage for hundreds of thousands of Minnesotans.”
Rep. Sawatzky encourages constituents to contact her with any questions, comments, concerns, or ideas. Rep. Sawatzky can be reached by phone at 651-296-6206 or by email at rep.mary.sawatzky@house.mn. Constituents can also visit Rep. Sawatzky’s AreaVoices blog, legislative page and sign up for email updates.