Massachusetts to Raise State Minimum Wage

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On Thursday, June 26, 2014, Massachusetts Governor Deval Patrick signed legislation that will raise the Commonwealth's minimum wage from $8 per hour to $11 per hour by 2017, which would be the highest minimum wage in the country.

In addition, the Massachusetts legislation lowered unemployment insurance (UI) costs for employers across the state. The reforms to the state UI system would freeze UI rates for employers for three years and then expand the wage base subject to those rates to $15,000.

This bill, titled, "An Act Restoring the Minimum Wage and Providing Unemployment Insurance Reforms," gradually raises the minimum wage over the course of the next three years as follows:

Date

New Minimum Wage

New Tipped Wage

January 1, 2015

$9.00/hour

$3.00/hour

January 1, 2016

$10.00/hour

$3.35/hour

January 1, 2017

$11.00/hour

$3.75/hour

In addition, the legislation makes the following changes to the Massachusetts Wage Laws:

  • Changes the minimum wage for employees in agriculture and farming from $1.60/hour to $8.00/hour;
  • Exempts seasonal camp counselors and counselor trainees from learner and apprentice rates; and
  • Provides that, in no case shall the minimum wage rate be less than $0.50 higher (which used to be $0.10) than the effective federal minimum rate.

This is the first minimum wage increase in Massachusetts since 2008 and the first increase to the minimum wage paid to tipped employees since 1999, and is expected to benefit some 500,000 workers statewide. The law does not include provisions to tie minimum wage increases after 2017 to inflation, which Governor Patrick had previously sought to include in the bill.

In the absence of federal action, other states have enacted legislation to raise entry-level wages. Vermont will raise its minimum wage to $10.50/hour by 2018, with Connecticut, Hawaii and Maryland all moving toward a $10.10 minimum. Earlier this year, the District of Columbia adopted an $11.50/hour minimum wage, to take effect in 2016, and Seattle's city council voted this month to raise its minimum wage to $15 an hour over the next seven years.

Topics:  Employer Liability Issues, Hiring & Firing, Minimum Wage, New Legislation, Wage and Hour

Published In: Labor & Employment Updates

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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