EMPLOYMENT LAW NEWS
New York State Minimum Wage Update
By Kris Janisch
Published May 1, 2023
Employers should keep an eye on activities in the assembly to ensure compliance with potential new New York State minimum wage rates.
A New York State minimum wage update appears to be at hand after the governor announced a “conceptual agreement” with lawmakers on the 2024 budget.
Gov. Kathy Hochul made the announcement April 27, 2023, calling for a few years of increases to the New York minimum wage, with indexing beginning thereafter.
Though it has yet to be formally enacted, a new New York State minimum wage law would impact all three of the rates in the state:
- New York City
- Nassau, Suffolk, and Westchester counties
- Upstate New York
Also of note, it would move New York State’s minimum wage increases from Dec. 31 each year to Jan. 1, which is more common. (Though, of course, July 1 is also popular, and several jurisdictions update at different times of the year.)
Minimum Wage Management. Simplified.
New York State Minimum Wage Update
As a reminder, as of Dec. 31, 2022, the minimum wage rates in New York are:
- New York City – $15
- Nassau, Suffolk and Westchester counties – $15
- Upstate New York – $14.20
But it looks as though those numbers will be going up in the coming years, with New York State minimum wage rates eventually reaching and surpassing $20 an hour.
Fight for $20: New Minimum Wage Push
Under a New York Senate version of the bill, the rates for large employers in New York City and the surrounding counties would be:
- $17.25 on Jan. 1, 2024
- $19.25 on Jan. 1, 2025
- $21.25 on Jan. 1, 2026
As for upstate New York, minimum wage would increase at a similar rate. It would still reach the $20 mark in the coming years, however. Again, under a senate version of the bill, the rates would be:
- $14.20, effective Jan. 1, 2023
- $16 on Jan. 1, 2024
- $18 on Jan. 1, 2025
- $20 on Jan. 1, 2026
After 2026, the rates would increase based on the applicable Consumer Price Index. Also, they would maintain the Jan. 1 schedule. (A labor law poster update seems likely, as well.)
Once passed, the New York State minimum wage update — under language in the senate bill — would take effect immediately.
“If we really want to tackle the affordability crisis head-on, we must recognize that low-wage workers in New York have been hit hardest by the increases in costs of living,” Hochul said in a statement earlier this year. “Our commonsense plan to peg the minimum wage to inflation will not only put more money into the pockets of hundreds of thousands of hardworking New Yorkers, it will also provide predictability for employers and spur more spending in local economies and businesses.”
How Many States Have a $15 Minimum Wage?
Managing Minimum Wage Rates
A few years ago, there was a flurry of new laws related to minimum wage. After a (very) brief lull, it has picked up again. And the legislation is only becoming more complex.
Jurisdictions in California have examined specific rates for healthcare employees.
Maryland’s minimum wage law was recently updated to hit the $15 threshold sooner than expected.
Minimum wage laws are being put before voters more often.
North of the border, Canada minimum wage rates present challenges.
Even in places where the rate hasn’t changed in more than a decade, like Texas minimum wage, people are interested in its status.
Plus, another recent development is a shift from scheduled rates, which employers can more easily plan for, to indexed rates, as will be the case for Oregon minimum wage in July 2023. At the same time, jurisdictions sometimes announce updated rates only weeks before their effective date, creating additional hurdles for employers.
The likelihood of a New York State minimum wage update is another addition to the challenges of managing rates for employers that operate in jurisdictions in the U.S.
What’s the Highest Minimum Wage in 2023?
While the numbers for the New York State minimum wage update are not final as of this writing, the recent announcement from the governor makes new rates seem inevitable.
According to legislators there, polling shows that 80 percent of New Yorkers — including 65 percent of GOP voters — support raising the minimum wage to $21.25 before indexing it.
The likely enaction of the New York State Raise the Wage Act would be a major move in terms of the landscape of minimum wage in the country. Even California, long at the forefront of employment law, does not have a jurisdiction with a standard rate over $20. (Although it will be interesting to see what happens should the New York State minimum wage update go into effect. And there will be a ballot measure put to voters on minimum wage in California next year.)
Employers should keep an eye on activities in the New York Assembly to ensure compliance with potential new minimum wage rates.
This Employment Law News blog is intended for market awareness only, it is not to be used for legal advice or counsel.
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