On September 1, 2008, the minimum wage for New Hampshire employers will increase the second time in a matter of weeks. On July 23, 2008 the state minimum wage was $6.50 per hour. The federal minimum wage increase on July 24 meant that most New Hampshire employers had to pay $6.55 per hour.
The New Hampshire state minimum wage is set to increase from $5.85 to $6.50, effective September 1, 2007. The 65 cent increase is the second in the Granite State in just 6 weeks, since the rate increased to $5.85 on July 24, 2007.
Minimum wage hikes are on the horizon in a number of states including Utah, Maine, California, Massachusetts, Delaware, Illinois, Oregon, Vermont, Washington, Michigan, West Virginia, New Mexico and Kentucky.
On September 8, the Utah minimum wage will increase from $5.15 per hour to $5.85 per hour. The higher rate is, of course, the same as the new federal minimum wage, so most workers in the Beehive State will be unaffected. Still, any employer who is covered under the state minimum wage, but not the federal minimum wage, will be required to increase the amount paid to minimum-wage workers.
Utah is in a unique position in the relationship between the state and federal minimum wages. In Texas, X and several other states, the state minimum wage by statute increases at the same time as the federal minimum wage rises. In Utah, the state minimum wage is increased by an administrative action taken by the Utah Department of Labor. The administrative action normally takes several months before it goes into effect. In this case, the July 24, 2007 increase in the federal minimum wage is not mirrored in Utah until September 8, 2007. Thus, on September 8, the Utah minimum wage will increase by 70 cents from $5.15 to $5.85 per hour.
The next state minimum wage in the nation will occur in Main on October 1, 2007 when the rate will go up by 25 cents, from $6.75 to $7.00 per hour.
A number of states have already voted minimum wage increases that will take effect on January 1, 2008. These include California where the state rate will increase by 50 cents, from $7.50 per hour to $8.00 per hour. In Massachusetts, the state wage rate will also increase by 50 cents from $7.50 per hour to $8.00 per hour. Another state rate increase already on the books for January 1, 2007 will occur in Delaware, where the rate will 50 cents from $6.65 to $7.15.
Three states have annual rate increases tied to the Consumer Price Index. All of these increases go into effect on January 1, 2007. The states are Oregon (currently at $7.80), Vermont (currently at $7.53) and Washington state (currently at $7.93.) Increases last year for these states varied from 26 cents to 36 cents per hour.
Another round of state rate increases will take place on July 24, 2008. These include the rate in the District of Columbia, which will increase from $7.00 per hour to $7.55 per hour, a 55 cent jump. In New Mexico, on the same date, the rate will climb from $5.15 to $6.50 per hour, an increase of a whopping $1.35.
Illinois has been a leader in state minimum wage hikes, with a number of increases over the past few years. The state has already approved 3 more increases before 2010. The next increase in the Land of Lincoln is 25 cents, which will bring the state rate from $7.50 per hour to $7.75 per hour on July 1, 2008. On that same date, the Kentucky minimum wage increase by 70 cents from $5.85 to $6.55. In Michigan, the July 1, 2007 increase will push the state rate from $7.15 to $7.40, an increase of 25 cents. And, in West Virginia the state minimum wage will increase from $6.55 per hour to $7.25 per hour on the same day.
The federal minimum wage increased by 70 cents on July 24, 2007 under the Fair Minimum Wage Act of 2007. The rate went from $5.15 to $5.85 per hour. his was the first increase in more than a decade. Two more increases are on the horizon. On July 24, 2008 the federal rate will increase by 70 cents to $6.55 per hour. Finally, on July 24, 2009, the federal rate will increase to $$.25 per hour.
Critics of the federal minimum wage increase worried that it will decrease the number of jobs available, especially for unskilled workers. Proponents pointed out that the increase is long overdue. At just $5.15 per hour, the old federal minimum wage had lower purchasing power in 2007 than in 1968, when the rate was $1.60 per hour. They point out that the $1.60 minimum wage was equivalent in purchasing power to a salary of $9.12 per hour in 2005. Proponents also note that in the 10 years since the last increase in the federal minimum wage, the average U.S. Congressman (or Congresswoman) has voted themselves raises totaling $31,600 per year. The current increase amounts to $1,456 per year for a full-time minimum wage worker.
An increase in the federal minimum wage was a major issue during the 2006 mid-term elections. Democrats won a majority in the House and a very slim majority in the Senate, partly because of a promise to pass an increase during their first 100 days in office. While the Democrats technically kept their promise, the original bill was vetoed by President George W. Bush because it was linked to the U.S. Troop Readiness, Veterans’ Care, Katrina Recovery and Iraq Accountability Appropriations Act of 2007. The act will raise the federal minimum a bill that demanded a reduction in American forces in Iraq. While the Iraq debate continued, the minimum wage increase languished.
The bill was finally passed and signed by the president on May 25, 2007. The bill provided for a total of three 70 cent increases, bringing the minimum wage to $7.25. The first increase, from $5.15 per hour to $5.85 per hour, is effective today. The next increase will occur on July 24, 2008, when the federal minimum wage will increase from $5.85 to $6.55 per hour. The final increase under the current bill will occur on July 24, 2009 when the rate will go to $7.25 per hour.
As of yesterday, the minimum wage bill in the New Hampshire legislature took a big final step toward becoming a law. The New Hampshire Senate voted on the New Hampshire minimum wage bill by the count of 19 to 5, in favor. The House in the state had already passed the bill by a strong vote of 286 to 69. All that is left for the New Hampshire minimum wage increase to become law is for the governor to sign the bill, and Gov. John Lynch has already said he would do just that.
The new minimum wage in New Hampshire would become $6.50 by the start of September of this year, up from its current rate of $5.15 per hour. Then come September 2008, the New Hampshire minimum wage would increase another time to reach $7.25 per year. As we talked about before with this law, one of the major motivations for supporters of the law is to get New Hampshire’s minimum wage closer to the rates that their neighbors pay. New Hampshire currently has the lowest minimum wage in all of New England.
Opponents and supporters of the bill alike, such as Sen. Michael Downing, a Republican from Salem (who voted for it), have come out on the record saying that they are not sure what sort of impact the increase of the New Hampshire minimum wage increase will be, considering that many employers in the state already pay more than the New Hampshire minimum wage to their employees. The one impact, for sure, will be that employers will need to find themselves a new New Hampshire minimum wage labor law poster.
The new bill does not include an index for inflation, so after 2008, there will need to be another law passed to increase the New Hampshire minimum wage higher than $7.25 per hour.
Getting back to the debate over the new New Hampshire minimum wage bill, the New Hampshire Lodging and Restaurant Association says that their tipped employees already make much more than the minimum wage—as much as $20 per hour—so that they do not need an increase in the tipped employee minimum wage. They suggest holding the tipped employee minimum wage at $2.38 per hour.
The reason that tipped employees can make less than the regular minimum wage in New Hampshire—and in many other states and under federal law—is because tipped employees do just that—make money off of tips from their customers. As long as those tips make up the difference between the regular minimum wage and the tipped employee minimum wage, then employees can go on paying these employees less.
However, under the new New Hamphire minimum wage bill, the tipped employee minimum wage is set at a percentage of the regular wage—not a set amount. That percentage equals 45 percent of the regular New Hampshire minimum wage, which at the $7.25 per hour level reached next year under the proposed bill, the tipped employee minimum wage would equal $3.26 per hour.
The New Hampshire Lodging and Restaurant Association had an amendment in the works in the Senate Finance Committee to freeze the tipped employee minimum wage at its recommended level, but that bill was turned down by the committee.
Supporters of the new New Hampshire bill point out to its critics, as well, that the bill still does not give the state’s workers a so called livable wage. A livable wage in New Hampshire for a single adult, according to my sources, would have to be as much as $10.42 per hour. For a family of four, with both parents working, in New Hampshire, the living wage would need to $11.69 per hour for each parent.
After much talk about it, the New Hampshire new minimum wage might be reality sooner than later. The state Senate is about to vote on the measure that would raise the New Hampshire minimum wage for the first time since 1997. And the governor of the state, Gov. John Lynch, has come out and said that he would sign the bill if passed.
As proposed, the New Hampshire minimum wage bill would increase the state minimum wage from its current level of $5.15 per hour to a new level of $6.50 per hour, as of this coming Sept. 1, 2007. Another increase would follow on Sept. 1, 2008, when the New Hampshire minimum wage would reach $7.25 per hour. Unlike the proposed minimum wage increase in Indiana, the New Hampshire minimum wage increase, I believe, would occur not matter what happens in Washington DC with the federal minimum wage bill there.
The bill on the docket in New Hampshire at the moment was introduced by the Chairperson of the House Finance Committee, House Rep. Marjorie Smith. Part of the rationale behind the increase for New Hampshire is that the state at the moment has the lowest minimum wage in all of New England. For instance, Maine has a $6.75 minimum wage, which will go up to $7 per hour come October 1. Vermont’s minimum wage increase to $7.53 this past January 1.
The New Hampshire minimum wage bill got this far despite opposition from employer and business groups, such as the New Hampshire Lodging and Restaurant Association. This group of restaurant workers is at least requesting that the state not increase the tipped employee minimum wage in the process. Their argument is that an increase in the tipped employee minimum wage in New Hampshire would hurt their nontipped employees, such as cooks and dishwashers.