HB201 HFIN ABST 5-19

HOUSE COMMITTEE ON FINANCE

ABSTRACT

HOUSE BILL 201 (MINIMUM WAGE)

Sponsors:   Mr. Speaker (Mr. Miley) and Delegate Armstead

                    [By Request of the Executive]

Attorney:    McO   / Assistant:

Date:           May 19, 2014

Title:           OK

Fiscal Note:          No

Code:          §§21-5C-1, -2, -4 & -6     (amend)

Purpose: The bill would clarify and effectuate the four changes to current law proposed by Enrolled Committee Substitute for HB4283 (Regular Session, 2014), made effective 90 days from passage, which will be June 6, 2014.

          1. The bill would continue to raise the minimum wage by $0.75 in 2015 (to $8.00) and another $0.75 in 2016 (to $8.75), but clarify that those increases begin January 1 rather than January 2.

          2. The bill would continue to raise the subminimum training wage from $5.15 per hour to $6.40 in 2015, but clarify that those increases begin January 1 rather than January 2.

          3. The bill would continue to apply those increases to all employees in the state. Note: Under prior law, raises in the state minimum wages did not apply to employers if 80% of their employees are subject to any federal act relating to minimum wage. The bill would continue to eliminate this exemption, and clarify that the exemption is eliminated beginning January 1. The bill would also correct an inadvertent change to law that would apply state law as to maximum hours and overtime. Language has been added to keep current law that state law as to maximum hours and overtime does not apply to employers if 80% of their employees are subject to any federal act relating to minimum wage; in that event, federal law as to maximum hours and overtime will continue to apply.

           4. The bill would continue to raise the credit for employers from 20% to 70% “of the hourly rate of the amount paid an employee customarily receiving gratuities,” but clarify that the increase begins January 1, rather than June 6. Note: Employers are only required to pay these employees $2.13 per hour, but if, when added to tips received by the employee, the total is less than the minimum hourly wage, the employer must make up the difference.

          The bill would also add new language to provide the state Commissioner of Labor with the authority to promulgate legislative and emergency rules to implement and administer the changes to law made by this legislation, including a limited period to bring state law in conformance with federal law with regard to employee exemptions.

          Finally, the bill would make non-substantive technical cleanup and clarifying corrections.

Effective Date:     Passage