New Jersey’s Minimum Wage Is Headed To $15

New Jersey’s governor signed legislation Monday to gradually increase the state’s minimum wage to $15 per hour, marking the latest win for the Fight for $15 labor campaign.

The Garden State’s wage floor will rise from its current rate of $8.85 per hour to $15 by 2024 for most workers. Small businesses that employ fewer than six people will have an extra two years before $15 becomes the minimum.

The plan, approved last week by the state’s Democratic-controlled legislature, makes New Jersey the fourth state to put its minimum wage on a path to $15. The three others are California, Massachusetts and New York.

Gov. Phil Murphy (D) said he was “incredibly proud” to sign the legislation, “ensuring that the most vulnerable among us will have the means to put food on the table.”  

“For far too long, too many of our fellow New Jerseyans have been struggling to survive on wages that have not kept up with the cost of living,” Murphy said.

Progressive activists and labor groups have been hugely successful in pushing minimum wage increases over the last several years, both through city and state legislation and ballot referendums. It is no coincidence many of those plans revolve around $15: That’s the stated goal of the union-backed Fight for $15 campaign, which began with worker strikes in the fast food industry in 2012.

The New Jersey law will boost the minimum wage roughly $1 per year until it reaches $15.

The first places to adopt a $15 minimum wage were liberal cities with high costs of living, including Seattle and San Francisco. But the approval of such a plan in New Jersey shows an eagerness in some Democratic-controlled states to aggressively hike the wage floor statewide.

The New Jersey law will boost the minimum wage by roughly $1 per year until it reaches $15. Business groups opposed the proposal, saying it would force employers to reduce workers’ hours in order to cover the higher payroll costs. Republican lawmakers uniformly opposed the legislation, but Democrats control both chambers of the statehouse.

Democrats had tried to raise the minimum wage repeatedly in recent years, but were stymied by former Gov. Chris Christie, a Republican. Murphy said brokering a deal on the minimum wage would be a priority for him after being elected in 2017.

Proposals to subject younger workers to a lower minimum wage was ultimately not adopted, although the minimum wage for employees working for gratuities will remain well below $15.

The plan will hike the tipped rate from its current rate of $2.13 per hour to $5.13 by 2024. (When a worker’s tips combined with the base wage do not amount to the regular minimum wage, the law calls for the employer to make up the difference.) Employers in the restaurant industry ― and, in the case of Washington, D.C., many restaurant employees ― have fought back against proposals to eliminate the separate wage floor for tipped workers, saying it would force bars and restaurants out of business.

New Jersey’s labor department estimated that there were roughly 300,000 workers earning the minimum wage in 2017. But the significant increase over time under the new law means the law will affect far more workers than that. The National Employment Law Project, an advocacy group for low-wage workers, estimates that more than 1 million would ultimately be impacted.

The current hourly minimum wage of $8.85 amounts to a full-time annual salary of about $17,000. The first hike is scheduled to take place in July, when the minimum wage will go up to $10.

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