“To amend the Fair Labor Standards Act of 1938 to provide for a Federal, cost-of-living based minimum wage, and for other purposes.”
No CRS summary available for this bill.
This section revises the federal minimum wage under the Fair Labor Standards Act (FLSA) from a flat rate of $7.25 per hour to a regionally variable rate determined by the Secretary of Labor for each metropolitan statistical area (MSA) or state nonmetropolitan portion (i.e., counties outside MSAs, aggregated statewide). (As background, the FLSA requires most employers to pay covered employees—those engaged in commerce or producing goods for commerce, or working for enterprises so engaged—at least the federal minimum wage, which has remained $7.25 per hour since July 2009.) The initial rate, effective on the bill's effective date, equals 40% of the national average hourly wage of private sector, non-supervisory workers (per Bureau of Labor Statistics data), multiplied by an adjustment percentage based on the area's regional price parity (RPP, per Bureau of Economic Analysis data)—87.5% if RPP is below 90, 92.5% if 90-94.9, 100% if 95-104.9, 107.5% if 105-109.9, or 115% if 110 or higher—rounded to the nearest tenth of a dollar. This rate increases to 45% of the national average wage one year later and to 50% two years later; thereafter, not later than five years after the effective date and every three years, it equals the greater of the 50% calculation or the prior rate for that area. (Thus, minimum wages will vary geographically to reflect local living costs, with a ratchet preventing decreases.)
This section revises the minimum cash wage that employers must pay tipped employees to 30% of the wage determined under FLSA section 6(a)(1)—currently $7.25 per hour nationally—for the metropolitan statistical area or nonmetropolitan portion where the employer resides (from the cash wage required on the date of enactment of the provision). (As background, the FLSA permits employers to pay tipped employees a cash wage below the full minimum wage and claim a tip credit for the difference if tips received by the employee in a workweek equal or exceed that amount.)
This section revises the subminimum training wage for newly hired employees under section 6(g) of the Fair Labor Standards Act (FLSA) by (1) setting the rate at not less than two-thirds of the wage determined under subsection (a)(1) for the metropolitan statistical area or nonmetropolitan portion in which the employer resides (from $4.25 an hour); and (2) in paragraph (5), changing the applicable age criteria to employees who are the age of 18 years or younger (from those who have not attained the age of 20 years) and to 24 years or younger (from 25 years).