Sen. Tom Harkin (D-Iowa) announced that a bill to gradually raise the minimum wage to $10.10 an hour and then index it to inflation likely will come to the Senate floor following a two-week recess for Thanksgiving, Harkin is then measure’s chief sponsor.

The bill, which has the support of President Obama, would increase the federal minimum wage, which currently stands at $7.25 per hour, over the next 2 years. There would be an immediate increase of $.95 followed by 2 other $.95 increases over the next 2 years resulting in a minimum wage of $10.10 in 2015. The proposed legislation would also raise the minimum wage for tipped employees, such as restaurant servers, which currently is $2.13 an hour, to 70 percent of the regular minimum wage over the same time frame.  After that, minimum wage increases would be tied to the CPI.

Speculation is that the bill will clear the Senate but have a more difficult time in the House.

The last time the minimum wage was increased was in July of 2009. It is estimated that if the minimum wage was keeping up with inflation over the last 40 years, when the minimum wage was first implemented,  it would currently be $10.74/hr.

Business managers and Payroll administrators need to keep track of this bill’s progress.

 

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