(March 15, 2019) Although significantly amended, the “Fight for Fifteen minimum wage bill appears headed for approval in the General Assembly, following the Senate Finance Committee’s issuance of a favorable report on the measure last Friday.
The House of Delegates passed its version of the legislation a week early by greater than a two-to-one margin.
Despite the General Assembly failing to pass comparable minimum wage legislation every year since 2016, the push was renewed again this session by Del. Diana Fennell (D-47, Prince George’s) and Sen. Cory McCray (D-45, Baltimore) who sponsored cross-filed HB 166 and SB 280, which originally aimed to raise the minimum wage to $11 per hour later this year, and then add $1 each year until reaching $15 in 2023.
SB 280 now awaits a full Senate vote after the Finance Committee decided 8-3 in favor of the measure last Thursday, while cross-filed HB 166 passed the lower chamber by a 96-44 margin on March 1.
Among the changes made to the house bill was an amendment to phase-in wage raises starting Jan. 1, 2020 to $11 hourly, and then go up by .75 cents annually through 2024, before reaching the $15 rate on Jan. 1. 2025.
Another proposal of particular importance to the restaurant industry, which would have increased wage rates for tip earners to $15 by 2027, was removed to retain the state’s current tip credit.
Exempted under the state’s current minimum wage regulation are: employees earning at least $30 monthly in tips who are paid a $3.63 hourly rate that must combine to equal at least the current $10.10 scale; amusement and recreational businesses employees who are paid the higher sum of either 85 percent of the minimum wage or $7.25; and employees under 20 years of age who must earn at least 85 percent of minimum wage rates during their first six months on the job.
The amended house bill also removed a proposal to dump the state’s youth opportunity wage and instead permits employers to compensate staff at 85 percent of the minimum rate if under 18 years of age.
The bill language approved by the house also removed proposed annual adjustments to keep pace with cost-of-living increases once the $15 rate is achieved.
Other changes approved by the Senate Finance Committee included a slower phase-in for small businesses with 14 or fewer employees, restricting increases to $0.50 per year before achieving the $15 rate on Jan 1, 2028 and requiring restaurants to show the effective hourly rate on wage statements for tipped staff members.
Melvin Thompson, senior vice president of Government Affairs & Public Policy for the Restaurant Association of Maryland, said his organization backed the inclusion of the tipped wage statements to foster transparency and bolster the argument to retain the present $3.63 tip wage.
“This will allow tipped employees to easily confirm that they are earning at least the minimum wage per hour, and makes it clear when employers are required by law to make up any shortfalls,” he said.
Del. Wayne Hartman (D-38C) said the house-approved bill also included what amounts to a fail-safe amendment.
“If the Board of Public Works said Maryland’s economy is slowing, there’s a provision which allows them to halt the increase for a year to allow the General Assembly to meet and discuss if it needs to take further action,” he said. “Which to me says, if they were confident this was the right thing to do, I don’t know if that would have been there.”