Orlando, Fla.—America prepares to see a national minimum wage of $15 an hour by 2025. It is meant to be a years-long transition to increase America's minimum wage for several categories of workers, including people whose income relies heavily on tips, and workers with disabilities.
Right now, workers who receive at least $30 in tips a month to qualify for the "tipped wage," which is split between a $2.13 minimum cash wage and a $5.13 maximum tip credit with both combining to $7.25.
Also, certain groups like student workers, and those under the age of 20 with physical or intellectual disability qualify for a wage below the minimum, which is now $4.25.
On January 22, President Biden signed an order to have the Office of Personnel Management provide recommendations for a $15 an hour for federal workers. That was considered a starting point.
In 2009 the federal minimum wage was established as $7.25, although states and cities can dictate their own hourly minimum, based on local economics.
There are different studies being weighed in before making this final decision.
According to a report from the Congressional Budget Office analyzing the Raise the Wage Act of 2021 the increase would result in an average of 1.4 million jobs lost over the course of four years, and also bring 900,000 people out of poverty.
Other studies show that cities where the minimum wage was increased to more than $10 an hour, there was either small loss of jobs, or maybe even an increase.
In Florida, voters approved the $15 minimum wage, which will occur in gradual increases during the next six years. Under the new mandate, Florida’s minimum wage rate (currently, $8.56) will increase to $10 an hour in September 2021. The minimum wage then will increase by $1 each year until it reaches $15 an hour in 2026. The minimum wage rate applies to all public and private sector employers, regardless of size or number of employees.
Amendment 2 does not change the allowable tip credit for tipped employees meeting the eligibility requirements under the Fair Labor Standards Act. Florida employers may continue to take a tip credit of up to $3.02 per hour for properly classified tipped employees. The minimum cash wage rate for eligible tipped employees will increase as follows:
- Through December 31, 2020 – $5.54 per hour plus tips
- January 1, 2021 – $5.63 per hour plus tips
- September 30, 2021 – $6.98 per hour plus tips
- September 30, 2022 – $7.98 per hour plus tips
- September 30, 2023 – $8.98 per hour plus tips
- September 30, 2024 – $9.98 per hour plus tips
- September 30, 2025 – $10.98 per hour plus tips
- September 30, 2026 – $11.98 per hour plus tips
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Mariana Zorrilla, CIC, CRIS, CPIA