Highlights Of Pennsylvania’s Minimum Wage Legislation

Nov 21, 2019

Pennsylvania’s Republican-controlled Senate has passed compromise legislation to raise Pennsylvania’s minimum wage for the first time since 2009 in a deal with Democratic Gov. Tom Wolf.

However, Wolf gave up a number of concessions to win its passage, and its prospects in Pennsylvania’s Republican-controlled House of Representatives aren’t clear. Here is a look at the bill:

The wage

Pennsylvania’s minimum wage, currently set at the federal minimum of $7.25 an hour since 2009, would rise in four steps to $9.50 over the next two years. On July 1, 2020, the wage would rise to $8 an hour; to $8.50 on Jan. 1, 2021; to $9 on July 1, 2021; and to $9.50 on Jan. 1, 2022.

About 385,000 people in Pennsylvania hold a job that pays between $7.25 an hour and $9.50 an hour, according to the state Department of Labor and Industry.

Overtime pay

Under the deal with Republican lawmakers, Wolf will rescind a pending regulatory package to expand overtime pay eligibility that he began seeking last year after fruitlessly asking the Legislature to increase the minimum wage. That regulatory package was scheduled for a vote in front of a state rule-making board on Thursday.

The regulation would require in 2022 that salaried workers earning up to $45,500 a year get time-and-a-half pay for any time they work over 40 hours in a week. Pennsylvania's current threshold is set at the federal baseline of $23,660, which took effect in 2004. The federal threshold is rising on Jan. 1 to almost $36,000. Some 140,000 people would become eligible for overtime pay at a baseline of $45,500, according to the Wolf administration.

Wolf's concessions

In January, Wolf rolled out an ambitious proposal to raise the minimum wage. That proposal would have raised the wage to $12 an hour immediately, then in annual 50-cent increases to $15 an hour in 2025.

The compromise package makes other concessions. Those include: not raising Pennsylvania’s tipped wage minimum from its current level of $2.83 an hour; and not adding an annual inflationary adjustment to the minimum wage.

Other states

Pennsylvania is one of 21 states that have a minimum wage at the federal minimum of $7.25. The 29 states that have raised their minimum wage include all of Pennsylvania’s neighbors, while roughly half of the 50 states have scheduled automatic increases to their wages.

The highest state minimum wage in 2020 will be Washington’s at $13.50, while the average minimum wage in Pennsylvania’s six neighbors will be above $10 an hour next year.