Minimum Wage Increase with Review Provision Approved by House

July 19, 2019

The House voted to increase the federal minimum wage from $7.25 to $15 per hour over six years and index it to median wage growth thereafter—but only after approving an amendment requiring Congress to consider delaying some of the increases after reviewing a future U.S. Government Accountability Office (GAO) study on the impact of the first two wage increases.

The GAO report was added to secure the votes of Democrats from rural congressional districts who are concerned about what impact increasing the minimum wage above $11 per hour will have on small businesses.

The minimum wage would increase annually by $1.10 per hour over six years and then be indexed to the median hourly wage of “all” employees as determined by the Secretary of Labor.

Minimum wage for tipped employees phased out over eight years:  The rate for tipped employees would increase to $3.60 upon enactment and annually increase by at least $1.50 per hour until it reaches the minimum for non-tipped employees.  The bill would also prohibit tip pooling.

Outlook:  The bill has no chance of passing the Republican-controlled Senate, but it is unclear whether the Senate would take up a more modest increase ahead of the next election.