NJ Minimum Wage Set to Rise in Yearly Increments for the Next Five Years
The New Jersey Legislature approved a historic increase to the state’s minimum hourly wage with a 52-25 vote in the Assembly, and a 23-16 vote in the Senate. New Jersey will now see a $1.15 increase this July, which will increase each year until 2024 when the hourly minimum wage will hit $15. Governor Phil Murphy is set to sign the bill on Monday, February 4.
The aim of this bill is to boost the Garden State’s minimum wage by 70 percent for most workers while putting agricultural, seasonal and small business employees on a slower path to $15.
Under the bill, the minimum wage for most workers would increase to $10 an hour on July 1, to $11 on Jan. 1, 2020, $12 an hour on Jan. 1, 2021, $13 in 2022, $14 in 2023 and $15 in 2024.
New Jersey will now join Washington D.C., California and Massachusetts in putting a plan in place to reach the $15 minimum wage. New York City currently requires employers with more than 10 employees to pay at least $15 per hour, and smaller businesses will also do so at the end of this year.
Opposers of the law argue this mandate will put stress on small businesses already struggling to make ends meet and warned the increase could force many businesses toward automation instead of hiring employees. Labor advocates have argued the current minimum wage of $8.85 it too little to afford even basic needs in New Jersey. An employee working 40 hours a week at the current minimum wage, $8.85 an hour, earns $354 a week, or $18,408 a year. At $15 an hour, that same worker will earn $600 a week and $31,200 a year.
Sax LLP will continue to keep you informed as new updates emerge. For more information on how this will impact New Jersey businesses or guidance on strategically planning for the future, feel free to reach out to a Sax advisor at (973) 472-6250 or visit www.saxllp.com.