House Approves $15 Minimum Wage

The U.S. House of Representatives has approved an increase in the federal minimum wage to $15 an hour within six years. 

Although it still needs approval from the Senate, Fight for $15, a union-backed movement to set $15 as the minimum wage, hailed the vote as an “historic victory.”

The Raise the Wage Act was approved July 18 by a 231-199 vote. It would also gradually raise the wage mandated for tipped employees to $15 an hour. The increase is the first wage hike approved by the House since 2007, when it passed a measure raising the pay floor to $7.25 an hour as of 2009.

The move comes as many retailers, manufacturing companies and states are already working toward a $15 minimum wage. 

Target Corp. recently raised its minimum wage to $13 an hour with a goal to reach $15 by the end of next year. Amazon has also hiked its wages to $15 as of last November, and the average full-time employee at Walmart Inc. makes $14.26 per hour, according to the retailer's first Environmental, Social and Governance Report. 

Eight states are working to phase in minimum wage increases that will eventually reach $12 to $15 an hour. They are Arizona, California, Colorado, Maine, Massachusetts, Missouri, New York and Washington. Additionally, 13 cities and counties reached or exceeded the $15 benchmark at the start of 2019, according to an analysis by the National Employment Law Project, a New York-based think tank that supports labor-friendly policies, including the “Fight for $15” movement.

Leaders of both parties, including U.S. Senate Majority Leader Mitch McConnell (R-Kentucky) and U.S. Senator Bernie Sanders (D-Vermony), are sparring over the bill's passage in the house.

The new bill calls for setting the minimum wage for nontipped employees at $8.35 an hour three months after the measure would become law. It would then climb every year afterward by about $1.30 until hitting $15 in 2025. The minimum wage paid directly to tipped employees would rise to $3.60 three months after the law is enacted, and then increase by at least $1.50 a year afterward. 

The Raise the Wage Act measure allows the increases for both tipped and nontipped employees to be adjusted by the Secretary of Labor in accordance with how the median wage of hourly workers is driven up or down by market forces. 

The bill, approved in the Democratic-controlled House on party lines, now moves to the Republican-controlled Senate, where pundits believe the bill is widely anticipated to die, possibly by being shelved rather than put to a vote. If Senate leadership should schedule a vote, political observers are widely quoted as saying it would almost certainly be defeated because of the Republican majority. As the leader of the Republican Party, President Donald Trump is expected by most observers to veto the act. 

However, both opponents and proponents of a $15 wage say Congress would be primed for passing the so-called living wage if Democrats gain control of the Senate in the 2020 elections. The threat of a veto would similarly be eliminated if Democrats capture the White House. 

“We’re celebrating the House vote today, but tomorrow, we’ll turn right back to the fight. Our eyes will be on the Senate and on President Trump,” Fran Marion, an employee of a McDonald’s in Kansas City, said in a statement released by Fight for $15. “And they’ll be on McDonald’s as well. We’re going to get McDonald’s to pay $15—and we’re going to win $15 all across the country.”

Passage of the measure by the House also increases the likelihood that a $15 minimum wage will be a key issue in the campaigning for the 2020 election.

The July 18 vote follows the release last week of a Congressional Budget Office study that found at least 1.3 million jobs and possibly as many as 3.7 million would be eliminated by 2025 if the federal minimum wage was raised to $15. However, the same report found that 1.3 million Americans would be lifted out of poverty by the increase. The report indicated that raising the wage to $10 an hour would have far less of a negative impact on employment. 

“House Democrats showed that they put party politics over jobs by voting for an unprecedented wage mandate, which even the nonpartisan Congressional Budget Office shows could eliminate up to 3.7 million jobs,” Samantha Summers, communications director for the conservative Employment Policies Institute (EPI), said in a statement. “This bill will only hurt those it is intended to help by killing jobs and forcing businesses to close.”

The EPI ran full-page ads in a number of newspapers this morning in hopes of convincing Democrats to vote with Republicans against the $15 wage.

A similar version of this story originally appeared on our sister site, Restaurant Business, here.