It’s déjà vu for Connecticut employers. The Connecticut General Assembly and Governor Malloy have approved the second minimum wage hike in less than a year. Just ten months ago, legislation was passed to increase the minimum wage to $8.70 on January 1, 2014, and $9.00 on January 1, 2015. The new legislation changes the 2015 minimum wage to $9.15 and institutes rates for 2016 ($9.60) and 2017 ($10.10) as well. The employer share of the minimum wage for tipped employees and the apprentice rate will be correspondingly adjusted, as they are based on percentages of the minimum wage.
This rapid-fire legislative action is part of a national movement to increase pay for workers on the lower end of the pay scale. While the federal minimum wage has not budged from $7.25 since 2009, on the state level, change has been more forthcoming, with several states increasing the minimum wage each year and several more considering such changes. While the federal government has not raised the minimum wage since 2009, President Obama is lobbying strongly for an increase to $10.10 per hour both on the federal level and on the state level. Recently, President Obama visited Connecticut and lobbied for this very change. Because Connecticut law requires the minimum wage to exceed the federal minimum wage, a federal increase would accelerate change in Connecticut.
Employers should ensure they are prepared for the changes. Build these wage increases into your budget planning now so you are not struggling to make payroll later. Will layoffs be necessary? Will you need to cut benefits? Can you afford to raise prices? Employers should also be prepared for workers making just over the minimum wage to demand pay increases and prepare a strategy for how to respond.
We can assist employers in adjusting to the new minimum wage requirements. Our team of employment attorneys and business attorneys is prepared to help you navigate the decisions this new law will make you confront.