Seattle’s new $15.00 minimum wage law went into effect yesterday, about nine months after Seattle City Council unanimously approved the increase to become the American jurisdiction with the highest minimum wage.
The politically charged increase will be phased in from now until January 2019 when all workers will be under the umbrella of the $15.00 hourly wage law. The enactment of the law on April 1 increases the city’s minimum wage from $9.47 to $11.00 per hour.
Large businesses with over 500 employees have until 2017 to raise their minimum compensation to $15.00, with incremental raises to $13.00 in January 2016. Any large business that contributes to employee’s health care benefits will have an extra year to comply to the $15.00 wage law.
On the other hand, smaller businesses with 500 or less workers have until 2021 to gradually increase their pay to $15.00 an hour through incremental scheduled increases. This can be achieved by combining tips and employer-paid health care benefits.
Any annual future wage increases beyond the new $15.00 minimum wage benchmark will reflect increases to the consumer price index – cost of living changes.
A recent University of Washington study has found that about 100,000 workers within Seattle’s municipal jurisdictional boundaries earn less than $15.00 per hour. The minimum wage law particularly targets retailers and fast food conglomerates, including locally-owned franchises.
However, residents within the region’s suburban municipalities will still work for Washington State’s minimum wage of $9.47. Even though the state already boasts one of the highest minimum wages in the country, the state government is also contemplating a bill to raise the state enforced wage floor even higher to $12.00 per hour.
In the wake of Seattle’s landmark policy, San Francisco approved a proposition last fall that increases the minimum wage incrementally to $15.00 hourly by the summer of 2018. Neighbouring Oakland, California currently has the highest minimum wage in the U.S. with last month’s increase from $9.00 to $12.75.
A federal law maintains the American minimum wage cannot be lower than $7.25, and there have been proposals by President Barack Obama to increase the national minimum wage to $10.10. A total of 30 states, including Washington D.C., have a minimum wage above the federal floor.
In British Columbia, where minimum wage policies are under the jurisdiction of the provincial government, the provincial minimum wage was recently raised by 20 cents from $10.25 (US$8.16) to $10.45 (US$8.32). Last month’s publicized increase was part of a new index system that links the provincial minimum wage to the provincial consumer price index.