April 2016 Budget Proposal - Wage Hike

Big changes are in store for employers in New York State.  On April 4, 2016, New York Governor Andrew Cuomo signed off on legislation to implement scheduled wage hikes that will eventually raise New York’s minimum wage to $15.00 per hour over a period of several years. The amount and pace of the increase will vary based upon geographic location within the State.  The increase represents a compromise between Governor Cuomo, who sought a faster rise to the $15.00 per hour mark, and the Senate Republicans, who pushed for more time for employers to adjust to a rising wage. 

Currently, every employer in New York State must pay its employees at least $9.00/hour. The minimum wage will rise again at the end of this year, and will continue to increase thereafter according to the following schedule:

Effective Date:

 

All Other Areas of New York State Counties of Nassau, Suffolk, and Westchester

New York City: Large Employers

(11 or more employees)

New York City: Small Employers

(10 or fewer employees)

December 31, 2016 $9.70/hour $10.00/hour $11.00/hour $10.50/hour
December 31, 2017 $10.40/hour $11.00/hour $13.00/hour $12.00/hour
December 31, 2018 $11.10/hour $12.00/hour $15.00/hour $13.50/hour
December 31, 2019 $11.80/hour $13.00/hour   $15.00/hour
December 31, 2020 $12.50/hour $14.00/hour    

On and After
December 31, 2021

DOB to use indices to determine any increase $15.00/hour    

 

 

For wage increases after December 31, 2020, the Commissioner of Labor will publish the amount of the next increase on each October 1st, with the increase taking effect on December 31st.  When determining the amount of the increase, the Director of the Budget and the Commissioner will consider a number of factors, including indices concerning the rate of inflation, the rate of state personal income growth, and wage growth.  Increases will cap out at $15.00 per hour statewide.

Outside of New York City and the Counties of Nassau, Suffolk and Westchester, the Legislature implemented a safety valve that allows for the delay of increases after January 1, 2019, if warranted based upon the health of the State’s economy.  The Division of Budget will analyze the State’s economy in each region, and the effect of the minimum wage increases on these regions.  The Division will publish this analysis as a report and recommendation, which will assist the Commissioner in determining whether there should be a temporary suspension or delay in the scheduled increases - including whether the scheduled increases should continue up to and including the $15.00 per hour mark.  Input for this analysis will be drawn from state and federal resources, including the State Division of Budget, the U.S. Department of Labor and the Federal Reserve Bank of New York.

Please feel free to contact any member of our Labor and Employment practice group if you have questions about the minimum wage increases or how they might affect your workplace.

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