HB146 (2009) Detail

Relative to the minimum wage.


HB 146-FN-LOCAL – AS INTRODUCED

2009 SESSION

09-0010

06/03

HOUSE BILL 146-FN-LOCAL

AN ACT relative to the minimum wage.

SPONSORS: Rep. J. Knowles, Hills 27; Rep. M. Knowles, Hills 27; Rep. Hatch, Coos 3; Rep. Long, Hills 10; Sen. Fuller Clark, Dist 24

COMMITTEE: Labor, Industrial and Rehabilitative Services

ANALYSIS

This bill directs the commissioner of the department of labor to calculate the minimum wage in a manner that reflects the cost of living.

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Explanation: Matter added to current law appears in bold italics.

Matter removed from current law appears [in brackets and struckthrough.]

Matter which is either (a) all new or (b) repealed and reenacted appears in regular type.

09-0010

06/03

STATE OF NEW HAMPSHIRE

In the Year of Our Lord Two Thousand Nine

AN ACT relative to the minimum wage.

Be it Enacted by the Senate and House of Representatives in General Court convened:

1 Minimum Hourly Rate. Amend the introductory paragraph of RSA 279:21 to read as follows:

279:21 Minimum Hourly Rate. Unless otherwise provided by statute, no person, firm, or corporation shall employ any employee at an hourly rate lower than that set forth in the federal minimum wage law, as amended, or as follows, whichever is higher:

Date Hourly Rate

On and after September 1, 1997 $5.15

On and after September 1, 2007 $6.50

On and after September 1, 2008 $7.25

On September 1, 2009 and on each following September 1, the commissioner shall calculate an adjusted minimum wage rate by adjusting the current year’s minimum wage by the rate of inflation based on the Consumer Price Index for All Urban Consumers, Northeast Region, as published by the United States Bureau of Labor Statistics. Each adjusted minimum wage rate calculated under this section shall take effect the following January 1.

Tipped employees of a restaurant, hotel, motel, inn, or cabin, who customarily and regularly receive more than $30 a month in tips directly from the customers will receive a base rate from the employer of not less than 45 percent of the applicable minimum wage. If an employee shows to the satisfaction of the commissioner that the actual amount of wages received at the end of each pay period did not equal the minimum wage for all hours worked, the employer shall pay the employee the difference to guarantee the applicable minimum wage. The limitations imposed hereby shall be subject to the following exceptions:

2 Effective Date. This act shall take effect 60 days after its passage.

LBAO

09-0010

12/15/08

HB 146-FN –LOCAL - FISCAL NOTE

AN ACT relative to the minimum wage.

FISCAL IMPACT:

      The Department of Employment Security states this bill may increase county expenditures by $17,488 in FY 2010, $52,015 in FY 2011, $90,236 in FY 2012, and $128,010 in FY 2013, and increase local expenditures by $215,638 in FY 2010, $656,717 in FY 2011, $1,112,698 in FY 2012, and $1,588,676 in FY 2013. The Department of Labor, the New Hampshire Association of Counties and the New Hampshire Municipal Association state this bill may increase county and local expenditures by an indeterminable amount in FY 2010 and each year thereafter. There will be no fiscal impact on state expenditures in FY 2010 through FY 2013. There will be no fiscal impact on state, county, and local revenue.

METHODOLOGY:

    The Department of Employment Security states this bill provides for an annual increase in the minimum wage proportional to the percentage increase in the consumer price index for all urban consumers, northeast region, as published by the U.S. Bureau of Labor Statistics. Under the 2007-2009 collective bargaining agreement, the lowest hourly pay level of any state employee is $9.06 (which is scheduled to increase to $9.56 effective January 2, 2009), therefore there is no immediate fiscal impact on the state. Using 2007 information from the U.S. Bureau of Labor Statistics, the Department assumes there are approximately 29,549 people in New Hampshire who make $7.25 or less per hour. Of the 29,549 individuals it is estimated 1,893 are government employees, with 142 (7.5%) employed at the county level and 1,751 (92.5%) employed at the local level. The Department states it is likely many of the employees working at $7.25 or less per hour are seasonal or part-time workers. The Department included a multiplier of 7.65 percent to account for the employer’s portion of Social Security and Medicare expenses.

    The Department also calculated unemployment compensation contributions resulting from the increased wages. Most counties and local governments reimburse the unemployment insurance trust fund dollar for dollar in benefits paid. The Department assumes an average of 1.4 percent of the workforce will receive benefits and the replacement value of benefits will be approximately 50 percent of the recipient’s weekly wages. The Department does not anticipate any noticeable fiscal impact until FY 2012. Benefits are calculated based on wages earned in the first 4 of the preceding 5 calendar quarters and will accordingly lag behind increased wages.

    Using a CPI of 3 percent, the Department of Employment Security calculated the following annual increased expenditures at the county and local levels:

    County Impact of Wage Increase and Unemployment Costs

 

FY 2010

FY 2011

FY 2012

FY 2013

Wages

$17,488

$52,015

$89,822

$127,182

Unemployment cost

0

0

414

828

Total

$17,488

$52,015

$90,236

$128,010

    Local Government Impact of Wage Increase and Unemployment Costs

 

FY 2010

FY 2011

FY 2012

FY 2013

Wages

$215,638

$656,717

$1,107,599

$1,578,478

Unemployment cost

0

0

5,099

10,198

Total

$215,638

$656,717

$1,112,698

$1,588,676

    The Department of Labor states this bill may increase county and local expenditures by an indeterminable amount. The Department states it cannot provide an estimate of the impact due to the fact that wage schedules for all towns, cities, counties, and the state governments are different. The Department also states this bill would not impact state expenditures as the state pays more than the minimum wage unless in future years the increases in the CPI results in a minimum wage higher than what is paid by the state.

    The New Hampshire Association of Counties states that all counties pay an hourly rate more than the minimum wage. The Association states there would be no impact in FY 2010 and an indeterminable impact in the FY 2011 and each year thereafter

    The New Hampshire Municipal Association states the number of municipal employees receiving minimum wage is small and primarily includes seasonal workers. The change in the minimum wage may result in a small but indeterminable increase in local expenditures.