Revision: Jan. 18, 2019, 3:14 p.m.
HB 731-FN - AS INTRODUCED
2019 SESSION
19-0761
04/06
HOUSE BILL 731-FN
AN ACT relative to the minimum hourly rate.
SPONSORS: Rep. Schultz, Merr. 18; Rep. King, Hills. 33; Rep. Read, Rock. 17; Rep. Conley, Straf. 13; Rep. T. Smith, Hills. 17; Rep. Josephson, Graf. 11; Rep. Ellison, Merr. 27; Rep. Bunker, Rock. 18; Rep. Frost, Straf. 16
COMMITTEE: Labor, Industrial and Rehabilitative Services
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ANALYSIS
This bill increases the state minimum hourly rate for employees, increases the base rate for tipped employees, and inserts a cost of living adjustment for both. The bill establishes a training wage for employees who are 16 or 17 years of age and allows a municipality to establish a minimum hourly rate that is greater than the state minimum hourly rate.
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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Matter which is either (a) all new or (b) repealed and reenacted appears in regular type.
19-0761
04/06
STATE OF NEW HAMPSHIRE
In the Year of Our Lord Two Thousand Nineteen
AN ACT relative to the minimum hourly rate.
Be it Enacted by the Senate and House of Representatives in General Court convened:
1 Minimum Wage Law; Minimum Hourly Rate. Amend the introductory paragraph in RSA 279:21 to read as follows:
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. No person, firm, or corporation shall employ any employee who is 18 years of age or older at an hourly rate lower than the following:
$12 per hour effective January 1, 2020.
$12.75 per hour effective January 1, 2021.
$13.50 per hour effective January 1, 2022.
$14.25 per hour effective January 1, 2023.
$15 per hour effective January 1, 2024 and thereafter.
A municipality may, by a vote of the legislative body, establish a minimum hourly rate for employers operating in the municipality that is greater than the state minimum hourly rate. Tipped employees of a restaurant, hotel, motel, inn or cabin, or ballroom who customarily and regularly receive more than $30 a month in tips directly from the customers [will] shall receive a base rate from the employer [of not less than 45 percent of the applicable minimum wage] as follows:
$3.75 per hour effective January 1, 2020.
$4.35 per hour effective January 1, 2021.
$4.95 per hour effective January 1, 2022.
$5.55 per hour effective January 1, 2023.
$6.75 per hour effective January 1, 2024 and thereafter.
The minimum hourly rate for employees and the base rate for tipped employees shall be adjusted beginning January 1, 2020, and each January 1 thereafter, according to the increase in the cost of living according to the Northeast Consumer Price Index as determined by the United States Department of Labor, Bureau of Labor Statistics. 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 New Paragraph; Minimum Hourly Rate; Training Wage. Amend RSA 279:21 by inserting after paragraph VIII the following new paragraph:
IX. A training hourly rate which shall be one dollar per hour less than the full minimum wage but no lower than $8.50 may be paid to those newly-hired employees who are 16 or 17 years of age for the first 3 months of employment by a specific employer. After 3 calendar months of employment with such employer, or upon reaching the age of 18, such employee shall receive the full minimum wage.
3 Effective Date. This act shall take effect July 1, 2019.
19-0761
Revised 1/18/19
HB 731-FN- FISCAL NOTE
AS INTRODUCED
AN ACT relative to the minimum hourly rate.
FISCAL IMPACT: [ X ] State [ X ] County [ X ] Local [ ] None
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STATE: | FY 2020 | FY 2021 | FY 2022 | FY 2023 |
Appropriation | $0 | $0 | $0 | $0 |
Revenue | $0 | $0 | $0 | $0 |
Expenditures | Indeterminable Increase | Indeterminable Increase | Indeterminable Increase | Indeterminable Increase |
Funding Source: | [ X ] General [ ] Education [ ] Highway [ X ] Other - Various Governmental Funds | |||
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COUNTY: |
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Revenue | $0 | $0 | $0 | $0 |
Expenditures | Indeterminable Increase | Indeterminable Increase | Indeterminable Increase | Indeterminable Increase |
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LOCAL: |
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Revenue | $0 | $0 | $0 | $0 |
Expenditures | Indeterminable Increase | Indeterminable Increase | Indeterminable Increase | Indeterminable Increase |
METHODOLOGY:
This bill increases the state minimum hourly rate for employees, increases the base rate for tipped employees, and inserts a cost of living adjustment for both. The bill establishes a training wage for employees who are 16 or 17 years of age and allows a municipality to establish a minimum hourly rate that is higher than the state minimum hourly rate. The Department of Labor indicates New Hampshire law tracks to the federal standard. This bill would set the minimum hourly rate for employees 18 years old or older as follows:
Effective Date | Minimum Hourly Rate | Tipped Employees |
January 1, 2020 | $12.00 | $3.75 |
January 1, 2021 | $12.75 | $4.35 |
January 1, 2022 | $13.50 | $4.95 |
January 1, 2023 | $14.25 | $5.55 |
January 1, 2024 an after | $15.00 | $6.75 |
In addition, the specified rates for hourly and tipped employees would be adjusted January 1, 2020 and each January 1st thereafter for a cost of living increase based on the Northeast Consumer Price Index published by the U.S. Bureau of Labor Statistics. The bill would allow municipalities, by vote, to establish a rate for employers operating in the municipality that is higher than the state minimum hourly rate. The bill establishes a training hourly rate for newly hired employees who are 17 or 18 years old for a period of three months. The Department of Labor assumes the bill would have no impact on state, county or local revenues. The Department indicates state, county and local expenditures would increase to the extent they have employees who are paid less than $12 per hour.
For informational purposes, the Department of Administrative Services (DAS) states there are currently 224 full-time and part-time employees earning less than $12.00 per hour. However, DAS is unable to estimate the cost of this bill across state government as it cannot determine how many employees will be affected each year of the phase-in of higher minimum wages. Factors that impact how many positions would be impacted include, but are not limited to, employee progress through the steps of each labor grade based on years of service, employee turnover, and position vacancies.
The New Hampshire Municipal Association indicates this bill would increase municipal expenditures. The Association does not have sufficient information to determine how many employees would be affected or what the amount of increase would be.
The Judicial Branch indicates the potential cost to the Branch would be attributed to current RSA 279:28, II which makes it a misdemeanor for a natural person or a felony for any other person to pay or agree to pay an employee less than the applicable minimum wage. In addition, existing RSA 279:29 provides that an employee paid less than minimum wage can bring a civil action against the employer for the full amount of the minimum wage together with attorney's fees. The Branch has no information on how many additional cases may be brought as a result of the bill but has provided estimates of the average cost of such cases:
Judicial Branch | FY 2020 | FY 2021 |
Class B Misdemeanor | $53 | $54 |
Class A Misdemeanor | $76 | $77 |
Routine Criminal Felony Case | $481 | $486 |
Routine Civil Case | $506 | $516 |
Appeals | Varies | Varies |
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It should be noted that average case cost estimates for FY 2020 and FY 2021 are based on data that is more than ten years old and does not reflect changes to the courts over that same period of time or the impact these changes may have on processing the various case types. An unspecified misdemeanor can be either class A or class B, with the presumption being a class B misdemeanor. | ||
AGENCIES CONTACTED:
New Hampshire Municipal Association, Judicial Branch, Departments of Labor, Employment Security and Administrative Services