Stay Informed About Income Inequality
In editions of our newsletter leading up to the start of the 2019 Session of the Indiana General Assembly, we made a call for change highlighting the impact of income inequality in our state and community as well as the current status of the minimum wage in Indiana. It has become apparent that many members of the Indiana State House and Senate have recognized that need as well, as a total of four bills related to the issue have been authored and introduced into the Assembly in this session to date. We are pleased that members of the legislature recognize the positive impact an increased minimum wage would have on Hoosiers. For those who have advocated for a change, it is encouraging. As voters and members of the communities that would be affected by these changes should one of these bills be passed into law, it is important to stay informed and in the know as far as what each of these bills specifically would mean for the future of minimum wage in Indiana. The Indiana General Assembly operates a user-friendly website where you can track these and other bills, but learn about the various committees, and review the up to date Indiana Code. And all of this is available including the ability to watch live streams of legislative sessions and more — by going to this link: iga.in.gov. In this article we’ll take a brief overview of each minimum wage bill currently active in the General Assembly and examine the similarities and differences of each.
The first of three bills introduced into the Senate, SB 214, was authored by Sen. Karen Tallian (D, Dist. 4) and added Sen Mark Stoops (D, Dist. 40) as a co-author on January 31st. This bill calls for a one-time increase of the state minimum wage to $11.12 per hour starting on July 1, 2019. This increase would impact tipped employees just the same – as the law stands now, employers of tipped workers are allowed to utilize a tip credit, meaning that if workers make at least the minimum wage of $7.25 per hour when factoring in tips with their base wage, these employers are allowed to pay a minimum wage of $2.13 per hour instead. If tips do not get the employee up to $7.25 per hour, the employer must pay the difference. If this bill were passed, the tip credit would be eliminated and would mandate the $11.12 minimum across the board.
The other two Senate bills were authored by Sen. Frank Mrvan (D, Dist. 1) and aim to propose two different paths to the same end. SB 262 also calls for a one-time increase to the minimum, but proposes a jump to $15.00 per hour starting July 1, 2020. This bill would retain the tip credit as described above, which would reduce the perceived impact of the significantly larger increase on employers of tipped employees. The bill goes on to propose that each year thereafter, starting on July 1, 2021, the minimum wage would change by a percentage equal to the change in the Consumer Price Index (CPI) for the preceding year. The CPI is a measurement taken by the U.S. Department of Labor of the average change in prices paid by consumers for an assortment of needed goods and services over a given time. In other words, this bill would propose that the minimum wage in Indiana continue to be altered over time based on how much we actually must pay for the things we need to support ourselves and our household, rather than setting a fixed minimum amount which does not keep up with inflation, price increases, and the like over the course of years.
On the other hand, SB 355 would enact a stepwise, incremental approach to reaching the same goal of $15.00 per hour. This bill proposes a series of smaller increases over time – $10.00 per hour effective July 1, 2020, $13.00 per hour effective July 1, 2021, and $15.00 per hour effective July 1, 2022 – rather than a single large jump. Much like in the other bill Sen. Mrvan authored, this bill also retains the tip credit for tipped employee wages, and would also be subject to review and change based on the CPI each year starting in 2023.
The State House of Representatives also find themselves with a bill to review and debate. HB 1081 was authored by Rep. Karlee Macer (D, Dist. 92), co-authored by Rep. Chris Campbell (D, Dist. 26), and shares some similarities with each of the Senate bills. This bill aims to ultimately raise the minimum wage across the board to $12.00 per hour by January 1, 2023. However, there would be some differences to the means by which this would occur for tipped and non-tipped employees. Non-tipped employees would see increases to $8.20 per hour on September 1, 2019, $9.15 per hour on January 1, 2020, $10.10 per hour on January 1, 2021, $11.05 per hour on January 1, 2022, and $12.00 per hour on January 1, 2023. This non-tipped wage of $12.00 per hour would then be subject to change based on the CPI as well starting on January 1, 2024. Tipped employees, on the other hand, would see their minimum wage increase to $4.00 per hour on September 1, 2019, $6.00 per hour on January 1, 2020, $8.00 per hour on January 1, 2021, $10.00 per hour on January 1, 2022, and finally $12.00 per hour on January 1, 2023. These increases would retain the tip credit currently in place, but would not be subject to the CPI-based increases that non-tipped employees would experience.
Regardless of the details and differences in these bills, it is clear that legislators are working to respond to the issues of income inequality that our current minimum wage contributes to, and are calling for change. However, these bills remain stuck in committee and without enough backing they may never even make it to the floor for a vote. It remains important as always to make your voice heard and let your legislators know that you support (or disagree with) their efforts. Let the committee chairs know your opinion and urge them to expedite these bills to promote real action: contact House Committee for Employment, Labor and Pensions Chair Rep. Heath VanNatter and Senate Committee on Pensions and Labor Chair Sen. Philip Boots to voice your concern. To find contact information for these legislators, learn who represents you and your community in the Indiana General Assembly, and to reach out to them in regards to your support of these or any other bills, visit http://iga.in.gov/legislative/find-legislators/