Background
Maryland’s minimum wage is currently just $7.25 per hour, or $15,080 per year for a full-time worker.
For tipped workers - like waitresses, carwash attendants, and nail salon workers - the base minimum wage is even lower – just 50 percent of the full minimum wage, or $3.63 per hour. Workers must then reply on tips to get to the full minimum wage.
19 states – and the neighboring District of Columbia – have minimum wages that are higher than $7.25 per hour.
If the minimum wage had kept pace with inflation over the last 40 years, it would be about $10.60 per hour today.
What the bill will do
It will raise Maryland’s minimum wage to $10.00 per hour by 2015 in the following three steps:
60 days after enactment -- $8.25 per hour, matching Washington, DC’s current rate
July 1, 2014 -- $9.00 per hour
July 1, 2015 -- $10.00 per hour
Starting in 2016, it will “index” Maryland’s minimum wage so that it keeps pace with the rising cost of living. Ten states have adopted this best practice in recent years, which ensures that the minimum wage does not fall in real value each year.
It will raise the minimum wage for tipped workers from 50 percent of the minimum wage to 70 percent. Many states have tipped worker minimum wages that are higher than Maryland’s, including seven states that require tipped workers to be paid 100 percent of the minimum wage. The bill takes a moderate approach by boosting the tipped worker wage to 70 percent – the level that Congress proposed for the federal tipped worker minimum wage, under the Fair Minimum Wage Act of 2012 and that Rep. Donna Edwards has proposed in her WAGES Act (H.R. 631).
Who it will benefit
Based on estimates by the Economic Policy Institute:
It will raise pay for 536,000 working Marylanders.
It will inject approximately $492 million into Maryland’s economy.