Minn. Lawmakers Reach Deal to Hike Minimum Wage to $9.50

Updated: 04/07/2014 5:18 PM
Created: 04/07/2014 7:15 AM

ST. PAUL, Minn. (AP) - Minnesota's minimum wage would rise to $9.50 per hour within a few years and continue going up unless a governor's administration applied the brakes.

That's the outline of a deal announced Monday between leaders of the House and Senate. It could move through both Democratic-led chambers this week.

Minnesota's current minimum is $6.15 for large employers, though most workers qualify for a higher federal minimum. Minnesota's base rate hasn't gone up since 2005.

Lawmakers had generally agreed to hit the $9.50 mark in a series of steps beginning this summer. But House leaders insisted on raises tied to inflation starting in 2017. Top senators said they couldn't muster support for purely automatic increases.

By giving the governor veto power, future raises could be withheld if economic trouble hits.

While many people support the minimum wage change, some restaurant owners said tips should be counted as wages. The bill does not have a tip credit, and Grandma's Regional Manager told Eyewitness News last month that would hurt the industry.

"If it goes through without some recognition of tips as wages, there will be job loss," Tony Boen said. "That might mean moving us into technology such as iPod ordering, kiosk ordering."

Boen, who is on the board of the MN Restaurant Association, also said he does not support the automatic tie to inflation.

"Minimum wage is too important of an economic driver to leave on auto pilot," Boen said.

If you're wondering how this will play out, the bill would mean a raise to $8.00 in August 2014. It would go to $8.50 in August 2015. Then, it will go to $9.50 in 2016.

Small businesses with gross sales under $500,000 will be forced to raise the wage to $7.75 over the three-year period. That will also be the cap for workers ages 16 and 17.

(Copyright 2014 WDIO-TV, LLC. All rights reserved. This material may not be published, broadcast, rewritten or redistributed. The Associated Press contributed to this report.)

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