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New $15.00 Maryland Minimum Wage

               Maryland recently joined the ranks of 6 other states, including California and New York, that have enacted legislation to raise the minimum wage to $15.00 an hour.  The Maryland bill is set to increase the minimum wage for employers with fifteen or more employees from the current wage of $10.10 an hour to $15.00 an hour by January 1, 2025.  Employers with fourteen employees or less will have until July 1, 2026 to meet the new minimum wage. 

               The minimum wage increase will occur incrementally on the following schedule, with the first increase set to go into effect on January 1, 2020:

Large Employer (15 employees or more; including governmental units)

·        Beginning July 1, 2018 for 18 months $10.10

·        Beginning January 1, 2020 for 12 months $11.00

·        Beginning January 1, 2021 for 12 months $11.75

·        Beginning January 1, 2022 for 12 months $12.50

·        Beginning January 1, 2023 for 12 months $13.25

·        Beginning January 1, 2024 for 12 months $14.00

·        Beginning January 1, 2025 $15.00

Small Employer (14 employees or less)

·        Beginning July 1, 2018 for 18 months $10.10

·        Beginning January 1, 2020 for 12 months $11.00

·        Beginning January 1, 2021 for 12 months $11.60

·        Beginning January 1, 2022 for 12 months $12.20

·        Beginning January 1, 2023 for 12 months $12.80

·        Beginning January 1, 2024 for 12 months $13.40

·        Beginning January 1, 2025 for 12 months $14.00

·        Beginning January 1, 2026 for 6 months $14.60

·        Beginning July 1, 2026 $15.00

               The new law additionally requires that all employers, regardless of size, pay all employees under the age of 18 at least 85% of the then-current minimum wage. Prior to the enactment of this law, the 85% requirement applied to employees age 20 and under. 

               While the minimum wage for tipped employees did not change from the current rate of $3.63 an hour, the new law includes a requirement that employers of tipped employees provide a wage statement report to each employee detailing how much the employee earned between base pay and tips. The combination of base pay and tips must equal at least minimum wage.

               Built into this new law is an option for a one-time, one-year suspension to the incremental increases.  This temporary suspension will be based upon a finding by the Maryland Board of Public Works of negative employment growth.  The formula used to determine “negative employment growth” is discussed in the law.  If a suspension is enacted, the current minimum wage in effect will remain and all future increases will be pushed back by one year. There is only one opportunity for a  suspension.

               Prince George’s County and Montgomery County remain the only counties in Maryland that have enacted a separate, higher minimum wage than the State. Prince George’s County’s minimum wage is currently $11.50 an hour.  In Montgomery County the minimum wage is currently $12.00 for employers with 50 or less employees and $12.25 an hour for those with 51 or more employees.

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