Due to the increase in the Consumer Price Index (CPI), the minimum wage increase wage of $1.13 per hour is warranted. Governor Murphy signed a bill in February 2019 that will raise the wage floor to $15 per hour by 2024. Murphy and Legislature have taken in consideration the rising costs of living and wanted to help low-wage workers be able to better provide for themselves and their families.
The New Jersey Department of Labor and Workforce Development (NJDOL) bases the minimum wage rate for upcoming years by using the specified law or Consumer Price Index (CPI), whichever appears to be higher. Based on the increases of the CPI, the state Constitution states that it will continue to increase even after the minimum wage reaches $15 per hour in 2024.
In 2018, when Governor Murphy officially came into office, the state minimum wage was at $8.60 per hour. Murphy along with the Democratic-controlled Legislature identified increasing this wage as an immediate priority.
As stated by the law, seasonal and small business employers were granted a grace period that is extended until 2026 to pay their employees $15 per hour to help lessen the impact on their business. For the time being, their minimum wage for their employees will increase from $11.90 per hour to $12.93 on January 1, 2023.
In addition, agricultural workers will be seeing an increase from $11.05 to $12.01 and have been given until 2027 by their employers to reach the $15 per hour minimum wage increase. All New Jersey employees who work on a farm and are compensated hourly or by piece-rate wage will see this increase as well. In addition, long-term care facility direct care staff will see their minimum wage increase by $1.13, to $17.13.
Employees who earn tips will see an increase to $5.26 per hour with workers able to claim an $8.87 tip credit, an increase of the maximum allowable tip credit of $1. Employers are required to pay their employees the difference, if the minimum cash wage plus an employee’s tips do not equal at least the new state minimum wage.
For more information on the rights and protections of tipped workers, visit: https://www.nj.gov/labor/worker-protections/myworkrights/tippedworkers.shtml
For more information on the state minimum wage, visit: https://www.nj.gov/labor/wageandhour/support/faqs/wageandhourworkerfaqs.shtml#minimumwage