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Raises the federal minimum wage on a multi-year schedule and creates automatic annual indexing tied to median wages thereafter. Establishes new, higher schedules for tipped workers and for workers with disabilities, phases out the subminimum certificate system, creates a temporary lower youth wage for newly hired workers under 20 that phases up to the adult rate, and requires the Department of Labor to give at least 60 days’ public notice before any scheduled wage increase takes effect. The Act takes effect on the first day of the third month beginning after enactment unless a different date is specified for a particular provision.
Amend 29 U.S.C. 206(a)(1) to require the federal minimum wage to be not less than specified amounts on the listed schedules.
Set minimum wage at $9.50 per hour beginning on the effective date referenced in section 7 of the Act.
Set minimum wage at $11.00 per hour beginning 1 year after the effective date referenced in section 7.
Set minimum wage at $12.50 per hour beginning 2 years after the effective date referenced in section 7.
Set minimum wage at $14.00 per hour beginning 3 years after the effective date referenced in section 7.
Who is affected and how:
Workers: Most directly benefit from higher base pay over the schedule and future indexing; tipped workers gain a guaranteed right to keep tips plus a rising cash tipped-wage floor; newly hired under-20 workers receive a lower temporary wage that increases annually until it reaches the adult rate; some workers with disabilities will receive higher base pay and protections as subminimum certificates end.
Employers: Face higher labor costs as base wages, tipped-cash minimums, and disability wage floors rise. Employers who hire many entry-level/under-20 workers or heavily employ tipped staff (restaurants, hospitality) will see phased cost increases and will need to update payroll, hiring notices, and compliance procedures. Small businesses may be more affected by near-term increases.
Department of Labor and enforcement: Must calculate indexing using BLS median-wage data, publish required notices at least 60 days in advance of increases, stop issuing new disability wage certificates, support transitions, and administer updated penalty and notice requirements.
People with disabilities and supported-employment programs: Benefit from higher mandated wages and a sunset of the subminimum-wage certificate system, but face transition adjustments; employers and service providers will need to restructure job supports and budgets.
Labor market and prices: Higher labor costs may lead some employers to reduce hours, slow hiring, invest in productivity, raise prices, or shift business models. The staged schedule and indexing aim to provide predictability, while the 60-day notice requirement gives employers and workers time to plan.
Net effect summary: The legislation raises wage floors and strengthens tip and disability worker protections while creating transitional rules and notice requirements; impacts are concentrated on low-wage workers, tipped-work sectors, employers who hire young workers, and programs that previously relied on subminimum disability certificates.
Replaces the existing cash-wage schedule for tipped employees with a new phased-in minimum cash-wage schedule and ties subsequent annual increases to the minimum wage under section 6(a)(1).
Revises the tip-retention language to affirm employees' right to retain tips and adds an employer notice requirement.
Further amends subsection (i) of section 6 by striking specified text (the provision as added/amended previously is altered by removal of language).
Inserts additional language into the third sentence of subsection (b) and into the second sentence of subsection (e)(2) at the specified insertion points.
Replaces the existing phased minimum wage schedule in 29 U.S.C. 206(a)(1) with a new multi-step schedule increasing the federal minimum wage to specified amounts over 6 years and providing for annual adjustments thereafter under a new subsection (h).
Replaces subparagraph (A) of section 14(c)(1) with a phased wage schedule for employment under special certificates and adds paragraphs (6), (7), and (8) to section 14(c) to (a) prohibit issuance of new special certificates to employers that did not have them before enactment, (b) require transition assistance and technical assistance and information to employers and affected individuals, and (c) sunset the authority to issue special certificates when the final wage rate takes effect.
Replaces the existing text of 29 U.S.C. 206(g)(1) with a new graduated wage schedule for newly hired employees under 20: $6.00/hour for the first year beginning on the effective date under section 7, then annual increases by the lesser of $1.75 or the amount necessary to reach parity with section 6(a)(1), and thereafter the wage in effect under section 6(a)(1).
Repeals subsection (g) of 29 U.S.C. 206, eliminating the separate statutory subsection that governed minimum wages for newly hired employees less than 20 years old (as amended by subsection (a)).
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Read twice and referred to the Committee on Health, Education, Labor, and Pensions.
Introduced April 8, 2025 by Bernard Sanders · Last progress April 8, 2025
Read twice and referred to the Committee on Health, Education, Labor, and Pensions.
Introduced in Senate