The U.S. Senate and House of Representatives have introduced the Fair Minimum Wage Act of 2012. If passed, the legislation would raise the federal minimum wage from $7.25 an hour to $9.80 by 2014. The minimum wage rate would increase in several steps. It would also provide for annual increases in the rate in future years tied to increases in the cost of living.
If passed the increases would be as follows:
- $8.10 an hour, beginning on the first day of the third month that begins after the date of enactment of the Fair Minimum Wage Act of 2012 (approximately 90 days after legislation is passed)
- $8.95 an hour, beginning 1 year after that first day (first annual increase)
- $9.80 an hour, beginning 2 years after that first day (second annual increase)
- Annually thereafter
Some states have a higher minimum wage than the federal minimum. If a worker is subject to both the state and federal minimum wage laws, the employee is entitled to the higher of the two minimum wages.
The bills are sponsored by Senator Tom Harkin (D-IA), chair of the Health, Education, Labor and Pensions Committee in the Senate, and Representative George Miller (D-CA), ranking member of the House Committee on Education and the Workforce.
It's too early to tell what chance the legislation has of getting passed, but it is, at least, a step in right direction to increasing wages for the lowest paid American workers.