Seasonal Businesses Have Until 2026 to Pay $15 Minimum

Feb 06, 2019

The minimum wage hike in New Jersey is a done deal, but seasonal businesses have seven years to reach the new law’s $15-per-hour target rather than the five-year, 2024 phase-in deadline date for most other employers.

The compromise is one that was lobbied for by some tourism interests at the shore.

To start the phase-in, the new law raises the minimum wage to $10 an hour on July 1 for most workers (exceptions include seasonal workers, very small businesses with fewer than six employees, and tipped wait staff – see below).

For most workers, the minimum wage will rise to $11 on Jan. 1, 2020; to $12 on Jan. 1, 2021; to $13 on Jan. 1., 2022; to $14 on Jan. 1, 2023; reaching $15 on Jan. 1, 2024, under the bill signed into law by Gov. Murphy on Feb. 4.

By contrast, employees at seasonal businesses and small businesses of five employees or fewer will see their pay rise more gradually. The scale is: to $10.30 on Jan. 1, 2020; to $11.10 in 2021; $11.90 in 2022; $12.70 in 2023; $13.50 in 2024; $14.30 in 2025, reaching $15 in 2026.

Workers earning tips will now see their tipped wage go up from the past $2.13 per hour to the new $5.13 per hour over a period of five years. Tipped workers are required by law to earn at least the minimum wage when their base wage is combined with tips.

Teenagers younger than 18 are right along with other workers in the new law, although there had been some call to exempt those youngest workers.

The previous minimum wage in New Jersey was $8.85 per hour.

“Make no mistake – today’s action will benefit all New Jerseyans by pushing wages up and supporting our economy, our businesses, and our people,” said a written statement released Feb. 4 by Murphy, Senate President Steve Sweeney and Assembly Speaker Craig Couglin.

“Higher wages have been proven to be a boon for the economy as a whole. More money in people’s pockets means consumers will be able to buy more to provide for their families, save for retirement, provide for their children’s education and live more productive, more dignified lives,” they said.

The Democratic leaders added the legislation was made “through honest compromise and an understanding that we must protect the small businesses who are the backbone of our state’s economy.”

Although the governor had wanted no exemptions in his push to establish $15 an hour, tourism interests had argued that seasonal businesses are in a different category.

Lori Pepenella, chief executive officer of the Southern Ocean County Chamber of Commerce, is also vice president of the N.J. Tourism Industry Association.

“We’ve been working with our lobbyist to try and get the seasonal exemption,” she told The SandPaper on Feb. 4. “It gives a longer time to reach for the $15 an hour. For the majority of our seasonal businesses, that’s going to be a very big game-changer.

“We worked hard to keep that in,” Pepenella said, for both seasonal businesses and small businesses. “We’re hoping that gives the relief so the businesses can create the strategy to meet that level in 2026.”

She also said the chamber of commerce has worked to notify its member businesses that change was coming.

“We’ve been announcing the likelihood for over a year; people have been calling in and contacting us based on their own business. I believe we tried to get the word out ahead of time to as many members as possible. Hopefully that helped.”

The law creates a task force to study whether the wage increases are effective in helping the intended families.

Ninth District legislators were among Republicans not in support of the measure. Sen. Christopher J. Connors, Assemblyman Brian E. Rumpf and Assemblywoman DiAnne C. Gove wrote last week that seniors and small business owners would be hardest hit.

“Consumers will see increased costs in goods as a direct consequence of a state-mandated minimum wage increase. Seniors living with limited disposable incomes will be hit disparately hard when purchasing necessary goods and services, just as they have been by the gas tax increase,” the 9th District legislators said.

“Too many small businesses would be forced into a position of laying off employees or cutting employees’ hours to compensate for the costs associated with this latest State mandate. Unlike Trenton, these businesses have to meet a bottom line to remain profitable and operational.”

— Maria Scandale

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