New Jersey minimum wage to increase to $11 per hour on Jan. 1

NJBIZ- The new year ushers in New Jersey’s minimum wage increasing to $11 per hour.

This follows Gov. Phil Murphy signing a law in February that will incrementally increase the minimum wage to $15 per hour by 2024 for most employees. The law gives seasonal workers, businesses that employ fewer than six workers, and agriculture employers more time to reach $15 per hour.

The law establishes a credit that employers of tipped employees may take against the $11 minimum wage, Murphy said in a press release Tuesday. Employers who elect to take the tip credit will be required to pay their tipped employees a cash wage of at least $3.13 per hour.

Once the minimum wage reaches $15 per hour, the New Jersey Constitution specifies that it continue to increase annually by the rate of inflation.

On Jan. 1, 2019, before the state’s new minimum wage law was signed, New Jersey’s minimum wage increased by 25 cents per hour to $8.85 per hour, Murphy said.

“I am proud to say that New Jersey continues to move forward on a path to a $15 per hour minimum wage,” Murphy said in a statement. “We believe that every resident deserves the opportunity to join the middle class. Our progress on fair and equitable wages demonstrates our state’s commitment to fighting for economic justice and a stronger and fairer economy that works for every family.”

Business organizations contend this increase will hurt their operations, resulting in laying off workers and raising the prices of goods and services.

New Jersey Business Industry Association President and Chief Executive Officer Michele Siekerka continues to see what she anticipated: businesses making necessary adjustments to afford the cost of their labor.

“Of course, employers who can afford to pay a $15 an hour minimum wage or more to their workforce will do so,” Siekerka said in a statement issued Tuesday. “Other smaller businesses, with their slimmer profit margins impacted by a higher minimum wage and other costly workplace mandates, will need to raise prices or reduce staff, hours or benefits to accommodate these added expenses.”

“Across the country, we are beginning to see some of the unintended consequences of $15 minimum wage increases – whether it’s the stalling of entry-level job growth in Seattle or restaurants adding surcharges to food bills to offset labor ordinances in California,” Siekerka said. “New Jersey has an opportunity to mitigate these and other impacts with corrective legislation.”

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