On “Election Tuesday,” the Montgomery County Council cast a unanimous vote to raise the minimum hourly wage in the County to $15. Tuesday’s vote came only 10 months after the Council narrowly approved legislation that would have enacted the same $15 minimum hourly wage by 2020, only to see that bill vetoed by the County Executive. Tuesday’s compromise now implements this change gradually through annual increases to the minimum wage starting in 2018 – with the $15 minimum hourly wage not becoming effective until 2021 for large businesses (over 50 employees), 2023 for mid-size businesses (11-50 employees), and not until 2024 for small businesses (10 or fewer employees). Here’s how the new minimum wage is scheduled to be phased in:
Importantly, in addition to the incremental increases detailed above, this bill also provides for automatic annual increases to this new $15 minimum wage (once fully implemented) based on the inflation rate.
While the Council’s unanimous vote makes the bill “veto-proof,” County Executive Ike Leggett already confirmed that he plans to sign the new bill into law. Once enacted, Montgomery County will become the first jurisdiction in Maryland to require a $15 minimum hourly wage and only the second jurisdiction in the Washington D.C. Metropolitan region, joining the District of Columbia, to do so.
The new, extended time period for local businesses to implement this increase not only provides more time to plan and budget for this additional operating expense, but it also serves as notice that the County’s minimum wage will continue to increase without further legislation or input from the business community. We encourage local companies to determine how the increased minimum wage may affect their business in both the short and long term, and to begin planning now for how best to address and budget for it. If you have questions regarding the new legislation and the legal obligations or ramifications this may create for your company, please do not hesitate to contact us.
The contents of this Alert are for informational purposes only, and do not constitute legal advice. If you have any questions about this Alert, please contact the Shulman Rogers attorney with whom you regularly work or a member of the Shulman Rogers Employment and Labor Law Group.
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