What You Need to Know About New Jersey’s Minimum Wage Increase
On February 4, 2019, NJ Phil Governor Murphy signed legislation raising the state’s minimum wage to $15 an hour, which will be implemented over a six-year phase-in period. New Jersey is now the fourth state in the U.S. to phase in an increased higher minimum wage, and this move is expected to affect more than one million Garden State workers.
New Jersey’s current minimum wage is $8.85 per hour; in July 2019 that will increase to $10 per hour. Then, as part of the phase in, the next hike will take place in January 1, 2020, raising the minimum wage to $11. Each subsequent year NJ’s hourly wage will increase $1 until it reaches $15 per hour on January 1, 2024.
There are a few noteworthy exceptions to this law. Restaurant and other workers that receive gratuities will see their minimum wages increase to $5.13 by 2024. Small business workers and seasonal employees will realize a $15-per-hour wage by 2026. And farm workers (because we are the Garden State after all) will make $12.50 per hour by 2024, which will be one of the highest hourly farm wages in the nation.
Per the legislation, after the minimum wages are fully phased in they will be adjusted based on the Consumer Price Index. Thus, New Jersey will continue to increase its minimum wage beyond 2024 (or 2026, depending on industry).
If your business employs minimum wage workers, talk to your trusted advisors as soon as possible to plan for this increase in employee compensation as well as discuss any other ramifications of this (or any other) new law.