Massachusetts to Raise State Minimum Wage

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On Thursday, June 26, 2014, Massachusetts Governor Deval
Patrick signed legislation that will raise the Commonwealth's minimum wage from
$8 per hour to $11 per hour by 2017, which would be the highest minimum wage in
the country.

In addition, the Massachusetts legislation lowered
unemployment insurance (UI) costs for employers across the state. The reforms to
the state UI system would freeze UI rates for employers for three years and then
expand the wage base subject to those rates to $15,000.

This bill, titled, "An Act Restoring the Minimum Wage and
Providing Unemployment Insurance Reforms," gradually raises the minimum wage
over the course of the next three years as follows:

In addition, the legislation makes the following changes to
the Massachusetts Wage Laws:

• Changes the minimum wage for employees in agriculture and farming from
  $1.60/hour to $8.00/hour;
• Exempts seasonal camp counselors and counselor trainees from learner and
  apprentice rates; and
• Provides that, in no case shall the minimum wage rate be less than $0.50
  higher (which used to be $0.10) than the effective federal minimum rate.

This is the first minimum wage increase in Massachusetts since 2008 and the
first increase to the minimum wage paid to tipped employees since 1999, and is
expected to benefit some 500,000 workers statewide. The law does not include
provisions to tie minimum wage increases after 2017 to inflation, which Governor
Patrick had previously sought to include in the bill.

In the absence of federal action, other states have enacted legislation to
raise entry-level wages. Vermont will raise its minimum wage to $10.50/hour by
2018, with Connecticut, Hawaii and Maryland all moving toward a $10.10 minimum.
Earlier this year, the District of Columbia adopted an $11.50/hour minimum wage,
to take effect in 2016, and Seattle's city council voted this month to raise its
minimum wage to $15 an hour over the next seven years.

If you need Wage and Hour assistance, please contact Ellen Kearns at ekearns@constangy.com or any Constangy
attorney.

About Constangy, Brooks &
Smith, LLP
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