Political motives are no strangers to wage-hour legislation. At least one bill introduced in Congress recently smacks of election year politicking and could have troubling consequences for employers in Florida and nationwide.
On June 6, 2012, Congressman Jesse Jackson, Jr. (D-IL), and 23 co-sponsors, introduced the “Catching Up to 1968 Act of 2012.” This bill proposes to raise the federal minimum wage for non-tipped employees from $7.25 an hour to $10.00 an hour under the Fair Labor Standards Act. The minimum wage in Florida stands at $7.67 an hour. The bill also calls for automatic increases in the minimum wage indexed to the Consumer Price Index (CPI). The minimum wage for tipped employees would stand at 70 percent of the nontipped employee minimum wage. Rep. Jackson claims the purchasing power of the 1968 minimum wage is approximately $11.00 an hour today and that a minimum wage of $10.00 an hour helps “catch up to 1968.” Rep. Jackson’s bill arguably would benefit Democratic candidates whose political appeals are directed to lower-wage earners.
But critics of the legislation note that passage of this bill means employers would take a hit. An immediate 38 percent increase in labor costs could force many businesses out of business. Other businesses might be forced to conduct layoffs or raise prices of their products and services in order to offset the increased cost of labor.