The state House Finance Committee on Wednesday drafted a new minimum wage bill that would increase the wage to $10 an hour by January 2018 and expand a tip credit to 75 cents. But businesses would not be able to deduct the tip credit unless workers earn at least $7 an hour above the minimum wage, a threshold meant to protect the lowest paid workers.
Rep. Sylvia Luke, the chairwoman of the committee, described the bill as the “best that we can do at the moment. We do want to help both the employees and also the restaurant employers. We’re hoping that this will provide balance.”
Luke (D, Punchbowl-Pauoa-Nuuanu) said she hoped the details are accepted by the full House and the Senate, forgoing the need for conference committee negotiations. The state’s $7.25 an hour minimum wage has not been raised since 2007. The tip credit -- the amount businesses can deduct from the wage from workers who earn tips -- is 25 cents.
The new draft mirrors an agreement reached privately in February between state House and Senate leaders that was challenged by Sen. Clayton Hee, the chairman of the Senate Judiciary and Labor Committee, over the size of the tip credit.
Hee said Wednesday evening that he would prefer to raise the minimum wage to $10.10 an hour -- the amount recommended nationally by President Barack Obama -- by January 2017. He said he found it strange that Luke dropped the wage to $10 an hour when the House Labor and Public Employment Committee had agreed to $10.10 by January 2018.
"I imagine we’re headed to conference,” said Hee (D, Heeia-Laie-Waialua).
Here are the details of the new draft:
$7.25 an hour
$7.75 an hour/January 2015
$8.50 an hour/January 2016
$9.25 an hour/January 2017
$10 an hour/January 2018
25 cents an hour
50 cents an hour/January 2015
75 cents an hour/January 2016
Businesses would be able to deduct the tip credit for workers who earn $7 an hour more than the minimum wage, up from 50 cents.