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Tennessee Legislature to Consider a $1.00 Per Hour Increase to the Minimum Wage

A bill, HB3318, is currently pending before the legislature to raise the minimum wage from $5.15 per hour to $6.15 per hour and provides that:

  • Employers subject to the bill must post a summary of the bill and any applicable wage orders and regulations in a conspicuous and accessible place in or about the place of business;

  • The Department of Labor and Workforce Development enforces this bill under the direction of the Commissioner of Labor and Workforce Development;

  • The Commissioner cooperates fully, to the extent consistent with this bill, with the Administrator of the Wage and Hour Division of the United States Department of Labor;

  • A violation of this bill is a Class B misdemeanor punishable by a fine of not less than $100 nor more than $500. An employer who willfully violates this bill would be subject to a civil penalty of not less than $500 nor more than $1,000, at the discretion of the Commissioner. The Commissioner would have sole discretion to elect whether to proceed civilly or criminally upon any violation of this bill; however, the employer may not be charged both civilly and criminally for the same violation.

    On the first violation, if the Commissioner determines that the violation was unintentional, a warning would be given in lieu of a penalty. On second or subsequent violations, the civil penalty would be applicable.

    Each infraction would constitute a separate and distinct violation;

  • An employer in violation of the minimum wage requirements is liable to the affected employees for the amount of unpaid minimum wages. Upon judgment being rendered in favor of any employee in an action to recover unpaid wages under this bill, the judgment would include, in addition to the unpaid wages adjudged to be due, an additional amount equal to such wages in damages. The court would also require the defendant to pay court costs and reasonable attorney's fees incurred by the employee or employees;

  • Actions to recover these wages be instituted within three years from the date such wages should have been paid; and

  • This bill is not to be construed to interfere with, impede, or in any way diminish the right of employees to bargain collectively through representatives of their own choosing in order to establish wages in excess of the minimum proposed in this bill.

Opponents of this bill contend that raising the minimum wage is bad for small business because minimum-wage hikes affect not only small businesses and their employees, but raise the cost of all goods and services for everyone. The National Bureau of Economic Research concluded recently that minimum wage laws have caused significant employment reduction among lower-skilled workers. Cites that implement the laws have experienced an average 1.7 percentage point increase in unemployment, and up to a 3.5 percentage point increase two to three years after enactment.

The bill specifically exempts state government from having to comply with any increase in the state minimum wage. It will be heard Wednesday, May 15, in the House Government Operations Committee.

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