November 9, 2009: Raise the wage. Protect those who need it most.

If New Jersey’s minimum wage had kept pace with inflation, minimum wage workers today would be paid $8.69 per hour instead of $7.25. And the only reason New Jersey’s minimum wage is actually $7.25 an hour right now is that the state wage is tied to the federal wage. In July of this year, the federal Fair Labor Standards Act mandated a third and final minimum wage increase.

For the past two years, NJPP and others have argued in issue briefs to New Jersey’s Minimum Wage Advisory Commission that the minimum wage in New Jersey is inadequate. This year is no different, and given the current state of the economy it is more important than ever that the Legislature act to help those who need it most.

The minimum wage should reflect New Jersey’s high cost of living — currently fourth in the nation, behind Hawaii, the District of Columbia and California. NJPP therefore recommends the following action be taken during the legislative lame duck session:

  • 1. New Jersey’s minimum wage should be increased to at least $8.50 per hour;
  • 2. The minimum wage should be increased annually to reflect increases in the cost of living; and
  • 3. The state should establish a minimum wage for tipped workers that is at least 60 percent of the state’s full minimum wage.

New Jersey is one of only two states (the other is Virginia) where the state minimum wage law does not require employers to pay tipped workers. Under federal guidelines (which New Jersey must adhere to), tipped employees must receive a minimum cash wage per hour of $2.13. Tipped workers include waiters and waitresses, delivery drivers, car wash and parking attendants and others who earn at least $30 a week in tips. Depending on the generosity of others is a difficult way to live. Workers who rely on tips face severe challenges daily. The added stresses of a bad economy and seasonal fluctuations in their income make it even more difficult to consistently budget for food, housing and other necessities.

In December 2007, the New Jersey Minimum Wage Commission recommended the minimum wage be raised to $8.25 an hour and that it be adjusted annually to reflect increases in the state’s cost of living. In December 2008, it recommended it be raised to $8.50 an hour and adjusted annually. In addition, the Commission recommended that New Jersey establish a minimum cash wage requirement for tipped employees set at a percentage of the State minimum wage that is comparable to the “tip credit” percentage in surrounding states. The Legislature did nothing. The Legislature must finally act-to improve the quality of life for nearly half a million workers in the state and provide greater protection to tipped workers. A bad economy hurts those who have the least the most. It’s time to finally do something about this.

Read the commentary here.