This bill amends the Minimum Wage Act to establish an annual cost-of-living increase to the state minimum wage rate starting in 2026. Specifically, it mandates that the minimum wage will be adjusted each January 1 based on the consumer price index, ensuring that the wage does not exceed 104% of the previous year's rate and does not decrease. Additionally, the bill introduces a new provision requiring that state contracts for services include terms that protect contractors and subcontractors from wage increases due to the minimum wage adjustments, ensuring that employees under these contracts receive wage increases concurrently with state minimum wage increases.

Furthermore, the bill specifies that tipped employees will receive an hourly wage that is 25% of the prevailing minimum wage rate, plus tips, while ensuring that all tips are retained by the employees, with the option for pooling among wait staff. The bill also adds a definition of "consumer price index" to clarify the basis for calculating the cost-of-living adjustments. The effective date for these provisions is set for July 1, 2025.

Statutes affected:
introduced version: 50-4-21, 50-4-22