The bill proposes an annual cost-of-living increase to the state minimum wage rate starting in 2026. 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 establishes that certain tipped employees will receive an hourly wage that is 25% of the prevailing minimum wage rate, plus tips, while ensuring that all tips received by these employees are retained by them, with the option to pool tips among wait staff.

Furthermore, the bill requires state agencies that contract for services to include provisions in their contracts that protect contractors and subcontractors from wage increases due to the state minimum wage hikes. It also introduces a definition of "consumer price index" to the Minimum Wage Act. The effective date for these provisions is set for July 1, 2025.

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