OHIO LEGISLATIVE SERVICE COMMISSION
Office of Research Legislative Budget
www.lsc.ohio.gov and Drafting Office
S.B. 146 Bill Analysis
135th General Assembly
Click here for S.B. 146’s Fiscal Note
Version: As Introduced
Primary Sponsors: Sens. Smith and Craig
Effective Date:
Kelly Bomba, Attorney
SUMMARY
Increases the basic state minimum wage to $12.00 per hour beginning January 1, 2024.
Increases the basic state hourly minimum wage rate by $1.00 each year for the
following three years, beginning January 1 of the respective year.
Eliminates the tipped employee minimum wage, and instead requires all employees to
be paid the basic state minimum wage.
Requires, beginning January 1, 2028, the minimum wage rates to be adjusted annually
based on the Consumer Price Index, in accordance with Ohio’s constitutional minimum
wage requirements.
DETAILED ANALYSIS
State minimum wage
The bill raises the state minimum wage rate to $12.00 per hour beginning January 1,
2024. It also increases the hourly minimum wage by $1.00 each year for the following three
years. The following table identifies the minimum wage under the bill an employee must be
paid during the listed year.1
Year Hourly wage rate under the bill
2024 $12.00
2025 $13.00
1 R.C. 4111.02(A).
September 26, 2023
Office of Research and Drafting LSC Legislative Budget Office
Year Hourly wage rate under the bill
2026 $14.00
2027 $15.00
Under current law, the basic state minimum wage is $10.10 per hour and is currently set
pursuant to the Minimum Wage Amendment of the Ohio Constitution (MWA). The MWA
requires the basic state minimum wage to be increased annually according to the Consumer
Price Index or its successor index for all urban wage earners and clerical workers for all items as
calculated by the federal government, rounded to the nearest five cents. However, the MWA
allows laws to be passed that set the state minimum wage at a rate higher than the rate
calculated pursuant to the MWA.2 The bill establishes scheduled increases in the minimum
wage rate and, beginning January 1, 2028, requires the Director of Commerce, who administers
and enforces the law, to adjust the minimum wage rate annually in accordance with the MWA.3
Currently, pursuant to MWA, employees who are under age 16 or who are employed by
a business with gross annual receipts of $372,000 or less in 2023 must be paid at least the
federal minimum wage rate, which is $7.25 per hour. Under the MWA, the amount of gross
annual receipts is adjusted annually based on the Consumer Price Index. The bill applies the
higher state minimum wage rate to these employees.4
State minimum wage for tipped employees
Under current law, tipped employees may be paid less than, but not less than half, the
basic state minimum wage rate if the employer is able to demonstrate that the employee
receives tips that combined with the wages paid by the employer are equal to or greater than
the state minimum wage rate for all hours worked. The bill eliminates the tipped employee
minimum wage, and instead requires that all employees be paid the basic state minimum wage
discussed above.5
2Ohio Constitution, Article II, Section 34a; see also Ohio Department of Commerce Division of Industrial
Compliance (ODC-DIC), State of Ohio 2023 Minimum Wage, which may be accessed by conducting a
keyword “minimum wage poster” search on the Department’s website: https://com.ohio.gov/.
3 R.C. 4111.02, with conforming changes in R.C. 4111.09 and 4111.14.
4R.C. 4111.02; Ohio Const., art. II, sec. 34a; 29 United States Code (U.S.C.) 206; ODC-DIC, State of Ohio
2023 Minimum Wage.
5 R.C. 4111.02; Ohio Const., art. II, sec. 34a; ODC-DIC, State of Ohio 2023 Minimum Wage.
P a g e |2 S.B. 146
As Introduced
Office of Research and Drafting LSC Legislative Budget Office
Apprentices
The bill also eliminates the authority of the Director to adopt rules permitting the
employment of apprentices at a wage rate not less than 85% of the state minimum wage. The
Director has not adopted these rules.6
Relationship between state and federal law
The federal Fair Labor Standards Act7 (FLSA) and Ohio’s minimum wage laws both
specify minimum wages that an employer must pay the employer’s employees at least the
minimum wage. An employer may be subject to one or both laws. The FLSA specifies that if an
employer is subject to both laws, the employer is governed by the law that establishes the
higher minimum wage.8 Currently, Ohio has a higher basic minimum wage ($10.10 per hour in
2023) as compared to the basic minimum wage under the FLSA ($7.25 per hour). Thus,
employers subject to both laws pay the state rate under current law and under the bill.
HISTORY
Action Date
Introduced 08-31-23
ANSB0146IN-135/ar
6 R.C. 4111.07, repealed.
7 29 U.S.C. 201 et seq.
8 29 U.S.C. 218.
P a g e |3 S.B. 146
As Introduced
Statutes affected: As Introduced: 4111.02, 4111.05, 4111.09, 4111.14, 4111.07