Senate Bill 2495 amends various sections of the Tennessee Code Annotated to establish a new state minimum wage framework. Under the new provisions, starting January 1, 2027, the state minimum wage will be set at $20.00 per hour, with annual adjustments based on the consumer price index (CPI-U) beginning January 1, 2028. Employers are required to pay employees at least the greater of the federal minimum wage or the state minimum wage, and they must also pay overtime at a rate of one and one-half times the regular wage for hours worked over 40 in a week. The bill mandates that employers keep a summary of these wage rules posted in their workplaces and outlines penalties for non-compliance, including liability for unpaid wages and damages.

Additionally, the bill stipulates that employees have a two-year window to file claims for unpaid wages, which extends to three years if the employer is found to have willfully violated the wage requirements. The commissioner of labor and workforce development is tasked with publishing the adjusted minimum wage annually and is required to collaborate with the U.S. Department of Labor in administering these provisions. The bill also clarifies that it does not interfere with employees' rights to negotiate higher wages collectively and exempts certain employees as defined under federal law.