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Texas Minimum Wage Change

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I’m the owner of a

Texas company that is covered by the state minimum wage, not the federal minimum wage. I understand that the federal minimum wage will soon increase from $5.15 per hour to $5.85 per hour. But, won’t the

Texas state minimum wage stay at $5.15 per hour?

Under the current law, when the federal minimum wage increases, the Texas state minimum wage increases, as well. So, on July 25 2007, when the federal minimum wage increases, by 70 cents to $5.85, the state rate will, also increase.

There are further minimum wage increases scheduled under the same bill. On July 25, 2008, the federal minimum wage will increase by 70 cents to $6.55 per hour.

On July 25, 2009 the federal minimum wage will increase yet again. This increase of 70 cents per hour will make the rate $7.25 per hour.

Under the Texas state minimum wage law, the state rate will mirror each of these increases. The state increases will be effective on the same date as the federal increases. The

Texas minimum wage statute doesn’t specify a dollar amount. Instead, it ties the state minimum wage to the federal rate.

Employers should note that each of these state and federal changes will require that they update the required minimum wage posters.

The changes in the federal minimum wage will automatically affect the state minimum wage in a number of states. A total of 15 states currently have state minimum wages of $5.15 per hour. In some states such as Texas, Oklahoma Virginia and

Utah, the state rate is pegged to the federal standard and will increase automatically as the federal rate raises. In other states such as

Georgia, the state rate will remain at $5.15 per hour until it is changed by state legislation. Employers in those states should note that they may still be required to pay the higher federal wage.  

Proponents of the increase in the federal minimum wage argue that at $5.15, the rate was lower in purchasing power than in 1950. Minimum wage workers have not had an increase since 1997. In that time, Congress has voted increases of $31,600 per year for the average legislator.  

The total $2.10 cent raise represents an increase of 41% for minimum wage workers. Still, at $5.85 the federal minimum wage will be lower than the state minimum wage in 28 states plus the District of Columbia, the Virgin Islands and Guam.