New York Governor Andrew Cuomo and legislative leaders in Albany have reached an agreement on the state’s new $15 minimum wage.
The new measure will be part of the state’s 2016-2017 budget package.
“We believe that people who work hard should be able to earn a decent living and support a family with dignity,” Cuomo said.
The $15 minimum wage is a 67% increase over the state’s current $9 minimum.
Cuomo says the new increases will affect approximately 2.3 million workers, who represent close to a quarter of the state’s workforce.
As a side bonus, mid-level workers should also receive pay increases as employers continue to offer a pay differential between entry-level and more senior level jobs.
Here’s how the increases will occur
In New York City the minimum wage will rise to $11 by the end of 2016. It will then increase by $2 each year until it hits $15 at the end of 2018.
Companies with less than 10 workers will have an extra year to reach that $15 level. Their minimum wage will rise to $10.50 at the end of this year, then go up by $1.50 each year until it reaches $15 at the end of 2019.
In areas near New York City (Westchester, Nassau and Suffolk counties), the minimum wage won’t reach $15 until the end of 2021.
Businesses in upstate New York will also experience a slower rate of increases. The minimum wage would only climb 70 cents a year until it reaches $12.50 by 2020. After that, the upstate minimum will continue increasing to $15 but at a pace set by the state’s budget director and State Department.
Starting 2019, the budget division and labor department will annually assess the economy in each region to determine if any further increases should be suspended based on economic conditions.
The New York deal arrives hours after California became the first state in the nation to pass a statewide $15 minimum wage.
Some business owners warn that a $15 per hour minimum wage will cost closer to $18 per hour with taxes and other fees they must pay to the state and federal government.