The Akron Legal News

Lawmaker wants to increase Ohio's minimum wage to $10.10 an hour

TIFFANY L. PARKS
Special to the Legal News
Published: July 24, 2015

Senate Bill 25 would raise the state’s minimum wage from $8.10 an hour to $10.10 in 2016 and would adjust to inflation in the years following.

“For some of you, this provision is reason enough to balk at having further conversations about this bill,” Kenny Yuko, the proposal’s sponsor, said to members of the Senate Transportation, Commerce and Labor Committee.

“However, we need to take an honest look at our economic recovery that has occurred since the recession.”

In stumping for SB 25, Yuko, D-Richmond Heights, noted that Tim Keen, the director of the Ohio Office of Budget and Management, discussed Ohio’s insignificant wage growth earlier this legislative session.

Keen said the average hourly earnings of all private-sector employees rose by 1.65 percent in 2014 — a lower increase than in the recession and early recovery years of 2009 and 2010.

He went on to say that real wage inflation is “effectively zero” since wages have grown more slowly than labor productivity.”

Yuko said SB 25, also known as the Ohio Worker’s Rights Act, was crafted to take a multi-pronged approach to “aggressively empower workers whose paychecks, benefits and well-being have been eroding for decades.”

“SB 25 contains provisions that would rectify these issues through an increase in the minimum wage, better overtime protection and guidance on employee classification,” he said.

In addition to raising the state basic minimum wage, the bill would increase the state minimum wage for tipped employees from $4.05 per hour to $5.05.

“Imagine raising a family on $324 per week, which equates to a little over $1,000 per month, after taxes. When we talk about minimum wage earners in Ohio, 56 percent of these individuals are women and 86 percent are over 20 years old,” Yuko said, noting that Ohioans who don’t earn a living wage are left to turn to government programs to subsidize their needs.

“If we increase the minimum wage to $10.10, we could lessen the dependency on government programs.”

The lawmaker estimated that more than 88,500 state residents would no longer need food stamps with the proposed wage increase.

“People are worth more than the dollars and cents that confine them to working in poverty with no end in sight,” Yuko said.

According to a bill summary, SB 25 would maintain current law with respect to paying the following employees federal minimum wage rate, which is $7.25 per hour: employees who are under age 16 or employees who are employed by a business with gross annual receipts of $297,000 or less in the preceding calendar year, adjusted annually based upon the Consumer Price Index.

With regard to overtime, the proposal would expand the scope of employees who may be eligible to receive overtime wages.

Under current law, an employer must pay overtime wages to an employee at a rate of 1.5 times the hourly wage rate for hours worked by that employee in excess of 40 in one work week.

Continuing law exempts certain individuals from this requirement, including an individual who is employed in a bona fide executive, administrative or professional capacity, as defined by the federal Fair Labor Standards Act.

Under the bill, for 2016, a bona fide executive, administrative or professional employee is exempt only if the employee has a salary of at least $50,000.

Beginning in 2017, such an employee is exempt only if he or she has an annual salary of at least $69,000.

Concerning the definition of “employee,” there are portions of the minimum fair wage standards Law, the bimonthly pay law, the prevailing wage law, the workers’ compensation law, the unemployment compensation law and the income tax law that have varying or no such definition.

Except as otherwise specified, “employee” under the bill means an individual who performs services for compensation for an employer.

The bill offers several exceptions to that definition such as the individual has been and continues to be free from control and direction in connection with the performance of the service and the individual customarily is engaged in an independently-established trade, occupation, profession or business of the same nature of the trade, occupation, profession or business involved in the service performed.

If enacted, SB 25 would ban an employer from failing to designate as an employee an individual who meets the bill’s definition of employee.

Employers also could not retaliate against an individual who takes specified actions regarding being misclassified.

“Employment misclassification practices dismantle the integrity of employee and employer benefit systems and do so at the expense of those companies that follow the rule of law,” Yuko said.

SB 25 has gained partisan support from eight Senators.

The bill has not been scheduled for additional hearings.

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