Lawmakers are pulling a vote Thursday on a controversial bill to suspend the state’s yearly minimum wage increases – now $10 an hour, and slated to rise to $15 an hour by 2024 – in the event of an economic recession, according to the bill’s main sponsor Sen. Vin Gopal, D-11th District.
The measure met opposition from U.S. Rep. Don Norcross, D-1st District, who in a Tuesday afternoon statement called the proposal “irresponsible” and said that it would “harm both workers and businesses.”
“I’ve asked Chairman Madden to pull my bills tomorrow and he said OK,” Gopal tweeted Wednesday morning. “There will be no discussion. I look forward to meeting with stakeholders in the weeks and months ahead on the positives and negatives of both bills.”
Under the first measure, Senate Bill 3607, the state-mandated pay increase schedule would be suspended in the event of a decline in employment and sales tax, at which point the suspension would be instituted on a year-by-year basis. The second scenario laid out in the bill would suspend the wage increase until the state regains revenue past 2 percent.
Senate Bill 3608, meanwhile, would create a task force to study the effect the minimum wage increase has on businesses including the ability to hire new workers, whether they needed to cut hours or lay off workers to make ends meet, and whether they switched to automation.
Both measures were scheduled for a vote at the Thursday Senate Labor Committee, which is chaired by Sen. Fred Madden, D-4th District.
Business advocates argued since the increase was signed in February that companies be granted relief from the yearly increases in the event the economy goes sour – citing worries that in the event of a recession, they would be slammed even harder by this mandate.
“If you talk to any economist, they’ll tell you that the next recession may hit within the next one or two years. So we feel this off-ramp is a critical protection for both businesses and state government because the increase impacts state government as well,” New Jersey Business and Industry Association Vice President of Government Affairs Mike Wallace told NJBIZ.
But progressive activists worried that the measure would hit lower-income, vulnerable populations, which the wage increase is supposed to help.
“The bill uses broad and arbitrary metrics to pause increases in the minimum wage, cheating workers and families already struggling to make ends meet,” New Jersey Policy Perspective President Brandon McKoy said in a statement.