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House panel passes key wage provisions

ANNAPOLIS — Members of a House of Delegates committee charged with crafting legislation that would increase the minimum wage in Maryland agreed on key provisions Monday and moved closer to a final version of a bill late Monday night.

Martin O'Malley, Anthony Brown

Maryland Gov. Martin O’Malley and Lt. Gov. Anthony Brown testify on a bill to raise the minimum wage during a Feb. 11, 2014 House of Delegates Economic Matters Committee. (The Daily Record/Bryan P. Sears, file)

The House Economic Matters Committee broke for dinner and a Monday night floor session having settled three major points in the bill: wages for tipped employees, the implementation date and the striking of language linking automatic increases to the rate of inflation.

House Bill 258 would increase the minimum wage in Maryland from $7.25 to $10.10 an hour. Those increases would be phased in over a three-year period beginning Jan. 1, 2015.

Under the terms of the bill, minimum-wage workers would see an increase from $7.25 to $8.20 per hour in January. The next bump, to $9.15 an hour, would come in January 2016, with a final bump to $10.10 a year later.

The initial plan, as proposed by Gov. Martin J. O’Malley, would have phased in increases beginning July 1, 2014, with the final increase coming in July 2016.

Del. Dereck E. Davis, D-Prince George’s, the chairman of the committee, said the delay was meant to help businesses adapt.

“We wanted to give them enough lead time to plan for it,” Davis said Monday night.

Tipped employees will not see an increase in their pay related to the amount of the hourly wage picked up by their employer.

Under a plan approved by the committee, employers would continue to pay $3.63 per hour, an amount equal to about 50 percent of the current $7.25 minimum wage.

Instead of the increase to 70 percent proposed by O’Malley, the committee voted to freeze the employer portion. If the employee earns an amount in tips equal to the minimum wage at the time, then the employer will have complied with the law. The employer would have to make up the difference in hourly wages if the tips fail to bring the employee’s hourly wage up to the minimum at the time.

Davis said the flat dollar amount was still “80 cents higher than the rate of the nearest state we compete with.”

The rate for tipped employees in Washington is $2.77. Delaware and New Jersey and the federal government all have a $2.13 minimum wage for tipped employees.

The committee also voted to strip out language favored by O’Malley and Lt. Gov. Anthony G. Brown that would have automatically increased the minimum wage based on the rate of inflation, beginning in 2018.

A bill similar to the one O’Malley introduced in the House, Senate Bill 295, is filed in the Senate.

If approved, the $10.10 minimum wage would still be lower than what two other counties approved in 2013. Montgomery and Prince George’s Counties both increased the minimum wage to $11.50 an hour.

The committee was expected to go back to work late Monday night on the bill with the intention of bringing a finished bill to the floor for debate and a preliminary vote as early as Wednesday.