Last year, during the 2019 Maryland General Assembly, state lawmakers voted to pass a bill that gradually increases Maryland’s minimum wage rate from $10.10 per hour to $15.00 per hour over the next several years. Governor Larry Hogan originally vetoed the bill, stating that the mandated increase would make Maryland less competitive and could cause low-wage workers to lose their jobs; however, the Democratic-majority General Assembly overrode the veto, arguing that the increase is needed as the cost of living has become high for basic needs, and the bill became law.
The first increase recently went into effect on January 1, 2020, bringing Maryland’s minimum wage rate to $11.00 per hour. After this year, however, the increases will vary, depending on the size of the employer.
Maryland employers with 15 employees or more will have until 2025 to increase the minimum wage to $15.00 per hour. The minimum wage rate for these employers will increase as follows:
|Effective Date||Minimum Wage|
|January 1, 2021||$11.75|
|January 1, 2022||$12.50|
|January 1, 2023||$13.25|
|January 1, 2024||$14.00|
|January 1, 2025||$15.00|
Maryland employers with 14 or fewer employees, on the other hand, will have one extra year to reach the $15.00 per hour minimum wage rate. The minimum wage rate for these employers will increase as follows:
|Effective Date||Minimum Wage|
|January 1, 2021||$11.60|
|January 1, 2022;||$12.20|
|January 1, 2023||$12.80|
|January 1, 2024||$13.40|
|January 1, 2025||$14.00|
|January 1, 2026||$14.60|
|July 1, 2026||$15.00|
In addition, under the new legislation, employers may no longer pay a training wage of 85% of the state minimum wage rate to employees under the age of 20 for the first 6 months of employment, or to employees who work for seasonal, amusement, recreational, or swimming pool establishments. Instead, employers must pay workers under the age of 18 a minimum wage equal to 85% of the state’s minimum wage.
As for tipped employees, tipped employees earning more than $30 per month in tips must earn the state’s minimum wage rate per hour. Although employers are only required to pay their tipped employees at least $3.63 per hour in base pay (which is half of the federal minimum wage rate of $7.25 per hour), this amount plus tips must equal or exceed the state’s minimum wage rate requirements. If it does not, the employer must make up the difference to ensure the worker earns at least the state’s minimum wage. The legislation also includes a requirement that employers with tipped employees provide a written or electronic wage statement to their employees for each pay period which shows how much the employee earns in base pay and in tips.
Within Maryland, Prince George’s County and Montgomery County approved their own minimum wage increases. Prince George’s County’s minimum wage is currently $11.50 per hour. Montgomery County’s minimum wage is currently $12.50 per hour for employers with 51 or more employees, $12.00 per hour for employers with 11 to 50 employees, and $12.00 per hour for employers with 10 or fewer employees.
For more information, please visit Maryland’s Department of Labor website at: https://www.dllr.state.md.us/labor/wages/wagehrfacts.shtml.