GENERAL ASSEMBLY OF NORTH CAROLINA

SESSION 2017

H                                                                                                                                                    1

HOUSE BILL 474

Short Title:      Up Minimum Wage/Set Rates/COLA.		(Public)
Sponsors:	Representatives Cunningham, Earle, and W. Richardson (Primary Sponsors). For a complete list of sponsors, refer to the North Carolina General Assembly web site.
Referred to:	Rules, Calendar, and Operations of the House

March 27, 2017

A BILL TO BE ENTITLED

AN ACT to increase the state minimum wage, to set wage rates based upon the size of the employer, and to provide for automatic adjustments to reflect increases in the cost of living.

The General Assembly of North Carolina enacts:

SECTION 1.  G.S. 95‑25.3 reads as rewritten:

"§ 95‑25.3.  Minimum wage.wage rates; cost-of-living adjustments.

(a)        Every Subject to the provisions of subsection (a2) of this section, every employer shall pay to each employee who in any workweek performs any work, wages of at least six dollars and fifteen cents ($6.15) per hour or the minimum wage set forth in paragraph 1 of section 6(a) of the Fair Labor Standards Act, 29 U.S.C. 206(a)(1), as that wage may change from time to time, whichever is higher, except as otherwise provided in this section.at the applicable rate set forth in subsection (a1) of this section. For the purposes of this section, the following definitions apply:

(1) Large employer. – An enterprise whose annual gross volume of sales made or business done is not less than five hundred thousand dollars ($500,000), exclusive of excise taxes at the retail level that are separately stated.

(2) Small employer. – An enterprise whose annual gross volume of sales made or business done is less than five hundred thousand dollars ($500,000), exclusive of excise taxes at the retail level that are separately stated.

(a1) Except as otherwise provided by this section:

(1) Every large employer shall pay each employee wages at a rate of at least ten dollars and seventy‑five cents ($10.75) per hour, effective January 1, 2018.

(2) Every small employer shall pay each employee at a rate of at least seven dollars and seventy‑five cents ($7.75) per hour, effective January 1, 2018.

(a2) The minimum wage required by subsection (a1) of this section shall be increased on January 1, 2019, and on January 1 of successive years by the increase in the cost of living. The increase in the cost of living shall be measured by the percentage increase of the Consumer Price Index (all urban consumers, U.S. city average for all items), CPI‑U, or its successor index, as calculated by the U.S. Department of Labor for the 12 months preceding the previous September 1. The Commissioner shall calculate the indexed minimum wage rate. The indexed minimum wage rate shall be calculated to the nearest cent.

(b)        In order to prevent curtailment of opportunities for employment, the wage rate for full‑time students, learners, apprentices, and messengers, as defined under the Fair Labor Standards Act, shall be ninety percent (90%) of the rate in effect under subsection (a) above, rounded to the lowest nickel.

(c)        The Commissioner, in order to prevent curtailment of opportunities for employment, may, by regulation, establish a wage rate less than the wage rate in effect under section (a) which may apply to persons whose earning or productive capacity is impaired by age or physical or mental deficiency or injury, as such persons are defined under the Fair Labor Standards Act.

(d)       The Commissioner, in order to prevent curtailment of opportunities for employment of the economically disadvantaged and the unemployed, may, by regulation, establish a wage rate not less than eighty‑five percent (85%) of the otherwise applicable wage rate in effect under subsection (a) which shall apply to all persons (i) who have been unemployed for at least 15 weeks and who are economically disadvantaged, or (ii) who are, or whose families are, receiving Work First Family Assistance or who are receiving supplemental security benefits under Title XVI of the Social Security Act.

Pursuant to regulations issued by the Commissioner, certificates establishing eligibility for such subminimum wage shall be issued by the Division of Employment Security.

The regulation issued by the Commissioner shall not permit employment at the subminimum rate for a period in excess of 52 weeks.

(e)        The Commissioner, in order to prevent curtailment of opportunities for employment, and to not adversely affect the viability of seasonal establishments, may, by regulation, establish a wage rate not less than eighty‑five percent (85%) of the otherwise applicable wage rate in effect under subsection (a) which shall apply to any employee employed by an establishment which is a seasonal amusement or recreational establishment, or a seasonal food service establishment.

(f)        Tips earned by a tipped employee may be counted as wages only up to the amount permitted in section 3(m) of the Fair Labor Standards Act, 29 U.S.C. 203(m), if the tipped employee is notified in advance, is permitted to retain all tips and the employer maintains accurate and complete records of tips received by each employee as such tips are certified by the employee monthly or for each pay period. Even if the employee refuses to certify tips accurately, tips may still be counted as wages when the employer complies with the other requirements of this section and can demonstrate by monitoring tips that the employee regularly receives tips in the amount for which the credit is taken. Tip pooling shall also be permissible among employees who customarily and regularly receive tips; however, no employee's tips may be reduced by more than fifteen percent (15%) under a tip pooling arrangement.

(g)        Repealed by Session Laws 2006‑259, s. 18, effective August 23, 2006."

SECTION 2.  This act is effective when it becomes law.