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One Step Closer to a Higher Massachusetts Minimum Wage and More Stable Unemployment Taxes

Published:  May 2, 2014

Yesterday, Massachusetts took one more step in the long journey to raise the minimum wage and to reform the state’s unemployment insurance system. The Senate voted on the House of Representatives’ bill addressing these issues and replaced language in the House’s bill with language the Senate has already voted to implement. Previously, the Massachusetts Senate has addressed these two issues separately while the House of Representatives has compiled their plans on these two issues into one bill in hopes of gaining more support. Although the House and Senate are like-minded on these issues, their bills do have significant differences.

In November, the Senate passed its bill that would raise the state’s minimum wage to $11 an hour with economic indexing provision that would raise the minimum wage every year at the same rate as the consumer price index starting in 2016. The House’s bill proposing a minimum wage increase would raise the minimum wage only to $10.50 an hour and contained no economic indexing provision.

Then in February, the Senate passed a bill proposing a reform of the state’s unemployment system that would stabilize rates for employers over a four year period and prohibit senior officers or owners of a company from laying themselves off, collecting unemployment, then re-hiring themselves. The House’s bill would also stabilize unemployment rates for businesses and would create a Massachusetts employment fund to pay for job training for unemployed or underemployed workers.

While the Senate and House are moving in the same directions on both of these issues they have set different standards. While it is clear some form of these bills will likely become law, it is unknown which version will reign.

If you have any questions regarding the minimum wage or unemployment insurance, please contact any of the attorneys at Royal LLP at (413) 586-2288.

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