Minimum Wage Fairness Act of 2018

To provide consequences to States that reduce their State minimum wage and to redirects Federal funding to those States to the neediest localities. 1. Short title This Act may be cited as the Minimum Wage Fairness Act of 2018 2. Findings The Congress finds the following: (1) The Federal minimum wage peaked 50 years ago in 1968 at $8.68 in 2016 dollars. Since that time, Americans have watched their wages remain stagnant despite massive increases in productivity, which has fueled an economically unfair and unjust trend for the Nation. The growing income inequality has been a destabilizing force on the communities of the Nation, the economy, and the Nation’s very democracy. (2) The Federal minimum wage does not only affect the young and inexperienced worker. More than half of all minimum wage workers are over the age of 24. (3) Nearly 60 percent of States have raised their minimum wage above the Federal minimum wage, and in nearly 25 percent of States the wage is adjusted yearly for inflation. (4) Opponents of minimum wage increases routinely use dire predictions about job losses and the failure of businesses in locations that raise the minimum wage. These predictions have proven almost entirely untrue. Locations that raise the minimum wage largely reap the benefits of a stronger tax base and increased consumer demand. (5) Those opposed to minimum wage increases frequently use more than misleading campaigns, and in some cases have interfered with democracy to ensure that the will of citizens is frustrated. (6) Americans deserve a raise and the voters and constituents who support minimum wage increases should not be frustrated by anti-democratic special interests who have captured the legislative, executive, and regulatory apparatus of States and localities. 3. Safeguards for workers in States that reduce the minimum wage (a) Review of minimum wage laws The Secretary of Labor shall, within 30 days of the each fiscal year beginning after the date of enactment of this Act, identify any State that has, within the previous fiscal year that began after the date of enactment of this Act, reduced its State minimum wage, or which has reduced a minimum wage increase that would otherwise go into effect. (b) Communication of minimum wage reduction The Secretary of Labor shall inform all other Federal agencies responsible for allocating Federal funds to a State for its direct use or for the State to distribute within its boundaries, of any State that has reduced its State minimum wage. (c) Review of indirect costs Any head of an agency notified that a State has reduced its State minimum wage shall review all funds under programs administered by the head of such agency that would otherwise be allocated to a State under Federal law. Such agency head shall then review any funds allocated to that State specifically designated as for use for the State’s administrative costs of any such program. Where such administrative costs are not specifically designated, the agency head shall— (1) determine the amount of such Federal funds used by the State to administer any such program; and (2) presume in the absence of a contrary showing, that a similar amount or percentage will be allocated by the State in the next fiscal year. (d) Reduction in indirect costs Upon determining the percentage of Federal funding under a given program provided to a State that is used for administrative costs, the head of each agency shall restrict the use of funds by the State for administrative costs, overhead, and salaries for the following year. Such a restriction shall reduce the amount the State may spend on administrative costs by a percentage equivalent to the State’s reduction in its State minimum wage. (e) Exceptions Where the head of an agency has determined that a reduction in program funding for administrative costs to a State shall constitute a threat to the public health, safety, and welfare of the people of the State, then the head of such agency may withhold from the State for administrative costs a lesser amount than that equivalent to the percentage of the State’s minimum wage reduction. (f) Redirection of funds Where possible, the head of each such agency shall direct any funds withheld from a State under this Act to a municipality located in that State where the municipality is an eligible recipient of the funding program in question, and where the municipality would be otherwise eligible to use such funds for administrative costs. Where no such municipality is eligible to directly receive such funds, such funds shall be available to the Secretary of Housing and Urban Development for use only for grants under title I of the Housing and Community Development Act of 1974 ( 42 U.S.C. 5301

Summary: Minimum Wage Fairness Act of 2018 This bill requires the Department of Labor to identify each fiscal year any states that have reduced their minimum wage or that have reduced a minimum wage increase that would otherwise become effective. Labor must then notify federal agencies that administer programs in such states and such agencies must reduce the funding for the administrative costs of such programs by a percentage equivalent to the reduction in the minimum wage in such states.