Minimum Wage Hike Unlikely to Make COVID-19 Relief Package

Most Republicans and some Democrats in Congress have concerns.

February 09, 2021

WASHINGTON—President Biden doesn’t think his proposed federal minimum wage hike to $15 an hour will make it into the final $1.9 trillion COVID-19 relief package after negotiations with Congress, reports USAToday.

Biden advocated for the minimum wage hike before the pandemic began and believes it is an effective way to help working-class Americans cope with the economic consequences of the crisis.  

"No one should work 40 hours a week and live below the poverty wage. And if you’re making less than $15 an hour, you’re living below the poverty wage," the president said recently. But he conceded that his plan to raise the federal minimum rate did not look likely to be a part of the new relief legislation. Many Republicans oppose Biden’s attempt to raise the federal minimum wage, and some Democrats also have concerns.

Sen. Joe Manchin, D-W.Va., said last week that he doesn’t support increasing the federal minimum wage to $15 an hour, although he does support a smaller increase.

Republican Sen. Joni Ernst of Iowa said she is concerned about raising the minimum wage during the pandemic. "A $15 federal minimum wage would be devastating for our hardest-hit small businesses at a time when they can least afford it," Ernst said.

Despite the roadblocks, the wage increase does have the support of progressive Democrats, who proposed to increase the wage to $15 an hour by 2025, raising it in five steps over the coming years. Although Senate Democrats have promised future legislation that will increase the federal wage, the Senate has been criticized for not including it in the latest package. 

If the minimum wage increase isn’t part of the relief package, Biden said he’s prepared to negotiate a separate bill to make it happen. The last time Congress increased the federal minimum wage was in 2007, when it was raised to $7.25 an hour. Since then, at least 29 states and Washington, D.C., have raised their minimum wages on their own.

For a deep dive on wages and other HR-related issues, join us at this year’s HR Forum. At a session on legal issues, Travis W. Vance, a partner of the law offices of Fisher & Phillips, will review laws that impact the human-capital aspects of your business, paying special attention to COVID-19 and the pressures it has placed on employers of essential workers. Register for the HR Forum today.