WeVote
Log In

Bill

Bill

SB 1357

Salaries and Benefits - As introduced, increases, from $7.25 to $20, the minimum hourly wage for employees within this state. - Amends TCA Section 8-23-203; Title 12 and Title 50, Chapter 2.

114th Regular Session (2025-2026) Introduced by Raumesh Akbari

Establishes a Tennessee minimum wage of at least $20 per hour (or higher of $20 or federal minimum), with enforcement, damages, and rulemaking, effective July 1, 2025.

Assigned to General Subcommittee of Senate Commerce and Labor Committee
#salariesandbenefits
0
WeVote Research Nonpartisan
Bill Summary · SB 1357

Summary: SB 1357 / HB 1399 (Tennessee, 114th Legislature)

Proposed minimum wage statute for Tennessee, with broad fiscal impact analysis.

1) Purpose and Intent

  • The bill establishes a state minimum wage standard in Tennessee of not less than $20.00 per hour.
  • It supersedes, or sits alongside, the federal minimum wage requirement (FSLA) by setting a higher state floor.
  • It also extends protections and enforcement related to wage compliance, including damages and attorney’s fees for violations.
  • Takes effect for rulemaking immediately upon law (as to rulemaking), but the substantive wage requirements apply starting July 1, 2025.

2) Key Provisions and Changes

  • Section 50-2-116 (new):

    • Definitions: clarifies terms for enforcement (Commissioner, Department, Employer, Employee, Wages, etc.).
    • Wage floor: an employer must pay at least the greater of:
    • The federal minimum wage under the Fair Labor Standards Act (FLSA), or
    • $20.00 per hour.
    • Overtime: standard overtime provision—1.5 times the regular wage rate for hours over 40 in a workweek.
    • Posting: employers must display a conspicuous summary of wage rules on the premises.
    • civil remedies: employers violating minimum wage must pay unpaid wages plus damages equal to the unpaid amount; courts must award court costs and reasonable attorney’s fees.
    • Statute of limitations: action to recover damages must be filed within 2 years, or 3 years if the complaint alleges willful violation.
    • Federal-state cooperation: DLWD must cooperate with the U.S. Department of Labor’s Wage and Hour Division.
    • Union rights: the bill does not diminish employees’ rights to bargain collectively to obtain higher wages.
    • Employee exemptions: employees exempt under 29 U.S.C. § 213 retain federal-law exemptions.
    • Rulemaking: DLWD to promulgate implementing rules consistent with the FLSA using the Uniform Administrative Procedures Act; funded within existing resources.

  • Effective dates:

    • For rulemaking purposes: takes effect upon becoming law.
    • For substantive wage requirements: July 1, 2025.

  • Severability: standard clause.

3) Affected Parties

  • Employees:
    • All employees in Tennessee (subject to wage definitions), who would be entitled to a minimum of $20/hour or the federal minimum, whichever is higher.
    • Overtime eligibility remains 1.5x for hours over 40 per week.
  • Employers:
    • All Tennessee employers (private sector and state/local government to the extent they pay wages; see fiscal impact).
    • Required to adjust payroll to meet the $20/hour minimum where applicable.
  • Government:
    • Tennessee Department of Labor and Workforce Development (DLWD) enforces the rule, investigates wage claims, and posts information.
    • Potential increase in workload and need for staff (inspector and administrative assistant positions noted in fiscal analysis).
  • Higher education institutions:
    • Noted in fiscal analysis as incurring additional payroll costs to align with the new wage rate for certain staff/contracts.

4) Procedural and Timeline Considerations

  • Legislative action history shows committee steps in early 2025, with advancement to the Senate Commerce and Labor Committee and scheduled hearings.
  • If enacted, the bill mandates rulemaking by the DLWD to implement the new wage requirements, with the law taking effect for policy purposes upon becoming law and substantive provisions effective July 1, 2025.
  • Civil remedies provide private rights of action with damages, fees, and court costs for noncompliance.
  • The bill contemplates cooperation with federal wage enforcement and preserves collective bargaining rights to go beyond the state minimum.

5) Fiscal and Economic Impact (Summary)

  • State government:
    • Recurring increase in expenditures for implementing wage increases and enforcement: approximately $95.0 million per year beginning FY2025-26, plus a one-time setup cost (~$311k to $356k total in the first year).
    • Additional staff: 3 labor standards inspectors and 1 administrative assistant-3; software, training, and equipment needs.
  • Local government:
    • Potentially large cost impact, estimated up to roughly $592 million annually in FY2025-26 and onward, depending on local wage structures and employment levels.
  • Businesses:
    • Private sector: estimated annual cost increase up to about $19.38 billion starting in FY2025-26, driven by higher wages for full-time and part-time workers.
    • After accounting for existing state/local expenditures and higher education costs, the net private-sector impact is shown as around $18.69 billion per year.
  • General note:
    • The fiscal analysis assumes the wage floor will drive higher consumer spending, potentially increasing tax revenue, while noting offsets from reduced business net income and other market adjustments. The exact effects would depend on behavioral responses and economic conditions.

If you’d like, I can pare this down to a one-page briefing for policymakers or expand the fiscal appendix with line-item detail from the analysis.

Compiled from official sources — confirm details with the bill’s official record.

Sign in to ask a question.