Original Living American Wage Act or the Original LAW ActThis bill increases the federal minimum wage according to a formula specified in the bill.First, the bill increases the minimum hourly wage to $10.59 beginning on January 1, 2026, and increases the minimum hourly wage by $4 annually from January 1, 2027, through January 1, 2030.Next, beginning on January 1, 2031, the Department of Labor shall increase the minimum hourly wage every seven years according to a specified formula. The formula establishes the minimum hourly wage as the wage sufficient for a person working 1,799 hours per year (approximately 35 hours per week) to earn an annual income that is 40% higher than the federal supplemental poverty threshold for a renter family of four, with two children under the age of 18, as published by the Bureau of Labor Statistics for the preceding year. However, if this formula results in a reduction, the minimum hourly wage may not be lowered.
If enacted, HB 122 will significantly influence labor laws across the nation by tying the federal minimum wage to specific economic indicators. This law intends to ensure that minimum wage earners are compensated adequately enough to afford basic living expenses, including housing. By mandating that a full-time worker's income needs to be above the calculated poverty threshold, the legislation aims to bridge the growing economic divide experienced by low-income families. The bill includes a detailed schedule for future minimum wage increases, directly impacting employee income levels and potentially benefiting small families surviving on minimum wage jobs.
House Bill 122, titled the 'Original Living American Wage Act,' seeks to amend the Fair Labor Standards Act by establishing a new method for calculating the federal minimum wage based on the Federal supplemental poverty threshold for a renter family of four with two children. This bill aims to ensure that the minimum wage provides a living wage that exceeds the poverty line, thereby improving the economic circumstances of millions of American households living in poverty. Provisions include a specification for annual adjustments that reflect inflation levels and periodic evaluations of the viability of the minimum wage in relation to housing affordability.
Despite its noble intent, the bill may foster contention among policymakers and economic stakeholders. Proponents argue that such a wage adjustment is essential for reducing poverty and ensuring dignity for workers. Critics, however, warn of potential downsides including increased operational costs for businesses, which may lead to adverse employment effects such as layoffs or reduced hiring. There are also concerns that the consistent increase in minimum wage may not align adequately with productivity rates, creating a strain on small businesses that could result in unintended economic consequences.