The state Legislature overrode Gov. Mitt Romney’s veto this summer increase the minimum wage in Massachusetts for the first time in seven years.
The legislation increases minimum wage from $6.75 and hour to $7.25 in October, to $7.50 on Jan. 1, 2007 and again to $8 on Jan. 1, 2008.
However, schools, colleges, universities and other educational institutions may apply for a license to pay enrolled students less than minimum wage — as low as $5.40 per hour.
“The future increases in the statutory minimum wage do not affect this regulation,” said Lisa Price, deputy general counsel for Minimum Wage and Prevailing Wage Programs in the Division of Occupational Safety, adding that only one private school has obtained this license, although she could not disclose the institution’s name.
The legislation, which was passed unanimously by the state Legislature July 31, has been under consideration since early 2005 when Rep. J. James Marzilli, Jr. (D-Middlesex) submitted a petition to the Labor and Workforce Development committee.
However, the measure adopted on July 31 was pared down from its original form, which called for of $8.25 an hour by 2008.
According to the original petition, Marzilli proposed the creation of a Massachusetts Commission on the Minimum Wage — an economic commission that would meet every three years to consider further increases in the minimum wage “to reflect existing economic conditions in the commonwealth.”
While the original petition also called for the minimum wage to be adjusted yearly to counter inflation, the adopted bill does not guarantee annual wage increases
Still, proponents say the bill’s approval gives justice to the working class. The Massachusetts Budget and Policy Center wrote in favor of the legislation in Keeping It Real: The Effects of Increasing and Indexing the Massachusetts Minimum Wage, saying the current minimum wage provides an annual income of only 38 to 66 percent of accepted costs-of-living standards.
The MBPC said Massachusetts has seen sharp job losses in recent years, but “those losses have been concentrated in sectors such as manufacturing and information, neither of which relies on minimum wage workers to any large degree.”
Opponents of the bill see the increased minimum wage as a threat to employers and the job pool.
The Beacon Hill Institute highlighted this concern in The Economics of a Higher Minimum Wage in Massachusetts, published before the vote.
Authored by Paul Bachman and David Tuerck, the study said some workers would benefit from increased wage rates, but other workers — an estimated 26,970 people — could lose their jobs because businesses would not be willing or able to pay the higher wages.
The bill will affect 315,000 workers, according to the Massachusetts Budget and Policy Center.