Massachusetts Legislature Strikes 'Grand Bargain'

On June 20, Massachusetts lawmakers approved legislation aimed at preventing several high profile ballot questions from appearing before voters in November. Commonly referred to as the “Grand Bargain,” the legislation (H.4640) raises the state's minimum wage, eliminates premium pay for those who work on Sundays and holidays, creates a paid family and medical leave program, and institutes a permanent annual sales tax holiday weekend.

The legislation represents a compromise between labor and progressive groups, led by Raise Up Massachusetts, supporting ballot questions to increase the minimum wage and create a paid family and medical leave program and business groups, led by the Retailers Association of Massachusetts (RAM), pushing for a ballot question to reduce the state sales tax and create a permanent sales tax holiday. By reaching this deal, lawmakers hope to keep the proposed questions regarding these topics off of the November 2018 ballot. Below we detail the components of the compromise:

Minimum Wage

The bill raises the minimum wage from $11 to $15 per hour over a five-year period ($1 increase in 2019 and $0.75 increases per year from 2020 through 2023) and increases the minimum wage of tipped workers from $3.75 to $6.75 per hour ($0.60 increases per year from 2019 through 2023). The original ballot question proposed raising the minimum wage to $15 per hour and the wages for tipped workers to $9 per hour over a four-year period.

Premium Pay

The compromise phases out the premium pay employees receive for work on Sundays and holidays (1.5 times their regular pay) over a five-year period. On Sundays and holidays, workers will receive 1.4 times their regular pay in 2019, 1.3 times their regular pay in 2020, 1.2 times their regular pay in 2021, 1.1 times their regular pay in 2022, and no premium in 2023. The ballot questions did not address premium pay.

Paid Family and Medical Leave

The paid family and medical leave portion of the bill creates a state program that provides workers with 12 weeks of paid family leave and up to 20 weeks of paid medical leave (but no more than 26 weeks per year). When returning from leave, employees must be restored to the same or equivalent positions they previously held. During a period of leave, employees are entitled up to 80 percent of their regular wages up to half of the state's average weekly wage ($670), then 50 percent of wages up to an $850 per-week cap on gross benefits. The original ballot...