Higher Wages for American Workers Act of 2025
The Higher Wages for American Workers Act of 2025 would overhaul the federal minimum wage under the Fair Labor Standards Act (FLSA). It would establish a new wage floor of not less than $15 per hour, starting January 1 of the first year after enactment, with subsequent annual increases on January 1 in the second year after enactment and every January 1 thereafter. Those future increases would be determined each year by the Secretary of Labor using an inflation-based formula tied to the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W), and would be rounded to the nearest five cents. The bill also creates an annual process to adjust the wage using CPI-W data from the prior 12-month period ending in July. The act takes effect on January 1 of the first year after enactment. In short, the bill guarantees a federal minimum wage floor of $15 and then ties future increases to inflation, with a formal annual adjustment process to keep the wage in line with rising costs.
Key Points
- 1Sets a new federal minimum wage floor of at least $15 per hour, starting January 1 of the first year after enactment.
- 2From the second year after enactment onward, the minimum wage for the period covered is the prior amount plus the inflation-based increase determined annually by the Secretary of Labor, rounded to the nearest $0.05.
- 3Annual inflation adjustments are calculated using CPI-W (the Consumer Price Index for Urban Wage Earners and Clerical Workers) and reflect the 12-month period ending in July of the year of determination.
- 4The calculated wage amount is rounded to the nearest multiple of $0.05 if needed.
- 5Effective date: the Act and its amendments take effect on January 1 of the first year after enactment.