Fair Wage Act of 2025

The Fair Wage Act of 2025 would replace the current federal minimum with a cost-of-living based wage floor calculated for each metropolitan statistical area (MSA) or nonmetropolitan portion. The base calculation uses 40% of the national average hourly wage for private-sector, non-supervisory workers, adjusted by region-specific factors tied to regional price parity (RPP). The adjustment factors vary by area and are phased in over time: starting at 40%, rising to 45% after one year, then 50% after two years, and thereafter the applicable area wage would be the greater of the current three-year value or the prior three-year value, effectively creating a non-decreasing wage path. The act also sets the tipped-wage cash component at 30% of the computed area wage, modifies the youth minimum wage (for newly hired workers 18 or younger) to 2/3 of the area wage, and expands the "youth" age criteria to include up to age 24 for certain provisions. The effective date is three months after enactment. The bill’s sponsors are listed as unknown; it’s introduced and referred to the Education and Workforce Committee.