HB 23 — An Act amending the act of January 17, 1968 (P.L.11, No.5), known as The Minimum Wage Act of 1968, further providing for definitions and for minimum wages; providing for eligibility and coverage; further providing for exemptions, for duty of employer, for enforcement and rules and regulations and for civil actions; and repealing provisions relating to preemption.

PRINTER'S NO.   2444

                     THE GENERAL ASSEMBLY OF PENNSYLVANIA



                         HOUSE BILL
                         No. 23
                                               Session of
                                                 2025

     INTRODUCED BY RABB, HILL-EVANS, WEBSTER, DOUGHERTY AND GREEN,
        OCTOBER 9, 2025

     REFERRED TO COMMITTEE ON LABOR AND INDUSTRY, OCTOBER 10, 2025


                                    AN ACT
 1   Amending the act of January 17, 1968 (P.L.11, No.5), entitled
 2      "An act establishing a fixed minimum wage and overtime rates
 3      for employes, with certain exceptions; providing for minimum
 4      rates for learners and apprentices; creating a Minimum Wage
 5      Advisory Board and defining its powers and duties; conferring
 6      powers and imposing duties upon the Department of Labor and
 7      Industry; imposing duties on employers; and providing
 8      penalties," further providing for definitions and for minimum
 9      wages; providing for eligibility and coverage; further
10      providing for exemptions, for duty of employer, for
11      enforcement and rules and regulations and for civil actions;
12      and repealing provisions relating to preemption.
13      The General Assembly of the Commonwealth of Pennsylvania
14   hereby enacts as follows:
15      Section 1.    Section 3(d), (f), (h) and (i) of the act of
16   January 17, 1968 (P.L.11, No.5), known as The Minimum Wage Act
17   of 1968, are amended and the section is amended by adding
18   subsections to read:
19      Section 3.    Definitions.--As used in this act:
20      * * *
21      (d)   "Wages" mean compensation due to any employe by reason
22   of his or her employment, payable in legal tender of the United
23   States or checks on banks convertible into cash on demand at
 1   full face value, subject to such deductions, charges or
 2   allowances as may be permitted by regulations of the secretary
 3   under section 9.
 4      "Wage" paid to any employe includes the reasonable cost, as
 5   determined by the secretary, to the employer for furnishing such
 6   employe with board, lodging, or other facilities, if such board,
 7   lodging, or other facilities are customarily furnished by such
 8   employer to his or her employes: Provided, That the cost of
 9   board, lodging, or other facilities shall not be included as a
10   part of the wage paid to any employe to the extent it is
11   excluded therefrom under the terms of a bona fide collective-
12   bargaining agreement applicable to the particular employe:
13   Provided, further, That the secretary is authorized to determine
14   the fair value of such board, lodging, or other facilities for
15   defined classes of employes and in defined areas, based on
16   average cost to the employer or to groups of employers similarly
17   situated, or average value to groups of employes, or other
18   appropriate measures of fair value. Such evaluations, where
19   applicable and pertinent, shall be used in lieu of actual
20   measure of cost in determining the wage paid to any employe.
21      [In determining the hourly wage an employer is required to
22   pay a tipped employe, the amount paid such employe by his or her
23   employer shall be an amount equal to: (i) the cash wage paid the
24   employe which for the purposes of the determination shall be not
25   less than the cash wage required to be paid the employe on the
26   date immediately prior to the effective date of this
27   subparagraph; and (ii) an additional amount on account of the
28   tips received by the employe which is equal to the difference
29   between the wage specified in subparagraph (i) and the wage in
30   effect under section 4 of this act. The additional amount on

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 1   account of tips may not exceed the value of tips actually
 2   received by the employe. The previous sentence shall not apply
 3   with respect to any tipped employe unless:
 4      (1)    Such employe has been informed by the employer of the
 5   provisions of this subsection;
 6      (2)    All tips received by such employe have been retained by
 7   the employe and shall not be surrendered to the employer to be
 8   used as wages to satisfy the requirement to pay the current
 9   hourly minimum rate in effect; where the gratuity is added to
10   the charge made by the establishment, either by the management,
11   or by the customer, the gratuity shall become the property of
12   the employe; except that this subsection shall not be construed
13   to prohibit the pooling of tips among employes who customarily
14   and regularly receive tips.] In determining compliance with
15   section 4, gratuities shall be in addition to wages and may not
16   be credited against the wage required under section 4. An
17   employer may not, directly or indirectly, take, keep or divert
18   any part of an employe's gratuities. Where a gratuity is added
19   to a charge by the establishment or the customer, the gratuity
20   shall be the sole property of the employe who performed the
21   service. A tip pool may be permitted only among employes who
22   customarily receive gratuities and may not include an employer,
23   manager or supervisor. Any gratuities paid by credit card shall
24   be remitted in full to the employe, without deduction for
25   processing or other fees, no later than the next regular payday.
26      * * *
27      [(f)    "Employe" includes to suffer or to permit to work.]
28      * * *
29      (h)    "Employe" includes any individual [employed by an
30   employer.] who is suffered or permitted to work for

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 1   remuneration. The term includes, without limitation, a domestic
 2   worker, agricultural worker, incarcerated worker participating
 3   in a work program, worker with a disability, minor or individual
 4   who performs labor or services through a marketplace platform or
 5   similar arrangement, regardless of job title or contractual
 6   designation.
 7      (i)   "Gratuities" means [voluntary, monetary contributions
 8   received by an employe from a guest, patron or customer for
 9   services rendered.] a voluntary monetary amount paid by a guest,
10   patron or customer to an employe for services rendered.
11      (j)   "Domestic worker" means an individual who performs
12   services of a household nature in or for a private dwelling,
13   including housekeeping, cleaning, cooking, home care or child
14   care.
15      (k)   "Agricultural worker" means an individual engaged in
16   agricultural production, including planting, cultivating,
17   harvesting or caring for livestock.
18      (l)   "Marketplace platform" means a person or entity
19   operating a digital platform or application that facilitates the
20   provision of services to end users by individuals who receive
21   remuneration for the services.
22      (m)   "Marketplace contractor" means an individual who
23   provides services to end users through a marketplace platform
24   for remuneration.
25      (n)   "Worker with a disability" means an individual whose
26   earning or productive capacity is impaired by a physical or
27   mental condition.
28      Section 2.   Section 4(e) of the act is amended and subsection
29   (a) is amended by adding paragraphs to read:
30      Section 4.   Minimum Wages.--Except as may otherwise be

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 1   provided under this act:
 2      (a)    Every employer shall pay to each of his or her employes
 3   wages for all hours worked at a rate of not less than:
 4      * * *
 5      (9)    Fifteen dollars ($15) an hour beginning July 1, 2026.
 6      (10)    Beginning July 1, 2027, and each July 1 thereafter, the
 7   minimum wage shall increase by one dollar ($1) an hour from the
 8   previous year until the hourly rate for each employe reaches a
 9   living wage for a household of two adults and two children based
10   on the average cost of living, by county, as determined by the
11   department. The minimum wage shall be automatically indexed to
12   the Consumer Price Index for All Urban Consumers (CPI-U) for the
13   Pennsylvania, New Jersey, Delaware and Maryland area upon
14   meeting or exceeding the living wage threshold in the prior
15   fiscal year.
16      * * *
17      (e)    In lieu of the minimum wage prescribed in subsection (a)
18   [and section 5(c)] and notwithstanding subsections (b) and (d),
19   an employer may, during the first sixty calendar days when an
20   employe under the age of twenty years is initially employed, pay
21   the employe training wages at a rate of not less than the
22   minimum wage set forth in section 6(a) of the Fair Labor
23   Standards Act (29 U.S.C. § 206(a)). A person employed at the
24   training wage under this subsection shall be informed of the
25   amount of the training wage and the right to receive the full
26   minimum wage, or a higher wage, upon completion of the training
27   period. No employer may take any action to displace existing
28   employes, including partial displacements such as reduction in
29   the hours, wages or employment benefits of existing employes,
30   for purposes of hiring individuals at the training wage

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 1   authorized by this subsection.
 2      Section 3.     The act is amended by adding a section to read:
 3      Section 4.1.     Eligibility and Coverage.--(a)   Notwithstanding
 4   the Fair Labor Standards Act of 1938 (52 Stat. 1060, 29 U.S.C. §
 5   201 et seq.), the minimum wage under this act shall apply to all
 6   classes of workers, including domestic workers, agricultural
 7   workers, incarcerated workers participating in work programs,
 8   workers with a disability, minors and marketplace contractors.
 9      (b)    The sub-minimum cash wage of two dollars eighty-three
10   cents ($2.83) for tipped employes is abolished.
11      Section 4.     Sections 5(a)(1) and (2) and (c), 8, 9 and 13 of
12   the act are amended to read:
13      Section 5.     Exemptions.--(a)   Employment in the following
14   classifications shall be exempt from both the minimum wage and
15   overtime provisions of this act:
16      [(1)    Labor on a farm;
17      (2)    Domestic services in or about the private home of the
18   employer;]
19      * * *
20      [(c)    (1)   Notwithstanding the provisions of section 4(a)(7)
21   and (8), an employer unless otherwise exempt from the minimum
22   wage provisions of section 4(a)(6) whose employe complement is
23   composed of the equivalent of ten or less full-time employes to
24   be calculated on a forty-hour workweek shall pay:
25      (i)    Five dollars sixty-five cents ($5.65) an hour beginning
26   January 1, 2007.
27      (ii)    Six dollars sixty-five cents ($6.65) an hour beginning
28   July 1, 2007.
29      (2)    Such employer shall pay the full amount of the minimum
30   wage under section 4(a)(8) beginning July 1, 2008.]

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 1      Section 8.   Duty of Employer.--Every employer of employes
 2   shall keep a true and accurate record of the hours worked by
 3   each employe and the wages paid to each, and shall furnish to
 4   the secretary or his or her duly authorized representative, upon
 5   demand, a sworn statement of the same. Such records shall be
 6   open to inspection by any duly authorized representative of the
 7   secretary at any reasonable time and shall be preserved for a
 8   period of three years. Every employer subject to this act shall
 9   keep a summary of this act and any regulations issued thereunder
10   applicable to him or her, posted in a conspicuous place where
11   employes normally pass and can read it. Employers shall, upon
12   request, be furnished copies of such summaries without charge.
13   Employers shall permit any duly authorized representative of the
14   secretary to interrogate any employe in the place of employment
15   and during work hours with respect to the wages paid to and the
16   hours worked by such employe or other employes. In addition, an
17   employer shall provide each employe, on each regular payday, an
18   itemized statement of hours worked, rates of pay, gross wages,
19   the amount and nature of each deduction and the amount of any
20   gratuities paid, including gratuities paid by credit card.
21   Gratuities paid by credit card shall be paid in full to the
22   employe without deduction for processing or other fees no later
23   than the next regular payday. An employer may not require an
24   employe to surrender or credit any gratuities toward the wage
25   required under section 4.
26      Section 9.   Enforcement; Rules and Regulations.--The
27   secretary shall enforce this act. The secretary shall make and,
28   from time to time, revise regulations, with the assistance of
29   the board, when requested by the secretary, which shall be
30   deemed appropriate to carry out the purposes of this act and to

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 1   safeguard the minimum wage rates thereby established. Such
 2   regulations may include, but are not limited to, regulations
 3   defining and governing bona fide executive, administrative, or
 4   professional employes and outside salespersons, learners and
 5   apprentices, their number, proportion, length of learning
 6   period, and other working conditions; handicapped workers; part-
 7   time pay; overtime standards; bonuses; allowances for board,
 8   lodging, apparel, or other facilities or services customarily
 9   furnished by employers to employes; [allowances for gratuities]
10   regulation of gratuities, including tip pooling and payment
11   practices consistent with section 3; or allowances for such
12   other special conditions or circumstances which may be
13   incidental to a particular employer-employe relationship.
14   Regulations may not authorize crediting gratuities against the
15   wage required under section 4.
16      Section 13.   Civil Actions.--If any employe is paid by his or
17   her employer less than the minimum wages provided by section 4
18   of this act or by any regulation issued thereunder, such worker
19   may recover in a civil action the full amount of such minimum
20   wage less any amount actually paid to the worker by the
21   employer, together with costs and such reasonable attorney's
22   fees as may be allowed by the court, and any agreement between
23   the employer and the worker to work for less than such minimum
24   wage shall be no defense to such action. At the request of any
25   employe paid less than the minimum wage to which such employe
26   was entitled under this act and regulations issued thereunder,
27   the secretary may take an assignment of such wage claim, in
28   trust for the assigning worker and may bring any legal action
29   necessary to collect such claim, and the employer shall be
30   required to pay the cost and such reasonable attorney's fees as

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 1   may be allowed by the court. An employe may also recover, in a
 2   civil action, any gratuities the employer unlawfully kept,
 3   diverted or failed to remit under section 3, together with costs
 4   and such reasonable attorney fees as may be allowed by the
 5   court.
 6      Section 5.   Section 14.1 of the act is repealed:
 7      [Section 14.1.   Preemption.--(a)   Except as set forth in
 8   subsection (b), this act shall preempt and supersede any local
 9   ordinance or rule concerning the subject matter of this act.
10      (b)   This section does not prohibit local regulation pursuant
11   to an ordinance which was adopted by a municipality prior to
12   January 1, 2006, and which remained in effect on January 1,
13   2006.]
14      Section 6.   This act shall take effect in 60 days.




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