Sen. Hawley to introduce blue-collar pay raise bill

Blue-collar bonus proposal

WASHINGTON, D.C. (KFVS) - U.S. Senator Josh Hawley (R-Mo.) announced he will be introducing a new bill to give blue-collar workers a pay raise on Wednesday, February 24.

The measure, the “Blue-Collar Bonus Tax Credit,” would give workers a bonus four times a year through an automatic, advanceable tax credit based on hours worked and median pay formula.

In a released statement, Sen. Hawley said the following is how the formula would work:

  • Credit Amount The credit is worth 50 percent of the difference between the median wage and the worker’s hourly wage rate. In other words, the credit would boost per hour wages 50 percent closer to the median. The median wage is set at $16.50 per hour and will be indexed to inflation. The credit is allowed for a maximum of 40 hours per week and phases out at the median wage.
    • Example: An American worker making $12 per hour would be eligible for a $2.25 per hour credit [(16.50-12.00)/2]. The maximum credit would be for 40 hours of work per week, or 2080 hours over the course of a year, allowing this full-time worker a total credit of $4,680 for the taxable year. This worker can expect to receive four distinct payments of $1,170 from the IRS.

To be eligible for the credit, workers will need to have a valid social security number and earn below the median wage.

The IRS will send a quarterly payment to eligible workers in the same manner they receive a tax refund, including by direct deposit.

If approved, the Blue-Collar Bonus Tax Credit would be implemented during the economic recovery process from the coronavirus and then end after three years.

Sen. Hawley stated that wages for blue-collar workers has been stagnant for decades.

“It’s time we give blue-collar workers some respect and a pay raise,” said Hawley. “This plan would deliver meaningful relief for families and working Americans through higher pay while incentivizing and promoting work.”

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