Fair Wage Act of 2025

HR 3438, the Fair Wage Act of 2025, establishes a regional minimum wage tied to cost of living, directly affecting most covered workers across the U.S. The bill sets the minimum wage for each metropolitan area or nonmetropolitan region as a percentage (starting at 40%) of the national average hourly wage for private non-supervisory workers, adjusted by regional price parity (ranging from 87.5% to 115% based on local costs). It phases in higher percentages over time (45% after 1 year, 50% after 5 years) and requires tipped employees to receive cash wages equal to 30% of this regional minimum, while setting a new minimum for workers aged 18 or younger at two-thirds of the regional rate. The law takes effect three months after enactment.