Linking increases in the minimum wage to the federal minimum wage.

SB 5339 would change Washington State's minimum wage calculation method, linking future increases directly to any annual raises in the federal minimum wage instead of using inflation adjustments. Starting December 30, 2025, the state minimum wage would only increase if the federal wage rises in the previous year, with no increase allowed if the federal rate stays the same. Local jurisdictions with higher minimum wages (above $16.66/hour as of the bill's effective date) cannot raise their rates further, though the state rate would override local rates if it increases. This affects all Washington employers and workers covered by state minimum wage laws, particularly small businesses operating on thin margins.