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E-Alerts

Ten States Have Raised The Minimum Wage: Be Sure The New Posters Are Up!

[March 14, 2013]  In the ten states where the minimum wage has increased with the new year, employers should be sure that they are paying at least the minimum wage, and that they have the requisite new posters up in the workplace.

Minimum Wage Increases

As of January 1, 2013, the minimum wage rates in the following ten states have increased as follows:

  • Arizona:  from $7.65 to $7.80 per hour (for tipped employees, from $4.65 to $4.80 per hour);
  • Colorado:  from $7.64 to $7.78 per hour (for tipped employees, from $4.62 to $4.76 per hour);
  • Florida:  from $7.67 to $7.79 per hour (for tipped employees, from $4.65 to $4.77 per hour);
  • Missouri:  from $7.25 to $7.35 per hour (for tipped employees, from $3.63 to $3.68 per hour);
  • Montana:  from $7.65 to $7.80 per hour (for tipped employees, no lower rate permitted);
  • Ohio:  from $7.70 to $7.85 per hour (for tipped employees, from $3.85 to $3.93 per hour);
  • Oregon:  from $8.80 to $8.95 per hour (for tipped employees, no lower rate permitted);
  • Rhode Island:  from $7.40 to $7.75 per hour (for tipped employees, remains $2.89 per hour);
  • Vermont:  from $8.46 to $8.60 per hour (for tipped employees, from $4.10 to $4.17 per hour); and
  • Washington:  from $9.04 to $9.19 per hour (for tipped employees, no lower rate permitted).

With the exception of Rhode Island, these states adjust their minimum wage rates annually, based on increases in the Consumer Price Index.  Rhode Island’s rate increase is pursuant to special legislation enacted in 2012.

The federal and Massachusetts minimum wage rates remain unchanged, at $7.25 and $8.00 per hour, respectively.  Generally, employers in all states must pay all nonexempt employees the greater of the federal or the applicable state minimum wage.

While the above increases cover most employees in these ten states, some of these states permit lower hourly wage rates for certain categories of employees, such as tipped employees and minors.  Additionally, a few of these states allow lower hourly wage rates for small employers whose annual revenues fall below certain thresholds.  Employers should consult with counsel to determine whether any such exceptions apply, as wage violations are frequently litigated and often carry heavy penalties.

Finally, employers should be aware that a number of municipalities (including Long Beach, San Francisco, and San Jose, California; Albuquerque and Santa Fe, New Mexico; and Washington, D.C.) have enacted measures establishing their own minimum wage rates. Employers should confirm that they are paying wages that are consistent with all applicable local minimum wages and monitor municipal wage increases, as they are increasingly in vogue.

Recommendations For Employers

Penalties for paying sub-minimum wages, misclassifying employees as independent contractors, and committing other wage-and-hour violations can be substantial.  We recommend that employers promptly take steps to ensure compliance with the new minimum wage rates and related legal obligations.

In particular, we recommend that employers:

  • Update payroll practices to implement any pay increases that may be necessitated by the increased minimum wage rates in these ten states.
  • Ensure that all required workplace posters concerning minimum wages and other employment matters are displayed in the appropriate locations.
  • Carefully review all written job descriptions to ensure that employees are appropriately classified as exempt or nonexempt – and that workers are not improperly classified as independent contractors rather than employees.

Employers with employees in the states in which minimum wages have increased are required to display new posters reflecting these increases.  Additionally, these mandatory minimum-wage posters are only one component of more comprehensive poster requirements under various state and federal employment laws.  The Firm offers state-specific compliance packages to enable employers to achieve full compliance with all poster obligations and other applicable wage-and-hour requirements.

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Please feel free to contact us if you have any questions regarding these minimum wage increases or any other wage-and-hour issues.