July 14, 2020

Volume X, Number 196

July 13, 2020

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State Minimum Wage Increases Effective 2016

State and local legislatures continue to be busy with minimum wage legislation. As in past years, employers with multi-state operations must remain abreast of these changes. Many state laws provide for annual increases based on the U.S. Consumer Price Index and inflation. Except as noted below, higher state minimum wages are effective January 1, 2016. Because hospitality and similar employers also need to be aware of changes to the permissible tip credit that affect the minimum wage they must pay to customarily tipped employees, such increases also appear below.

In addition, a number of localities around the country have increased their minimum wage rates effective January 1, 2016. A few of these localities are listed below.

Of course, these changes to minimum wage rates also affect overtime pay calculations. Finally, we also provide information relating to increases in the minimum weekly salary that must be paid to certain exempt employees to satisfy the Fair Labor Standards Act salary basis test for the exemptions.

State Minimum Wage Rate Increases

Alaska – General minimum wage increases from $8.75 to $9.75 an hour. (Alaska law does not allow employers to take a tip credit against minimum wage for tipped employees.) In addition, to satisfy the salary basis test for exempt status, the minimum weekly salary for bona fide executive, professional, and administrative employees will increase from $700 to $780 per week (i.e., two times state minimum wage for the first 40 hours of employment).

Arkansas – General minimum wage increases from $7.50 to $8.00 an hour. Minimum wage for tipped employees remains $2.63.

California – General minimum wage increases from $9.00 to $10.00 an hour. (California law does not allow employers to take a tip credit against minimum wage for tipped employees.) In addition, to satisfy the salary basis test for exempt status, the minimum annual salary for bona fide executive, professional, and administrative employees will increase from $37,440 to $41,600 (i.e., two times state minimum wage for the first 40 hours of employment each week).

Colorado – General minimum wage increases from $8.23 to $8.31 an hour. Minimum wage for tipped employees increases from $5.21 to $5.29 an hour.

Connecticut – General minimum wage increases from $9.15 to $9.60 an hour. Minimum wage for tipped bartenders increases from $7.46 to $7.82 an hour and minimum wage for hotel and restaurant tipped employees other than bartenders increases from $5.78 to $6.07 an hour.

Hawaii – General minimum wage increases from $7.75 to $8.50 an hour. Adjusted minimum wage for tipped employees increases from $7.25 to $7.75 an hour, provided that when tips are added to the wages paid by the employer, the total amount is no less than $15.50 per hour.

Massachusetts – General minimum wage increases from $9.00 to $10.00 an hour. Minimum wage for tipped employees increases from $3.00 to $3.35 an hour.

Michigan – General minimum wage increases from $8.15 to $8.50 an hour. Minimum wage for tipped employees increases from $3.10 to $3.23 an hour.

Nebraska – General minimum wage increases from $8.00 to $9.00 an hour. Minimum wage for tipped employees remains $2.13 an hour.

New York – General minimum wage increases from $8.75 to $9.00 an hour, effective December 31, 2015. Subject to caveats outside the hospitality industry, the minimum wage for all tipped employees will increase to $7.50 an hour. In addition, to satisfy the salary basis test for exempt status, the minimum weekly salary for bona fide executive and administrative employees will increase from $656.25 to $675 per week.

Rhode Island – General minimum wage increases from $9.00 to $9.60 an hour. Minimum wage for tipped employees increases from $2.89 to $3.39 an hour.

South Dakota – General minimum wage increases from $8.50 to $8.55 an hour. Minimum wage for tipped employees increases from $4.25 to $4.28 an hour.

Vermont – General minimum wage increases from $9.15 to $9.60 an hour. Minimum wage for tipped employees increases from $4.58 to $4.80 an hour.

West Virginia – General minimum wage increases from $8.00 to $8.75 an hour. Minimum wage for tipped employees increases from $2.40 to $2.62 an hour.

Local Minimum Wage Rate Increases

Oakland, CA – General minimum wage increases from $12.25 to $12.55 an hour.

Portland, ME – General minimum wage increases from $7.50 (the state minimum wage) to $10.10 an hour.

Seattle, WA – General minimum wage increases (for large employers employing at least 501 employees) from $11.00 to $13.00 an hour (or $12.50 for such employers that contribute to health benefits). For small employers (employing 500 or fewer employees) the 2016 rate is $12.00 or $10.50 an hour, depending on whether health benefits are provided.

Jackson Lewis P.C. © 2020National Law Review, Volume V, Number 360

TRENDING LEGAL ANALYSIS


About this Author

Jeffrey Brecher, Jackson Lewis, Management Arbitration Lawyer, Labor Litigation Attorney
Principal

Jeffrey W. Brecher is a Principal in the Long Island, New York, office of Jackson Lewis, and is Practice Group Leader of the firm's Wage and Hour practice. He has litigated hundreds of cases, defending management at arbitration, before state and federal administrative agencies and at trial.

Mr. Brecher regularly advises clients on compliance with various state and federal laws affecting the workplace, including discrimination and related claims arising under Title VII, Family and Medical Leave Act, Americans with...

631-247-4652
Richard Greenberg, Jackson Lewis, workplace grievances lawyer, arbitrations litigation attorney
Principal

Richard Greenberg is a Principal in the New York City, New York, office of Jackson Lewis P.C. He advises both unionized and union-free clients on a full-range of labor and employee relations matters.

With respect to traditional labor matters, Mr. Greenberg represents clients in collective bargaining negotiations, labor disputes, grievances and arbitrations, proceedings before the National Labor Relations Board, and in state and federal court. Mr. Greenberg also advises clients on the legal aspects of remaining union-free. With respect to employee relations matters, Mr. Greenberg has extensive experience assisting clients in numerous industries with the development and maintenance of personnel policies and personnel infrastructures. In this regard, Mr. Greenberg often works on these issues with clients as business needs and culture change as a result of business transactions, such as mergers and acquisitions.

212-545-4080
Noel Tripp Principal Employment lawyer at Jackson Lewis Law Firm
Principal

Noel P. Tripp is a Principal in the Long Island, New York, office of Jackson Lewis P.C. Since joining Jackson Lewis as a summer associate in May 2005, he has practiced exclusively in employment law.

Mr. Tripp has been involved in matters pending before federal and state courts and administrative agencies covering the gamut of employment-related matters from discrimination and workplace harassment to wage/hour disputes and affirmative-action compliance. His principal focus is the defense of class and collective action...

631-247-0404
Jason Zoldessy, Jackson Lewis Law Firm, Labor and Employment Attorney
Principal

Jason Zoldessy is a Principal in the New York City, New York, office of Jackson Lewis P.C. Since joining Jackson Lewis in 2003, Mr. Zoldessy has represented employers before various federal and state courts and administrative agencies.

Mr. Zoldessy has also represented clients in a number of arbitration and mediation proceedings. Mr. Zoldessy advises clients on traditional labor/management relations, wage and hour laws and preventive counseling matters. Mr. Zoldessy also advises clients on compliance with various federal...

212-545-4021