The minimal wage regulation prevents employers from paying workers under a specific amount per hour. What’s minimal wage? There’s a federal minimal wage, however many states and localities set the next wage. Adjust to labor legal guidelines by studying what minimal wage what you are promoting could also be topic to.
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What’s minimal wage?
The minimal wage is the lowest quantity you possibly can legally pay an worker per hour of labor. You’ll be able to pay greater than the minimal wage should you’d like, however you can’t pay lower than the minimal wage.
Minimal wage legal guidelines don’t apply to impartial contractors, so it’s essential to just be sure you classify your workers accurately.
Who units the minimal wage?
The federal authorities units a typical minimal wage that applies to all workers in america. Nonetheless, states and localities can set minimal wage charges, too.
So, which price do it’s essential comply with? Federal, state, or native?
Federal minimal wage vs. state vs. native
What occurs if a state’s minimal wage is decrease than the federal minimal wage? What about if the native minimal wage is decrease than the federal?
If the state or native minimal wage is decrease than the federal minimal wage, it’s essential to pay your workers at the very least the federal minimal wage price.
What about if the state or native minimal wage is larger? If the state or native minimal wage is larger than the federal price, pay your workers the state or native price (whichever is larger).
When selecting between federal, state, and native minimal wage legal guidelines, at all times pay your workers the very best price.
What’s the federal minimal wage?
The federal minimal wage is ready by the Truthful Labor Requirements Act (FLSA) and enforced by the U.S. Division of Labor (DOL).
Though the federal minimal wage price is topic to vary, it has not elevated since 2009.
So, what’s the nationwide minimal wage? The present federal minimal wage is $7.25 per hour. Nonetheless, the federal minimal wage may doubtlessly improve in upcoming years.
State minimal wage 2025
Every state can set its personal minimal wage. If a state’s minimal wage is bigger than the federal minimal, pay workers at the very least the state’s minimal wage.
For instance, the minimal price in Ohio is $10.70 per hour for 2025. When you’ve got workers in Ohio, it’s essential to pay them at the very least the state’s minimal since it’s better than the federal minimal wage of $7.25.
Use the map under to see which states comply with the federal minimal wage price and which set their very own minimal.
2025 State minimal wage chart
You could be questioning how a lot minimal wage is in your state. Try our state-by-state minimal wage price chart under to seek out out.
Needless to say the states with $7.25 comply with the federal minimal wage base.
[State minimum wages as of January 1, 2025]
*These states would not have a state-mandated minimal wage. As an alternative, most employers should pay the federal minimal wage.
**These states have a minimal wage of $5.15 for any employers who should not lined by the Truthful Labor Requirements Act. Most employers are lined by the FLSA and should pay the federal minimal wage of $7.25.
Heads up! State minimal wage legal guidelines are ever-changing. Keep up-to-date together with your state’s minimal wage necessities by periodically checking your state’s web site.
Native minimal wage
Some cities and counties create a neighborhood minimal wage that differs from state or federal charges. Native wages are commonest in larger cities. Employers should pay the larger of the 2 charges if the native minimal wage is totally different from the state minimal wage.
For instance, the minimal wage in San Francisco is $18.67 per hour (as of July 1, 2024). Employers in San Francisco should pay workers at the very least the native base wage as a result of it’s better than each the state and federal minimums.
One other instance is New York. Employers in many of the state should pay an hourly minimal wage of $15.50 per hour. Nonetheless, the minimal wage in Lengthy Island, Westchester, and NYC is $16.50 per hour.
Like state minimal wage charges, native charges are topic to vary. Verify together with your native authorities for extra info.
Exceptions to minimal wage
There are some exceptions to paying your workers minimal wage. Minimal wage varies for:
Minimal wage for tipped workers
The FLSA at the moment permits a tip credit score, which reduces the federal minimal wage for tipped workers. Tipped workers can have a decrease base wage as a result of their suggestions ought to make up the remainder of their wages.
The federal tipped minimal wage is at the moment $2.13. This is applicable to workers who earn greater than $30 in suggestions per 30 days.
Particular person states may have minimal wage legal guidelines for tipped workers. Verify your state’s tipped minimal wage legal guidelines to be taught extra.
Youth minimal wage
The FLSA additionally permits a particular youth minimal wage. You’ll be able to pay workers below age 20 a wage of $4.25 for the primary 90 days of employment. After 90 consecutive days of employment or the worker reaches 20 years of age (whichever comes first), the worker should obtain the minimal wage.
Some states have a youth minimal that’s better than the federal youth minimal wage. For extra info, take a look at the U.S. Division of Labor’s web site.
Dwelling wage vs. minimal wage
When wanting by state and native minimal wage legal guidelines, you may even see the time period “residing wage.” So, what’s a residing wage?
A residing wage is a state or native wage that’s larger than the minimal wage. Much like price of residing, the residing wage is the quantity an employer would want to pay an worker to keep away from poverty. The objective of a residing wage is to lower poverty by elevated earnings.
This text has been up to date from its authentic publication date of March 22, 2012.
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