Are You Prepared for State and Local Minimum Wage Hikes in 2014?

30 December 2013 Labor & Employment Law Perspectives Blog

As the new year fast approaches, employers with operations in the following state and local jurisdictions should take note of any applicable minimum wage increases. These increases are scheduled to take effect on January 1, 2014 (except as noted below).

It is important to note that some states have also made changes to the tip credit, which may also affect the mandatory minimum wage that would be paid to customarily tipped employees. (Certain states such as California, Montana, Oregon and Washington do not permit a tip credit.)

In addition to the above increases, some localities have minimum wage increases that will take effect in 2014. For example, employees in San Francisco, California will realize a minimum wage increase from $10.24 to $10.55 per hour. Similarly, San Jose, California’s minimum wage will increase from $10.00 to $10.15 per hour. Albuquerque, New Mexico’s minimum wage, with some exceptions, will increase to $8.60 per hour. Thus, companies with employees who work in these localities and/or regularly travel to these localities should review whether these wage and hour requirements are applicable to those employees.

The changes to the minimum wage increases will affect, among other things, the calculation of overtime pay rates and the minimum salaries paid to employees classified as exempt. Moreover, it would be prudent for companies in the affected jurisdictions to review and to make adjustments in compensation levels to employees where appropriate.

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