Federal, State, and Local Wage Laws in the United States

In the early 1900s, in the wake of the Industrial Revolution and the Great Depression, it was all too common for employers to expect their employees to work long hours for little pay. To address these oppressive working conditions, in 1938, the government passed the Fair Labor Standards Act (FLSA), which, among other things, set a living wage for employees.

The first federal wage was $0.25 per hour. Today, nearly 30 amendments later, the rate is $7.25, set back in 2009. And states have gotten in on the action too, enacting their own minimum rates of pay.

Here’s what you need to know to ensure your company is in compliance with the latest wage laws.

Federal wage under FLSA

 

The FLSA requires employers to pay nonexempt (which generally means non-salaried employees) a wage of at least $7.25 per hour. The rule is slightly different for employees under 20 years old: for the first 90 days of their employment, they must be paid at least $4.25 an hour. The rule is also different for employees who receive tips: they are entitled to at least $2.13 per hour if they claim a tip credit. Some other employees can earn less than the statutory minimum wage: student learners; full-time students in retail or service establishments, agriculture, or institutions of higher education; and individuals whose earning or productive capacities are impaired by physical or mental disabilities, including those related to age or injury.

Additional state and local requirements

 

States and localities may also have adopted additional laws that regulate the wage for employees. In these states and cities, employers must follow the law with a higher standard. In other words, if state law requires a higher wage than the FLSA, then the employer must pay the higher wage.

Five states—Alabama, Louisiana, Mississippi, South Carolina, and Tennessee—don’t have their own minimum wage law. And only the Commonwealth of the Northern Mariana Islands has a lower minimum wage than the federal rate: $7.05. Of the rest, 29 states, plus Washington, D.C., Guam, and the Virgin Islands, have a higher wage than $7.25.

Minimum Wage by State, Federal, City or County

State City/County Minimum Wage
Alabama   $7.25
Alaska   $10.34 (effective 1/1/21)
Arizona   $12.15 (effective 1/1/21)
  Flagstaff $15.00 (effective 1/1/21)
Arkansas   $11.00 (effective 1/1/21)
California   $14.00 (26 or more employees, effective 1/1/21)
    $13.00 (25 or fewer employees, effective 1/1/2021)
  Alameda $15.00 (effective 7/1/20)
  Belmont $15.90 (effective 1/1/21)
  Berkeley $16.07 (effective 7/1/21)
  Cupertino $15.65 (effective 1/1/21)
  Daly City $15.00 (effective 1/1/21)
  El Cerrito $15.61 (effective 1/1/21)
  Emeryville $16.84 (effective 7/1/21)
  Fremont $13.50 (25 or fewer employees, effective 7/1/20)
    $15.00 (26 or more employees, effective 7/1/20)
  Los Altos $15.65 (effective 1/1/21)
  Los Altos Hills $13.00 (26 or more employees, effective 1/1/20)
    $12.00 (25 or fewer employees, effective 1/1/20)
  Los Angeles $15.00 (26 or more employees, effective 7/1/20)
    $14.25 (25 or fewer employees or Non-Profit Corporations, effective 7/1/20)
  Los Angeles County $15.00 (26 or more employees, effective 7/1/20)
    $14.25 (25 or fewer employees or Non-Profit Corporations, effective 7/1/20)
  Malibu $15.00 (26 or more employees, effective 7/1/20)
    $14.25 (25 or fewer employees, effective 7/1/20)
  Menlo Park $15.25 (effective 1/1/21)
  Milpitas $15.40 (effective 7/1/21)
  Mountain View $16.30 (effective 1/1/21)
  Novato $15.00 (100+ employees, effective 7/1/20)
    $14.00 per hour (26-99 employees, effective 7/1/20)
    $13.00 (1-25 employees, effective 7/1/20)
  Oakland $14.36 (effective 1/1/21)
  Palo Alto $15.65 (effective 1/1/21)
  Pasadena $15.00 (26 or more employees, effective 7/1/20)
    $14.25 (25 or fewer employees, effective 7/1/20)
  Petaluma $15.20 (All employers regardless of size, effective 1/1/21)
  Redwood City $15.62 (effective 1/1/21)
  Richmond $15.21 (effective 1/1/21)
  San Diego $14.00 (effective 1/1/21)
  San Francisco $16.07 (effective 7/1/21)
  San Jose $15.45 (effective 1/1/21)
  San Leandro $15.00 (effective 7/1/20)
  San Mateo $15.65 (effective 1/1/21)
  Santa Clara $15.65 (effective 1/1/21)
  Santa Monica $17.13 (All Hotels, effective 7/1/2020)
    $15.00 (26 or more employees, effective 7/1/20)
    $14.25 (25 or fewer employees, effective 7/1/20)
  Santa Rosa $15.00 (26 or more employees, effective 6/1/20)
    $14.00 (25 or fewer employees, effective 6/1/20)
  Saratoga $12.00 (25 or less employees, effective 1/1/2020)
    $13.00 (26 or more employees, effective 1/1/2020)
    $14.00 (25 or less employees, effective 7/1/20)
  Sonoma $15.00 (26 or more employees, effective 1/1/21)
    $14.00 (25 or fewer employees, effective 1/1/21)
  Sunnyvale $16.30 (effective 1/1/21)
Colorado   $12.32 (effective 1/1/21)
  Denver $14.77 (effective 1/1/2021)
    $9.83 (tipped workers, effective 1/1/2020)
Connecticut   $12.00 (effective 8/01/20)
    $13.00 (effective 8/1/21)
Delaware   $9.25 (effective 10/1/19)
    $8.75 (youth & training wage)
District of Columbia   $15.00 (effective 7/1/20)
Florida   $8.65 (effective 1/1/21)
  Broward County 15.12 (without health benefits)
    $13.47 (with qualifying health benefits amounting to at least $1.65/per hour)
Georgia   $5.15 (Basic Minimum Rate, 6 or more employees)
    $7.25 (Employers subject to Fair Labor Standards Act)
Hawaii   $10.10 (effective 1/1/18)
Idaho   $7.25 (effective 10/1/12)
Illinois   $11 (effective 1/1/21)
  Chicago/Cook County $14.00 (21 or more employees, effective 1/1/21)
    $13.50 (21 or less employees, effective 1/1/21)
Indiana   $7.25
Iowa   $7.25
Kansas   $7.25
Kentucky   $7.25
Louisiana   $7.25
Maine   $12.15 (effective 1/1/21)
  Portland $12.00 (Non-tipped workers, effective 1/1/20)
    $6.08 (Tipped workers, effective 1/1/2020)
Maryland   $11.75 (effective 1/1/21)
  Montgomery County $14.00 (Large Employers, effective 7/1/20)
    $13.50 (Small and Mid-Sized Employers, effective 7/1/20)
  Prince George’s County $11.50 (10/1/17 wage still effective as of 7/1/20)
Massachusetts   $13.50 (effective 1/1/21)
Michigan   $9.87 (effective 1/1/21)
Minnesota   $10.08 (Large employer: annual gross revenue of $500K+, effective 1/1/2021)
    $8.21 (Small employer: annual gross revenue less than $500K, effective 1/1/2021)
    $8.21 (Youth wage: may be paid to employees age 17 or younger)
    $8.21 (Training wage)
    $8.21 (J-1 Visa)
  Minneapolis $14.25 (100 or more employees, effective 7/1/21)
    $12.50 (100 or fewer employees, effective 7/1/21)
  Saint Paul $12.50 (10K or more employees & city employees, effective 1/1/20)
    $11.50 (101 of more employees, effective 7/1/2020)
    $10.00 (6-100 employees, effective 7/1/2020)
    $9.25 (5 or fewer employees, effective 7/1/2020)
  Duluth $10.00 (Large-Employer)
    $8.15 (Small-Employer)
    $8.15 (Training wage)
    $8.15 (Youth wage)
Mississippi   $7.25
    $6.16 (Youth/Student Wage up to 20hrs/per week)
    $4.25 (Training wage)
Missouri   $10.30 (private employees, effective 1/1/21)
    $5.15 (tipped workers, effective 1/1/21)
Montana   $8.75 (effective 1/1/21)
Nebraska   $9.00 (effective 1/1/20)
Nevada   $9.75 (effective 7/1/21)
    $8.75 (employees that are offer qualifying health insurance benefits, 7/1/21)
New Hampshire   $7.25 (effective March 1, 2014)
New Jersey   $12.00 (most employers, effective 1/1/21)
    $10.30 (Seasonal and Small Employers – fewer than 6, effective 1/1/20)
    $11.10 (Agricultural Employers w/fewer than six employees), effective 1/1/21)
    $3.13 (Cash wage for tipped workers)
New Mexico   $10.50 (effective 1/1/21)
    $2.35 (tipped employees, effective 1/1/20)
  Albuquerque $9.35 (without medical/childcare benefits, effective 1/1/20)
    $8.35 (with medical/childcare benefits, effective 1/1/20)
    $5.60 (tipped worker, effective 1/1/20)
  Bernalillo County $9.20 (effective 1/1/20)
  Las Cruces

$10.50 (most employees, effective 1/1/21)

   

$4.20 (tipped employees, effective 1/1/21)

  Santa Fe $12.10 (effective 4/1/20)
  Santa Fe County $12.10 (effective 4/1/20)
    $3.62 (base wage for tipped employees, effective 4/1/20)
New York   $15.00 (all employees in New York City, effective 12/31/19)
    $14.00 (Nassau, Suffolk and Westchester Counties, effective 12/31/21)
    $12.50 (Remainder of the state, effective 1/1/21)
North Carolina   $7.25 
    $2.13 (base wage for tipped employees, effective 1/1/20)
North Dakota   $8.70 (08/01/16)
Ohio   $8.80 (non-tipped employees, effective 1/1/21)
    $7.25 (Minors ages 14-15)
    $4.40 (tipped employees, effective 1/1/21)
Oklahoma   $7.25 (01/01/14)
Oregon   $12.75 (effective 7/1/21)
  Portland $13.25 (increasing to $14.00 on 7/1/21)
    $11.50 (Rural areas. Increasing to $12.00 on 7/1/21)
Pennsylvania   $7.25
  Philadelphia $13.25 (Government Employees, City Contractors and Sub Contractors)
    $7.25 (All other industries)
Rhode Island   $11.50 (all other employees, effective 10/1/20)
    $10.35 (full-time students under 19 working in certain non-profit organizations, effective 10/1/20)
    $8.63 (minors 14-15 years old working not more than 24 hours a week, effective 10/1/20)
    $3.89 (tipped employees, effective 10/1/20)
South Carolina   $7.25
South Dakota   $9.45 (effective 1/1/21)
Tennessee   $7.25
Texas   $7.25
Utah   $7.25
Vermont   $11.75 (general minimum wage, effective 1/1/21)
    $5.88 (service & tipped wage, effective 1/1/21)
Virginia   $7.25 (Increases to $9.50 5/1/21)
Washington   $13.69 (effective 1/1/21)
    $11.64 (minors under age 16, effective 1/1/21)
  Seattle $16.69 (500 or more employees, effective 1/1/21)
    $15.00 (500 or fewer employees without benefits or tips)
West Virginia   $8.75 (effective 1/1/16)
Wisconsin   $7.25
Wyoming   $5.15
    $7.25 (employers subject to Fair Labor Standards Act)
Federal   $7.25
Federal Contractor   $10.80 (effective 1/1/20)
     
 

 

 

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How often does the federal wage increase?

 

There is no set schedule for the automatic increase of the minimum wage, whether at the federal, state, or local level. To raise the federal wage, Congress must pass a bill, and the president must sign it into law.

Similar legislative processes occur at the state and local levels. In 2019, 20 states raised their wage rate and required employers to notify employees of the new wage.

Sometimes state and local governments set an incremental yearly increase if they want to hit a particular target. For instance, California has scheduled yearly wage increases for small (under 25 employees) and large (26 or more employees) employers with the goal of hitting $15.00 by 2022 and 2023: the current rate for small employers is $12.00, and it’s $13.00 for large employers. The law in New York is even more detailed. For large and small employers in New York City, the current wage is $15.00. For Long Island and Westchester, the rate is $13.00, regardless of employer size. And the rest of the state is currently at $11.80. The wages for all locations will increase yearly through 2021 until they reach $15.00.

Other states adjust their wages to match the rise in the cost of living. These inflation adjustments are generally smaller and may occur annually or less often. As an example, Florida and New Jersey both adjust their rates annually to account for inflation.

Additionally, 45 localities currently have their own minimum wage, including cities and counties in Arizona, California, Illinois, Maine, Maryland, Minnesota, New Mexico, and Washington.

Wage notices and posters

 

Employers must post a notice explaining the provisions of the FLSA and applicable state and local wage laws—and they must ensure that they have the latest version of that information posted at all times. Bookmark this page to stay up to date on changes in the wage at the federal, state, and local levels. And contact us if you need help navigating the complex requirements relating to posters about wage and hour laws.