President Obama has spent much of his second term zealously pursuing an increase to the current $7.25 federal minimum hourly wage. While it is not clear whether a federal wage hike is in the offing, many states have recently taken measures to increase their own minimum wage rates. Effective January 1, 2014, Arizona, Colorado, Connecticut, Florida, Missouri, Montana, New Jersey, New York, Ohio, Oregon, Rhode Island, Vermont and Washington have all increased their minimum wage rates. There are also five additional states, California, Delaware, Michigan, Minnesota, West Virginia, plus the District of Columbia, which have passed legislation for future minimum wage increases that will take effect in 2014.
Employers, especially ones which operate in multiple states, must be vigilant in monitoring and planning for future state minimum wages increases. What is more, employers in specific industries, such as hospitality, must consider additional compliance measures, including changes in the maximum tip credit an employer may take against its tipped employees’ hourly wages.
The chart below provides each state’s previous and current minimum wage and maximum tip credit rates, as well as scheduled future increases through the end of 2014.
|
State |
Previous Minimum Wage |
Current Minimum Wage |
Future Minimum Wage Increases in 2014 |
Previous Tip Credit |
Current Tip Credit |
| Arizona |
$7.80 |
$7.90 (effective 1/1/14) |
$4.80 |
$4.90 (eff. 1/1/14) |
|
| California |
$8.00 |
$9.00 (eff. 7/1/14) |
No tip credit permitted |
— |
|
| Colorado |
$7.78 |
$8.00 (eff. 1/1/14) |
$4.76 |
$4.98 (eff. 1/1/14) |
|
| Connecticut |
$8.25 |
$8.70 (eff. 1/1/14) |
$7.34 for bartenders; $5.69 all other tipped employees |
||
| Delaware |
$7.25 |
$7.75 (eff. 6/1/14) |
$2.23 |
||
| D.C. |
$8.25 |
$9.50 (eff. 7/1/14) |
$2.77 |
||
| Florida |
$7.79 |
$7.93 (eff. 1/1/14) |
$4.77 |
$4.91 (eff. 1/1/14) |
|
| Michigan |
$7.40 |
$8.15 (eff. 9/1/14) |
$2.65 |
||
| Minnesota |
$6.15 for employers w/ annual sales >$625,000; $5.25 for employers w/ < $625,000 |
$8.00 for employers w/ annual sales >$500,000; $6.50 for employers w/ < $500,000 (eff. 8/1/14) |
$6.15 for employers w/ annual sales >$625,000; $5.25 for employers w/ < $625,000 |
||
| Missouri |
$7.35 |
$7.50 (eff. 1/1/14) |
$3.68 |
$3.75 (eff. 1/1/14) |
|
| Montana |
$7.80 |
$7.90 (eff. 1/1/14) |
No tip credit permitted |
— |
|
| New Jersey |
$7.25 |
$8.25 (eff. 1/1/14) |
$2.13 |
No change in tip credit |
|
| New York |
$7.25 |
$8.00 (eff.12/31/13) |
$8.75 (eff.12/31/14) |
$5.00 for food service employees; $5.65 for service employees (delivery and coat check) |
No change in tip credit |
| Ohio |
$7.85 |
$7.95 (eff. 1/1/14) |
$3.93 |
$3.98 (eff. 1/1/14) |
|
| Oregon |
$8.95 |
$9.10 (eff. 1/1/14) |
No tip credit permitted |
— |
|
| Rhode Island |
$7.75 |
$8.00 (eff. 1/1/14) |
$2.89 |
No change in tip credit |
|
| Vermont |
$8.60 |
$8.73 (eff. 1/1/14) |
$4.17 |
$4.23 (eff. 1/1/14) |
|
| Washington |
$9.19 |
$9.32 (eff. 1/1/14) |
No tip credit permitted |
— |
|
| West Virginia |
$7.25 |
$8.00 (eff.12/31/14) |
$5.80 |