There are several minimum wage increases taking place on January 1, 2018. The following is a summary of each of the changes:
The Department of Labor (DOL) has published the 2018 wage-rate floor required by Executive Order 13658, "Establishing a Minimum Wage for Contractors." Beginning on January 1, 2018, the minimum rate will increase by 15 cents per hour to $10.35 per hour. At the same time, the DOL announced that the minimum cash wage for tipped workers performing work on or in connection with a covered contract will increase by 45 cents to $7.25 per hour. If the worker does not receive enough tips to produce the full amount, then the employer must pay the worker additional wages to bring him or her up to $10.35.
State of Minnesota
Beginning January 1, 2018, Minnesota’s minimum wage rates will increase by 15 cents to $9.65 an hour for large employers (i.e., any enterprise with an annual gross dollar volume of sales made or business done of $500,000 or more) and $7.87 an hour for small employers (i.e., any enterprise with an annual gross volume of sales made or business done of less than $500,000). Under Minnesota law, the commissioner of the Department of Labor and Industry is required to determine and announce the inflation-adjusted minimum-wage rate for each year.
Earlier this year, the Minneapolis City Council approved a $15 minimum wage ordinance that will be phased in over five years for large businesses and seven years for small businesses. Large businesses are defined as having more than 100 employees, and small businesses as 100 or fewer workers.
The minimum wage increases will apply to employers with locations in the geographic boundaries of the city of Minneapolis. It does not apply to federal, state, county, or local government employers, except for employees of the city of Minneapolis. Employees who are typically based outside the city, yet perform work in the city on an occasional basis (two hours a week), are required to comply.
The first phase becomes effective for large businesses on January 1, 2018, and raises the minimum wage to $10 an hour. In July 2018, it will be raised to $11.25 an hour for large businesses and $10.25 an hour for small businesses.
More information about the Minneapolis minimum wage increase can be found in our previous Inside HR article.
As a reminder, MRA has a partnership with GovDocs, a reputable and cost-effective provider of state and federal consolidated employment law posters, so members can receive a 10 percent discount off the regular price of employment law posters and any other products. Employers enrolled in the GovDocs program will receive notification whenever updates are made to compliance posters, such as minimum wage increases.
Source: Lynell Meeth, Director, Member Content, MRA – The Management Association