The minimum wage is expected to increase annually until it reaches $15.00 per hour by the end of 2021 for all of New York State. A city or county enacts a law to set a minimum wage rate that exceeds that set by federal and state law. Minimum Wage (2021) In keeping with the gradual increase in the State’s minimum wage levels, the new tiered rates across the State, effective December 31, 2020, are listed below. applicable to hospitality employers, As previously reported here, the minimum weekly and annual salary that exempt administrative and executive employees in New York State … employers can deduct from employees' wages for items such as Note, however, that the legislative history suggests the general minimum wage rate only applies to tipped employees of seasonal employers. If the state minimum wage, the wage rate will increase on December 31, 2020. Note that in Arizona, local minimum wage rates may apply (see above). employer, Remainder of State, regardless of size of employer. Effective January 1, 2021 minimum wage is increasing for both the state of California and the City of San Diego. 10 Notwithstanding the available credit (see previous footnote), employers must comply with local and state law. However, currently under state law, employers must pay covered tipped employees a minimum cash wage of $2.35 per hour. Stat. In these jurisdictions, such employees must earn at least the applicable minimum wage for each hour worked in a workweek. 1 Pay increases are not limited to hourly employees. 31 This includes any rate that would be in effect before the scheduled increase in 2021. For the administrative, professional, and executive exemptions under state law, employers with 26 or more employees must pay a salary of at least $1,120 per week beginning January 1, 2021. July 1, 2021: Berkeley, Emeryville, Fremont, Long Beach (Hotel), Los Angeles, Los Angeles County (Unincorp. Pennsylvania employees otherwise exempt under the duties test but making less than the specified minimum weekly salary must be paid overtime … To help manage this challenge, below we provide a rates-only update that details scheduled state- and local-level wage increases throughout 2021 so employers can determine the minimum amount they must pay non-exempt, tipped, and certain exempt employees. Note, however, even using the lower statutory CPI-adjustment MCW, both would exceed the state’s 2021 MCW of $2.55 per hour. ), Las Cruces), Ohio, South Dakota, Vermont, Washington (incl. For Executive, Administrative and Professional employees receiving salaries, an employer may not generally deduct or "dock" from wages any amount of time for missed work which is less than a full day. Seyfarth Synopsis: As they have each year since 2016, the minimum wage and exempt salary threshold will increase for New York employers effective December 31, 2020.. 1 For more information, see Natalie Storch and Kimberly Doud, Florida Passes Amendment 2, Gradually Increasing Florida’s Minimum Wage to $15 an Hour, Littler ASAP (Nov. 9, 2020). For 2021, the Washington minimum wage will be $13.69 per hour (an increase from the current $13.50 per hour). Richmond, CA Code § 7.108.040. Bernalillo County announced the CPI adjustment would increase the local minimum wage from $9.20 to $9.35, more than $1 per hour less than the 2021 state minimum wage. Using the 2021 minimum wage, L&I has calculated the salary thresholds taking effect Jan. 1, 2021: Small businesses (1-50 employees): An exempt employee must earn a salary of at least 1.5 times the minimum wage, or $821.40 a week ($42,712.80/year). Belmont, Burlingame, Cupertino, Daly City, El Cerrito, Half Moon Bay, Hayward, Los Altos, Menlo Park, Mountain View, Novato, Oakland (Gen.), Palo Alto, Petaluma, Redwood City, Richmond, San Carlos, San Diego, San Jose, San Mateo, Santa Clara, Santa Rosa, Sonoma, South San Francisco, Sunnyvale), Colorado (incl. employers. * The state minimum wage for 2021 is $13.69/hour. New York41 (Nassau, Suffolk & Westchester Counties), Computer & Medical Professional Minimum Pay Increases. Employees that are classified as exempt are automatically excluded from minimum wage and overtime requirements that the FSLA provides, as well as any state overtime regulations. 19 The “Urban” rate applies to employer located within the urban growth boundary of a metropolitan service district organized under state law (i.e., Portland area). Minimum Salary for Exempt Administrative and Executive Employees. Minimum Salary Levels for Executive, Administrative and Professional Employees by State. Effective January 1, 2021, the minimum salary threshold for these exemptions is as follows: $58,240 per year (or $1,120 per week) for employers of 26 or more employees. 17 Although the ordinance uses “Beginning January 1, 2009, and each year therafter [sic]. This development creates unique issues for employers subject to local minimum wage ordinances in Albuquerque, Bernalillo County, and Las Cruces. .” the City of Santa Fe has routinely adjusted its rate on March 1. On December 31, 2020, the state minimum weekly salary for administrative and executive employees will range from $937.50 per week for employees outside of New York City and Nassau, Suffolk and Westchester counties, to $1,125.00 per week for employees who work in New York City for large employers and Fast Food Establishments. Moreover, many have established rate increases across multiple years, sometimes followed by annual adjustments based on CPI changes. District of Columbia: An employee’s regular rate of pay must exceed one-and-a-half times the district minimum wage, which on July 1, 2021, will be annually adjusted from its current $15.00 per hour rate. 39 In the COMPS Order, the weekly and annual salary amounts may not perfectly align, so the "math" (M) rate (multiplying weekly by 52 and making further division) and "rule" (R) rate (dividing rule's annual rate) alternate being the highest possible rate. Salary Threshold for Exempt Employees (2021) Finally, the tiered salary thresholds required for exempt status are also rising effective December 31, 2020. 37 An executive, supervisor, administrative, or professional employee must be paid a salary that is at least the level listed and sufficient for the minimum wage for all hours in a workweek. In these jurisdictions, such employees must earn at least the applicable minimum wage for each hour worked in a workweek. With Wednesday’s announcement of the state minimum wage for 2021, the Washington State Department of Labor & Industries (L&I) has calculated the new state minimum salary thresholds for overtime exempt employees. For 2021, this means exempt employees must receive a minimum annual salary of: This means that employers are not required to pay these employees overtime for working more than 40 hours and they are also exempt from paying an hourly minimum wage, paid sick leave and other benefits. Result. Thus, by October 3, 2021, any employee classified as exempt under a white-collar exemption that has a minimum salary requirement who earns less than that amount will need to receive a salary increase to at least meet this amount or be reclassified as non-exempt (and made eligible for overtime pay) going forward. Department of Labor & Industries Announces 2021 Salary Thresholds. All Rights Reserved. Under some state laws, these employees are exempt only from overtime requirements, meaning employers must pay them at least the state minimum wage for all hours worked, and many of these state minimum wage rates will increase in 2021. In 2021, more than twenty states will increase their minimum wages for workers. Salary Thresholds for Overtime Exempt Employees to Rise Jan. 1, 2021 Increase in state’s minimum wage rate to $13.69 an hour triggered recalculation As a result of the state’s minimum-wage rate rising to $13.69 an hour on Jan. 1, 2021, a new minimum salary threshold for overtime-exempt employees will also increase. You’ll only need to do it once, and readership information is just for authors and is never sold to third parties. However, it is unclear whether employers must base payment on the federal or state minimum wage. As a result, the state rate could exceed the local rate. So, when the minimum wage goes up statewide, so does the exempt salary threshold. The rest of the state outside New York City: $937.50 per week, which equals $48,750 per year. However, if the direct wage plus tips does not equal the minimum wage, an employer must pay the employee the difference. 12 The minimum wage for employers with 26 or more employees remains $15.00 per hour. On September 30, 2027, and each subsequent September 30, the state will annually adjust the minimum wage based on changes to the consumer price index (CPI).1. An exempt employee is not eligible to receive overtime pay, and is excluded from minimum wage requirements. Again, please note that: 1) if the rate(s) will not change, we do not include that information; 2) for this article we focus on the New York rates that will apply every day in 2021 except December 31, 2021; and 3) information concerning Albuquerque, Bernalillo County, and Las Cruces, New Mexico is not included in the below chart. 25 Neither the ordinance, nor accompanying posters, state the minimum cash wage and maximum tip credit. Notably, the ordinances in these two cities do not expressly say that the local minimum wage rate will be the state rate if higher, as some other local minimum wage ordinances do (e.g., Cook County, IL; Portland, ME; Montgomery County, MD; Saint Paul, MN). By Nancy Gunzenhauser Popper, Ann Knuckles Mahoney & Alison Gabay on February 11, 2020. Employers with operations subject to this rate should monitor the following city webpage: https://www.oaklandca.gov/topics/measure-ff-and-measure-z. Colorado: An employee’s regular rate of pay must be at least one-and-a-half times the state minimum wage, which on January 1, 2021, will increase to $12.32 per hour. For employers with 25 or fewer employees, the minimum annual salary would be $54,080. The minimum wage in some of these states will increase on January 1, 2021:42 Arizona ($12.15); Illinois ($11.00); Massachusetts ($13.50); New Jersey ($12.00 under the general rate; $11.10 for small employers; $10.30 for seasonal employers); and South Dakota ($9.45). Exempt Administrative and Executive Minimum Salaries. March 1, 2021: Santa Fe and Santa Fe County (Unincorporated), NM. However, employers subject to the lower $13.00 per hour minimum wage can claim the full local credit without violating state law. That said, the regulations do not prohibit prospective changes to exempt employees’ salaries (provided they still receive the minimum required salary). Conduct an audit. 5 The minimum wage for employers with 26 or more employees remains $15.00 per hour. In various states, the pay rates for exempt computer employees will continue to, or for the first time exceed, the rate the federal FLSA requires: California law also provides that licensed physicians and surgeons are exempt from state overtime requirements if they receive a minimum hourly rate, which is determined annually based on cost-of-living changes. Additionally, in a handful of states, outside sales employees are not exempt from state minimum wage requirements. Albuquerque, Bernalillo County (Unincorp. Specifically, the minimum will increase from $13.00 to $14.00 per hour for employees working in Long Island and Westchester, and from $11.80 per hour to $12.50 per hour for the rest of the state except New York City, where the minimum is already $15.00 per hour and will remain so. The United States Department of Labor issued a final regulation to take effect January 1, 2020, raising the minimum overtime salary threshold for exempt employees under federal law to $35,568. 36 An employee must earn a monthly salary equivalent to no less than 2 times the state minimum wage for full-time employment (employment in which an employee is employed for 40 hours per week). Salary threshold implementation schedule Salary thresholds for overtime exempt workers are a multiplier of state minimum wage for a 40-hour workweek 2021 Salary thresholds ƒSmall businesses: $821.40/week ($42,712.80/year) 7 At the time of publication, Oakland had not announced its adjusted 2021 hotel-worker-specific minimum wage rates. May 1, 2021: Virginia. remains permissible for all other categories of employers to pay Flagstaff), Arkansas, California (incl. tipped workers, including hospitality industry employers They are as follows: While most people will not be sad to leave 2020 behind, employers across much of New York State will see an increase to their labor costs in 2021, even though much of the state is navigating recession-like conditions caused by the Covid-19 pandemic. Colorado Officially Increases the Minimum Salary Threshold for Exempt Employees and Makes Changes for Non-Exempt Employees Too. Finally, another issue that arises with the increased state minimum wage involves credits employers may apply toward satisfying their local minimum wage obligations in Albuquerque and Bernalillo County. The 2021 Colorado minimum wage is $12.32/hr for standard pay, and $9.30/hr for tipped employees. summaries to determine how much they can deduct for a uniform Pennsylvania employees otherwise exempt under the duties test but making less than the specified minimum weekly salary must be paid overtime for all hours worked in excess of 40 in a workweek at a rate of not less than 1.5 times the employee’s regular pay rate. Generally (Outside Hospitality Wage Order): Beginning on December 31, 2020, employers cannot apply a tip credit, and employees must be paid the full minimum wage (see chart above). Most of these changes are effective January 1, 2021, though states including Connecticut, Nevada and Oregon will see increases later in the year. January 1, 2021: Alaska, Arizona (incl. A Review Of 2020 Labor & Employment Legislation In California. industries," and employers in the "building service As such, Pennsylvania employers will not need to account for any state-specific changes until October 3, 2021 when the minimum salary increases to $780 per week and then again on October 3, 2022 when the minimum salary increases to $875 per week. An employer may reduce the regular workweek of an exempt employee, for example, from 40 hours to 32 hours, with a commensurate reduction in pay, provided the change applies to all workweeks going forward. Sign Up for our free News Alerts - All the latest articles on your chosen topics condensed into a free bi-weekly email. salary threshold will increase for New York employers effective 8 The minimum wage for employers with 26 or more employees remains $15.00 per hour. 33 Until the FLSA rate increased in 2020, Connecticut, Iowa, and Oregon may have had greater rates. CT State Statute 31-76i - exempt employees not covered for the purpose of overtime payment. When Washington state's minimum wage increases on January 1, 2021, it will have a cascading effect. Each January 1 afterwards, the city will annually adjust the rate based on changes to the CPI. The 2016 rule also increased the minimum salary for HCEs (to $134,004), allowed employers to use nondiscretionary bonuses and incentive pay to satisfy up to 10% of the salary threshold, and provided for automatic annual updates to keep the minimum salary level adjusted to the 40th percentile of full-time salaried workers in the lowest-wage Census region. 28 Under the Hospitality Wage Order, the service employee rates applicable in New York City will not change on December 31, 2020. Effective January 1, 2021, the minimum monthly salary for sheepherders increases to $2,488.97 per month for employers with 26 or more employees and $2,311.24 per month for employers with 25 or fewer employees. POPULAR ARTICLES ON: Employment and HR from United States. . The regulation increases the EAP salary threshold under Pennsylvania law to: $684 per week ($35,568 annually) effective Oct. 3, 2020. 45 The building services and hospitality industry wage orders do not incorporate, or contain, the commissioned employee exemption. © Mondaq® Ltd 1994 - 2021. Effective January 1, 2021, for licensed physicians and surgeons, the minimum hourly rate of pay will increase from $84.79 to $86.49. The last several years have seen successful efforts by employees and employee advocates to raise the minimum wage and salary thresholds for exempt employees throughout New York State. 6 The minimum wage for employers with 26 or more employees remains $15.00 per hour. The minimum wage rate is the lowest hourly pay that can be awarded to workers, also known as a pay floor. wage order. In states that do not set a minimum wage rate, or have an antiquated minimum wage rate that is less than the rate set by the Federal government, the Federal minimum wage rate will take precedence and apply to all employees within that state. covered by the "miscellaneous industries" wage order was 16 In 2021, the separate rate for employers with 10,001 or more employees will remain $12.50 per hour. Employees must earn the salary threshold set by the FLSA to be exempt. TDD users, call 711. On January 1, 2021, the new state minimum salary thresholds for overtime exempt employees goes into effect. For 2021, this means exempt employees must receive a minimum annual salary of $58,240 for employers with more than 26 employees, and $54,080 for employers with 25 employees or less. New York State employers, though, must be mindful that, a The “Nonurban” rate applies to employers located within a nonurban county. Part 541. Nevada: An employee’s regular rate must exceed one-and-a-half times the state minimum wage, which on July 1, 2021, will increase to $9.75 per hour if an employer does not offer health benefits or $8.75 per hour if an employer offers health benefits. The minimum monthly salary for sheepherders is specially set under IWC Wage Order 14-2001. For employers with 25 or fewer employees, the minimum annual salary would be $54,080. Note that the some – but not all34 – New York rates will also increase on December 31, 2021, but for this article we focus on the New York rates that will apply every day in 2021 except December 31, 2021. The new stimulus bill (the Consolidated Appropriations Act of 2021 or CAA) imposes new disclosure requirements for brokers and consultants providing services to ERISA health plans. The minimum monthly salary for sheepherders is specially set under IWC Wage Order 14-2001. The FLSA. Essentially, local minimum wage ordinances are a response to low or unchanging federal or state minimum wage rates. In California, exempt employees must receive a salary of at least twice the state minimum wage for a 40-hour workweek, in addition to meeting the general duties and other requirements. Almost all Oregon employers are subject to the Fair Labor Standards Act (FLSA), and the minimum salary to qualify for exemption under that law is $684 per week or $35,568 annually (allowing up to 10% of the salary basis threshold to be met with nondiscretionary bonuses/incentives, including commissions, paid at least annually). Mondaq uses cookies on this website. $4,853.34 per month (or $58,240.00 annually) if the employee works for an employer of more than 25 people.⁠40. Works for an employer of more than 25 people.⁠40 adjusted 2021 hotel-worker-specific minimum wage rates may (... New state minimum wage ordinances in Albuquerque, Bernalillo County, and cities where the minimum for! Popper, Ann Knuckles Mahoney & Alison Gabay on February 11, 2020 2024 ( $ 42,390.40 )... Pay covered tipped employees on Tuesday, the wage rate for New York:! Issues for employers with 26 or more employees remains $ 15.00 per hour by March 31 2021... Than the state minimum wage for a 40-hour workweek state its own section $ 937.50 per week, which $... Or other allowances and facilities remains $ 15.00 per hour ) 15 Subsidized Temporary Youth / Employment. Services and Hospitality industry wage orders do not include that information employee the difference on... This obligation through wages ( including applicable commissions, piece-rate, and employees practicing law or medicine our! And maximum tip credit exempt the employee the difference York ( Nassau, Suffolk & Counties... Covered tipped employees of seasonal employers state wage and hour Laws, wage and hour Policies wage hour. 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( an increase from the state outside New York City: $ 937.50 per week ) for employers of or... Wage ordinances in Albuquerque and Las Cruces, New Issues: state rate could exceed the or. And is never sold to third parties proper remedies under ERISA are largely of interest to... Paid the minimum wage rate for New York, so we give the state! The legislative history suggests the general minimum wage based on changes to the subject matter New Jersey Long-Term... Articles on: Employment and HR from United states not include that information at. Gabay on February 11, 2020 exceeds that set by federal and state law violating state law over... On Mondaq.com ” rate applies to employers located within a Nonurban County states ' minimum salary threshold set federal. Fewer than 26 employees must pay an executive or Administrative employee a specific weekly,! Hotel-Worker-Specific minimum wage rate for New York, so we give the Empire state own... In certain places, employers subject to this rate should monitor the following City webpage: https //www.oaklandca.gov/topics/measure-ff-and-measure-z... Cash wage of $ 2.35 per hour ) rising effective December 31, 2021 minimum wage requirements 2020. You agree to our use of cookies as set out in our Policy. An employee in your position is usually entitled to an annual salary would be $ 54,080 per year or... Recur each pay period without variance due to hours, quantity, Community-Based. Employers can satisfy this obligation through wages ( including applicable commissions, piece-rate and! Officially increases the minimum wage ordinances in Albuquerque, Bernalillo County, MD ( 11-50 ≥11... Will remain $ 12.50 per hour $ 12.50 per hour on January 1 afterwards, the minimum annual salary be. At $ 455 a week ( $ 42,390.40 annualized ) a result, the wage rate the... Rate exceeds various local rates in 2021 not announced its adjusted 2021 hotel-worker-specific minimum wage Employment Program – 18... Including applicable commissions, piece-rate, and discusses service charges, credit card tips and. Articles on: Employment and HR from United states New Mexico, New year, Mexico... Employees of seasonal employers is excluded from minimum wage for employers with 10,001 or more employees $., for the purpose of this article is intended to provide a guide. Rules start with setting the salary must be paid the minimum wage rates in,. Issues for employers subject to this rate should monitor the following City webpage: https:.... 2024 ( $ 14.00 ) and 2024 ( $ 15.00 per hour concerning overtime Exemptions more than people.⁠40! Exempt salary cutoff is $ 815.20 a week ( $ 15.00 per.! In areas not covered for the purpose of overtime payment Computer & Medical minimum... City employers remains $ 15.00 per hour Arizona, local minimum wage will be $ 54,080 had not its! Tip pooling wage rates also impact commissioned inside salespeople for these `` miscellaneous industries '' Order! Direct wage plus tips does not equal the minimum wage or record keeping Laws 1,040 2021! Code § 28-1.5 ( B ) that information popular ARTICLES on: Employment and from. Requirements concerning the tip credit Nancy Gunzenhauser Popper, Ann Knuckles Mahoney & Alison Gabay on February 11,.. Different and some exempt employees must receive a salary of at least $ 1,040 in,! 'S guide to exempt employees explains everything you need is to be registered login! Beginning January 1, 2021 salary or fee amounts exceed the federal rate, and readership information is just authors! Support and formats for persons with disabilities are available the ( R ) rate of $ 3,375 fee exceed! The time of publication, Oakland had not announced its adjusted 2021 hotel-worker-specific wage. Whether employers must pay the employee from overtime hours the FLSA, non-exempt are. Home Health, or contain, the separate rate for employers with 10,001 or more employees $. Pay increases are not exempt from being paid overtime for hours worked over 40 week!