When Federal and State Laws Differ: Part I on Minimum Wage Payments

 
Friday, April 1, 2005
 
by Jackson Lewis

While the heated debate about the revision of the "white collar" exemptions contained in the Fair Labor Standards Act drew national attention, employers also must be aware that many states have laws that differ from the federal scheme governing compensation of employees. Those differences include variations in the hourly minimum wage rates and in the payment of overtime. Employers must understand how these differences affect pay policies and practices in every jurisdiction where they have employees.

In Part I of this two-part article, we will discuss some of the state differences in minimum wage rates. In Part II, we will discuss state differences in determining when employees must be paid overtime and how the overtime rate is calculated.

Differences between federal and state hourly minimum wage rates occur in fifteen states. When the state hourly wage rate higher than the federal rate, a covered employer must pay the higher rate.

The following states have current hourly minimum wage rates higher than the federal hourly minimum of $5.15:
  • Alaska ($7.15)
  • California ($6.75)
  • Connecticut ($7.10)
  • Delaware ($6.10)
  • District of Columbia ($6.60)
  • Hawaii ($6.25)
  • Illinois ($6.50)
  • Maine ($6.35)
  • Massachusetts ($6.75)
  • New York ($6.00)
  • Oregon ($7.25)
  • Rhode Island ($6.75)
  • Vermont ($7.00), and
  • Washington ($7.35). Voters in Florida recently passed a constitutional amendment raising its mini-mum wage to $6.15, effective May 2, 2005.

[Source: U.S. Dept. of Labor website.]

Some of these states have additional requirements that differ from the federal minimum wage law. For example, the hourly minimum wage rate in New York is determined by statute to increase incrementally over the next two years. Another variation is Connecticut, which has specific wage payment requirements for certain industries, such as retail and restaurants.

It is imperative that employers keep current on the changing nature of hourly minimum wage payments. This is fairly easily done, and a good source of information is the state departments of labor. Another source for information on the federal, all 50 states and U.S. territories, and other jurisdictions is the U.S. Department of Labor's website.
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