Minimum Wage Hikes Hit 21 States

Raising the minimum wage was certainly a hot topic in 2014 (even more so than in 2013). The issue sparked employees in several industries across the country to organize high-profile protests, asserting that minimum wages are not sufficient and a raise in the wage floor is due. President Obama agreed that wages need to be raised, first by mentioning the issue in his 2014 State of the Union address and then subsequently issuing an executive order in February 2014, raising the minimum wage to $10.10 per hour for federal contract workers. Despite the rhetoric that has kept this issue at the top of many minds over the course of the year, Congress did not move to raise the federal minimum wage from $7.25 in 2014. However, with the 2016 election cycle beginning as early as Fall of 2015, it is anticipated that this issue will continue to be at the forefront of political discussion over the course of 2015.

Despite the lack of any raise in the federal minimum wage, almost half of the states raised their state minimum wages, effective January 1, 2015:

• Alaska: $8.75 per hour (effective February 24, 2015)
• Arizona: $8.05 per hour (with tipped employees getting a minimum cash wage boost to $5.05 per hour)
• Arkansas: $7.50 per hour
• Colorado: $8.23 per hour
• Connecticut: $9.15 per hour
• Florida: $8.05 per hour (with tipped employees getting a minimum cash wage boost to $5.03 per hour)
• Hawaii: $7.75 per hour
• Maryland: $8.00 per hour (with another increase to $8.25 per hour set to go into effect on July 1, 2015)
• Massachusetts: $9.00 per hour (with tipped employees getting a minimum cash wage boost to $3.00 per hour)
• Missouri: $7.65 per hour (with tipped employees getting a minimum cash wage boost to $3.83 per hour)
• Montana: $8.05 per hour (for businesses with annual gross sales of $110,000 or more; for businesses with gross sales less than $110,000, the minimum wage stays at $4.00 per hour)
• Nebraska: $8.00 per hour
• New Jersey: $8.38 per hour
• New York: $8.75 per hour (effective December 31, 2014)
• Ohio: $8.10 per hour (for workers 16 and older who work for employers grossing at least $297,000 in receipts; tipped employees also received a minimum cash wage raise to $4.05 per hour)
• Oregon: $9.25 per hour
• Rhode Island: $9.00 per hour
• South Dakota: $8.50 per hour (with tipped employees getting a minimum cash wage raise to $4.25 per hour)
• Vermont: $9.15 per hour (with tipped employees getting a minimum cash wage boost to $4.58 per hour)
• Washington: $9.47 per hour
• West Virginia: $8.00 per hour (effective December 31, 2014 and another increase to $8.75 per hour set to be effective December 31, 2015; in addition, tipped employees will receive a minimum cash wage boost to $2.40 per hour)

In 2015, a majority of states (29 states plus the District of Columbia will have a higher minimum wage than the federal minimum wage of $7.25 per hour. Washington remains the state with the highest state minimum wage with its increase to $9.47. Several municipalities around the country also approved increases to their local minimum wages to become effective in 2015. San Francisco, California, for example, voted to increase its local minimum wage to $11.05 effective on January 1, 2015 and again to $12.25 per hour effective on May 1, 2015. Also, Oakland, California voted to raise its minimum wage to $12.25 as of March 2, 2015; and Chicago, Illinois voted to increase its minimum to $10.00 per hour effective July 1, 2015.

Given all of this recent change and the continued focus on this issue at the local, state, and national level, employers are well-served to remain abreast of minimum wage changes in their city and state.

Michelle R. Maslowski is an associate in the Indianapolis office of Ogletree Deakins.

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