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What You Need to Know About Federal and State Minimum Wage and Overtime Requirements

The Department of Labor has created an excellent resource about your state's overtime and premium pay laws. Review the table below for more information.

To stay current with essential labor law requirements, U.S. employers these days must dig a little deeper and educate themselves on federal AND state regulations. This includes time and pay requirements under the Fair Labor Standards Act (FLSA). The FLSA establishes federal minimum wage and overtime pay standards for private-sector employees – the first layer of compliance you must satisfy. Beyond that, you also must research your state requirements and ensure you’re meeting them. Here’s an overview of the key requirements with minimum wage and overtime pay at both levels.

Minimum Wage Makes Its Mark on Workplaces

Covered, nonexempt employees are entitled to a minimum wage of $7.25/hr., the national rate since July 2009. Although the federal rate hasn’t changed in nearly a decade, numerous states and cities have stepped in and passed higher minimum wages. In 2018 alone, there were minimum wage increases in approximately 75 states, cities and counties.

Effective January 1, 2019, here are the states with minimum wage increases:

State 2018 2019
Alaska $9.84 $9.89
Arizona $10.50 $11.00
Arkansas $8.50 $9.25
California $11.00 $12.00 (26 or more employees)
Colorado $10.20 $11.10
Delaware $8.25 $8.75
Florida $8.25 $8.46
Maine $10.00 $11.00
Massachusetts $11.00 $12.00
Minnesota $9.65 $9.86
Missouri $7.85 $8.60
Montana $8.30 $8.50
New Jersey $8.60 $8.85
New York Variable rates based on location Variable rates based on location
Ohio $8.30 $8.55
Rhode Island $10.10 $10.50
South Dakota $8.65 $9.10
Vermont $10.50 $10.78
Washington $11.50 $12.00

For a snapshot of current minimum wages (not just increases) for each state, check out this Department of Labor (DOL) resource.

Stay Ahead of Mandatory Overtime Pay

The FLSA also establishes parameters with overtime pay. Specifically, covered, non-exempt employees must receive overtime pay at a rate of 1.5 times the regular rate of pay for hours over 40 in workweek.

An employee’ workweek is defined as a fixed and regularly recurring period of 168 hours, or seven consecutive 24-hour periods. The workweek doesn’t have to coincide with the calendar week, so it can begin on any day and at any hour of the day. Also, although the FLSA doesn’t require overtime pay for regular hours worked on weekends or holidays, it does require overtime pay if these hours exceed 40.

And from here, it gets more interesting. Just like the minimum wage can vary from state to state, so can the requirements regarding overtime pay.

For guidance on this, refer to this DOL resource and click on the state(s) where you conduct business. In addition to providing the minimum wage for your state, it will highlight whether daily or industry-specific overtime rules apply. For example, the state of Colorado requires overtime pay after an employee works 12 hours in a day. As another example, restaurant employees in Connecticut must receive at least 1.5 times the minimum rate for all hours worked on the seventh consecutive day.

Remember: With both minimum wage and overtime regulations, the more generous coverage applies. In situations where both the FLSA and state law apply, you must honor the higher standard. Failing to do this could result in legal complications, up to a lawsuit, regarding the proper payment of overtime and wages.

Sort Out Time and Pay Issues with Online Tools

Time and pay matters can be challenging for most employers. TrackSmart can help ensure you’re complying with the essential FLSA rules, along with the latest recordkeeping obligations.

TrackSmart allows you to assign categories to employees, such as full-time hourly, part-time hourly, salaried and volunteer, so you know how to handle their time and pay.

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