New York and Other Employers: Minimum Wage Increases and Other Reminders for the New Year

December 2, 2014Alerts Labor & Employment Alert

As we approach the end of the year, it is important to remind employers about a few legal requirements that will impact the New York business community in January 2015. Failure to comply with these requirements could subject an uninformed employer to substantial liability.

Minimum Wage Increases

Effective December 31, 2014, the minimum wage in New York will increase from $8.00 per hour to $8.75 per hour. This means that employers must make changes to their payroll prior to New Year’s Day.

For those employers covered by New York’s Hospitality Wage Order, the tipped minimum wage for food service and non-food service employees (e.g., valets, bathroom attendants, coat check personnel) will remain at $5.00 per hour and $5.65 per hour, respectively. However, the overtime rates for such employees will change. Effective December 31, 2014 (assuming that such employees only receive the tipped minimum wage and tips), the overtime rate for food service workers will increase to $9.38 per hour and the overtime rate for non-food service workers will increase to $10.03 per hour.

New York is not the only state or municipality in which the minimum wage will be increasing in the New Year. For those employers with operations in other states, please by cognizant of changes in other jurisdictions. For example, as the chart below indicates, effective January 1, 2015, the minimum wage will increase in a number of other states as well.

State

Current Minimum Wage

Current Tipped Minimum Wage

Minimum Wage Effective January 1, 2015

Tipped Minimum Wage Effective January 1, 2015

Alaska

$7.75

$7.75

(no tip credit)

$8.75

$8.75

(no tip credit)

Arizona

$7.90

$4.90

$8.05

$5.05

Arkansas

$6.25

$2.63

$7.50

$2.63

(no change from 2014)

Colorado

$8.00

$4.98

$8.23

$5.21

Connecticut

$8.70

$5.69 (for employees other than bartenders in the restaurant and hotel industry)

$7.35 (for bartenders)

$8.35 (for other tipped employees)

$9.15

$5.79 (for employees other than bartenders in the restaurant and hotel industry)

$7.46 (for bartenders)

$8.80 (for other tipped employees)

Florida

$7.93

$4.91

$8.05

$5.03

Hawaii

$7.25

$7.00

$7.75

$7.25

Maryland

$7.25

$3.63

$8.00

$3.63

(no change from 2014)

Massachusetts

$8.00

$2.63

$9.00

$3.00

Missouri

$7.50

$3.75

$7.65

$3.83

Montana

$7.90

$7.90

(no tip credit)

$8.05

$8.05

(no tip credit)

Nebraska

$7.25

$2.13

$8.00

$2.13

(no change from 2014)

New Jersey

$8.25

$2.13

$8.38

$2.13

(no change from 2014)

Ohio

$7.95

$3.98

$8.10

$4.05

Oregon

$9.10

$9.10

(no tip credit)

$9.25

$9.25

(no tip credit)

Rhode Island

$8.00

$2.89

$9.00

$2.89

(no change from 2014)

South Dakota

$7.25

$2.13

$8.50

$4.25

Vermont

$8.73

$4.23

$9.15

$4.58

Washington

$9.32

$9.32

(no tip credit)

$9.47

$9.47

(no tip credit)

West Virginia

$7.25

$2.13

$8.00

$2.40

State Minimum Wage Increases Later in 2015

In addition to these January 1st increases, please be advised that:

  • On June 1, 2015, Delaware will increase its minimum wage to $8.25;
  • On July 1, 2015, Maryland will increase its minimum wage (for the second time in 2015) to $8.25 and Washington, DC will increase its minimum wage to $10.50; and
  • On August 1, 2015, Minnesota will increase its minimum wage for large employers (annual gross sales of $500,000+) to $9.00 and for small employers (annual gross sales of less than $500,000) to $7.25.

Local Wage Increases

Several municipalities throughout the country require the payment of minimum wages that are higher than the federal minimum wage and their respective state minimum wages. In 2015, some of these municipalities - such as San Francisco, California ($11.05 on 1/1/15; $12.25 on 5/1/15); San Jose, California ($10.30 on 1/1/15); Santa Fe, New Mexico (increased wage TBD based upon the consumer price index); Albuquerque, New Mexico ($8.75 on 1/1/15); Montgomery County, Maryland ($9.55 on 10/1/15); and Prince George’s County, Maryland ($9.55 on 10/1/15) - will increase their minimum wages. Other municipalities - such as Oakland, California ($12.25 on 3/2/15); Richmond, California ($9.60 on 1/1/15); and Seattle, Washington ($10.00 or $11.00 (based on employer size) on 4/1/15) - will implement municipal minimum wages for the first time in 2015.

Based upon the number of increases in the minimum wage in 2015, it is prudent for employers to consult with counsel to determine if the minimum wage is increasing in the state, city and/or jurisdiction in which their businesses operates.

New York’s Notice of Rate of Pay

Pursuant to New York’s Wage Theft Prevention Act (WTPA), between January 1 and February 1 of each year, New York employers must provide a “Notice of Pay” form to all employees, regardless of their position or role within the organization. The notice must contain the following information:

  • The employee’s normal rate(s) of pay and the basis thereof (e.g., hourly, shift, weekly, salary);
  • If applicable, the employee’s overtime rate of pay;
  • The employee’s regular pay day;
  • Any allowances claimed against the minimum wage (e.g., tip credit, meal credit, lodging allowance, etc.);
  • The name of the employer (including any “doing business as” name);
  • The address of the employer’s main office and a mailing address (if different); and
  • The employer’s telephone number.

The written notice must be signed by both the employer and the employee and must be retained by the employer for at least six years.

The New York Department of Labor (NYDOL) has issued sample Notice of Pay forms that employers may use. Although employers are not required to use the NYDOL forms, it is recommended that they do so in order to ensure full compliance with New York law. The NYDOL sample forms can be obtained from the NYDOL’s website here.

In addition, the notice must be provided in both English and the employee’s native language (if not English), provided the NYDOL has created a Notice of Pay form in the employee’s native language. Currently, the NYDOL has issued forms in English, Spanish, Chinese, Haitian Creole, Korean, Polish and Russian, which are available on the NYDOL’s website.

The WTPA also requires employers to provide notice to employees whenever there is a change in the employee’s rate of pay. For all employers outside of the hospitality industry, the NYDOL has opined that, as long as the new rate of pay is referenced in the employee’s next pay stub, employers do not need to provide a new Notice of Pay as a result of the increase in the minimum wage. Unfortunately, hospitality employers are not so lucky. Because of the language of the Hospitality Wage Order, hospitality employers must provide a Notice of Pay form to those employees who are affected by the increase to the minimum wage (including all tipped employees) on or prior to December 31, 2014, as well as in January 2015.

For more information about this alert, please contact Carolyn D. Richmond at 212.878.7983 or [email protected] , Gregg M. Kligman at 212.878.7910 or [email protected] or any other member of the firm’s Labor & Employment Department.