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Minimum Wage Regulations




Full Interview transcript

Carl: Hello business owners this is Carl Kleimann with another Business Survival Tip from Odyssey OneSource. Would it surprise you to know that the minimum wage in Illinois is higher than the minimum wage in Texas? And that the minimum wage in San Francisco is higher than the minimum wage in Los Angeles? Complying with minimum wage rules is not as easy as it once was.

For starters, the U.S. Department of Labor has increased the minimum wage three times since 2007. On July 24th, 2009, the federal minimum wage increased to its current $7.25 per hour. This is where the simple part ends.

More than a dozen states, including California, Illinois, and Connecticut for example, have adopted minimum wage rates that exceed the federal requirement. Furthermore, a number of U.S. cities including San Francisco and Santa Fe have adopted minimum wage rates that exceed both the federal and state requirement.

To add more complexity, there are a host of exemptions to the federal minimum wage requirements. For example, businesses that generate less than $500,000 in annual gross revenue and do not engage in interstate commerce, are generally exempt from federal minimum wage requirements altogether; however, may be subject to state requirements. There is also a youth minimum wage that allows employers to pay $4.25 per hour to employees under 20 years of age. This wage may only be paid during the first 90 calendar days of employment regardless of the number of days worked.

And finally, you are not allowed to reduce an employee’s pay below the applicable minimum wage level by deducting for non-voluntary items such as cash and/or merchandise shortages, company required uniforms, or tools of the trade. This is one of the more frequent violations of the minimum wage requirements.

I am Carl Kleimann and this has been another Business Survival Tip by Odyssey OneSource, ranked as the number one Professional Employer Organization two years running by the Black Book of Outsourcing.

For more information on this and other issues affecting employers, please visit odysseyonesource.com.


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