Alert

Alert: Federal Minimum Wage Reminder

July 17, 2007

The first wave of federal minimum wage increases signed into law on May 25, 2007, will go into effect in one week.  Effective Tuesday, July 24, 2007, the federal minimum wage will increase from the current $5.15 per hour to $5.85 an hour.  For employers of minimum wage employees, this is a reminder to make sure all employees will earn at least $5.85 an hour for all time worked on, and after, July 24.

For employers of “tipped employees,” the federally-mandated minimum cash wage which must be paid directly to the tipped employee will not increase from $2.13 an hour.  However, the increase in minimum wage means employers must ensure that the tips received, combined with the direct cash wage, satisfy the new minimum wage requirement.

One word of caution: Certain states have minimum wage laws that set amounts higher than the federal mandates for both minimum wage and tip credit.  Wise employers will also check the requirements in the states where they operate for any other adjustments that follow from the increase of the federal minimum wage.

If you have any questions about the effect of the minimum wage increase, who may qualify as a “tipped employee,” or any other wage payment issue, please contact any of the attorneys in McGlinchey Stafford’s Labor and Employment practice group.