As the New Year approaches, employers throughout the United States must prepare for new legislation taking effect that may impact their operations.  One critical change that commonly occurs around the New Year is an increase to the minimum wage.  On January 1, 2020 (or December 31, 2019), the minimum wage will rise in 21 states.  The District of Columbia and four other states will increase their minimum wage at some other time in the next year.  Forty-two individual municipalities or locales that impose their own, higher, standards will also raise their minimum wage in 2020.  A table of the states and municipalities increasing their minimum wage on January 1, 2020 (or December 31, 2019), is set forth below:

Minimum Wage Increases on January 1, 2020

Other Minimum Wage Increases in 2020

A number of states and municipalities will raise their minimum wage on July 1, 2020 or other dates later that year. Some of these increases in various municipalities are unknown at this point because they are dependent on an Index. These are noted by the letter I in the following chart.

Takeaways

Employers with employees in states or municipalities subject to a minimum wage increase should adjust their pay practices by the date the increase becomes effective at the latest.  Employers should also be aware that there might be certain applicable exemptions that may apply in the event they do not hit certain annual gross receipt amounts. Employers should consider and react to increases to both the standard minimum wage and the tipped minimum wage in their workforce.  Additionally, employers should always review any applicable provisions of the Fair Labor Standards Act (FLSA) in conjunction with state law and local ordinances.