Federal Minimum Wage

New Minimum Wage Posting Released
On July 3, 2007, the Department of Labor released the new federal minimum wage posting requirements that reflect the three step increase signed by President Bush in May. The first step, taking the minimum wage up to $5.85 an hour, takes effect on July 24, 2007.  It will then increase 70 cents each year until 2009 when it will reach $7.25.

Federal Minimum Wage Basics
The federal minimum wage provisions are contained in the Fair Labor Standards Act (FLSA). The FLSA contains mandatory standards for federal minimum wage rates at most U.S. companies, along with requirements for child labor, overtime and exempt vs. non-exempt status.
Non-exempt employees paid on an hourly basis must receive at least the federal minimum wage for every hour worked. When non-exempt employees are paid in other ways, such as salary, commission or a piece-rate basis, their pay must generate an hourly rate of at least the federal minimum wage when divided by the total hours worked in the workweek.
As a general rule, non-exempt employees must be compensated for all hours of work that management knows of, or has reason to know of, even if the employer did not request or authorize the time or type of work performed. This means managers should not modify time records to delete entries for work that was performed without management’s request or authorization, even for work performed against company policy or a specific directive. These types of entries should be addressed as disciplinary matters, not as grounds to deny pay. Otherwise, the employer and its individual managers may face legal liability for violating federal minimum wage laws and/or overtime laws.
The previous rate of $5.15 no longer exists for all employers and employees.
Effective now, the Federal Minimum Wage is $5.85 and will continue to increase for the next two years. Posters reflecting $5.15 as the Federal Minimum Wage must be replaced.
Confused with State Minimum Wage vs. Federal Minimum Wage? It’s simple….The federal minimum wage sets the bare minimum that all states must pay their employees.
How are your posters affected?  If your state operates under a minimum wage higher than $5.85, you still must obtain and post the new rate.
What can employers do to comply with the new rate?  There are several websites available that allow you to purchase a new posters: www.laborLawCenter.com, www.gniel.com, www.postercompliance.com & www.hrdocs.com just to name a few.

Future State Increases:

Arizona - Will increase annually to adjust to inflation
California - $8.00 per hour effective January 2008
Delaware - $7.15 per hour effective January 2008
Florida - Will increase annually to adjust to inflation
Illinois - $7.75 per hour effective July, 2008, $8.00 per hour effective July 2009, and $8.25 per hour effective July 2010
Iowa - $7.25 per hour effective January 2008
Maine - $7.00 per hour effective October 2007
Mass. - $8.00 per hour effective January 2008
Michigan - $7.15 per hour effective July 2007
Montana - Will increase annually to adjust to inflation
Pennsylvania - $7.15 per hour effective July 2007. *Employers with less than 10 employees are subject to a minimum wage rate of $6.65 per hour effective July 2007 and $7.15 per hour effective July 2008.
West Virginia - $6.55 per hour effective July 2007 and $7.25 per hour effective July 2008

Posted by Kristen August 2007

Comments are closed.