Increase to Minimum Wage in Several States & Localities
In 2022, a record number of states (24 states) and localities (several dozen cities and/or counties) will increase their minimum wages. Is your company ready for these increases, most of which go into effect on January 1, 2022? Do you have employees in any of the states below? If so, have you already updated your pay rates and payroll system to ensure you are meeting these new minimum wages?
States With Increases:
| State | 2020 | 2021 | 2022 | Effective Date |
|---|---|---|---|---|
| Arizona | $12.00 | $12.15 | $12.80 | 1/1/2022 |
| California | $13.00 | $14.00* | $15.00* | 1/1/2022 |
| Colorado | $12.00 | $12.32 | $12.56 | 1/1/2022 |
| Connecticut | $12.00 | $13.00 | $14.00 | 7/1/2022 |
| Florida | $8.56 | $10.00 | $11.00 | 9/30/2022 |
| Illinois | $10.00 | $11.00 | $12.00 | 1/1/2022 |
| Maine | $12.00 | $12.15 | $12.75 | 1/1/2022 |
| Maryland | $11.00 | $11.75** | $12.50** | 1/1/2022 |
| Massachusetts | $12.75 | $13.50 | $14.25 | 1/1/2022 |
| Michigan | $9.65 | $9.65 | $9.87 | 1/1/2022 |
| Minnesota | $10.00 | $10.08*** | $10.33*** | 1/1/2022 |
| Missouri | $9.45 | $10.30 | $11.15 | 1/1/2022 |
| Montana | $8.65 | $8.75 | $9.20 | 1/1/2022 |
| Nevada | $8.00 | $8.75 | $9.50**** | 7/1/2022 |
| New Jersey | $11.00 | $12.00***** | $13.00***** | 1/1/2022 |
| New Mexico | $9.00 | $10.50 | $11.50 | 1/1/2022 |
| New York | $11.80 | $12.50****** | $13.20****** | 12/31/21 |
| Ohio | $8.70 | $8.80 | $9.30 | 1/1/2022 |
| Oregon | $12.00 | $12.75 | $13.50******* | 7/1/2022 |
| Rhode Island | $10.50 | $11.50 | $12.25 | 1/1/2022 |
| South Dakota | $9.30 | $9.45 | $9.95 | 1/1/2022 |
| Vermont | $10.96 | $11.75 | $12.55 | 1/1/2022 |
| Virginia | $7.25 | $9.50 | $11.00 | 1/1/2022 |
| Washington | $13.50 | $13.69 | $14.49 | 1/1/2022 |
**$12.50 applies to Maryland employers with 15 or more employees. Employers in Maryland with 14 of fewer employees must pay a minimum wage of $12.20 per hour.
***$10.33 rate is for large employers in Minnesota (with annual gross revenues of at least $500,000). Small employers have a minimum wage of $8.42 per hour.
****$9.50 is for Nevada employees who are offered health insurance. Nevada employees who are not offered health insurance must receive $10.50 per hour.
*****$13.00 applies to New Jersey employers who are non-seasonal and with 6 or more employees. Seasonal employees and those working for businesses who employ 5 or fewer employees must receive $11.90 per hour.
******In New York, the rate for Nassau, Suffolk, and Westchester counties will increase to $15 per hour.
*******Minimum wage for the Portland Metro area is $14.00 per hour and $12.50 for nonurban counties in Oregon.
Even though the above states are changing their minimum wage, the federal minimum wage will NOT change and will remain at $7.25, the same rate since 2009.
However, dozens of localities (cities and/or counties) will also be increasing their minimum wage. So make sure you are checking your local area(s) where your employees are working. If you have not kicked off a campaign for all your employees to confirm/review/update their address with your HR/Payroll team, now is the time to do so. Not only for the upcoming mailout of the 2021 W2s and other tax-related documents but also to ensure you are paying the employees appropriately, as minimum wage is based on where the employee is working (aka home for remote workers, if they are not working from your business building).
Additional Resources:
- US Department of Labor (DOL)
- National Employment Law Project
- USA Today
- USA Facts
- National Law Review
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