20 states are upping their 2019 minimum wage, taking effect on or around January first. While that’s awesome news for employees, employers need to make sure they’re aware and up to date! The last thing anyone wants moving into the new year is a compliance issue.
According to the Economic Policy Institute, these pay increases will impact around 5.3 million workers across the country. Increases in 8 of the 20 states are due to inflation, while other increases are due to recent pushes in state legislature. Some of them are simply the result of an eventual minimum wage of $15 by 2024.
Whatever the reason for your state’s increase (or lack thereof), arm yourself with as much knowledge as you can! If employees have questions, it’s much easier to have answers ready than be put on the spot. If you already have answers, clearly you know and care about what’s going on!
So why was it raised?
The Federal minimum wage has been set at $7.25 per hour since 2009. That increase now being 10 years ago, many states have taken it upon themselves to adjust for the cost of living.
In short, good old-fashioned inflation is the answer for most states. There’s also been a lot of attention surrounding “living wages” lately. These debates resulted in pushes for state legislature to take increases into their own hands. Throughout this debate, many agree upon an eventual $12 or $15 an hour as an acceptable living wage.
Speaking of a $15 minimum wage, the National Employment Law Project is just one organization pushing for a $15 wage. They must be making progress, considering this year 21 states (Oregon’s increase from $10.75 to $11.25 won’t take effect until July) and 39 cities are increasing their minimum wage. Although some aren’t planning to implement increases until later this year, that’s still quite the change!
Whatever your feelings on the topic, it’s still important to keep up with these movements to better prepare yourself and your business. If the push continues, the wage increases may continue as well.
Not only can you prepare for the future, but you can keep a pulse on your employees. Even if your employees don’t directly express their thoughts on the matter, you can get a good idea from the general feeling in your area or region. Not only can you monitor employee happiness, but this is good info to have when considering your company’s budget.
It’s better to expect future increases and have a plan, rather than a surprise increase that takes you and your budget off guard.
Which States are Increasing Their 2019 Minimum Wage?
The following states are increasing their 2019 minimum wage. If you have a specific question about one of the states you’re operating in, don’t sweat it. The laws aren’t necessarily written for the average Joe to understand. Luckily for all of us, the US Department of Labor’s website has answers! You can click through each state and view most recent news releases regarding the changes.
What do I need to do?
First and foremost – double check your non-exempt employees. If you’re not sure which employees are non-exempt, learn more about non-exempt vs. exempt employees. Understanding how to properly classify employees is an important piece of ensuring proper pay.
Next, ensure your non-exempt employees are at or above the new minimum wage for your first payroll for 2019. If you operate in multiple states, double-check the laws for each state. As mentioned before, some of them are implementing minimum wage later this year, so note when updates need to be made if the increase is not immediate. Some states, like California, have exceptions for their new minimum wage like employee count requirements. So make sure to read each state’s requirements thoroughly!
If you are a Journey client and enter your payroll online, great! You can not only check employee rates but you can update them as well. Within this portal, you also have access to our HR Library portal. Double-check state information and any other HR related laws by individual state, or compare states.
If you are a Journey client and do not have online access, please email any wage updates directly to your Payroll Specialist. If you have more than one employee, please include a spreadsheet listing employee name, current pay rate, and new pay rate: Download the spreadsheet template, 2019 Pay Rate Updates, below. Please note that no updates will be assumed or made automatically.
If your employees require wage updates to reflect the new minimum wage, send your Payroll Specialist the 2019 Pay Rates spreadsheet as soon as possible.