Preparing for a 2021 Minimum Wage Increase
It's that time of year! Minimum wage increases will happen January 1, 2021 for SEVERAL states, which all have the minimum set higher than the Federal $7.25 level. In preparation for the increases, review the rate table and perform a basic compensation analysis for other wage scenarios to avoid potential wage and hour risk.
Perform a Compensation Analysis
- Re-Calculate exempt employees salary requirements. To ensure it meets California state exempt employee salary requirements after the minimum wage increase. When state minimum wage increases, so must this salary threshold for exempt employees.
- Review Overtime/double-time and other pay calculations. Make sure they reflect all changes and amendments to the wage and hour laws (state and federal) effective January 1, 2020. Overtime/double-time, meal periods, weighted average and regular rates of pay for blended rates, etc.
- Adjust the minimum wage threshold for piece-rate, commission or other complex wage calculations.
Do not forget about the employees paid in alternative methods, for example, piece-rate, commission, bonuses etc. All non exempt employees, no matter the method and complex wage calculations performed, must earn at least the federal, state or local ordinance minimum wage requirement for all hours worked including overtime (if applicable according to hours worked).
OnePoint automatically updates minimum wage rates
The OnePoint real-time system updates ensure that the pay rate tables are updated as minimum wages increase at the state and municipal level. This makes it easier perform wage audits faster to ensure compliance with wage rates. Quick compensation rate reports provide current compensation rates for each of your employees. Run the base compensation history report and apply a filter to only display current rates to quickly verify pay rates.
Increases Scheduled for January 1, 2021 (or in 2021)
Minimum Wage Changes
The state minimum wage rates discussed in this blog do not include county and city minimum wage rates. Also, this blog only covers updates from December 31, 2020 through July 2021 for states only.
This intended for market awareness only, it is not to be used for legal advice or counsel. Please access any number of public resources available to monitor changes to the minimum wage rate at the county or city level.