In 2016, 17 states and the District of Columbia implemented increased minimum wage rates. This year, even more states are scheduled to do so.
Federal Minimum Wage for 2017
The federal minimum wage will remain at $7.25 per hour for non-tipped employees and $2.13 per hour for tipped employees.
State and City Minimum Wage Increases for 2017
The following table summarizes the minimum wage increases for 2017 in affected states and some noteworthy cities, along with the related changes to the maximum tip credit and minimum cash wage for tipped employees (changes in bold text):
Minimum Wage | Max Tip Credit | Minimum Cash Wage | |
Alaska | $9.75 (current) $9.80 (effective Jan. 1, 2017) | Tip credit not allowed | Tip credit not allowed |
Arizona | $8.05 (current) $10.00 (effective Jan. 1, 2017)Not applicable to “small businesses” that have less than $500,000 in annual gross revenues and that are exempt from paying minimum wage under federal law (29 U.S.C. Section 206(a)). Ariz. Rev. Stat. § 23-362. | $3.00 (set credit amount) | $5.05 (current) $7.00 (effective Jan. 1, 2017) The minimum cash wage may be $3.00 per hour less than the minimum wage. |
Arkansas | $8.00 (current) $8.50 (effective Jan. 1, 2017) | $5.37 (current) $5.87 (effective Jan. 1, 2017) | $2.63 (unchanged) |
California | $10.00 (current)
$10.50 (effective Jan. 1, 2017) |
Tip credit not allowed | Tip credit not allowed |
Colorado | $8.31 (current) $9.30 (effective Jan. 1, 2017) | $3.02 (unchanged) | $5.29 (current) $6.28 (effective Jan. 1, 2017) |
Connecticut | $9.60 (current)
$10.10 (effective Jan. 1, 2017) |
The maximum tip credit for hotel and restaurant workers is 36.8 percent of the current minimum wage ($3.53); 18.5 percent for bartenders ($1.78); and $0.35 per hour for employees in any other industry. Effective Jan. 1, 2017, the maximum tip credit for hotel and restaurant workers will be 36.8 percent of the 2017 state minimum wage ($3.71); 18.5 percent for bartenders ($1.87); and $0.35 per hour for employees in any other industry. | The current minimum cash wage is set at $6.07 for hotel and restaurant workers; $7.83 for bartenders; and $9.25 for all others. Effective Jan. 1, 2017, it will be $6.39 for hotel and restaurant workers; $8.23 for bartenders; and $9.75 for all others. |
District of Columbia | $11.50 (current) $12.50 (effective July 1, 2017) | $8.73 (current) $9.17 (effective July 1, 2017) | $2.77 (current) $3.33 (effective July 1, 2017) |
Florida | $8.05 (current) $8.10 (effective Jan. 1, 2017) | $3.02 (unchanged) | $5.03 (current) $5.08 (effective Jan. 1, 2017) |
Hawaii | $8.50 (current) $9.25 (effective Jan. 1, 2017) | $0.75 provided that wages plus tips are at least $7.00 more than the applicable minimum wage | $7.75 (current) $8.50 (effective Jan. 1, 2017) |
Maine | $7.50 (current) $9.00 (effective Jan. 1, 2017) | $3.75 (current) $4.00 (effective Jan. 1, 2017) | $3.75 (current) $5.00 (effective Jan. 1, 2017) |
Maryland | $8.75 (current) $9.25 (effective July 1, 2017) | $5.12 (current) $5.62 (effective July 1, 2017) | $3.63 (unchanged) |
Massachusetts | $10.00 (current) $11.00 (effective Jan. 1, 2017) | $6.65 (current) $7.25 (effective Jan. 1, 2017) | $3.35 (current) $3.75 (effective Jan. 1, 2017) |
Michigan | $8.50 (current) $8.90 (effective Jan. 1, 2017) | $5.27 (current) $5.52 (effective Jan. 1, 2017) | $3.23 (current) $3.38 (effective Jan. 1, 2017) |
Missouri | $7.65 (current) $7.70 (effective Jan. 1, 2017) | $3.82 (current) $3.85 (effective Jan. 1, 2017) | $3.83 (current) $3.85 (effective Jan. 1, 2017) |
Montana | $8.05 (current) $8.15 (effective Jan. 1, 2017) | Tip credit not allowed | Tip credit not allowed |
New Jersey | $8.38 (current) $8.44 (effective Jan. 1, 2017) | $6.25 (current) $6.31 (effective Jan. 1, 2017) | $2.13 (unchanged) |
New York | $9.00 (current) $9.70 (effective on Dec. 31, 2016) $10.40 (effective Dec. 31, 2017) | $1.50 for all hospitality positions (current)
$2.20 for all hospitality positions (effective Dec. 31, 2016) |
$7.50 for all hospitality positions (effective Dec. 31, 2016) |
Ohio | $8.10 (current) $8.15 (effective Jan. 1, 2017) | $4.05 (current) $4.07 (effective Jan. 1, 2017) | $4.05 (current) $4.08 (effective Jan. 1, 2017) |
Oregon | The base minimum wage rates are as follows: $9.75 (current) $10.25 (effective July 1, 2017) | Tip credit not allowed | Tip credit not allowed |
South Dakota | $8.55 (current) $8.65 (effective Jan. 1, 2017) | $4.27 (current) $4.32 (effective Jan. 1, 2017) | $4.28 (current) $4.33 (effective Jan. 1, 2017) |
Vermont | $9.60 (current) $10.00 (effective Jan. 1, 2017) | $4.80 (current) $5.00 (not more than one half the minimum wage) (effective Jan. 1, 2017) (applies only to service or tipped employees, defined as employees of a hotel, motel, tourist place, or restaurant who earn at least $120 per month in tips for direct and personal customer service) | $4.80 (current) $5.00 (not less than one half the minimum wage) (effective Jan. 1, 2017) (applies only to service or tipped employees, defined as employees of a hotel, motel, tourist place, or restaurant who earn at least $120 per month in tips for direct and personal customer service) |
Washington | $9.47 (current)
$11.00 (effective Jan. 1, 2017)
|
Tip credit not allowed | Tip credit not allowed |
Employers may want to take note of these changes and prepare to implement them as necessary in their businesses.
Federal and state minimum wage information—in addition to other wage and hour information—is available in OD Comply: State Wage and Hour Issues subscription materials, which are updated and provided to OD Comply subscribers as the law changes.