labor lawAdivision of labor law center

Back in their 2006 session, the law makers of North Carolina passed a new minimum wage law that raised their state’s minimum wage from $5.15 per hour to $6.15 per hour. What is more, the North Carolina minimum wage law as it stands now also stipulates that that $6.15 per hour state minimum wage is not static. The North Carolina minimum wage could increase if the federal minimum wage increases. That makes for an interesting discussion here, as you might imagine from all the interesting discussions we’ve already had. But more on that in a moment.

The North Carolina minimum wage law as it stands now went into effect this past January 1, so that gives all of us employers in the state a chance to have already gotten ourselves a new North Carolina minimum wage poster. But as I intimated earlier, all of you folks might have to be getting yourselves a new one soon too. And I am not just talking about the new updated federal minimum wage poster.

Let me explain: the federal minimum wage is set to increase for the first time in nearly 10 years. It will happen in a few weeks, about six at this point, and when it does, the federal minimum wage will go from $5.15 per hour to $5.85 per hour. That amount will still be below the North Carolina minimum wage level of $6.15 per hour. But what happens in 2008? Then, the federal minimum wage will head up to $6.50 per hour, and in that instance, it will increase beyond what the North Carolina minimum wage level is.

And it will be then that the provision in the North Carolina minimum wage law—the one that says that the North Carolina minimum wage will increase to match any increases in the federal minimum w age—will go into effect. I am assuming that it will go into effect, too, as soon as the federal minimum wage changes. So in the middle of 2008, then, the North Carolina minimum wage will increase to match the federal minimum wage. And that brings me back to my original point. It will be then that the North Carolina employers will need to get themselves a new North Carolina minimum wage poster that shows this new increase.

But hold on, wait a minute. What will happen in 2009? Will employers need to get themselves another new North Carolina minimum wage poster? It is looking like a yes, when you consider that the federal minimum wage will go up again, from $6.50 per hour to $7.25 per hour. And again, that provision in the North Carolina minimum wage law will go into effect, and the North Carolina minimum wage will need to increase to keep pace with the federal minimum wage.

It will be at that moment, perhaps, that North Carolina employers will need another new North Carolina minimum wage poster to reflect those changes as well. Truth is, it will all depend on how the Tar Heel state designs its 2008 North Carolina minimum wage poster. If the 2008 poster includes info on the 2009 changes, then perhaps a new poster in 2009 will not be necessary. We will all have to wait with baited breath to see.

One thing, though, that we all surely do not have to wait and hold our breath for is the new federal minimum wage labor law poster. Though the new federal minimum wage will not directly affect employers in North Carolina in 2007, all of us still need the federal minimum wage poster now for display in all our work sites.

We have covered the whole debate on the family and wage act changes that Gov. Eliot Spitzer and others in Albany want to pass to provide paid time off to workers to care for their loved ones and for themselves. And we have covered the debate in Albany on whether or not domestic workers should stop being exempt from overtime and minimum wage laws. But we have not talked all that much about the New York minimum wage bill. Why? Well, for starters, the New York minimum wage changed in January 1 of this year, not because of some long, dragged out debate on the issue (as in, say, Missouri or New Mexico) but because of a law passed in previous years. I hate to say the word “boring,” but we could say that New York has its minimum wage issue under control. How’s that?

Anyways, the details of this issue are that on January 1, 2007, the New York minimum wage increased to $7.15 per hour. That was up from its previous level of $6.75 per hour, which the New York minimum wage had become as of January 1, 2006. That rate holds true for most every worker in the state, except those industries that the state of New York has allowed to have their own minimum wages.

For example, as with in other states, New York state allows employers of tupped employees to pay those workers a little less than the regular New York minimum wage. Tipped employees in New York state, as elsewhere, are defined as employees who make as much as $30 in tips per month. In New York, the tipped employee minimum wage is $4.60 per hour, as long as the workers’ tips make up the difference between that and the New York minimum wage. This tipped employee minimum wage, mind you, can be higher in cases where workers have to pay for their own uniform. There is also a separate New York minimum wage if the employee is not necessarily a tipped employee but is still in the service industry. That New York minimum wage is $5.40 per hour.

Also, there are separate and special New York minimum wages for employees in the building services industry, the hotel and hospitality industry, and for those workers in farming and other agricultural pursuits. And all of this information is contained, in gist form, on the New York minimum wage poster that all employers must contain in their work sites on a wall that is frequently passed and easy to see for employees.

But what does all this have to do with the real point of my post here—the federal minimum wage? Well, the point is that in this context as well, the New York minimum wage issue and the federal minimum wage will not get “exciting” any time soon—until 2009.

That’s because when the federal minimum wage changes for the first time in more than 10 years in a few weeks—from $5.15 per hour to $5.85 per hour—the New York minimum wage, at $7.15 per hour, will remain higher than it and thus will be the minimum wage that most all employers in the state must pay. When the federal minimum wage changes again in 2008—from $5.85 per hour to $6.50 per hour—the New York minimum wage will still remain higher again, and again will be the minimum wage that employers have to pay.

The interesting question in all this period, though, is whether or not employers paying those special New York minimum wages—such as for ag workers or hotel workers—will be required to pay the higher federal minimum wage. That is something I will need to look into for you, because it could become an issue. If as an employer you are liable to follow the Fair Labor Standards Act.

Nevertheless, all employers in New York could be facing a new minimum wage—the $7.25 per hour federal minimum wage—in 2009 if the New York minimum wage does not increase between now and then. That would be because at that point the federal minimum wage would be higher than the New York minimum wage.

I looked up the New York minimum wage poster, which I have not seen in a biut and could always use a refresher on, and tried to scope out whether or not the New York minimum wage increases automatically because of an adjustment for inflation every year, and according to the New York minimum wage poster, I could not find any indication of that. There are also some minimum wages on the state level that will automatically increase to a certain level any time the federal minimum wage surpasses them. The increase of this kind is automatically built into the state minimum wage law. According to the New York minimum wage poster, again, I could not find any indication of such a move in the New York minimum wage law. I will need to keep checking and get back to you with it. My supposition would be, however, with a governor such as Gov. Eliot Spitzer at the helm, New York will not have a minimum wage that is lower than the federal minimum wage. However, we will not know for sure until that new New York minimum wage is passed between now and 2009, or until 2008 rolls around, and the New York minimum wage does something then.

In the meantime, we know one thing is for certain. All employers in New York hopefully already have themselves the new New York minimum wage poster on their walls (considering that they have needed it since the first of the year and we’re already half way through 2007). Those employers who are in the farm industry should also have themselves a 2007 New York Farm minimum wage poster. And another thing is certain—time is running out for New York employers *and employers across the country) to have themselves new federal minimum wage posters.

There was a compromise recently in the Arizona legislature between supporters of businesses and employers and supporters of labor and workers. The result in the state is something worth taking a few seconds away from our federal minimum wage discussion—just a few seconds!

The compromise has been in the works for a while, but the state Senate just recently passed the workers’ comp bill this past Thursday. That vote, however, was only a preliminary vote in the Senate, and a “real” vote will take place this coming week. If things occur as expected, the bill would then get passed to the House, which would have to agree to changes that the Senate made to the bill. If all goes as planned, the House will sign off on them, and it will go to the governor to sign into law.

Those changes I mentioned include an increase to the monthly cap on how much employees can get when they are injured and disabled. Right now, the cap is at $2400 per month, but that would go up to $3000 in 2008 and then $3600 in 2009 if the law goes through. After that, the cap amount that workers could get per month if injured and disabled would be increased in much the same way some minimum wages are increased every year—by the amount of increase that the cost of living goes up in the state in the previous year.

The reason for the increase to the cap amounts, say law makers, is that the caps currently are low and hurt, so to speak, workers who normally have higher paying jobs but still get injured at work. The monthly cap for these workers might not adequately make up for the money they are losing by not being able to work. And after all, that is the whole point of workers’ comp—to compensate workers for time they miss from work due to work related injuries.

One reason that this big compromise was possible, say my experts, is because otherwise labor supporters had threatened to take the issue to the voters in the form of a ballot initiative, where the Arizona minimum wage was just passed.

Before Arizona and before New Hampshire became a huge focus of our attention here on the minimum wage issue—and even before the state of Missouri became such a hot topic and all we could talk about was tipped employee minimum wage and overtime for fire fighters and police officers—there was New Mexico. But then in March of this year, the governor of the state signed into law a compromise New Mexico minimum wage law and the state issue’s seemed to fade away and all those other states took the spotlight away.

That was what happened—the New Mexico minimum wage bill got signed and all the fuss in the state disappeared. What materialized, though, was a new New Mexico minimum wage law that come this January, will increase the state minimum wage from its current level of $5.15 per hour to a new level at $6.50 per hour. Then in January 2009, the New Mexico minimum wage will increase again, this time to the final level of $7.50 per hour.

Originally, though, in the New Mexico legislature, there had been two versions of a New Mexico minimum wage bill floating around, and that is why we spent so much time talking about it. The first version of the New Mexico minimum wage law came out of the state House, where they wanted to increase the New Mexico minimum wage higher and faster than what the Senate’s second version had planned to do.

Another point of difference was that the Senate version of the law did not include annual increases to the New Mexico minimum wage for inflation, in other words, increasing the New Mexico minimum wage every year after 2009 to make way for the higher costs of living that the state would experience, or the Consumer Price Index. The Senate version of the bill would have also made it illegal for small locales—towns and counties and such—to have their own minimum wages and living wages. Currently, Santa Fe and Albuquerque have their own double digit minimum wages, and under the Senate version of the New Mexico minimum wage bill, these living wages would have had to been removed from the books.

The way the New Mexico minimum wage bill turned out, I think, was that the employers of the state do not have to expect an annual increase due to inflation to start in 2010, but one thing that the House got removed from the Senate version of the bill was the ending of local minimum wages. Under the new law, those local minimum wages such as the ones in Santa Fe and Albuquerque get to remain in effect, but no other localities for the time being can move to create new local minimum wages.

What does all this mean now that the federal minimum wage will be in effect soon? Not too much because the New Mexico minimum wage law will predominate in the state through 2009—except for a few months this year, when the federal minimum wage will be at $5.85 per hour and higher than the $5.15 per hour New Mexico minimum wage. While this takes place for the remainder of 2007, some employers in the state will be required to pay that higher federal minimum wage.

But then in 2008, as soon as the year starts, the New Mexico minimum wage will increase to that $6.50 per hour, and will overtake the federal minimum wage. Of course, in the middle of 2008, the federal minimum wage will also increase to $6.50 per hour and catch up. But then again, the New Mexico minimum wage will surpass the federal minimum wage in January, this time in 2009, and at $7.50 per hour, the New Mexico minimum wage will remain ahead of the federal minimum wage, even when it becomes $7.25 per hour in the middle of 2009.

Employers who are liable to follow the federal wage and hour regulations in the Fair Labor Standards Act will still be required to follow the New Mexico minimum wage law, because the common practice on the state level is to require employers to pay the higher of the two minimum wages that they are required to follow. Those employers who are liable to follow the FLSA include those employers that bring in more than $500,000 per year in revenue, as well as those employers with employees who perform functions on an interstate basis—meaning that they sell, train, travel, work, or produce in states other than New Mexico. There are also FLSA requirements for certain types of employers, such as schools, universities, hospitals, retirement and other care settings, and governmental agencies. All of them would normally have to follow the federal minimum wage law if the New Mexico minimum wage wasn’t higher.

Those local and smaller employers who are not required to follow the Fair Labor Standards Act, well, all of that talk above does not mean too much for you. You would get to pay the New Mexico minimum wage law no matter if it was higher or lower than the federal minimum wage law.

And all employers in the state of New Mexico—I hope by now you have moved to get yourselves new New Mexico minimum wage posters, as well as your new latest and greatest updated federal minimum wage posters that must replace the now outdated federal minimum wage posters on your walls.

The New Jersey minimum wage increased last October 1, 2006, to $7.15 per hour, up from the $5.15 per hour level that it had been at. But since then, there are advocates in the Garden State who are pushing for another increase to the New Jersey minimum wage. We already talked about them—they don’t want the New Jersey minimum wage law changed. They say there is no need for such a change, because the current New Jersey minimum wage bill already has a built in mechanism in it that would allow for increases to the state minimum wage to occur every year.

That is because the New Jersey minimum wage law passed last year also established in the state the so called Minimum Wage Advisory Commission. The commission’s one main job, according to the New Jersey minimum wage law, is to make sure that the state minimum wage is meeting the needs of the economy, the employers, and the employees of the state.

The commission could set up an annual increase to the New Jersey minimum wage based on the inflation index, the so called Consumer Price Index, so that the minimum wage would go up each year based on how much the cost of living in the state goes up. The commission has not decided to do this yet or not—and if they have, I have not heard about it yet—but they have the power to do so if they wanted to and felt it appropriate, and as I said, there are some labor advocates in the state already asking them to do this.

I bring it up because it could affect how much the federal minimum wage has to play in the New Jersey employer landscape. For instance, as it stands now, with the New Jersey minimum wage being $7.15 per hour, the federal minimum wage increase will not affect employers in the state any time soon. The first increase to the federal minimum wage—set to happen this coming July or so, in a few weeks—when the federal minimum wage goes from $5.15 per hour to $5.85 per hour, will still keep the federal minimum wage lower than the Jersey minimum wage. And as we know, when that is the case, all employers liable to pay a minimum wage must pay the higher of the two.

A year from that increase, in 2008 when the federal minimum wage goes from $5.85 per hour to $6.50 per hour, the New Jersey minimum wage will still remain higher than the federal minimum wage. Thus, again, the employers of the state will be paying the higher of the two—the New Jersey minimum wage.

But in 2009, when the federal minimum wage increases to $7.25 per hour, the New Jersey minimum wage could fall lower than it, if the Minimum Wage Advisory Commission does not act to increase the New Jersey minimum wage. That 10 cents might not seem like very much, but it would be enough to create a minimum wage bifurcation in the state—or a two part minimum wage system, whereby some employers in the state would still be paying the lower New Jersey minimum wage and some employers in the state would be paying the higher federal minimum wage.

What side of the coin you come up on would be determined by whether or not you have to follow the Fair Labor Standards Act. If you do, you’d pay the higher federal minimum wage. If not, you wouldn’t. All employers in the state, though, will need new federal minimum wage posters.