labor lawAdivision of labor law center

Under state law, the Delaware minimum wage increases automatically if the federal minimum wage is higher. On July 24, 2009 when the federal minimum wage increased, the Delaware minimum wage went from $7.15 per hour to $7.25 per hour.

This makes it critical for Delaware employers to display an updated minimum wage poster.

According to the Delaware Department of Labor, many employers in the state are covered by federal minimum wage law. Many employers in Delaware were affected by the July 24, 2009 increase of the federal minimum wage.

The FLSA or Fair Labor Standards Act of 1938 is the law relevant to the federal minimum and applies to businesses with annual revenue of $500,000 or more, and to companies and individual employees engaged in interstate commerce.

Interstate commerce includes:

·         Accepting or sorting mail from out-of-state

·         Receiving goods from out-of-state vendors

·         Buying from out-of-state vendors

·         Accepting long-distance phone calls

·         Accepting credit card or debit card payments

·         Accepting out-of-state checks

·         Using the Internet, a website or email

A company that does not buy or sell goods out-of-state can still have several workers who engage in interstate commerce on a regular basis. Consider a small hair salon with annual revenue of less than $500,000. This salon serves local customers and buys its supplies locally. (more…)

Employers in Delaware should take note that the state’s minimum wage is now $7.15 per hour.

Governor Ruth Ann Minner signed a Delaware state bill into law in 2006 to raise the state minimum wage.

On January 1, 2007, the first step of the increase went into effect, raising the minimum a full 50 cents from $6.15 to $6.65 per her hour. The second and final step of that increase took effect on January 1, 2008 and raised the minimum from $.6.65 per hour to $7.15 per hour.

Delaware’s state website says the new minimum wage law will affect about 1.6% of the state’s workers or 6,700 people, the majority of whom are employed by the food service industry.

Though the Delaware minimum wage applies to businesses with over 10 employees, a number of industries are exempt from the state minimum wage law.

Delaware workers in the fishing industry are exempt from the state minimum wage, as are workers who process fish at sea. Domestic service employees who work in or “about” private homes are exempt, so are junior camp counselors working for a non-profit organization and inmates in a Department of Corrections program.

Outside sales people who are paid by commission are exempt from Delaware state minimum wage. Employees who receive tips as part of their earnings can be paid a lot less than minimum wage, as low as $2.23 per hour. The employee can only be paid such a low wage, however, if she or she averages at least $4.92 per hour in tips.

In addition to types of industries being exempt, several types of employees are exempt from Delaware state minimum wage law, too. For a wage less than minimum to be legal, the employer and/or employee must be certified by the Delaware Department of Labor. Disabled employees (both mentally and physically) who work in sheltered workshops may earn less than minimum wage, as may some disabled workers in competitive employment.

Workers in formal apprenticeship programs and student-learners are covered by a special minimum wage.

Delaware is not the only state changing its minimum wage in 2008.

January 1, 2008 saw an increase in state minimum wage for fourteen states, including Montana, Arizona, Iowa and Delaware and ten others. These raises, however, are just the first of many increases slated for 2008.

The first of these increases will occur on July 1, 2008. Three states will enjoy a substantial raise at this time. Kentucky will add 70 cents to its minimum resulting in a new rate of $6.55. West Virginia will also see a 70 cent bump, from $6.55 to $7.25 per hour. Employees in Pennsylvania, however, will see the biggest boost, a 90 cent jump from $6.25 to $7.15

On May 24, 2006, President George W. Bush signed the Fair Minimum Wage Act of 2007 into law. This law set up increases in the federal minimum wage as a three-step system. On July 24, 2008, the second step of the Fair Minimum Wage Act’s system goes into effect. The federal minimum wage will go up from $5.85 to $6.55 per hour.

Texas, Oklahoma, Utah and several other states connect the increases in their state minimum wage rates to when the federal minimum wage goes up. So, when the federal minimum wage increases on July 24, 2008, the minimum wage rates in these states will be increased, too.

These changes in the minimum wage law require employers to update their labor law posters, both for their own state laws, and for the federal law changes. Companies seeking updated information can visit www.laborlawcenter.com.

With so many minimum wage changes on the way, many employers will want to contract with a poster service that automatically delivers quality, laminated posters each time there is an update.

Effective January 1, 2008 the Delaware state minimum wage will increase by 50 cents from $6.65 per hour to $7.15 per hour.

In 2006, the Delaware state legislature passed a bill that was signed into law by Governor Ruth Ann Minner to increase the state rate from $6.15 per hour.

The first step of the increase went into effect on January 1, 2007 when the state minimum wage rose by 50 cents to $6.65 per hour. This is the second and final tier in that increase.

According to the Delaware state website, this change will affect 6,700 workers, which is approximately 1.6% of the state workforce. About 66% of those workers are in the foodservice industry.

Earlier this year, the federal minimum wage was increased from $5.15 per hour to $5.85 per hour. This was the first increase in the federal rate in more than a decade. However, because the state minimum wage is higher, most employers in the Delaware are obligated to pay the state rate to all employees.

The Delaware minimum wage applies to companies within the state with more than 10 employees.

A number of industries in the First State are exempt from the state minimum wage laws. These include agriculture and employees of the U.S. government. Employees in the fishing industry, and those who process fish at sea, are exempt from the state minimum wage.

Outside salespeople who are paid on commission are exempt from the state minimum wage, although inside salespeople are not. Junior camp counselors may be paid less than the minimum wage, only if they are employed by a non-profit summer camp. Inmates in a Department of Corrections program may be paid less than the state minimum wage.

Employees engaged in domestic service in or “about” private homes are exempt from the state’s minimum wage law, as are volunteers.

The state of Delaware does exempt several classes of workers from the state minimum wage. Mentally or physically disabled workers in sheltered workshops may be paid less than the minimum wage. Some disabled workers in competitive employment may also be paid less than the minimum wage. A special minimum wage applies to those enrolled in a formal apprenticeship program, and to student-learners. In all cases, the employer and/or the worker must be certified by the Delaware Department of Labor for the lower wage to be legal.

Under Delaware law, employees who receive tips may be paid as little as $2.23 per hour, provided they average at least $4.92 per hour in tips. If an employee earns less than $4.92 per hour for a shift, the employer must pay the difference, to ensure the employee is earning at least the minimum wage. By law, the employer cannot retain tips. Up to 15% of tips may be pooled under certain circumstances. This law has been in effect in the state since October 1, 1996.

The Department of Labor collects unpaid wages and benefits on behalf of workers in Delaware.

In general, under Delaware state law, wages must be paid to employees at least once per month. With a few exceptions, workers must be paid wages within 7 days of the end of the pay period. Any employee who is not present will be paid by mail (if requested by the employee), or on the next workday where the employee is present.  

An employer who pays by check in Delaware must make arrangements for payroll checks to be cashed at a bank or other business convenient to the workplace. If an employee requests (in writing), wages may be paid directly into the employees bank account by direct deposit.

Whenever an employee quits, resigns or is fired, suspended or laid off, wages must be paid on the next regularly scheduled payday. This may be done in the usual manner, or, if the employee requests, by mail.

The bottom line when it comes to the Delaware minimum wage law for employers is that they should have gotten themselves a new Delaware minimum wage poster a while back when the new minimum wage first went into effect in 2006. That poster also contains info on what the changes will be in 2007 and 2008.

As for the bottom line on the Delaware minimum wage and the federal minimum wage, there really isn’t one at the moment because the new federal minimum wage law has not been passed down I-95 from Delaware in Washington DC. And at the current moment, the Delaware minimum wage is higher than the federal minimum wage of $5.15 per hour, so Delaware employers have to pay the higher state minimum wage.

When and if the federal minimum wage gets passed, then the employers in the state will have to pay the new federal minimum wage right? Well, not exactly. The Delaware minimum wage law puts the state minimum wage one step ahead of federal minimum wage. I mean to say, that when the federal minimum wage will be going up to $6.50 per hour in 2008, the Delaware minimum wage will be already up to $7.15 per hour.

The interesting situation will be in 2009, when the federal minimum wage goes up to $7.25 (again, if the new federal minimum wage law gets passed). Then the federal minimum wage in that case will be higher than the state minimum wage, and then employers liable to follow the Fair Labor Standards Act will then have to pay the higher federal minimum wage in Delaware. Local smaller Delaware employers could still pay the lower state minimum wage.

That is, if Delaware does not change its minimum wage law again between now and 2009 and make its minimum wage higher than $7.15 per hour.

The Delaware minimum wage went up to $6.65 per hour as of January 1 of this year, up from its previous level of $6.15 per hour. It will go up again in another year, on January 1, 2008, to the level of $7.15 per hour. This change was pursuant to the minimum wage law in the state, and this law has not changed in the last couple weeks, unlike many of the other states’ minimum wage laws, so no need to report on cutting edge or all important news items coming out of the First State.

But what we should make a note of is the fact that the Delaware minimum wage law does have a tip credit that all employers of employee who make tips should know about. Under the Delaware law, tipped employees have to at least get paid by their employer as much as $2.23 per hour, which means that the rest of their salary must be made up for in tips from their customers, to at least get their hourly wage back up to the state minimum wage.

That is an interesting fact to know about the Delaware minimum wage, and important for all such employers. It is also interesting to know—back on my kick of tip credits around the country—that Delaware’s tip credit in its minimum wage is a set rate, whereas some states instead determine their minimum wage for tipped employees as a percentage of the overall minimum wage.

Either way, straight tip credit amount or percentage of the minimum wage tip credit, employers also have to know at what point their employees officially become tipped employees. In Delaware that level is at $30. That is the minimum amount of tips per month that an employee must make before they can be considered a tipped employee and can get paid less on their minimum wage.