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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.

A recently settled lawsuit involving violations of federal and Delaware minimum wage laws will cost Wal-Mart $33 million. This money is back pay and interest that Wal-Mart will pay to almost 87,000 workers. These workers reside in Delaware and throughout the United States.

The suit was brought against Wal-Mart by the U.S. Department of Labor. It refers only to certain violations and doesn’t impact any private lawsuits against the corporate giant. Moreover, this recent settlement doesn’t impact the ability of workers to file their complaints with the U.S. Department of Labor.

The settlement resolves a dispute on how some salaried employees were paid. These employees included manager trainees, interns, and programmer trainees. These employees often were paid low wages yet they worked long hours. According to the ruling by the US Department of Labor, these workers actually were “non-exempt salaried” employees. When employees are “non-exempt salaried,” they are entitled to be paid for overtime.

Whether the salaried employees are entitled to overtime depends on the duties assigned to their jobs. New guidelines adopted in recent years affect employees whose weekly earnings are less than $455 ($23,660 per year).

These guidelines require that employees who earn less than $455 per week be paid overtime for any hours over the normal 40. If employees earn more than $455 per week, they still may be entitled to overtime pay if they do not have the power to make significant decisions regarding a department, store, or division.

The case against Wal-Mart related to employees who had limited power to make decisions, had no employees to supervise, and yet still worked long hours. In some cases, the salaries of these employees were much less that $23,660.

Employers have tried before to avoid paying employees overtime. Over twenty years ago, Howard Johnson’s would hire “assistant managers” who were required to work 80 or more hours a week. They were found guilty of making these employees work long hours without paying them properly.

Delaware (DE) wage and hour laws make it possible for both employers and employees in Delaware to benefit from improved working conditions. Several provisions are made by these laws.

For instance, Delaware (DE) wage and hour laws include provisions for employee breaks. Those who work 7 ½ hours or more per day must be given at least a 30 minute break. Penalties are given to employers who do not provide adequate break times.

The minimum wage for Delaware workers will be $6.15 until December 2006 and then will rise to $6.65 per hour starting January 2007, and then to $7.15 per hour in 2008. Some workers are exempt from receiving the standard the minimum wage. For example, those with disabilities may be paid lower than minimum wage in some cases. Likewise, students and apprentices are not required to receive minimum wage by an employer.

Delaware (DE) wage and hour laws state that employers must pay the premium pay for overtime hours worked. Delaware employers usually abide by the federal overtime standards and there are certain exemptions for overtime pay. Usually the rate is 1 ½ times the regular rate of pay for any hours worked over 40 in a regular work week.

Another function of Delaware (DE) wage and hour laws is to help protect minors. For instance, minors who are only 14-15 years of age are only allowed to work up to 4 hours a night on a school night. Another example of a provision that would protect minors is the one that states that 16-17 year olds must have at least 8 hours of free time within a 24-hour period on days they attend school.

Delaware (DE) wage and hour laws exist to help ensure that working conditions are as fair for everyone as possible. Provisions are made by these laws as well for people who believe they have not been treated fairly. Penalties are given to employers who do not abide by state or federal wage and hour laws.

The federal government allows each state to determine whether or not they want special overtime laws for local businesses. Each state can determine what makes up a legal workday, or how many hours are in a standard work week. And each state can also decide if and when there are exceptions to its overtime laws. Not Delaware.

The First State has no set of laws that decide if and when so-called premium pay is warranted for work over a set amount of hours per day or week for small and local businesses. Delaware instead defers to the Fair Labor Standards Act, also known as the FLSA.

The FLSA is the federal guideline that tells us what the basic overtime pay rules are for employers, technically with interstate businesses, and the law also goes into a whole set of provisions and exemptions that we could cover in detail in a future blog when we have the chance.

In the meantime, we should touch upon the very basic rules outlined in the Fair Labor Standards Act. The most important of all possibly is the one that declares that the standard workday consists of 8 hours per day, and the standard work week is made up of 40 hours. If an employer expects an employee to work more than that amount of time, then they will have to pay that premium wage rate that we talked about before—at least one and a half times the employee’s typical wage rate.

That being said, what we can’t forget is that Delaware does have some employment laws that indirectly touch upon overtime labor rules. One of them is the Delaware Wage Payment and Collection Act. It basically tells us that it will enforce the fact that the employer has to pay the employee the rate it promised for all of the employee’s hours worked. How does this work with overtime? Well, if the employee worked over 40 hours in a week, and the employer promised to pay time and a half in that case, the employer better pay up. Otherwise, the employee can file with the state.

The Delaware Complete Labor Law poster reflects all of the FLSA laws as well as all the state specific laws.