July 2009 is an important month for employees and employers alike in South Dakota.
On July 24, 2009, the South Dakota minimum wage will increase from $6.55 per hour to $7.25 per hour. When the federal minimum increases, over a dozen states will increase their minimum wage to match the federal.
The majority of the employers in the United States are covered by the federal minimum wage law, the FLSA or Fair Labor Standards Act. That law covers employers who earn $500,000 or more annually, and companies that engage in interstate commerce.
The law also applies to individual employees who engage in interstate commerce. For example, a receptionist who answers out-of-state phone calls is considered to be engaged in interstate commerce and would be covered by the federal minimum wage. (more…)
The minimum wage in South Dakota is now $6.55 per hour. On July 24, 2008 when the federal minimum wage increased from $5.85 per hour. Under state law, the South Dakota minimum wage also increases to reflect the change in the federal minimum wage.
The Fair Minimum Wage Act of 2007increased the federal minimum wage from $5.15 per hour to $7.25 per hour. However, the increase didn’t go into effect all at once. Under the federal law, the minimum wage increases in three 70 cent steps. The first step went into effect 60 days after the President signed the bill into law, on July 24, 2007. The other two increases occur on the same dates in 2008 and 2009.
But whatever happens with the Democrats and the Republicans in faraway Washington DC will greatly impact how you employers do things in South Dakota. Those of you liable for the Fair Labor Standards Act will obviously need to begin learning the new three part increase system that the federal minimum wage will experience in the next couple years, culminating in the final federal minimum wage of $7.25 per hour. And all employers in the state of South Dakota will be required to update their federal minimum wage labor law poster.
But those of you in South Dakota that are currently not liable to follow the Fair Labor Standards Act will be required to—what? And I think that is the most important issue with the effects of the federal minimum wage change to all employers in the state of South Dakota. What will they have to pay when the federal minimum wage increase goes into effect? Will they still be liable to pay the current South Dakota minimum wage of $5.15 per hour, or will the state experience some sort of law change that makes the state continue to follow whatever the federal minimum wage does? Or does the state of South Dakota already have some form of provision in its minimum wage labor law that dictates that the state will change its minimum wage to match any increase in the federal minimum wage?
These are all good and important questions, and I can hear you asking yourself: but isn’t that why I read this blog? To get answers to these question? And answers you shall have. Let me check with my sources and get back to you folks, pronto. In the meantime, South Dakota employers, keep your eyes peeled on Capitol Hill to see what the national politicians end up doing.
The second main category of employers liable for the Fair Labor Standards Act is those that have interstate operations. And here is an important distinction that I don’t know I’ve stressed enough in the past. An employer is liable for this category of the Fair Labor Standards Act on an employee by employee basis. So if they have one employee who does some form of interstate activity, and no others, that employer would be liable to follow the Fair Labor Standards Act for that one employee.
But how does this all matter with the new federal minimum wage changes anyway? All this talk about the Fair Labor Standards Act might not be so fair if you’re a South Dakota employer who already knows all about it. Well, listen up, Mr. Smarty Pants, if you know all about the Fair Labor Standards Act, and you already know whether or not you are liable to follow it in paying your employers, then you know that it could become an even more important distinction when and if the federal minimum wage changes in the next few weeks or months.
As I was mentioning earlier in the week, the Democrats in Washington DC have not shown their hand yet in what they will do with the federal minimum wage bill in their control now that the president vetoed the bill that they sent to him attached to the supplemental spending bill. We had discussed that they might send the president the federal minimum wage bill again attached to the revised version of the supplemental spending bill, or they might send it to him separate and on its own. The reason they might not do the latter, however, is because the president could then veto the federal minimum wage bill on its own and that might end its chances of getting passed soon as is.
Enough, Mark, I can hear you say. Of course, I was only kidding with the bragging back in the last post. My blog is only valuable to you employers because you are out there to read it. Without you, my loyal readers, I would be nowhere. Now back to my alphabetical review of all of the major minimum wage changes in the last couple months. The next state—South Dakota—where I am finding that not a heck of lot has happened with the minimum wage.
The South Dakota minimum wage still matches the federal minimum wage at $5.15 per hour. That includes the tipped employee minimum wage of $2.13 per hour, which employers can pay their employees as long as they make up enough tips from their customers to cover the rest of the minimum wage.
Oh, and what did the South Dakota minimum wage question and answer page on the department of labor Web site have to say about the Fair Labor Standards Act? Well, basically it said that many employers in the state would be liable to follow that wage and hour set of regulations, and went on to define the two types of employers who would be liable for the Fair Labor Standards Act. Those two, of course, are the so called “enterprise” employer, or the one that is big enough to bring in $500,000 or more in annual revenue.
And remember those special exceptions that I always mention? Those include hospitals, or retirement homes—anywhere that cares for elderly people or disabled people. No matter their size or number of locations, they must follow the Fair Labor Standards Act, as do all schools and government and public agencies. There might be more similar “exceptions” to the rule, and a labor law lawyer might be best person to discuss the topic with if you are an employer in South Dakota with very specific questions.