Minimum wage has been part of the labor law since 1938, when the Fair Labor Standards Act (FLSA) was introduced in the United States. There are both a federal minimum wage and states have their own minimum wage.
The federal minimum wage has not increased since July 2009 and remains at $7.25 per hour. This is the longest period of standstill since it's introduction.
There are some states that adhere to the federal minimum wage (like Alabama, Louisiana, Mississippi, South Carolina, and Tennessee). There are two states that are below the federal minimum wage: Georgia and Wyoming - this means their default is $7.25.
However, not all states have followed suite with the federal government. Progressive states like New York and New Jersey continue to raise the bar annually, not just by increasing minimum wages, but also bby enacting forward-thinking policies to support workers' well-being.
New York, for instance, is taking a groundbreaking step in 2025 by introducing a paid prenatal leave policy!
As a business owner, understanding these changes is crucial! Not only to remain compliant, but to also retain employees in a competitive job market.
Starting January 1, 2025, New York is implementing significant changes to wage laws and introducing a new paid prenatal leave policy.
Paid Prenatal Leave
Pregnant employees in New York are entitled to 20 hours of paid prenatal leave per 52-week period.
Action Items for Employers:
New York City, Suffolk, Nassau, and Westchester Counties:
Rest of New York State:
Like New York, New Jersey will increase its minimum wage starting January 1, 2025.
Unique Factor: New Jersey ties its annual minimum wage increases to the Consumer Price Index (CPI), ensuring wages adjust to reflect economic trends such as inflation.
Action Items for Employers:
| State | Minimum Wage 2022 | 2023 | 2024 | New Minimum Wage 2025 |
| Alabama | $7.25 | $7.25 | $7.25 | $7.25 |
| Alaska | $10.34 | $10.85 | $11.73 | $11.91 |
| Arizona | $12.80 | $13.85 | $14.35 | $14.70 |
| Arkansas | $11.00 | $11.00 | $11.00 | $11.00 |
| California | $15.00 | $15.50 | $16.00 | $16.50 |
| Colorado | $12.56 | $13.65 | $14.42 | $14.81 |
| Connecticut | $14.00 | $14.00 | $15.69 | $16.35 |
| Delaware | $10.50 | $11.75 | $13.25 | $15.00 |
| District of Columbia | $16.10 | $17.00 | $17.00 | $17.00 |
| Florida | $10.00 | $11.00 | $12.00 | $12.00 |
| Georgia | $7.25 | $7.25 | $7.25 | $7.25 |
| Hawaii | $12.00 | TBD | $14.00 | $14.00 |
| Idaho | $7.25 | $7.25 | $7.25 | $7.25 |
| Illinois | $12.00 | $13.00 | $14.00 | $15.00 |
| Indiana | $7.25 | $7.25 | $7.25 | $7.25 |
| Iowa | $7.25 | $7.25 | $7.25 | $7.25 |
| Kansas | $7.25 | $7.25 | $7.25 | $7.25 |
| Kentucky | $7.25 | $7.25 | $7.25 | $7.25 |
| Louisiana | $7.25 | $7.25 | $7.25 | $7.25 |
| Maine | $12.75 | $13.80 | $14.15 | $14.65 |
| Maryland | $12.50 | $13.25 | $15.00 | $15.00 |
| Massachusetts | $14.25 | $15.00 | $15.00 | $15.00 |
| Michigan | $9.87 | $10.21 | $10.33 | $14.65 |
| Minnesota | $10.33 | $10.59 | $10.85 OR $8.85 with ARR >$500k | $11.13 |
| Mississippi | $7.25 | $7.25 | $7.25 | $7.25 |
| Missouri | $11.15 | $12.00 | $12.30 | $13.75 |
| Montana | $9.20 | $9.95 | $10.30 | $10.55 |
| Nebraska | $9.00 | $10.50 | $12.00 | $13.50 |
| Nevada | $10.50 | $10.00 | $12.00 *effective July 1, 2024 | $12.00 |
| New Hampshire | $7.25 | $7.25 | $7.25 | $7.25 |
| New Jersey | $13.00 | $14.13 | $15.13 or $13.73 with less than 6 employees | $15.49 or $14.52 with less than 6 employees |
| New Mexico | $11.50 | $12.00 | $12.00 | $12.00 |
| New York | $13.20 | $14.20 | $15.00 or $16.00 for specific counties | $15.50 or $16.50 for specific counties |
| North Carolina | $7.25 | $7.25 | $7.25 | $7.25 |
| North Dakota | $7.25 | $7.25 | $7.25 | $7.25 |
| Ohio | $9.30 | $10.10 | $10.45 | $10.70 |
| Oklahoma | $7.25 | $7.25 | $7.25 | $7.25 |
| Oregon | $13.50 | $14.20 | $14.20 until June 30, 2024 | $14.70+ based on location |
| Pennsylvania | $7.25 | $7.25 | $7.25 | $7.25 |
| Rhode Island | $12.25 | $13.00 | $14.00 | $15.00 |
| South Carolina | $7.25 | $7.25 | $7.25 | $7.25 |
| South Dakota | $9.95 | $10.80 | $11.20 | $11.50 |
| Tennessee | $7.25 | $7.25 | $7.25 | $7.25 |
| Texas | $7.25 | $7.25 | $7.25 | $7.25 |
| Utah | $7.25 | $7.25 | $7.25 | $7.25 |
| Vermont | $12.55 | $13.18 | $13.67 | $14.01 |
| Virginia | $11.00 | $12.00 | $12.00 | $12.41 |
| Washington | $14.49 | $15.74 | $16.28 | $16.66 |
| West Virginia | $8.75 | $8.75 | $8.75 | $8.75 |
| Wisconsin | $7.25 | $7.25 | $7.25 | $7.25 |
| Wyoming | $7.25 | $7.25 | $7.25 | $7.25 |
Compliance with wage and leave laws is not just about avoiding penalties, it’s a demonstration of fairness and respect for your workforce. Updating your employee handbook, payroll systems, and training programs are proactive steps to avoid disruptions.
For expert guidance on navigating these changes and ensuring your business remains ahead of compliance requirements, MegaPay now offers a Fractional HR Service!