The current federal minimum wage rate is $7.25 per hour. However, many states (or local governments) have adopted minimum wage rates higher than the federal rate. When the state/local rate and the federal rate are different, employers must pay their employees the higher rate.
While Utah, Wyoming, and Idaho are not increasing their minimum wage in 2021, the following states have announced new minimum wage rates:
| State | 2021 Rate | Effective | Tip Rate/Notes |
| Alaska | $10.34 | Jan. 1, 2021 | Tips do not count toward the minimum wage. |
| Arizona | $12.15 | Jan. 1, 2021 | $3 below minimum wage rate for tipped employees. |
| Arkansas | $11.00 | Jan. 1, 2021 | $2.63 for tipped employees. The state rate applies to employers with 4 or more employees. |
| California | $14/$13 | Jan. 1, 2021 | The minimum wage rate depends on employer size:
· $14 for employers with 26 or more employees · $13 for employers with 25 or fewer employees California does not allow employers to use a tip credit. Visit the California Department of Industrial Relations website for state wage orders. |
| Colorado | $12.32 | Jan. 1, 2021 | $9.30 for tipped employees. |
| Connecticut | $13.00 | Aug. 1, 2021 | 36.8% gratuity allowance for waitpersons and 18.5% for bartenders. |
| Delaware | $10.25 | Oct. 1, 2021 | $2.23 for tipped employees. |
| Florida | $8.65 | Jan. 1, 2021 | $5.63 for tipped employees. |
| $10.00 | Sept. 30, 2021 | $6.98 for tipped employees. | |
| Illinois | $11.00 | Jan. 1, 2021 | The state rate applies to employers with 4 or more employees. Tip credit cannot exceed 40 percent of the applicable minimum wage.
· $6.60 for tipped employees · $8.50 for youth under the age of 18 working fewer than 650 hours per calendar year |
| Maine | $12.15 | Jan. 1, 2021 | $6.08 for tipped employees. |
| Maryland | $11.75 | Jan. 1, 2021 | The state rate applies to employers with 15 or more employees.
· $3.63 for tipped employees · $11.60 for employers with 14 or fewer employees Different rates may apply for Montgomery and Prince George counties. |
| Massachusetts | $13.50 | Jan. 1, 2021 | $5.55 for tipped employees. |
| Michigan | $9.87 | Jan. 1 2021 | $3.75 for tipped employees. |
| Minnesota | $10.08 / $8.21 | Jan. 1, 2021 | No tip credit allowed. The higher rate applies to large employers ($500,000 or more in annual gross revenue). The $8.21 rate applies to:
· Small employers · Employees under 18 years of age (youth wage) · Employees under 20 years of age, during their first 90 days of work (training wage) |
| Missouri | $10.30 | Jan. 1, 2021 | $5.15 (half the current minimum rate) for tipped employees. |
| Montana | $8.75/$4.00 | Jan. 1, 2021 | No tip credit, meal credit or training wage is allowed. The lower rate applies to businesses with gross annual sales of $110,000 or less. |
| Nevada | $9.75/$8.75 | July 1, 2021 | The $9.75 rate applies to employees without health benefits. No tip credit is allowed. |
| New Jersey | $12.00 | Jan. 1, 2021 | The state rate applies to employers with 6 or more employees. The following rates also apply:
· $10.30 for agricultural employees · $11.10 for seasonal employers and employers with 6 or fewer employees · $4.13 for tipped employees |
| New Mexico | $10.50 | Jan. 1, 2021 | $2.55 for tipped employees. |
| New York | $15.00 / $14.50 / $14.00 / $12.50 / $10.00 / $9.35 / $8.35 | Dec. 31. 2020 | The minimum wage rate in New York varies by location and industry:
· $15 for employees in New York City · $14.50 for fast food workers outside of New York City · $14 for Long Island and Westchester employees (unless they are fast food workers) · $12.50 for employees outside Long Island and Westchester and who are not fast food workers The minimum wage rate for tipped food service workers in New York also varies by location: · $10 in New York City · $9.35 on Long Island and in Westchester · $8.35 in the rest of the state Additional rates may apply under specific industry wage orders. Visit the New York Department of Labor website for more minimum wage rate information. |
| Ohio | $8.80/$7.25 | Jan. 1, 2021 | $4.40 for tipped employees. The lower rate applies to employers with annual gross receipts of $323,000 or less. |
| Oregon | $12.75 | July 1, 2021 | No tip credit allowed. The following minimum wage rates also apply:
· $14 for the Portland metropolitan area · $12 for non-urban counties |
| South Dakota | $9.45 | Jan. 1, 2021 | $4.725 for tipped employees. |
| Vermont | $11.75 | Jan. 1, 2021 | $5.88 for tipped employees. |
| Washington | $13.69 | Jan. 1, 2021 | No tip credit allowed. Workers who are 14 or 15 years old may be paid 85% of the state minimum wage rate or $11.64 per hour. |
Please keep in mind that state minimum wage rates apply in areas that are not governed by a higher, local minimum wage ordinance. Make sure you understand the minimum wage rules in the areas where your employees work. Affected employers should review their employees’ pay rates and update their minimum wage poster notices as necessary to ensure compliance with local wage regulations.
If you have any questions, please contact Helpside at humanresources@helpside.com for assistance.