Littler’s Semi-Annual Rates Update for Minimum Wage, Tips, and Exempt Pay Increases on January 1, 2025 (and Other Developments)
While Americans across the country headed to the polls to decide who would govern their country, state, county, or city, most decisions were already made concerning what minimum pay rate would govern the employment of non-exempt and exempt employees on January 1, 2025. However, some state and local ballot measures had the potential to – and will – shape 2025 and future years’ pay standards. Additionally, a federal judge vacated the U.S. Department of Labor’s (DOL) rule increasing the salary threshold for exempt executive, administrative, and professional employees. Accordingly, with these notable events behind us, we can now look forward to what employers with U.S. operations can expect to pay their employees at the beginning of the new year, while also cautioning that further changes are always a possibility, as are revised minimum wage adjustment announcements – that happened multiple times this update cycle – so it’s important to consult with counsel to ensure that the rate they intend to pay their employees is “the” rate the law requires.
Minimum Wage, Minimum Cash Wage & Tip Credit Changes
Pre-January 1, 2025 Changes
Jurisdiction | Minimum Wage | Minimum Cash Wage | Maximum Tip Credit |
Florida (Sept. 30) | $13.00 | $9.98 | $3.02 |
California (Healthcare) (Oct. 16) | $18, $21, or $23, Based on Tier Size | Not Applicable | Prohibited |
Changes on January 1, 2025
In the below chart we include the (mostly) generally applicable minimum wage (MW) that will change on January 1, 2025.2 We list the rate that will apply after the change. In certain jurisdictions – excluding, e.g., Alaska, California, Minnesota, Montana, Washington – employers may be able to count tips an employee receives toward the minimum wage. In those jurisdictions that permit a tip credit (TC), if the direct wage an employer pays (minimum cash wage or MCW) and tips an employee earns equals the minimum wage, an employer satisfies its minimum wage obligation, but, if the direct wage plus tips does not equal the minimum wage, an employer must pay the employee the difference.
Jurisdiction | Minimum Wage | Minimum Cash Wage | Maximum Tip Credit |
Alaska | $11.91 | Not Applicable | Prohibited |
Arizona | $14.70 | $11.70 | $3.00 |
-Flagstaff | $17.85 | $16.85 | $1.00 |
-Tucson | $15.00 | $12.00 | $3.00 |
California (General) | $16.50 | Not Applicable | Prohibited |
-Belmont | $18.30 | Not Applicable | Prohibited |
-Burlingame | $17.43 | Not Applicable | Prohibited |
-Cupertino | $18.20 | Not Applicable | Prohibited |
-Daly City | $17.07 | Not Applicable | Prohibited |
-East Palo Alto | $17.45 | Not Applicable | Prohibited |
-El Cerrito | $18.34 | Not Applicable | Prohibited |
-Foster City | $17.39 | Not Applicable | Prohibited |
-Half Moon Bay | $17.47 | Not Applicable | Prohibited |
-Hayward (26 or More Employees) | $17.36 | Not Applicable | Prohibited |
-Hayward (25 or Fewer Employees) | $16.503 | Not Applicable | Prohibited |
-Los Altos | $18.20 | Not Applicable | Prohibited |
-Menlo Park | $17.10 | Not Applicable | Prohibited |
-Mountain View | $19.20 | Not Applicable | Prohibited |
-Novato (100 or More Employees) | $17.27 | Not Applicable | Prohibited |
-Novato (26-99 Employees) | $17.00 | Not Applicable | Prohibited |
-Novato (25 or Fewer Employees) | $16.42 | Not Applicable | Prohibited |
-Oakland (General) | $16.89 | Not Applicable | Prohibited |
-Oakland (Hotels – No Benefits) | $24.48 | Not Applicable | Prohibited |
-Oakland (Hotels –Benefits) | $18.36 | Not Applicable | Prohibited |
-Palo Alto | $18.20 | Not Applicable | Prohibited |
-Petaluma | $17.97 | Not Applicable | Prohibited |
-Redwood City | $18.20 | Not Applicable | Prohibited |
-Richmond | $17.77 | Not Applicable | Prohibited |
-San Carlos | $17.32 | Not Applicable | Prohibited |
-San Diego | $17.25 | Not Applicable | Prohibited |
-San Jose5 | $17.95 | Not Applicable | Prohibited |
-San Mateo | $17.95 | Not Applicable | Prohibited |
-San Mateo County | $17.46 | Not Applicable | Prohibited |
-Santa Clara | $18.20 | Not Applicable | Prohibited |
-Santa Rosa | TBD | Not Applicable | Prohibited |
-Sonoma (26 or More Employees) | $18.02 | Not Applicable | Prohibited |
-Sonoma (25 or Fewer Employees) | $16.96 | Not Applicable | Prohibited |
-South San Francisco | $17.70 | Not Applicable | Prohibited |
-Sunnyvale | $19.00 | Not Applicable | Prohibited |
-West Hollywood (Non-Hotel-Related)6 | $19.65 | Not Applicable | Prohibited |
Colorado | $14.81 | $11.79 | $3.02 |
-Boulder | $15.57 | $12.55 | $3.02 |
-Boulder County | $16.57 | $13.55 | $3.02 |
-Denver | $18.81 | $15.79 | $3.02 |
-Edgewater | $16.52 | $13.50 | $3.02 |
Connecticut (Tipped Hotel or Restaurant Industry Employee) | $16.35 | $6.38 | $9.97 |
Connecticut (Bartender) | $16.35 | $8.23 | $8.12 |
Delaware | $15.00 | $2.23 | $12.77 |
Illinois | $15.00 | $9.00 | $6.00 |
-Cook County7 | $15.00 | $9.00 | $6.00 |
Maine | $14.65 | $7.33 | $7.32 |
-Portland8 | $15.50 | $7.75 | $7.75 |
-Rockland | $15.50 | $7.75 | $7.75 |
Maryland | $15.00 (No Change) | $3.63 (No Change) | $11.37 (No Change) |
-Howard County | $16.00 | $3.63 | $12.37 |
-Howard County (Certain Employers)9 | $15.00 (State Rate Is Higher) | $3.63 | $11.37 |
Michigan | $10.56 (See Note10) | $4.01 | $8.98 |
Minnesota11 | $11.13 | Not Applicable | Prohibited |
-Minneapolis | $15.97 | Not Applicable | Prohibited |
-Saint Paul (Macro & Large Employer)12 | $15.97 | Not Applicable | Prohibited |
Missouri | $13.75 | $6.875 (Est.)13 | $6.875 (Est.) |
Montana | $10.55 | Not Applicable | Prohibited |
Nebraska | $13.50 | $2.13 | $11.37 |
New Jersey (General) | $15.49 | $5.62 | $9.87 |
New Jersey (Small) | $14.53 | Not Applicable | Not Applicable |
New Jersey (Farm) | $13.40 | Not Applicable | Not Applicable |
New Jersey (Direct Care) | $18.49 | Not Applicable | Not Applicable |
New Mexico | $12.00 (No Change) | $3.00 (No Change) | $9.00 (No Change) |
-Las Cruces | $12.65 | $5.06 | $7.59 |
New York (NYC, Nassau, Suffolk & Westchester Counties) [Service Employee]14 | $16.50 | $13.75 | $2.75 |
New York (Same) [Food Service Worker] | $16.50 | $11.00 | $5.50 |
New York (Elsewhere) [Service Employee]15 | $15.50 | $12.90 | $2.60 |
New York (Elsewhere) [Food Service Worker] | $15.50 | $10.35 | $5.15 |
Ohio | $10.70 | $5.35 | $5.35 |
Rhode Island | $15.00 | $3.89 | $11.11 |
South Dakota | $11.50 | $5.75 | $5.75 |
Vermont | $14.01 | $7.01 | $7.00 |
Virginia | $12.41 | $2.13 | $10.28 |
Washington | $16.66 | Not Applicable | Prohibited |
-Bellingham | $17.66 | Not Applicable | Prohibited |
-Burien (500 or More Full-Time Equivalent Employees)16 | $21.16 | Not Applicable | Prohibited |
-King County (General) | $20.2917 | Not Applicable | Prohibited |
-King County (16-499 Employees) | $18.29 | Not Applicable | Prohibited |
-King County (15 or Fewer Employees and Gross Revenue of $2 Million) | $18.29 | Not Applicable | Prohibited |
-King County (15 or Fewer Employees and Gross Revenue Less than $2 Million) | $17.29 | Not Applicable | Prohibited |
-Renton (501 or More Employees) | $20.90 | Not Applicable | Prohibited |
-Renton (15 - 500 Employees)18 | $18.90 | Not Applicable | Prohibited |
-SeaTac | $20.17 | Not Applicable | Prohibited |
-Seattle19 | $20.76 | Not Applicable | Prohibited |
-Tukwila (501 or More Employees) | $21.10 | Not Applicable | Prohibited |
-Tukwila (Other Covered Employers)20 | $20.10 | Not Applicable | Prohibited |
Post-January 1, 2025 but Pre-July 1, 2025
Jurisdiction | Minimum Wage | Minimum Cash Wage | Maximum Tip Credit |
Michigan (Feb. 21) | $12.48 | $5.99 | $6.49 |
New Mexico (Santa Fe City) (Mar. 1) | TBD | TBD | TBD |
New Mexico (Santa Fe County) (Mar. 1) | TBD | TBD | TBD |
Washington (Bellingham) (May 1) | $18.66 | Not Applicable | Prohibited |