Minimum wage in the US: how does it work and why does it vary?

d4uimmigration
Escrito por:d4uimmigration

The issue of the minimum wage in the USA is very different from what we have in Brazil. Therefore, it is worth exploring this topic and understanding it better. 

Although there are federal regulations on the subject, the American minimum wage varies according to the State and the profession, with some professions being exempt from following this logic — such as professionals who receive tips.

This is, therefore, a very complex subject. Therefore, today we are going to show you everything you need to know about the minimum wage in the United States.

Minimum wage in the USA: how does it work?

According to US Department of Labor website, consulted in September 2023, the federal minimum wage in the United States was $7.25 per hour.

However, some states and cities have higher minimum wages than the federal minimum, meaning workers in those places receive a higher minimum pay.

This happens because, in the United States, the Minimum Wage is regulated by the Fair Labor Standards Act, which establishes the right to a minimum wage for workers.

Therefore, the federal minimum wage in the United States is $7.25 per hour. This value applies to workers covered by the legislation, that is, those who are not exempt from this rule, such as employees who receive tips.

In these cases, the minimum wage is $2.13 per hour. However, the sum of tips received plus $2.13 must reach at least $7.25 per hour. If this does not happen, the employer is obliged to pay the difference.

In addition to the federal minimum wage, some states and cities in the US have the power to set their own minimum wage.

When this occurs, if the minimum value established by the local government is higher than the federal one, the worker must receive the higher value.

Additionally, some states may have different rules for employees who rely on tips, offering a higher minimum wage.

Being aware of the value of the minimum wage in the states can make it easier to choose a city and the process of rent a property in the USA.

Read too: American visas: what they are, importance and how to get them

American states with wages higher than the federal minimum

American states with wages higher than the federal minimum

In total, 29 of the 50 American states have a minimum wage higher than the federal minimum. Check out what they are below:

1. Florida

Florida sets its minimum wage at $11.00 per hour. Additionally, it is important to note that the state minimum is adjusted annually based on a specific formula.

2. California

California has one of the highest minimum wages in the country, set at $15.50 per hour, but in addition, there are also several specific regulations regarding overtime pay in the state.

3. Virginia

The​​ state of Virginia has established a minimum wage of $12.00 per hour that applies to a wide variety of industries.

4. Maryland

In Maryland, the minimum wage is tiered based on the size of the employer.

Employers with 15 or more employees must pay $13.25 per hour, while those with fewer than 15 employees pay $12.80 per hour.

From January 2024, the state plans to increase the minimum wage to $15.00 per hour for all employers.

5. Delaware

Delaware has set its minimum wage at $11.75 per hour. They also follow the federal minimum wage when it is higher.

6. New Jersey

New Jersey has established a minimum wage of $14.13 per hour. However, there is a minimum rate of $12.93 per hour for seasonal and small employers with fewer than six employees.

7. New York

New York State has different minimum wages for different regions.

The basic minimum wage is $14.20 per hour, but in Long Island, Westchester, and New York, it is $15.00 per hour.

Additionally, New York has specific regulations for overtime pay, with different premiums for hours worked beyond regular hours.

8. Connecticut

Connecticut has established a minimum wage of $15.00 per hour.

Additionally, in the restaurant and hospitality sector, additional time pay and half of the minimum wage are required on the seventh consecutive day of work.

9. Maine

In Maine, the minimum wage is $13.80 per hour. The state also adjusts the minimum annually based on a specific formula.

10. Massachusetts

Massachusetts has set its minimum wage at $15.00 per hour. They ensure that the state minimum wage is always at least $0.50 higher than the federal minimum wage.

11. Vermont

The state of Vermont has set its minimum wage at $13.18 per hour. This amount applies to employers with two or more employees.

12. Rhode Island

In Rhode Island, the minimum wage is $13.00 per hour. Additionally, there are specific regulations that require time and a half pay for work on Sundays and holidays in certain retail and other business sectors.

13. Ohio

Ohio has a tiered approach to its minimum wage. Employers with annual gross revenues of $372,000 or more must pay $10.10 per hour, while employers with annual gross revenues of less than $372,000 follow the federal minimum of $7.25 per hour.

14. Michigan

Michigan has established a minimum wage of $10.10 per hour for employers with two or more employees. 

Furthermore, they have a gradual increase scheduled over the years.

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15. Minnesota

Minnesota has different minimum wages for large employers (with annual revenue of $500,000 or more) and small employers (with annual revenue of less than $500,000).

Large employers pay $10.59 per hour, while small employers pay $8.63 per hour.

16. Illinois

Illinois requires employers with four or more employees, excluding family members, to pay a minimum wage of $13.00 per hour.

17. Missouri

The minimum wage in Missouri is $12.00 per hour. However, certain job categories are exempt from these requirements.

18. Arkansas

Arkansas has established a minimum wage of $11.00 per hour for employers with four or more employees.

19. Nebraska

Nebraska has a minimum wage of $10.50 per hour for employers with four or more employees.

20. South Dakota

In South Dakota, the minimum wage is $10.80 per hour. This value is adjusted annually.

21. Colorado

Colorado has set its minimum wage at $13.65 per hour, with specific rules for overtime pay in certain industries.

22. New Mexico

The minimum wage in New Mexico is $12.00 per hour, with additional rules for overtime pay.

23. Montana

Montana has different minimum wages based on business size and annual sales. The minimum varies from $4.00 to $9.95 per hour.

24. Washington 

Washington State has established a minimum wage of $15.74 per hour, with specific regulations for compensating time off in lieu of overtime pay.

25. Oregon

Oregon has a varying minimum wage based on location, with rates ranging from $13.20 to $15.45 per hour.

26. Nevada

The minimum wage in Nevada varies based on whether an employer offers health insurance, with rates of $11.25 or $10.25 per hour.

27. Arizona

Arizona has set a minimum wage of $13.85 per hour.

28. Alaska

The minimum wage in Alaska is $10.85 per hour, with additional provisions for overtime pay.

29. Hawaii

Finally, in Hawaii, the minimum wage is $12.00 per hour, and some categories of workers may be exempt from this rule.

Remembering that information on states' minimum wages is based on data from September 2023.

Therefore, always consult official sources in the respective states for the most up-to-date and accurate information.

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