Statewide minimum wage increase

Minnesota employers take note: Minimum wage will increase statewide as of January 1, 2018. There are two rates: a large-business rate and a small-business rate. If your annual gross revenue (not net revenue) is $500,000 or more, you’ll need to pay the large-business rate of $9.65/hr. If your annual gross revenue is lower, you’ll need to pay the small-business rate of $7.87/hr.

State law requires employers to display a minimum-wage poster in their workplace. The Minnesota Department of Labor and Industry (DLI) has an updated poster available for free here. Foreign-language posters will hopefully be available soon.

Keep in mind these other minimum-wage basics:

  1. Minnesota’s minimum wage is higher than federal minimum wage. If an employee is covered by both state and federal minimum-wage laws, the higher wage applies.
  2. Part-time workers still earn minimum wage.
  3. Regardless of whether an employee is compensated on an hourly, commission, flat-fee, or other basis, the average hourly rate needs to be at least minimum wage.
  4. Even if your gross annual revenue is $500,000 or more, you can pay the small-business rate for employees who are under age 18. For employees who are under age 20, you can pay a 90-day “training wage” at the small-business rate. The 90 days only include the first 90 days of consecutive employment. It is illegal to discharge someone and re-hire them simply to keep paying the training wage.

For more information on minimum-wage rules, check the DLI’s minimum wage web page.

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