Minnesota Legislature Considering Raising the Minimum Wage
On January 10, 2013, Minnesota Senator Chris Eaton introduced a bill that would raise the minimum wage in Minnesota to $7.50 per hour and require annual increases to the minimum wage to keep pace with inflation. See S.F. No. 3.
The current minimum wage rates in Minnesota are $6.15 per hour for large employers (those with more than $625,000 per year of annual gross volume of sales made or business done) and $4.90 per hour for small employers (those with less than $625,000 per year of annual gross volume of sales made or business done). But most employers in Minnesota are required to pay the current federal minimum wage of $7.25 per hour under the Fair Labor Standards Act (FLSA).
The legislation introduced by Senator Eaton would increase the minimum wage rates under Minnesota law to $7.50 per hour for large employers and $5.25 per hour for small employers. In addition, the legislation would require the Commissioner of Labor and Industry to calculate by May 30th of each year an adjustment to the minimum wage rates based on inflation, which would take effect on each subsequent August 1st. The inflation adjustments for the minimum wage rates would begin in 2014 and would continue each year thereafter.
Takeaways: Whether the legislation to increase the minimum wage in Minnesota will pass or will be amended from its current form remains to be seen. Employers with minimum-wage employees in Minnesota should monitor this proposed legislation in case it passes and increased pay rates become necessary. Ten other states recently raised their minimum wage rates as well.