Minimum wage Archives - Miami Payroll Center

2018 Florida Minimum Wage Changes

January 25, 2018

Effective January 1, 2018, the minimum wage increased from $8.10 to $8.25 per hour for most employees in Florida, with exceptions for tipped employees, some student workers, and other exempt occupations. The federal minimum wage is $7.25.

The annual calculation is based on the percentage increase in the federal Consumer Price Index for Urban Wage Earners and Clerical Workers in the South Region for the 12-month period prior to September 1, 2017. The Florida minimum wage was $8.05 per hour in 2015, $7.93 per hour in 2014, $7.79 per hour in 2013, and $7.67 per hour in 2012. Due to the inflation and cost of living formula used, a minimum wage increase did not occur in January 2016.

The Federal Fair Labor Standards act defines special minimum wage rates applicable to certain types of workers. Employees may be paid under the Florida minimum wage if they fit into one of the following categories:

Florida Tipped Minimum Wage – $5.23 – Employees who earn a certain amount of tips every month may be paid a special cash minimum wage, but must earn at least $8.25 including tips every hour.

Download the updated Florida Minimum Wage Poster here.

An employer found liable for intentionally violating minimum wage requirements is subject to a fine of $1,000 per violation, payable to the state.

Need help ensuring your Human Resources and Pay practices are up to date? Contact our HR team today!

What you need to know about Florida’s Minimum Wage

February 7, 2017

Effective January 1, 2017, the minimum wage increased from $8.05 to $8.10 per hour for most employees in Florida, with exceptions for tipped employees, some student workers, and other exempt occupations.

The annual calculation is based on the percentage increase in the federal Consumer Price Index for Urban Wage Earners and Clerical Workers in the South Region for the 12-month period prior to September 1, 2016. The Florida minimum wage was $7.93 per hour in 2014, $7.79 per hour in 2013, and $7.67 per hour in 2012. Due to the inflation and cost of living formula used, a minimum wage increase did not occur in January 2016.

Florida Under 20 Minimum Wage – $4.25 – Federal law allows any employer in Florida to pay a new employee who is under 20 years of age a training wage of $4.25 per hour for the first 90 days of employment.
Florida Student Minimum Wage – $6.89 – Full-time high school or college students who work part-time may be paid 85% of the Florida minimum wage (as little as $6.89 per hour) for up to 20 hours of work at certain employers.
Florida Tipped Minimum Wage – $5.08 – Employees who earn a certain amount of tips every month may be paid a special cash minimum wage, but must earn at least $8.10 including tips every hour. For more details, read about the Florida tipped wage.

Download the updated Florida Minimum Wage Poster here.

Need help ensuring your Human Resources and Pay practices are up to date? Contact our HR team today!

19 U.S. States Raised The Minimum Wage To Kick Off 2017

January 9, 2017

Approximately 4.3 million low-wage workers across America are slated to experience a pay increase across 19 states this week, is your state one of them?

You will find more statistics at Statista

We just elected a new President. Now What?

November 25, 2016

We just elected a new President. Chances are you’re either still celebrating or still in shock. President-Elect Trump made many campaign promises and, while we don’t know yet which ones he will deliver on, several key promises will directly affect employers. Among the safe predictions are a focus on immigration worksite enforcement and sweeping changes and/or a total repeal of the Affordable Care Act. Another prediction is lifting the new payroll threshold for overtime.[1] It’s this last item that has caused many to breath of sigh of relief. But don’t breathe too deeply!

According to SHRM, President-elect Trump can’t do much about the “December 1^st effective date of the new overtime rule, which doubles the exempt salary threshold under the Fair Labor Standards Act (FLSA) to $47,476.[2]” Even if it was a top priority of the new administration, changes would take a very long time thanks to the notice-and-comment period required by law.

So for the time being, we all need to be prepared to follow the overtime rule as written. It does appear that Trump is open to the idea of calling for a small-business exemption to the rule after he takes office in January, but by then businesses will have already made a lot of changes to comply with the rule.

It’s also possible that Trump will decide to leave the rule stand as-is. While Trump did say in a brief interview on the campaign trail that he favored a small-business exemption, any changes to the current rule could negatively impact some of his supporters, many of whom could earn more once the rule is in place.[3]

There are many HR regulations that could see sweeping changes under a Trump administration: Minimum Wage, FLSA, Pay Equity, Family Medical Leave and Health Insurance just to name a few. All were things discussed on the campaign trail at one point or another…but will they all be changed? Much like this election, it’s nearly impossible to predict!

Our job will require something much harder than predictions. As HR Professionals, we will need to determine what the changes mean to our own organizations and which will mandate action. If we’ve already reclassified employees based on the overtime rule, will be reclassify them again if the rule is changed? Sure, it would be allowed by law, but would it be the best thing for our organization? What is legal and what is right are not always one in the same.

What potential HR changes are you looking forward to under the new administration? We’d love to hear from you. Post your comments below.

[1] http://www.hreonline.com/HRE/view/story.jhtml?id=534361418

[2] https://www.shrm.org/resourcesandtools/legal-and-compliance/employment-law/pages/trump-overtime-rule.aspx

[3] http://www.hreonline.com/HRE/view/story.jhtml?id=534361495

USDOL: Coming Soon to a Restaurant Near You

October 31, 2016

In the month since we’ve written about Florida’s Tipped Minimum Wage, the US Department of Labor (USDOL) reported that three separate Restaurant owners were required to pay a combined $1.3 Million in back wages and damages due to workplace practices that were in violation of the Fair Labor Standards Act (FLSA). The scary part of these stories is not in the amounts awarded, but the idea that these practices are so commonplace that we don’t even realize we’re breaking the law.

labor-law One of the larger awards, more than a half a million dollars, was the result of owners who required servers to contribute a portion of their total tips back to the employer, who then distributed the money to cooks and dishwashers who were not tipped employees. Consequently, the employer paid servers less than the federal minimum wage of $7.25 as required. Additionally, the restaurant failed to pay required overtime wages to employees when they worked more than 40 hours in a week, and did not keep accurate records of all hours worked.[1]

Another large penalty, also over the half million mark, was to a restaurant owner who also fell victim to the practices mentioned above but, among other things, required servers and bartenders to pay for breakages, customer walkouts and ordering errors out of their tips, which reduced their pay to below the federal minimum wage. Employees were also required to work without pay at charity events.[2] The charity events idea is always a great discussion, because we can argue that the employees volunteered. That argument would not likely stand a chance, however, as the FLSA hardly ever permits employees to volunteer unpaid time to the employer!

The USDOL’s Wage and Hour Division reports that these issues are found across the nation. In addition to the violations mentioned above, the Division adds that it is common for them to find employers who are requiring employees to work exclusively for tips with no regard to minimum wage standards, taking illegal deductions from wages for credit card transaction fees and paying straight time for hours over 40.[3]

For the past month, Florida Restaurant Owners have been mostly lucky – none of the cases above were in our home state! However, earlier this month the Division announced that it will expand outreach, education and enforcement in the industry to more cities and states. While you never know when and if they might visit you, don’t wait to get things in order. Review your pay practices now to ensure you’re in compliance with FLSA. If you’re still unsure, contact your payroll professional today.

[1] https://www.dol.gov/newsroom/releases/whd/whd20161011

[2] https://www.dol.gov/newsroom/releases/whd/whd20160926-0

[3] https://www.dol.gov/newsroom/releases/whd/whd20161004

Florida’s Tipped Minimum Wage

September 22, 2016

Each year by October 15^th the State of Florida determines what the following year’s minimum wage rate will be. Take a minute to check your calendar – we can expect this announcement soon! While many would like to think these decisions are completely left to politics and protesters, the minimum wage determination in Florida is actually made using a formula that ties the minimum wage to the consumer price index (CPI).[1]

Last October it was announced that there would be no minimum wage increase in Florida for 2016. The decision was a surprise to some, especially those in the hospitality industry which contains a large number of the state’s minimum wage workforce. However, since Florida has already established a minimum wage higher than the federal minimum, news of a flat year was welcomed by employers.

tips Employers in the hospitality industry have come to terms with Florida’s higher-than-federal minimum wage, but many struggle with the tipped minimum wage and how to ensure compliance when paying tipped employees. The current minimum wage in Florida is $8.05 per hour, with a minimum directly paid wage of at least $5.03 per hour for tipped employees (with tips making up the difference).

Thus, in Florida, the employer can claim $3.02 toward the $8.05 minimum wage as long as the employee actually receives $3.02 in tips per hour. If the employee does not receive $3.02 per hour in tips the employer must pay the difference so that the full minimum wage is met.

While we wait to see if the state minimum wage (as well as the tipped minimum wage and tip credit amounts) will change for next year, now is a good time to review related Department of Labor Rules.

To begin with, employers must provide tipped employees specific information from the start of employment[2]:

Notice of the amount of direct hourly wages it is paying a tipped employee, which must be at least $5.03 in Florida
The additional amount it claims as a tip credit, which cannot exceed $3.02
An explanation that the tip credit it claims cannot exceed the amount of tips actually received by the tipped employee;
A statement that all tips received by the tipped employee are to be retained by the employee unless there is a valid tip-pooling arrangement in place; and
An explanation that the tip credit will not apply to any tipped employee unless the employee has been informed of the tip credit provisions.

Two aspects seem to be at the root of many tipped minimum wage and hour disputes: Dual jobs and tip pools.

Many employers don’t consider their tipped staff to have dual jobs. However, if tipped workers are expected to spend some of their shift completing work that does not provide tips, they may have a dual job. Take a server for example. The server may spend four hours waiting tables, but then two additional hours cleaning, taking inventory, stocking table condiments, etc. The employer must pay the server the full minimum wage, without taking a tip credit, for those two hours.[3]

Another issue is tip pooling. Although tip pooling has potential benefits for employees, it can also be misused by employers. While many believe that back-of-house staff (line cooks, dishwashers, bussers, etc.) deserve a cut of the tip for their role in the dining experience, this practice cuts wait staff tip wages by more than 50%, which is definitely not in accordance with the law. According to the Federal Department of Labor, only employees who regularly receive tips can be part of the pool and employees must receive notice that they will be pooling. The law says that employees cannot be required to share their tips with employees who do not receive their own tips, like dishwashers or cooks.[4]

Whether or not the minimum wage (and tipped minimum wage!) will change next year as a result of the CPI formula or the presidential election, employers should review their payroll practices to ensure compliance and minimize the chance of wage and hour issues!

[1] http://www.orlandosentinel.com/business/brinkmann-on-business/os-florida-minimum-wage-20151019-post.html

[2] http://hr.blr.com/HR-news/Compensation/FLSA-Fair-Labor-Standards-Act/Florida-court-FLSA-rules-valid-tip-credits-pools/#

[3] http://www.nolo.com/legal-encyclopedia/florida-laws-tipped-employees.html

[4] http://www.danzlaw.net/blog/2016/06/understand-the-tipped-minimum-wage-laws-and-common-florida-violations.shtml

Do your managers qualify for their exempt status?

June 27, 2016

Small business owners without any HR expertise and without seeking outside counsel tend to classify their employees on a whim, believing that granting someone “exempt” status will save the business on overtime expenses. Little thought is given to whether their “exempt” employees actually qualify for their exempt status. This is a problem that unfortunately, many of them don’t realize the severity of until there’s a claim of overtime that allows for them to learn about the qualifications for the exemption. By then, its usually too late and they are well on their way to losing a case.

Salary Test

Generally, an employee is paid on a salary basis if s/he has a “guaranteed minimum” amount of money s/he can count on receiving for any work week in which s/he performs “any” work. To qualify as exempt, employees must generally be paid a predetermined amount over $455 per week each pay period not-dependent on the quality or quantity of the work performed. Starting December 1st, 2016, the salary threshold of $455 a week will rise to $913 ($47,476 per year) making an additional 4.2 million workers eligible for overtime pay.

The Duties Tests

An employee who meets the salary level tests and also the salary basis tests is exempt only if s/he also performs exempt job duties.

There are three typical categories of exempt job duties, called “executive,” “professional,” and “administrative.”

Exempt executive job duties.

Job duties are exempt executive job duties if the employee

regularly supervises two or more other employees, and also,
has management as the primary duty of the position, and also,
has some genuine input into the job status of other employees (such as hiring, firing, promotions, or assignments).

“Mere supervision” is not sufficient. In addition, the supervisory employee must have “management” as the “primary duty” of the job.

Business owners should remember to look at the job duties of the position, not the job title of an employee to determine whether an exempt status applies. The Fair Labor Standards Act (FLSA) also provides certain exemptions for outside sales personnel, certain specialized computer personnel, certain highly compensated employees, certain retail sales employees, and employees covered by the Motor Carrier Act (MCA); Qualifying for these and documenting your rationale can get a little technical, and business owners should consult with an HR or Labor Attorney to ensure the exemption will hold up if ever challenged.

With the new salary threshold becoming effective in a few months, the time is perfect for employers to reevaluate their exempt/nonexempt classifications. If you are concerned that some of your exempt workers may be misclassified, the new regulations will give you another reason to revise their classification without necessarily creating liability for past wages.

Miami Beach Approves Raise In Minimum Wage To $13.31 « CBS Miami

June 8, 2016

The way it would work is, the city’s minimum wage would be changed to $10.31 per hour starting in 2018. From then on, there would be an increase of $1 dollar per hour for each year – eventually reaching $13.31 by 2021. Once that happens, the city commission can reconsider each year if they need to increase the minimum wage.

We will keep you informed as to any potential changes in city’s implementation plans as compliance with this new ordinance gets closer.

Source: Miami Beach Approves Raise In Minimum Wage To $13.31 « CBS Miami

The Never Ending Discussion of Wages

March 8, 2016

It’s almost impossible to watch the news or follow social media without hearing at least one side of the debate for raising wages. Last year The Wall Street Journal and Vistage International conducted a survey of 728 small business owners across the U.S., from a range of industries, and found that small business owners were evenly split in their opinion of raising the minimum wage, with about 49% of respondents saying the federal minimum wage should be raised, while 49% disagreed.

While reasonable arguments can be found on both sides of the fence, one thing that is certain is that businesses must revisit the issue of wages in their overall workforce strategy. In our last post, we mentioned that our employees can’t help comparing what they’re making to what their peers are making, both inside the organization and out. Last week, Costco announced that it will be raising wages for both new and current entry-level workers in the U.S. This means that Costco will be paying workers at least $13 an hour. Even those who don’t work in retail will be comparing their pay to that of Costco. Analysts suggest that, as the economy adds jobs, retailers will have to start paying their front-line employees more if they want to retain them.

Couple the Costco wage increase news with the increase Walmart announced a few months back, and it is easy to predict that the U.S. labor market might be tightening. February’s Department of Labor monthly report showed strong hiring in the U.S. economy as evidenced by the addition of 242,000 jobs and a steady unemployment rate of 4.9%. The U.S. economy has been adding jobs 72 months in a row. As the economy improves and job openings become more plentiful, it is safe to assume that workers will have more opportunities to jump from job to job in search of the best wages.

According to The Atlantic, many businesses are reporting that the competition for low-wage workers is growing and it’s harder to find employees to fill vacant positions. The Wall Street Journal reports that one third of small firms stated that they had lost workers due to higher wage offers by competitors or other businesses.

Of course, it’s not always feasible to adjust wage scales. If this is the case, then it’s time to revisit other ways to keep your employees motivated, productive and loyal. In terms of keeping your employees happy, money isn’t everything. But it helps.

Do you think wage increases outside of your industry will have any impact on your workforce? Weigh in by commenting below.

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Salary Test

The Duties Tests