ITEM 1c LMC bulletinITEM 7c
Excerpt from League of Minnesota Cities Bulletin
The new law phases in a minimum wage increase over three years,
beginning Aug. 1, 2014, with subsequent annual inflation adjustments.
(Published Apr 21, 2014)
Gov. Dayton on April 14 signed into law Chapter 166 (HF 2091), which will phase in
an increase to the Minnesota minimum wage, effective Aug. 1, 2014. The bill was
approved by the House on a 71-60 vote and the Senate on a 35-31 vote.
Under the new law, the state minimum wage increases for the next few years, and
the definition of "large employer" is modified. This modification to the large
employer definition effectively leads to more cities classified as a "large employer,"
based on their city's total budget, which will in turn lead to the higher state
minimum wage rate for their employees.
The definition of large employer now includes those with a total budget of at least
$500,000. Previously, a large employer was defined as one with a total budget of at
least $650,000. - See more at:
http://www.Imc.org/page/1/MinimumWageSigned.jsp#sthash.AB48Em5B.dpuf
As before, the minimum wage a city must pay depends on whether it is a large or
small employer and if the employee is covered by the law. While the statute is not
entirely clear, the League generally advises using the city's total budget amount to
determine whether a city is classified as a large or small employer for pay
purposes. For cities, annual gross volume of sales would likely be interpreted to
mean the city's total budget.
As of Aug. 1, 2014, large employers must pay most employees covered by
minimum wage law at a rate of at least $8 per hour, and small employers must pay
all applicable employees at a rate of at least $6.50 per hour. The League generally
advises cities with a total budget of $500,000 or more to comply with the higher
Minnesota minimum wage rate (i.e., in August 2014 paying the $8 per hour rate).
On Aug. 1 of 2015 and 2016, the Minnesota minimum wage is scheduled to
increase for both large and small employers.
Beginning on Aug. 1, 2015, the Minnesota minimum pay rate will increase to $9 per
hour for large employers, and to at least $7.25 per hour for small employers. Then,
on Aug. 1, 2016, the Minnesota minimum pay rate will increase to $9.50 per hour
for large employers, and to at least $7.75 per hour for small employers.
There are two exceptions to these wage amounts for younger employees. First,
large employers must pay employees under age 18 a rate of at least $6.50 per
hour. Second, all employers may elect to pay employees under age 20 at a rate not
less than $6.50 per hour, but only for their first 90 consecutive days of
employment. After the 90 days, the minimum hourly rate becomes $8. Both of
these rates are effective Aug. 1, 2014, and both amounts are scheduled to increase
each year. - See more at:
http://www.Imc.org/page/1/MinimumWageSigned.jsp#sthash.AB48Em5B.dpuf