Alert: 2015 Minimum Compensation Rates

New Year Brings Changes in Minimum Compensation Rates in Thirty States and Local Jurisdictions

Employers should review compensation rates for both exempt and nonexempt employees, to ensure compliance with current legal thresholds. Set forth below are rates at the federal level, and for the states and localities that exceed federal levels for the most common job categories.

The following minimum compensation rates are effective as of January 1, 2015 (except where another effective date noted):

JURISDICTION

EXEMPTION

MINIMUM COMPENSATION

FEDERAL

Nonexempt

$7.25/hour
$10.10/hour (federal contractors and subcontractors)

Executive

$4551/week on salary basis

Professional or Administrative

$455/week on salary or fee basis

Computer

$27.63/hour

Highly Compensated

$100,000 total compensation (including minimum $455 minimum weekly salary or fee)

Licensed practicing Medical Doctor or Attorney; Teacher

None

Business Owner (20% minimum equity and engaged in management)

None

Outside Sales

None

In the following jurisdictions, rates higher than the federal rates prevail.

ALASKA

Nonexempt

$8.75/hour (increase from 2014)

ARIZONA

Nonexempt

$8.05/hour (increase from 2014)

ARKANSAS

Nonexempt

$7.50/hour (employers with 4 or more employees) (increase from 2014)

CALIFORNIA

Nonexempt

$9.00/hour

Oakland

$12.25/hour (increase from 2014, effective March 2, 2015)

San Francisco

$11.05/hour (increase from 2014, effective January 1, 2015)
$12.25/hour (effective May 1, 2015)

San Jose

$10.30/hour (increase from 2014)

Executive, Professional or Administrative

$3,120.00/month on salary basis

Computer

$41.27/hour, $7,165.12/month or $85,981.40/year (increase from 2014)

Licensed Physician

$75.19/hour (increase from 2014)

COLORADO

Nonexempt

$8.23/hour (currently under consideration; would be increase from 2014)

CONNECTICUT

Nonexempt

$9.15/hour (increase from 2014)

DELAWARE

Nonexempt

$8.25/hour (effective June 1, 2015)

FLORIDA

Nonexempt

$8.05/hour (increase from 2014)

HAWAII

Nonexempt

$7.75/hour (increase from 2014)

ILLINOIS

Nonexempt

$8.25/hour

MAINE

Nonexempt

$7.50/hour

MARYLAND

Nonexempt

$8.00/hour (increase from 2014)
$8.25/hour (effective July 1, 2015)

MASSACHUSETTS

Nonexempt

$9.00/hour (increase from 2014)

MICHIGAN

Nonexempt

$8.15/hour (increase from 2014)

MINNESOTA

Nonexempt

$8.00/hour (employers whose annual gross volume of sales made or business done is at least $500,000)
$9.00/hour (employers whose annual gross volume of sales made or business done is at least $500,000; effective August 1, 2015)

MISSOURI

Nonexempt

$7.65/hour (increase from 2014)

MONTANA

Nonexempt

$8.05/hour (increase from 2014)

NEBRASKA

Nonexempt

$8.00/hour (increase from 2014)

NEVADA

Nonexempt

$7.25/hour (if qualifying health benefits available)
$8.25/hour (all others)
(increase may be announced in April 2014)

NEW JERSEY

Nonexempt

$8.38/hour (increase from 2014)

NEW MEXICO

Nonexempt

$7.50/hour

 

Santa Fe

$10.66/hour (increase may be announced in January 2015)

 

Albuquerque

$7.75/hour
(if qualifying healthcare and/or childcare benefits provided)
$8.75/hour (all others)
(increase from 2014)

NEW YORK

Nonexempt

$8.75/hour (increase from 2014, effective December 31, 2014)
$9.00/hour (effective December 31, 2015)

OHIO

Nonexempt

$8.10/hour (employers with gross revenue of more than $297,000/yr) (increase from 2014)

OREGON

Nonexempt

$9.25/hour (increase from 2014)

RHODE ISLAND

Nonexempt

$9.00/hour (increase from 2014)

SOUTH DAKOTA

Nonexempt

$8.50/hour (increase from 2014)

VERMONT

Nonexempt

$9.15/hour (increase from 2014)

WASHINGTON, DC

Nonexempt

$10.50/hour (increase from 2014, effective July 1, 2015)

WASHINGTON
STATE

Nonexempt

$9.47/hour (increase from 2014)

Seattle

$10.00/hour (employers with fewer than 500 employees in the U.S.)2
$11.00/hour (employers with 500 or more employees in the U.S.)
(increase from 2014, effective April 1, 2015; subject to pending litigation)

SeaTac

$15.24/hour (hospitality/transportation employees) (increase from 2014)

Outside Sales Exemption

guaranteed salary, commission, or fee

WEST VIRGINIA

Nonexempt

$8.00/hour (increase from 2014)

NOTES

  1. Equivalent amounts if paid on salary basis: $910 biweekly; $985.83 semimonthly; $1971.66 monthly; or $23,660 annualized.
  2. Employers with fewer than 500 employees must also pay their employees an hourly compensation of at least $11 per hour. Employers can meet the applicable hourly minimum compensation requirement through wages (including applicable commissions, piece-rate, and bonuses), tips, and money paid by an employer toward an individual employee's medical benefits plan, provided that the employer also pays the employee a minimum wage of $10 per hour.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations. Attorney Advertising.

© Cooley LLP

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