Minimum Wage Set to Rise in 25 States and D.C. in 2021

As the New Year approaches, employers throughout the United States must prepare for new legislation taking effect that may impact their operations.  One critical change that commonly occurs around the New Year is an increase to the minimum wage in certain jurisdictions.  On January 1, 2021 (or December 31, 2020), the minimum wage will rise in twenty states.  The District of Columbia and five other states will increase their minimum wages at some other time in the next year.  Forty-eight individual municipalities that impose their own, higher, standards will also raise their minimum wages in 2021.  There is no increase to the federal minimum wage scheduled in 2021 and an increase is unlikely within the next year.  A table of the states and municipalities increasing their minimum wage on January 1, 2021 (or December 31, 2020) is set forth below:

Minimum Wage Increases on January 1, 2021

State or Municipality Effective Date Min. Wage Tipped Min. Wage
Alaska Jan. 1 $10.19 to $10.34 Same as Minimum Wage
Arizona Jan. 1 $12.00 to $12.15 $9.00 to $9.15
       Flagstaff Jan. 1 $13.00 to $15.00 $10.00 to $12.00
Arkansas Jan. 1 $10.00 to $11.00 Stays at $2.63
California (26 or more)

California (25 or less)

Jan. 1 $13.00 to $14.00

$12.00 to $13.00

Same as Minimum Wage
       Cupertino Jan. 1 $15.35 to $15.65 Same as Minimum Wage
       Daly City Jan. 1 $13.75 to $15.00 Same as Minimum Wage
       El Cerrito Jan. 1 $15.00 to $15.37 Same as Minimum Wage
       Half Moon Bay Jan. 1 $13.00 to $15.00 Same as Minimum Wage
       Hayward (26 or more)

Hayward (25 or less)

Jan. 1 $13.00 to $15.00

$12.00 to $14.00

Same as Minimum Wage
       Los Altos Jan. 1 $15.40 to $15.65 Same as Minimum Wage
       Menlo Park Jan. 1 $15.00 to $15.25 Same as Minimum Wage
       Mountain View Jan. 1 $15.65 to $16.05 Same as Minimum Wage
       Novato (100 or more)

Novato (26-99)

Novato (25 or less)

Jan. 1 $15.00 to $15.24

$14.00 to $15.00

$13.00 to $14.00

Same as Minimum Wage
       Oakland Jan. 1 $14.14 to $14.36 Same as Minimum Wage
       Palo Alto Jan. 1 $15.40 to $15.65 Same as Minimum Wage
       Petaluma Jan. 1 $15.00 to $15.20 Same as Minimum Wage
       Redwood City Jan. 1 $15.38 to $15.62 Same as Minimum Wage
       Richmond Jan. 1 $15.00 to $15.21 Same as Minimum Wage
       San Carlos Jan. 1 State to $15.24 Same as Minimum Wage
       San Diego Jan. 1 $13.00 to $14.00 Same as Minimum Wage
       San Jose Jan. 1 $15.25 to $15.45 Same as Minimum Wage
       San Mateo Jan. 1 $15.38 to $15.62 Same as Minimum Wage
       Santa Clara Jan. 1 $15.40 to $15.65 Same as Minimum Wage
       Santa Rosa (26 or more)

Santa Rosa (25 or less)

Jan. 1 $15.00 to $15.20

$14.00 to $15.20

Same as Minimum Wage
       Sonoma (26 or more)

Sonoma (25 or less)

Jan. 1 $13.50 to $15.00

$12.50 to $14.00

Same as Minimum Wage
       South San Francisco Jan. 1 $15.00 to $15.24 Same as Minimum Wage
       Sunnyvale Jan. 1 $16.05 to $16.30 Same as Minimum Wage
Colorado Jan. 1 $12.00 to $12.32 $8.98 to $9.30
       Denver Jan. 1 $12.85 to $14.77 $9.83 to $11.75
Florida (see below chart for 9/30/2021 increase) Jan. 1 $8.56 to $8.65 $5.54 to $5.63
Illinois Jan. 1 $8.25 to $9.25 $4.95 to $5.55
Maine Jan. 1 $12.00 to $12.15 $6.00 to $6.08
Maryland (15 or more)

Maryland (14 or less)

Jan. 1 $11.00 to $11.75

$11.00 to $11.60

Stays at $3.63
Massachusetts Jan. 1 $12.75 to $13.50 $4.95 to $5.55
Minnesota Jan. 1 $10.00 to $10.08 Same as Minimum Wage
Missouri Jan. 1 $9.45 to $10.30 $4.725 to $5.15
Montana Jan. 1 $8.65 to $8.75 Same as Minimum Wage
New Jersey Jan. 1 $11.00 to $12.00 $3.13 to $4.13
New Mexico Jan. 1 $9.00 to $10.50 $2.35 to $2.55
New York Dec. 31, 2020 $11.80 to $12.50 $7.85 to $8.35
       Nassau County Dec. 31, 2020 $13.00 to $14.00 $8.65 to $9.35
       Suffolk County Dec. 31, 2020 $13.00 to $14.00 $8.65 to $9.35
       Westchester County Dec. 31, 2020 $13.00 to $14.00 $8.65 to $9.35
Ohio Jan. 1 $8.70 to $8.80 $4.35 to $4.40
South Dakota Jan. 1 $9.30 to $9.45 $4.65 to $4.725
Vermont Jan. 1 $10.96 to $11.75 $5.48 to $5.88
Washington Jan. 1 $13.50 to $13.69 Same as Minimum Wage
       Seattle Jan. 1 $16.39 to $16.69 Same as Minimum Wage
       SeaTac Jan. 1 $16.34 to $16.57 Same as Minimum Wage

 

Other Minimum Wage Increases in 2021

A number of states and municipalities will raise their minimum wage on July 1, 2021 or other dates throughout the year.  The amount of some of those increases in various municipalities are unknown at this time because they are dependent on an Index.  These are noted by the letter I in the following chart.

State or Municipality Effective Date Min. Wage Tipped Min. Wage
California      
       Berkeley July 1 $16.07 to I Same as Minimum Wage
       Emeryville July 1 $16.84 to I Same as Minimum Wage
       Fremont (26 or more)

Fremont (25 or less)

July 1 $15.00 to I

$13.50 to $15.00

Same as Minimum Wage
       Los Angeles July 1 $14.25 to $15.00 Same as Minimum Wage
       LA County July 1 $14.25 to $15.00 Same as Minimum Wage
       Malibu July 1 $14.25 to $15.00 Same as Minimum Wage
       Milpitas July 1 $15.40 to I Same as Minimum Wage
       Pasadena July 1 $14.25 to $15.00 Same as Minimum Wage
       San Francisco July 1 $16.07 to I Same as Minimum Wage
       Santa Monica July 1 $14.25 to $15.00 Same as Minimum Wage
Connecticut Aug. 1 $12.00 to $13.00 Stays at $6.38
Florida Sep. 30 $8.65 to $10.00 $5.63 to $6.98
Illinois      
       Chicago (21 or more)

Chicago (4-20)

July 1 $14.00 to $15.00

$13.50 to $14.00

$8.40 to $9.00

$8.10 to $8.40

       Cook County July 1 $13.00 to I $5.30 to I
Maryland      
       Montgomery (51 or more)

Montgomery (11-50)

Montgomery (10 or less)

July 1 $14.00 to $15.00

$13.25 to $14.00

$13.00 to $13.50

Stays at $4.00
Minnesota      
       Minneapolis (101 or more)

Minneapolis (100 or less)

July 1 $13.25 to $14.25

$11.75 to $12.50

Same as Minimum Wage
       Saint Paul (101 or more)

Saint Paul (6-100)

Saint Paul (5 or less)

July 1 $11.50 to $12.50

$10.00 to $11.00

$9.25 to $10.00

Same as Minimum Wage
Nevada (no health benefits)

Nevada (health benefits)

July 1 $9.00 to $9.75

$8.00 to $8.75

Same as Minimum Wage
New Mexico      
       Santa Fe Mar. 1 $12.10 to I $2.35 to $2.55 (effective Jan. 1)
Oregon July 1 $12.00 to $12.75 Same as Minimum Wage
       Portland July 1 $13.25 to $14.00 Same as Minimum Wage
       Non-Urban Counties July 1 $11.50 to $12.00 Same as Minimum Wage
Virginia May 1 $7.25 to $9.50 Stays at $2.13
Washington D.C. July 1 $15.00 to I $5.00 to I

 

States That Are Not Changing Their Minimum Wage

There are twenty-five states that are maintaining their current minimum wage in 2021.   While Michigan was originally scheduled to increase its minimum wage in 2021, the Wage and Hour Division of the Michigan Bureau of Employment Relations recently announced that the scheduled increase is unlikely to occur because the state’s current annual average unemployment rate for 2020 remains well above 8.5 percent (the threshold above which a minimum wage increase cannot occur according to statute).  If, as expected, the unemployment rate does not fall below 8.5 percent when the final 2020 numbers are released, then Michigan’s minimum wage will not increase.

The states that are marked by an asterisk (*) do not set a state-specific minimum wage, but simply use the Federal minimum wage.   A table of those states follows:

State or Municipality Min. Wage Tipped Min. Wage
Alabama $7.25* $2.13*
Delaware $9.25 $7.02
Georgia $7.25 $2.13
Hawaii $10.10 $9.35
Idaho $7.25 $3.35
Indiana $7.25 $2.13
Iowa $7.25 $4.35
Kansas $7.25 $2.13
Kentucky $7.25 $2.13
Louisiana $7.25* $2.13*
Michigan $9.65 $3.67
Mississippi $7.25* $2.13*
Nebraska $9.00 $2.13
New Hampshire $7.25 $3.26
North Carolina $7.25 $2.13
North Dakota $7.25 $4.86
Oklahoma $7.25 $2.13
Pennsylvania $7.25 $2.83
South Carolina $7.25* $2.13*
Tennessee $7.25* $2.13*
Texas $7.25 $2.13
Utah $7.25 $2.13
West Virginia $8.75 $2.62
Wisconsin $7.25 $2.33
Wyoming $5.15 $2.13

 

Takeaways

Employers with employees in states or municipalities subject to a minimum wage increase should adjust their pay practices by the date the increase becomes effective at the latest.  Employers should consider and react to increases to both the standard minimum wage and the tipped minimum wage in their workforce.  Additionally, employers should always review any applicable provisions of the Fair Labor Standards Act (FLSA) in conjunction with state law and local ordinances.

About the Authors:

James B. Perry is a Member in Dickinson Wright’s Detroit office.  He can be reached at (313) 223-3096 or jperry@dickinsonwright.com.

Matthew J. Keane is an Associate in Dickinson Wright’s Detroit Office.  He can be reached at (313) 223-3087 or mkeane@dickinsonwright.com.