On November 4, 2013, New Jersey citizens voted in support of a proposed amendment to the state’s Constitution to raise the minimum wage by $1 and to automatically adjust the rate annually to account for inflation.
After the change goes into effect on January 1, 2014, the new minimum wage for New Jersey workers will be $8.25 per hour. It is estimated that nearly 3 percent of hourly-paid citizens will be affected by the new pay rate. Out of the 1.8 million hourly-paid workers in the state, almost 50,000 will see a pay increase in the new year.
The Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI), which measures yearly increases in inflation, will be used to adjust the state’s minimum wage in coming years. Each September, the percentage increase in inflation for the previous 12 months will be applied to the minimum wage. Therefore, if the CPI shows a 2 percent increase in inflation over the previous 12 months, a 2 percent increase to the minimum wage of $8.25 will bring the new minimum wage up to $8.42 per hour.
With the new amendment, New Jersey will be the 11 th state to tie minimum wage increases to inflation and the 19 th state to institute a minimum wage higher than the federal rate of $7.25 per hour, according to the Asbury Park Press .
There is a wide range of state-established minimum wages throughout the country; states including Tennessee and South Carolina have not established any minimum wage, while Washington currently institutes the highest minimum wage of $9.19 per hour. Scheduled wage increases in California plan to trump the current record in Washington though, as the “Golden State” is expected to increase its minimum wage to $10.00 per hour by 2016. Connecticut, New York, and Rhode Island are also expected to increase their respective state minimum wages during the next two years.
Minimum Wage Across the United States
State
State Minimum Wage
Indexed Automatic Adjustments
Alabama, Louisiana, Mississippi, South Carolina, Tennessee.
None
Georgia, Wyoming
$5.15
Minnesota
$6.15 for employers with annual sales of more than $625,000.
$5.25 for employers with annual sales of $625,000 or less.
Arkansas
$6.25
Delaware , Hawaii, Idaho, Indiana , Iowa , Kansas, Kentucky , Maryland , Nebraska, Nevada , New York , North Dakota, Pennsylvania, South Carolina, South Dakota, Texas, Utah, Virginia, West Virginia , Wisconsin.
$7.25
New Jersey
$7.25
Starting 2014: Minimum wage will be automatically adjusted each Sept. and increases will be implemented the following Jan. based on inflation.
Oklahoma
$7.25 for all employers with annual gross sales of $100,000 or employers with 10 or more full-time employees.
$2.00 for all others.
Missouri
$7.35
Starting 2008: Minimum wage will be automatically adjusted based on inflation each Jan. 1.
Michigan
$7.40
Maine , New Mexico
$7.50
Alaska, Rhode Island
$7.75
Colorado
$7.78
Rate is increased annually based upon a cost-of-living formula.
Florida
$7.79
Rate is increased annually based upon a cost-of-living formula.
Arizona
$7.80
Rate is increased annually based upon a cost-of-living formula.
Montana
$7.80 employers with gross annual sales more than $100,000.
$4.00 employers with gross annual sales of $100,000 or less.
Minimum wage will be automatically adjusted each Sept. and implemented the following Jan. based on increases in the cost of living.
Ohio
$7.85 for employers grossing more than $283,000.
$7.25 for employers grossing $238,000 or less.
Minimum wage will be automatically adjusted each Sept. and implemented the following Jan. based on inflation.
California, Massachusetts
$8.00
Connecticut , Illinois
$8.25
Nevada
$8.25 without health benefits.
$7.25 with health benefits.
Adjustments subject to increases based on inflation.
Vermont
$8.60
Starting 2007: Minimum wage will increase by five percent or the percentage increase in inflation each subsequent Jan.
Oregon
$8.95
Starting 2004: Minimum wage will be adjusted annually for inflation. The wage amount established will be rounded to the nearest five cents.
Washington
$9.19
Starting 2001: Minimum wage will be adjusted annually for inflation.
* Bolded states enforce increases to their minimum wage to reflect any changes in the federal minimum wage.
Nearly half of the states have voluntarily established minimum wages to match the federal standard. Georgia, Wyoming, Minnesota, and Arkansas have set their minimum wages below the federal standard, and Alabama, Louisiana, Mississippi, South Carolina, and Tennessee have not established any minimum wage. Workers in these nine states are still required to receive the federal minimum wage by default.
Wage and Hour Lawsuits On the Rise
Between 2007 and 2012, almost $3 billion was paid out to settle wage and hour lawsuits. With almost 20 percent of that amount obtained during the last year alone, lawsuits involving unpaid wages and overtime have recently surpassed all other types of workplace litigation.
These lawsuits often allege violations of minimum wage or overtime laws, such as failure to pay employees for any work performed off the clock. During the last year alone, large corporations including Starbucks, Apple, and Wal-Mart faced wage and hour lawsuits. A recent report from NERA Economic Consulting found that in the first three quarters of 2013, 51 hour and wage cases settled for a total of approximately $215 million.
Author Bio:
Berger & Montague ’s Shanon J. Carson represents employees, consumers, and borrowers in class and collection action lawsuits across the United States. Currently, he is working as prosecutor for class actions alleging banks including Wells Fargo, Bank of America, and Citibank forced hazard and flood insurance on borrowers. Mr. Carson practices in the areas of defective product, unpaid overtime, and discrimination litigation, and is the Chair of Berger & Montague’s Employment Law Department.
Originally published on LawyerCentral by Shanon Carson on November 25, 2013 Read the original (Internet Archive).