Near the end of last year, Florida codified new wage laws that will have some substantial effects on businesses, including new minimum wage increases that will slowly ramp up over the next few years. Businesses should be careful to keep a close eye on the calendar, as they’ll need to adjust wages yearly to remain in compliance – and employees should keep a close eye on their wages to ensure they’re being fairly paid.
A Rolling Update to Minimum Wage
As of September 30, 2021, the minimum wage in Florida was raised to $10 an hour. This will continue to increase yearly until September 30, 2026 when it will settle in at $15 an hour. Employers should be careful to stay on top of these increases in order to avoid potential wage issues when the raise comes on September 30th of every year.
Tipped employees, however, are still treated somewhat differently. The updated minimum wage also applies to tipped employees, as well as any employee throughout hours worked where they are paid tips. If, for example, an employee worked as a server for five hours of their shift, and then worked in the kitchen as a dishwasher for another three hours, tip pay would only apply to them for the five hours that they worked as a server.
Employers are still obligated to ensure that tipped employees meet at least the minimum hourly wage, but are also provided a “tip credit”, through which they’re permitted to pay employees $3.02 per hour less, provided that amount is made up by tips. So, with the current $10 minimum wage, an employer is obligated to pay their tipped employees at least $6.98 per hour. If the employee makes enough tips that their total hourly wage is over $10, then no further action is needed. If tips don’t make up this difference, however, employers are then obligated to fill in the difference, up to the minimum wage. This system of tip credits will apply in the same manner to each increment of the minimum wage. Employers should also keep in mind that service charges are not considered tips, and cannot be used to cover the tip credit.
This new system of wage increases is a great way to provide minimum wage workers with more income while reducing the strain on Florida businesses by increasing wages slowly, but also requires business owners to remain attentive to the yearly changes. If your business is in need of assistance to resolve employment issues, or you’re an employee who feels that an employer has violated wage law, contact Salas Law Firm today at (954) 315-1155 to speak to our team.
John Salas
