Human Resource Blog

Ohio Minimum Wage

On January 1, 2008 the minimum wage will increase in the state of Ohio. How much will it increase and how are employees that earn tips affected?

The state of Ohio is increasing its minimum wage on January 1, 2008. The new minimum wage will be $7.00 per hour for non tipped employees and $3.50 per hour for tipped employees. Tipped employees are paid 50% of the state minimum wage. The tips an employee earns will make up the other half otherwise the employer must make up the difference to equal $7.00 per hour.

In 2007 Ohio voters passed a constitutional amendment that allows the minimum wage to increase in the future based on inflation. Any increases are based on the average Consumer Price Index increase during the previous 12 months. The increases are rounded to the nearest nickel. For example if the rate of inflation was 7% in 2007 then the minimum wage would increase to $7.33. Then the law requires the minimum wage to be rounded to the nearest nickel which would be $7.35.

Companies who gross less than $255,000 per year as of January 1, 2008 will not have to pay their employees the minimum wage. Also employees who are under the age of 16 are not entitled to the state minimum wage but they must be paid the federal minimum wage of $5.85.

Other exceptions to the Ohio minimum wage include family owned businesses. These businesses do not have to pay their own family members minimum wage. Domestic and casual workers are also exempt from the state minimum wage in Ohio.

There are other states that are increasing the minimum wage rate on January 1, 2008. Delaware, Oregon, Florida, Iowa, Massachusetts, and California, Washington and Vermont will all increase their minimum wage rates. The highest minimum wage rate belongs to Washington. The state of Washington will increase its minimum wage to $8.07 in 2008. Massachusetts and California will have a minimum wage of $8.00 per hour while Florida’s minimum wage will increase to $6.79 per hour.

Ohio’s neighbor Kentucky is increasing its minimum wage on July 1, 2008. The wage will increase from $5.58 to $6.55 per hour.

The federal minimum wage will increase on July 24, 2008. The minimum wage will increase from $5.85per hour to $6.55 per hour. Another increase is scheduled for July 24, 2009 which would make the new minimum wage rate $7.25 for all non exempt workers.

Since the minimum wage laws are changing in Ohio all employers must update their minimum wage posters. These posters must be displayed in plain site so all employees can see them. Minimum wage posters are available at www.laborlawcenter.com. GW