Minimum Wage

HR Glossary for HR Professionals

Glossary of the most common HR terms and acronyms to assist professionals navigating the ever-growing and ever-changing world of HR terminology.

Minimum Wage

What is Minimum Wage?

Minimum wage is the lowest wage permitted by law (from a federal or state level) that a worker can be paid. Currently, the federal minimum wage for covered nonexempt employees is $7.25 per hour – this has been unchanged since 2009.

Moreover, the annual salary for a full-time minimum wage worker is $15,080 before taxes. 

Why Was Minimum Wage Created?

The minimum wage was established as a way to help bolster wageworkers and decrease class stratification. It was first introduced in the US with the Fair Labor Standards Act and was passed under President Roosevelt. Additionally, the first national minimum wage was set at 25 cents per hour.

The Pros and Cons of High Minimum Wage

Pros of increasing minimum wage: 

  1. Increase economic activity and spur job growth
  2. Reduce poverty
  3. Decrease government welfare spending
  4. Minimize income inequality
  5. Reduce race and gender inequality


Cons of increasing minimum wage: 

  1. Companies may use automated processes to replace service employees
  2. Could disproportionately harm the poorest areas of the US
  3. Could hurt businesses and force closure
  4. Companies would be forced to lay off employees
  5. Might disadvantage low-skilled workers

Minimum Wage by State

The federal minimum wage is $7.25 per hour, however many states have their own minimum wage rates. Find your state below for the current minimum wage rate or view the state minimum wage laws provided by the U.S. Department of Labor.

Alabama: No state minimum wage law, although employers subject to the Fair Labor Standards Act must pay the current Federal minimum wage of $7.25 per hour.

Alaska: Basic Minimum Rate (per hour): $10.19

Arizona: Basic Minimum Rate (per hour): $12.00

Arkansas: Applicable to employers of 4 or more employees, the Basic Minimum Rate (per hour): $10.00

California: Applicable to employers with 26 employees or more, the Basic Minimum Rate (per hour): $13.00

Colorado: Basic Minimum Rate (per hour): $12.00

Connecticut: Basic Minimum Rate (per hour): $12.00

Delaware: Basic Minimum Rate (per hour): $9.25

District of Columbia: Basic Minimum Rate (per hour): $15.00

Florida: Basic Minimum Rate (per hour): $8.56

Georgia: Basic Minimum Rate (per hour): $5.15. Employers subject to the Fair Labor Standards Act must pay the current Federal minimum wage of $7.25 per hour.

Hawaii: Basic Minimum Rate (per hour): $10.10

Idaho: Basic Minimum Rate (per hour): $7.25

Illinois: Applicable to employers of 4 or more employees (excluding family members), the Basic Minimum Rate (per hour): $10.00

Indiana: Basic Minimum Rate (per hour): $7.25

Iowa: Basic Minimum Rate (per hour): $7.25

Kansas: Basic Minimum Rate (per hour): $7.25

Kentucky: Basic Minimum Rate (per hour): $7.25

Louisiana: No state minimum wage law. Employers subject to the Fair Labor Standards Act must pay the current Federal minimum wage of $7.25 per hour.

Maine: Basic Minimum Rate (per hour): $12.00

Maryland: Basic Minimum Rate (per hour): $11.00

Massachusetts: Basic Minimum Rate (per hour): $12.75

Michigan: Basic Minimum Rate (per hour): $9.65

Minnesota: For large employers (enterprise with annual revenues of $500,000 or more), Basic Minimum Rate (per hour) is $10.00. For small employers (enterprise with annual revenues of less than $500,000), Basic Minimin Rate (per hour) is $8.15.

Mississippi: No state minimum wage law. Employers subject to the Fair Labor Standards Act must pay the current Federal minimum wage of $7.25 per hour.

Missouri: Basic Minimum Rate (per hour): $9.45

Montana: Basic Minimum Rate (per hour): $8.65

Nebraska: Basic Minimum Rate (per hour): $9.00

Nevada: Basic Minimum Rate (per hour): $8.00

New Hampshire: Basic Minimum Rate (per hour): $7.25

New Jersey: Basic Minimum Rate (per hour): $11.00

New Mexico: Basic Minimum Rate (per hour): $9.00

New York: Basic Minimum Rate (per hour): $11.80, (Long Island & Westchester): $13.00, NYC: $15.00

North Carolina: Basic Minimum Rate (per hour): $7.25

North Dakota: Basic Minimum Rate (per hour): $7.25

Ohio: Basic Minimum Rate (per hour): $8.70

Oklahoma: Basic Minimum Rate (per hour): $7.25

Oregon: Basic Minimum Rate (per hour): $12.00

Pennsylvania: Basic Minimum Rate (per hour): $7.25

Rhode Island: Basic Minimum Rate (per hour): $10.50

South Carolina: No state minimum wage law. Employers subject to the Fair Labor Standards Act must pay the current federal minimum wage of $7.25 per hour.

South Dakota: Basic Minimum Rate (per hour): $9.30

Tennessee: No state minimum wage law. Employers subject to the Fair Labor Standards Act must pay the current Federal minimum wage of $7.25 per hour.

Texas: Basic Minimum Rate (per hour): $7.25

Utah: Basic Minimum Rate (per hour): $7.25

Vermont: Basic Minimum Rate (per hour): $10.96

Virginia: Basic Minimum Rate (per hour): $7.25

Washington: Basic Minimum Rate (per hour): $13.50

West Virginia: Basic Minimum Rate (per hour): $8.75

Wisconsin: Basic Minimum Rate (per hour): $7.25

Wyoming: Basic Minimum Rate (per hour): $5.15. Employers subject to the Fair Labor Standards Act must pay the current Federal minimum wage of $7.25 per hour.

Puerto Rico: Employees covered by the FLSA, Basic Minimum Rate (per hour): $7.25. Employees not covered by the FLSA, Basic Minimum Rate (per hour): $5.08

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