Not everyone will be the beneficiary of this constitutional largesse. In fact, a wide range of employees are exempt, according to the Federal Labor Standards Act (FLSA) including executives, professionals, certain administrative employees, outside salesmen and several areas within the IT computer/software fields, to name a few. Add to this list babysitters on a casual basis, companions for the elderly, workers with disabilities, fishing workers, limited circulation newspaper employees as well as delivery workers, seamen on foreign vessels, farm workers employed on small farms, and employees of certain seasonal amusement and recreational establishments. This list is by no means comprehensive. The US Department of Labor provides specific direction on wage requirements according to industry.
Service Sector/Tipped Employees Will Benefit Too
Florida’s tipped minimum wage increases from $4.91 up to $5.03 in 2015. Service employees like waitresses, waiters, bartenders, and valets who earn more than $30 a month in tips may be paid a lower hourly wage, but must earn at least the prevailing minimum wage including tips every hour, per FLSA. If a Florida employee does not earn $8.05 including tips in any given hour of work, the employer must make up the difference in cash.
Students and Younger Workers Also Get A Bump
By law, high school and full-time college students who work part-time may be paid 85% of the Florida minimum wage for up to twenty (20) work hours at certain employers. They too will see an increase in hourly wage rates from $6.74 up to $6.84 in 2015. Technically, under federal guidelines, a new employee under 20 years of age may be paid a training wage of $4.25 per hour for the first ninety (90) days of employment. In all likelihood, however, employers will be compelled by market factors to pay minimum wages from the outset just to get younger applicants in the door.
Wage Lines Drawn in the Legislative Sand
During the spring legislative sessions in Tallahassee, political wrangling is the norm. Any bills proposing further increases to the minimum wage escalate rapidly into a partisan firestorm. 2014 Florida gubernatorial race watchers may recall Democratic candidate Charlie Crist’s call for $10.10 per hour minimum wage. He cited federal Congressional Budget Office (CBO) stats that $10.10 for America’s 16.5M minimum wage workers would generate $31B in additional wages, which most economists believed would translate into a retail sales tax and revenue boom — especially relevant to Florida’s sales tax revenue dependency. Incumbent Republican Gov. Rick Scott’s argument, backed by crucial supporters like the Florida Chamber of Commerce and National Federation of Independent Business, focused on the same CBO report’s estimates of up to 500,000 jobs lost due to the wage increase. He successfully countered that Florida employers were already struggling to regain lost revenue ground from the recession. Forcing them to pay more in wages and employment taxes could adversely impact workforce growth.
WHAT DOES THIS MEAN FOR YOUR BUSINESS?
Mandatory minimum wage payroll requirements depend upon your particular industry. However, the reality is that you are competing with every other business out there for good workers. Of course, you want to contain payroll expenses and pay as little as you can, but minimum wage workers are notorious for jumping ship for an additional 25 cents an hour. Needless turnover ultimately costs you money, taking into account the time to recruit, rehire and train, plus productivity losses while a position is vacant. In fact, a recent Center for American Progress study revealed that for all jobs earning less than $50,000 per year, which is more than 40% of the American workforce, the average cost of replacing an employee amounts to fully 20% of the person’s annual salary. So it makes good business sense to focus on fair employment practices and competitive wages to attract and retain good people from the get-go. After all, your company and its bottom line rely on your staff’s ability to help you attract and retain customers.
