New York Increases Minimum Wage

New York Increases Minimum Wage

On April 4, 2016, Governor Cuomo signed new legislation as part of the 2016-2017 State budget, which enacted a $15.00 an hour minimum wage plan for New Yorkers across all industries in the State. The new legislation is estimated to impact 2.3 million New Yorkers. This new law joins New York with California as the only states that currently have a $15.00 state-wide minimum wage law. This law will raise the current minimum wage of $9.00 an hour to $15.00 an hour, to be phased in over the next 3-5 years.

The following tables depict the law’s minimum wage increases over the next 3-5 years. Different schedules apply for three different regions of the State, and within New York City there are separate schedules for large and small businesses. Employees’ minimum wage will increase as follows:

New York City - employed by large businesses (11 employees or more)

Date Effective

Minimum Wage Amount

December 31, 2016

$11.00

December 31, 2017

$13.00

December 31, 2018

$15.00

New York City - employed by small businesses (10 employees or less)

Date Effective

Minimum Wage Amount

December 31, 2016

$10.50

December 31, 2017

$12.00

December 31, 2018

$13.50

December 31, 2019

$15.00

Nassau, Suffolk, and Westchester Counties

Date Effective

Minimum Wage Amount

December 31, 2016

$10.00

December 31, 2017

$11.00

December 31, 2018

$12.00

December 31, 2019

$13.00

December 31, 2020

$14.00

December 31, 2021

$15.00

Rest of New York State

Effective Date

Minimum Wage Amount

December 31, 2016

$9.70

December 31, 2017

$10.40

December 31, 2018

$11.10

December 31, 2019

$11.80

December 31, 2020

$12.50

December 31, 2021

Unknown at this time

For the “Rest of New York State” the minimum wage increases $0.70 each year until it reaches $12.50 at the end of 2020. At that time, the wage will continue to increase, until it reaches $15 an hour, on an indexed schedule to be set by the Director of the Division of Budget, in consultation with the Department of Labor. This schedule is not yet available.

In addition, the law contains a “safety valve” and starting in 2019, the Division of Budget Director will conduct an annual analysis of the economy in regions of the state to determine the effect of the minimum wage increase and to determine if a temporary suspension of the scheduled increases is necessary.

Employers should closely monitor their payrolls to ensure compliance with the minimum wage increases over the coming years. Employers also need to make sure they are properly classifying exempt and non-exempt employees to ensure the correct calculation and payment of overtime wages for non-exempt employees, since the new minimum wage rates will apply. As the increase takes place over the next 3-5 years, businesses should plan accordingly to position themselves to best handle the new minimum wage increases. For 2.3 million New Yorkers, and all employers in the State, the countdown begins to $15.00 an hour.

For more information or if you have questions relating to employment law issues, please contact us at (518) 512-4580 or info@honeywelllfirm.com.

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