Most employees, with some exceptions, must be paid at least the federal minimum wage. If they work in a city or state with a higher minimum wage, they will receive the higher amount. Review information on minimum wage rates, when employers are required to pay minimum wage, employees exempt from minimum wage requirements, and locations with higher minimum wage rates than the federal minimum of $7.25 per hour.
What Is The Minimum Wage?
The minimum wage rate is the lowest hourly pay that can be awarded to workers, also known as a pay floor. The Fair Labor Standards Act (FLSA) determines the minimum wage for employees in private and public sectors, in both federal and state governments. Under the FLSA, non-exempt employees eligible must be paid the minimum wage or higher.
Federal Minimum Wage
The federal minimum wage in 2022 is $7.25 per hour and has not increased since July 2009. However, some states, cities, and counties have a higher minimum wage rate.
Minimum Wage for Federal Contract Workers
Effective January 1, 2023, the minimum wage rate, which generally must be paid to workers performing work on or in connection with covered federal contracts, is $16.25 per hour. Additionally, effective January 1, 2023, tipped employees performing work on or in connection with covered federal contracts generally must be paid a minimum wage of $13.75 per hour.
Federal Exemptions From Minimum Wage
Some employees are exempt from federal minimum wage requirements, such as those who are not protected by the Fair Labor Standards Act. Employees who receive tips, such as restaurant servers, for example, can be paid at a lower rate than minimum wage. Other federal exemptions (state laws may vary) to minimum wage include the following:
Babysitters on a casual basisCompanions for the elderlyEmployees of certain seasonal amusement and recreational establishmentsFarmworkers on small farmsFederal criminal investigatorsFishing workersHomeworkers making wreathsNewspaper delivery workersNewspaper employees of limited-circulation newspapersSeamen on foreign vesselsSome students and student-learnersSwitchboard operatorsWorkers with disabilitiesYoung workers
State Minimum Wage Rates
Some states set a minimum wage rate that is higher than the federal minimum. As of August 2022, 30 states and Washington D.C. have a minimum wage higher than the federal minimum wage, including Alaska, Arizona, Arkansas, California, Colorado, Connecticut, Delaware, Florida, Hawaii, Illinois, Maine, Maryland, Massachusetts, Michigan, Minnesota, Missouri, Montana, Nebraska, Nevada, New Jersey, New Mexico, New York, Ohio, Oregon, Rhode Island, South Dakota, Vermont, Virginia, Washington, Washington D.C., and West Virginia.
Minimum Wage Rates for 2023 Listed by State
The minimum wage across the country varies from the federally mandated minimum of $7.25 per hour in many states to as high as $15.00 per hour in California and $16.10 per hour in Washington D.C.
Cities and Counties With Higher Minimum Wages
There are 46 localities that have adopted minimum wages above their state minimum wage, including Alameda, California; Belmont, California; Berkeley, California; Birmingham, Alabama; Chicago, Illinois; Cook County, Illinois; Cupertino, California; Denver, Colorado; East Palo Alto, California; El Cerrito, California; Emeryville, California; Flagstaff, Arizona; Fremont, California; Hayward, California; Los Altos, California; Los Angeles County, California; Los Angeles, California; Malibu, California; Milpitas, California; Minneapolis, Minnesota; Montgomery County, Maryland; Mountain View, California; Nassau, Suffolk, and Westchester Counties, New York; New York City, New York; Novato, California; Oakland, California; Palo Alto, California; Pasadena, California; Petaluma, California; Portland Urban Growth Boundary, Oregon; Portland, Maine; Redwood City, California; Richmond, California; San Francisco, California; San Jose, California; San Mateo, California; Santa Clara, California; Santa Fe City, New Mexico; Santa Fe County, New Mexico; Santa Monica, California; Santa Rosa, California; SeaTac, Washington; Seattle, Washington; Sonoma, California; St. Paul, Minnesota; and Sunnyvale, California.
