New York State Minimum Wage Changes for 2016

The end of 2015 is only two months away, so it’s time to start thinking about impactful changes coming next year. The one that may affect your business the most is regarding the minimum wage, because there is not just one change coming, but three New York State minimum wage changes for 2016.

1. The change affecting the widest number of companies will the general minimum wage increase on December 31, 2015, when the wage rate will go from $8.75/hour to $9.00/hour for most non-exempt employees. This represents a nearly 25% increase in New York’s minimum wage since 2013. Also, the minimum salary for exempt employees that meet the overtime exemptions will jump from $656.25/week to $675/week.
2. The second minimum wage change involves tipped employees in the hospitality industry. Earlier this year, the state’s wage board voted to increase these workers’ wages from $5/hour to $7.50/hour (pre-tip), as well as changing the tip credit to $1.50/hour. This means businesses can pay their tipped workers less than the minimum wage, as long as the tips they earn are enough to cover the difference. It’s important to note that this new tipped worker minimum wage is not relegated to the food service industry – it applies to all tipped employees in the hospitality industry, regardless of the type of service they provide.
3. The final change to New York’s minimum wage affects fast food workers. Last month, Governor Cuomo accepted the wage board’s proposal to increase the minimum wage to $15/hour for workers in fast food restaurants. The increase will take place over the next three years in New York City, and over the next six years for the rest of the state. In 2016, the wage will increase to $10.50/hour in NYC and to $9.75/hour everywhere else.

We recommend taking steps now to prepare to implement any of the above changes that will impact your business. To learn more about how GTM keeps its clients compliant with wage and labor laws, including specific solutions for the restaurant and hospitality industries, contact us at (518) 373-4111.