21 States (and Dozens of Cities) Affected by 2017 Minimum Wage Increases: What Restaurants Can Do Now

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Who is Impacted?

There is no doubt that the two industries with the most at risk over the impending minimum wage increases are retail and hospitality.  Especially, in hospitality, the increases are set to affect over 14 million Americans in the hospitality/ food & beverage industries - that's nearly 10 percent of the entire United States workforce.  Of course, the attempt to close the wage gap amongst restaurant employees is very important.  However, with these changes coming, restaurant owners and operators must prepare their staff.  Below are the 21 states, along with their cities/ counties where the new minimum wage increases are taking place:

States Affected:

  • Alaska - $9.80

  • Arizona - $10.00

  • Arkansas - $8.50

  • California - $10.00 for small employers; 10.50 for large employers

  • Colorado - $9.30

  • Connecticut - $10.10

  • Florida - $8.10

  • New York - Varies across state from $9.70 to $11 (as of 12/31/16)*

  • Ohio - $8.15

  • Oregon - $10.25 (as of July)

  • South Dakota - $8.65

  • Vermont - $10.00

  • Washington - $11.00

  • *The basic minimum wage is $9.70 in most of the state. But it's higher for the fast food industry; Long Island; Westchester County; and large and small employers in New York City.

Cities & Counties:

  • California:

    • Cupertino - $12.00

    • El Cerrito - $12.25

    • Los Altos - $12.00

    • Mountain View - $13.00

    • Oakland - $12.86

    • Palo Alto - $12.00

    • Richmond - $12.30

    • Sacramento - $10.50 (large employers)

    • San Diego - $11.50

    • San Mateo - $12.00

    •  San Jose - $10.50

    • Santa Clara - $11.10

    • Sunnyvale - $13.00

  • Hawaii - $9.25

  • Maine - $9.00

  • Maryland - $9.25 (as of July)

  • Massachusetts - $11.00

  • Michigan - $8.90

  • Missouri - $7.70

  • Montana - $8.15

  • New Jersey - $8.44

  • District of Columbia:

    • Washington, D.C. - $12.50 (as of July)

  • Iowa:

    • Johnson County - $10.10

    • Linn Country - $8.25

    • Wapello County - $8.20

  • Maine:

    • Portland - $10.68

  • New Mexico:

    • Albuquerque - $8.80

    • Bernalillo - $8.70

    • Las Cruces - $9.20

  • New York:

    • New York City - $11.00 (as of 12/31/16)

    • Long Island and Westchester, NY - $10.00 (as of 12/31/16)

  • Washington:

    • Seattle - $15.00

    • SeaTac - $15.35

    • Tacoma - $11.15

What Restaurants Can Do NOW …

Begin to Strategically Schedule Staff:  Get your schedules down to a science by analyzing your most crucial shifts and recognizing the strongest members of your staff.  If you’re short on time, the TeamLive tool on Harri is a great help to managers and operators, who need to align their schedules with real-time sales, better streamline their labor costs and control their overall staffing budget.

Take Your Restaurant/ Store Hours Into Consideration:  Making this work means, keeping track of your stores’ sales patterns   For example, if Monday - Friday @ 11:30 AM - 2:00 PM are very busy lunch-pops for you, yet there is a sharp dip between the hours of 5:00 PM - 10:00 PM, you may want to consider closing earlier during the week and drive all of your marketing efforts towards weekday lunch.  Your POS weekly and monthly reports should be a great indicator of these trends. If you have never done this before, contact your POS company rep for help.  

Think About Raising Menu Item Prices:  This is the last resort, so, be sure that every change made is absolutely necessary.  Go into this knowing that you may lose some guests at the expense of your menu changes. With the help of your culinary team analyze each menu item and break it down by cost.

Compare vendors on the pricing of specific ingredients (ie. if carrots cost more at Baldor than AFI than switching vendors could be effective in this case).  Do your best to communicate to your guests that your business has slightly increased menu prices to stay open, pay your employees fair wages, and most significantly to continue to have the great privilege of serving them.  

New York 2016 Wage Increases & Reminders

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As 2015 winds down, it is important to keep in mind these important changes that will effect New York businesses the new year ahead. Failure to comply with these requirements could subject an uninformed employer to substantial liability.

Minimum Wage Increase

Effective December 31, 2015, New York State's minimum wage will increase a quarter from 8.75 to $9.00. Payroll changes must be made in advance, so this shall be a reminder for all employers.

Workers who are covered by New York's Hospitality Wage Order, their wages will now be raised to $7.50 an hour. The overtime rate for those receiving gratuities will be $12.00 per hour.

Please note that pursuant to the report and recommendations of the Hospitality Wage Board, food service workers (e.g., wait staff, bussers) and service employees (e.g., valets, bathroom attendants, coat check personnel) now are entitled to the same tipped minimum wage and overtime rate.

In addition, if an establishment is considered as a fast food provider, the minimum wage in New York City shall be $10.50, effective December 13, 2015. For employees in the rest of New York State, it will be $9.85 hourly.

New York is not the only region to increase minimum wages in 2016. See the chart below for the minimum wage increases for other states:

Notice of Rate of Pay

Pursuant to New York’s Wage Theft Prevention Act (WTPA), New York business owners must provide a “Notice of Pay” form to all employees upon a change in their rate of pay. For all employers outside of the hospitality industry, the New York State Department of Labor (NYDOL) has opined that it will not be necessary, as long as the new rate of pay is referenced in the employee’s next pay stub. Employers do not need to provide a new Notice of Pay as a result of the increase in the minimum wage.

However, hospitality employers are not so lucky. Because of the language of the Hospitality Industry Wage Order, hospitality employers must provide a Notice of Pay form to those employees who are affected by the increase to the minimum wage (including all tipped employees) on or prior to December 31, 2015. The notice must contain the following information:

  • The employee’s normal rate(s) of pay and the basis thereof (e.g., hourly, shift, weekly, salary);
  • If applicable, the employee’s overtime rate of pay;
  • The employee’s regular pay day;
  • Any allowances claimed against the minimum wage (e.g., tip credit, meal credit, lodging allowance, etc.);
  • The name of the employer (including any “doing business as” name);
  • The address of the employer’s main office and a mailing address (if different); and
  • The employer’s telephone number.

The notice must be written and signed by both parties (employer and employee) and retained by the employer for at least six years.

The NY Department of Labor has sample Notice of Pay forms that employers can use. It is not required to use the NYDOL forms, but it is recommended since it will ensure full compliance with the NY law. You can find all of the sample forms available on the NYDOL's website.

The notice must also be provided in both English and the employee's native language (if not English), contingent upon if the NYDOL has created the Notice of Pay form in the employee's native language. English, Spanish, Chinese, Haitian Creole, Korean, Polish and Russian are the languages currently available on the site.

(Information courtesy of the NYC Alliance)

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