Change in Minimum Wage Impacts Employers with Young Workers
On July 24, 2009, the federal minimum wage increased to $7.25 per hour. This increase is unlikely to affect most residents and employers in Michigan, since Michigan law requires most employers to pay the higher minimum wage, whether it is federal or state. In Michigan, the minimum wage has been $7.40 since July 1, 2008. Therefore, Michigan employers are still required to pay their employees at least $7.40 per hour, regardless of the federal minimum wage increase.
The federal increase may, however, affect employers with employees under age 18. In Michigan, it is permissible to pay underage employees 85% of the state minimum wage, only if that amount is equal to or greater than the federal minimum wage. 85% of $7.40 per hour does not meet or exceed the federal minimum wage, so employees under age 18 will be entitled to $7.25 per hour starting July 24, 2009. This does not impact employers’ ability to pay newly hired employees under 20 years of age a training wage of $4.25 per hour for the first 90 days of employment, under both state and federal law.
Julie Pfitzenmaier