I live in California which has a relatively high minimum wage. Moreover, I live in San Francisco where the city’s minimum wage is even higher than the rest of the state. It’s still a low amount that’s not easy to live off of. Nevertheless, it’s higher than the rest of the country. Which got me wondering, “what is the minimum wage for Florida and other states?”
What Is Minimum Wage?
Minimum wage is part of a set of rules that govern employment in the United States. We didn’t always have fair labor laws. Over time, however, the country established them. Part of those laws was to make sure that there was a base minimum hourly pay – or a minimum wage.
The federal government sets a minimum wage that all states must meet. Furthermore, states also have their own labor laws and employment guidelines. Therefore, while states must meet the mandatory federal minimum wage, they can also set their own (higher) minimum wage guidelines. That’s why the minimum wage for Florida is different from that of California, for example.
Federal Minimum Wage
The federal minimum wage is $7.25. This amount was set in 2009 and has not been updated. It’s a very controversial topic. Research indicates that a full-time employee earning $7.25 per hour can’t pay their bills in any state on this income alone. Therefore, there’s a big push to raise the federal minimum wage.
As of early 2021, many people want to see the wage raised to $15. This is even higher than California’s minimum wage (although some individual California cities have a rate slightly higher than this. However, as of right now, that $15 federal minimum wage isn’t going to happen. It was potentially going to be part of a COVID relief bill but has since been deleted from that plan, perhaps to be revisited later. So, for the time being, the federal minimum wage stands at $7.25.
What is The Minimum Wage for Florida?
Since the federal minimum wage doesn’t provide enough livable income in any state, it’s up to each state to do their best to set a better minimum wage. They have to take into consideration cost of living and other factors. So each state comes up with their own number.
About half of the states in the country set a minimum wage higher than that of the federal minimum wage. The other half set theirs the same as or even less than the federal amount. Of course, if it’s less than then the federal amount takes precedes. So what is the minimum federal wage for Florida?
Florida is one of the states that sets a higher minimum wage than the base federal rate of $7.25 per hour. The minimum wage for Florida is $8.65. The state reviews the amount annually and adjusts it according to an established formula.
Minimum Wage for Florida: 2021 Changes
Last year, the minimum wage for Florida was $8.56. As you can see, it went up slightly as of January 2021 to the current rate of $8.65 per hour. However, much bigger changes are on the horizon in Florida, starting later this year. That’s because last year the state’s voters approved a $15 minimum wage. It will take time to reach that, but the state has a plan.
Starting at the end of September 2021, the minimum wage in Florida will rise to $10 per hour. Then each September, it will increase by $1 per hour. At the end of September 2026, the Florida minimum wage will be $15 per hour according to this schedule. Therefore, even though the federal government hasn’t moved forward with a plan for a $15 minimum wage, the state of Florida is on track to make that happen for its citizens.
In fact, this makes Florida right on par with California in terms of a $15 minimum wage. Six other states have also agreed to this rate: Connecticut, Illinois, Maryland, Massachusetts, New Jersey, and New York. Whether or not the federal government raises the minimum wage anytime soon, states are taking action to do so.
Minimum Wage for Florida Tipped Employees
In many states, employees who receive tips have a special, reduced, minimum wage. For example, wait staff at restaurants often earn a very low base pay that’s less than the typical minimum wage for the state. The idea is that they get their money in tips so it adds up. This legal allows for a different minimum wage for tipped staff than for other workers. This is true in Florida as well.
Basically, the law about this in Florida is that employers may reduce a tipped employee’s base pay by $3.02 per hour. So, right now, the minimum wage for Florida is $8.65. But for tipped employees it’s $5.63. They earn $3.02 less per hour but then get to keep tips on top of that amount.
As the state’s minimum wage rises, so will the tipped minimum wage. In September 2021, when minimum wage rises to $10, tipped minimum wage will rise to $6.98 per hour plus tips. That will increase by $1 per year each September in accordance with the changing regular minimum wage for the state. In September 2026, tipped employees in Florida will begin to earn $11.98 per hour (plus tips.)
No Other Restrictions on Florida Minimum Wage
It’s important to note that besides the different rate for tipped employees, there are few other restrictions or exemptions from minimum wage for Florida. In some states, for example, businesses smaller than a certain number can pay less per hour than the state minimum wage. For example, a business with fewer than ten employees might have a slightly lower state minimum wage than the norm. However, that’s not the case with Florida. The minimum wage for Florida applies regardless of business size or type of business.
The only other exemption is for youth under the age of 18. Youth minimum wage laws are different, as are the labor laws. For example, teens are restricted from working in certain jobs. Moreover, they can’t work too late or too many hours. The federal minimum wage for youth is $4.25 per hour. In Florida, employers may pay teens this low hourly amount for their first ninety days of employment. However, after the ninety day period, teen minimum wage goes up to the regular minimum wage for the state.
Florida Annual Salary on Minimum Wage
If you do the math, then you’ll realize that an individual person working 40 hours per week at the current minimum wage in Florida will earn $17,804 per year before taxes. Once the minimum wage increases to $15 per hour in 2025, that same person will earn $31,200 per year before taxes. Obviously, that makes a huge difference in a person’s ability to pay their bills and sustain a good quality of life.
If you enjoy reading our blog posts and would like to try your hand at blogging, we have good news for you; you can do exactly that on Saving Advice. Just click here to get started.
Check out these helpful tools to help you save more. For investing advice, visit The Motley Fool.