Educational Reference

Minimum Wage Checker & Statutory Guide

A multi-jurisdictional analysis tool to verify pay rates against 2025 federal, state, and municipal floors. Understand the interaction between "Tip Credits," "Youth Minimums," and inflation-indexed triggers.

Statutory Disclaimer

Minimum wage laws are subject to concurrent jurisdiction. While federal law provides a $7.25 floor, state and city ordinances may set significantly higher requirements. In almost all cases, the most favorable rate for the employee governs. This tool is for educational modeling and does not constitute a legal audit of your specific payroll obligations.

Rate Verification Tool

The Bifurcated Economy: $7.25 vs. $19.00

We are currently witnessing the widest gap in wage standards in American history. While the federal minimum wage has remained frozen at $7.25 since 2009, local municipalities in high-cost hubs have pushed rates to triple that amount.

This "Bifurcation" creates a complex compliance landscape for remote employers. Generally, the minimum wage is determined by the Physical Location of the Worker, meaning a company based in Texas (using $7.25) hiring a remote coder in Seattle (using $19.97+) must adhere to the Seattle standard.

2025 Automatic Indexing Models

To combat inflation, many states have moved away from legislative votes toward Algorithmic Adjustments based on the Consumer Price Index (CPI).

The 'CPI-W' Trigger

States like Washington and California use the Consumer Price Index for Urban Wage Earners (CPI-W). If inflation rises by 3.5%, the minimum wage automatically ticks up on January 1st to preserve purchasing power.

The 'Wage Ceiling' Caps

Some jurisdictions have "Caps" (e.g., 5% per year) to prevent sudden, economy-shattering wage hikes during hyper-inflationary periods, ensuring a predictable growth curve for small business payrolls.

The Tipped Wage Complexity

Federal law allows for a Tip Credit, meaning employers pay a lower cash wage (as low as $2.13) provided tips make up the difference. However, several states have move to "One Fair Wage" models.

Full Minimum Wage States

States like CA, WA, and OR prohibit tip credits. Employers must pay the full statutory minimum regardless of how much the worker earns in tips. Tips are considered a "gratuity" on top of base pay.

Federal Floor States

States like TX, GA, and AL use the federal $2.13 base. If tips do not bring the hourly average to $7.25 for the work week, the employer must pay the difference.

Wage Theft: The 'Hidden' Violations

Minimum wage violations often occur through Systemic Deductions rather than just low hourly rates. If these deductions pull your pay below the statutory floor, they are illegal.

Uniform Costs

Requiring employees to purchase specialized equipment or branded clothing if that cost drops their weekly average below the legal minimum.

Mandatory Prep

"Off-the-clock" work such as attending a mandatory shift meeting, donning safety gear, or cleaning after a sign-out.

Illegal Tip Pooling

Requiring tipped employees to share gratuities with "Back-of-House" staff (in some states) or management (illegal federally).

Statutory Wage FAQ

Does the rate depend on company size?↓
Yes, in many jurisdictions. For example, some cities have a higher rate for "Large Employers" (e.g., 500+ employees globally) than for "Small Employers." Our checker allows you to toggle this variable to ensure the correct statutory floor is applied.
What is the 'opportunity' wage?↓
Under the FLSA, for the first 90 days of employment, workers under age 20 can be paid a sub-minimum "Youth Opportunity Wage" of $4.25. Once they reach 20 or 90 days of tenure, they must receive the full statutory minimum.
How long do I have to file a claim?↓
Generally, the FLSA has a 2-year statute of limitations which expands to 3 years for "willful" violations. Many states have longer lookback periods (e.g., California has 3 years). Delaying a claim can result in the loss of back-pay rights for older pay periods.