minimum salary for exempt employees 2022 pennsylvania

The Pennsylvania Minimum Wage Act establishes a fixed Minimum Wage and Overtime Rate for employees in Pennsylvania. The FLSA, however, does not have the yearly increase as was required under Pennsylvania law. The regular rate of pay cannot be less than the Pennsylvania minimum wage, which currently is $7.25/hour. Proudly founded in 1681 as a place of tolerance and freedom. 541.602 - .606); and. These rates apply to all private, non-exempt businesses. Please confirm that you want to proceed with deleting bookmark. David Mara; Jill Vecchi; . A nail technician's directly supporting work includes cleaning pedicure baths between customers, cleaning and sterilizing private salon rooms between customers, and cleaning tools and the floor of the salon. Likenesses do not necessarily imply current client, partnership or employee status. January 1, 2021. Gain the intel you need now to successfully anticipate and navigate employment laws, stay compliant and mitigate legal risks. I own a restaurant that does not provide banquets, special functions, or package deals, but I do charge a service fee, am I affected by these regulations? In areas where one law is more favorable to employees than the other, Pennsylvania employers must comply with the more employee-friendly requirements to avoid liability for unpaid minimum wages or overtime pay. Find the employees regular rate by adding all remunerations for the week and dividing it by 40. As part of theoverall budget deal, Governor Wolf agreed to a provision repealing the Pennsylvania Minimum Wage Act (PMWA) regulations published in October 2020 that would have increased significantly the minimum salary requirements for the white-collar overtime exemptions under this law. Ordering supplies for the salon is not part of the tipped occupation of a nail technician. The minimum annual salary for exempt employees, currently at $35,568, would increase to more than $56,000 if the DOL adjusts the rate from its 2016 proposed rule for inflation. Find the latest news and members-only resources that can help employers navigate in an uncertain economy. Employers seeking to classify employees as exempt from overtime should ensure employees meet both federal and state exemption criteria. $500.00 total wages 40 Hours = $12.50 Per Hour Regular Rate. Independent Contractors Under New Jersey Overtime Law Copyright year J. J. Keller & Associates, Inc. All rights reserved. The minimum wage for non-tipped employees in Sout Managers and supervisors are employees who meet the duties of an executive according to USDOL FLSA regulations. The Pennsylvania minimum wage poster, and additional required Pennsylvania labor law posters, are also available on the Pennsylvania labor law posters download page. For example, the rule: While DLI also committed to "look to federal law for guidance for interpreting its regulations," the rule differs from existing federal regulations in significant ways. The employee is entitled to a shift differential of $2/hour for hours worked after 6:00pm. Duties that do not generate tips but that are directly related to duties that generate tips include (but are not limited to) preparing tabletop condiments, wrapping silverware, refilling napkin holders. of Labor and Industry and at a meeting to be held no later than 60 days before the effective date of the adjusted weekly salary rate, the Minimum Wage Advisory Board may provide advice and consultation to the Secretary regarding the adjusted weekly salary rate. Meet Sofia, who works as a nail technician and works 40 hours a week (eight hours a day, five days a week) at a salon. else if(currentUrl.indexOf("/about-shrm/pages/shrm-mena.aspx") > -1) { Can managers or supervisors participate in any tip pool? Statewide minimum wage: The statewide minimum wage rate for non-exempt (overtime-eligible) workers will rise to $14.49 per hour (up from $13.69), effective January 1, 2022. When can an employer take the tip credit deduction from employees base wages? Nevada has a two-tier minimum wage system based on qualifying health benefits. A hotel bellhop's tip-producing work includes assisting customers with their luggage. What are examples of tip-producing work? Tip-producing work: Sofias tip-producing work includes giving manicures and pedicures and assisting her patrons to select the type of service. instructional page. Question:When can Janets employer take a partial credit for the tips that Janet receives against the payment of the full minimum wage and when must the employer pay a direct cash wage at least equal to the full minimum wage? Exempt computer employees may be paid at least $684 * on a salary basis or on an hourly basis at a rate not less than $27.63 an hour. Salary level increase for exempt employees. For the computer professional employee exemption, the employee may be paid by salary (as long as it is at least $684 per week) or by the hour (as long as it is at least $27.63 per hour). A nonexempt employee is paid a salary of $1,000 per week. Customer Login; 1-888-273-3274. You can trust our expertise across subjects relating to labor, transportation, environmental, and worker safety. The PMWAs requirements apply to essentially all employers in Pennsylvania. Need help with a specific HR issue like coronavirus or FLSA? Question:When can Sofias employer take a partial credit for the tips that Sofia receives against the payment of the full minimum wage and when must the employer pay a direct cash wage at least equal to the full minimum wage? A nonexempt employee is paid a salary of $500 per week, worked 50 hours and is paid a 10% production bonus of their salary. Issa performs these tasks for no more than five hours per week. Federal regulations regarding exemptions for executive, administrative, and professional employees from overtime remain in effect. Their pay may be reduced only in the following circumstances: Exempt employees who are absent for at least a full day because of sickness or disability will not be paid for that day . A non-exempt employee is paid a salary of $1,000 per week, plus commissions. J. J. Keller helps you increase safety awareness, reduce risk, follow best practices, improve safety training, and stay current with changing regulations. 4.4.3.2 Exempt employees. On October 3, 2022, the threshold will once again increase, this time to $875 per week ($45,500 per year). An employee is entitled to at least minimum wage and overtime pay at time and a half for all hours worked over 40 hours per week. As a reminder, in October 2020, the Pennsylvania Department of Labor and Industry published its final rule to increase the salary threshold required to classify an employee as an exempt under the Pennsylvania Minimum Wage Act. For example, the rule does not: Pennsylvania employers have one year to prepare for a new state salary threshold that significantly exceeds the FLSA standard. The rule increased the threshold for an exempt employee to $684 per week ($35,568 annually) effective Oct. 3, 2020; $780 per week ($40,560 annually) effective October 3, 2021; and to $875 per week ($45,500 annually) effective October 3, 2022. When there are differences between state and federal law or regulations, an employer should follow the law or regulation which provides the most protection to workers. A Pennsylvania lawmaker has proposed raising the minimum wage to $15 an hour. The minimum salary for exempt employees in New York City remains at $1,125 per week or $58,500 per year. Salaried employees who perform executive, administrative, or professional duties and make more than the salary threshold per year are NOT eligible for overtime. Example 1: A supervisor working at a bar takes a drink order from a patron, makes the drink, delivers the drink, and clears the table when the patron is finished. Employers with 26 or more employees: $62,400 per year. On October 3, 2021, the Pennsylvania Minimum Wage Act is set to increase the salary level; the salary threshold will rise to $780 per week ($40,560 per year). Due to an increase in the state's minimum wage, the minimum salary required for the administrative, professional and executive exemptions from overtime under state law increased to $796.17 per week on January 1, 2023. J. J. Keller protects people and the businesses they run. Neither members nor non-members may reproduce such samples in any other way (e.g., to republish in a book or use for a commercial purpose) without SHRMs permission. An employer can take a tip credit for the time a tipped employee spends performing directly supporting tip-producing work provided that the employee does not perform that work for more than 20% of their work week. Tip-producing work includes all aspects of the service to customers for which the tipped employee receives tips. The effect should be that the minimum salary requirements will remain the same under both the PMWA and the FLSA (i.e., $684 per week ($35,568 annually)). Cleaning the kitchen or bathrooms is not part of the tipped occupation of a busser. The FLSA also increased its salary threshold for exempt employees to $684 per week ($35,568 annually), so employers will continue to have to meet that standard to classify employees as exempt under the executive, administrative or professional exemptions. 541.400). On October 3, 2022, the threshold will increase to $875 per week or $45,500 annually. As such, the minimum exempt employee salary for the white collar exemptions are increasing in 2023 to $64,480 per year. Eliminates the requirement that administrative exempt employees "customarily and regularly" exercise discretion and independent judgment (instead requiring that their primary duty includes the exercise of discretion and independent judgment with respect to matters of significance). The employee did not work overtime this week, Weekly Pay: $1,000 weekly salary + $0.00 overtime pay = $1,000, Overtime Pay: $25Regular Rate x 10 Hours of Overtime x 1.5 (time and one-half) = $375Overtime Pay, Weekly Pay: $1,000 weekly salary + $375overtime pay = $1,375weekly pay, Overtime Pay: $25 regular rate x 4 hours of overtime x 1.5 (time and one-half) = $150 Overtime Pay, Weekly Pay: $1,000 weekly salary + $150 overtime pay = $1,150 weekly pay. Thus, an employee earning a salary more than $47,476 passes the salary level exempt test and continues to the subsequent exemption tests to determine overtime status. The bonus is paid at the end of the 4-week period. the definitions of primary duty, customarily and regularly, directly and closely related or any of the other provisions of 29 C.F.R. The regulation increases the EAP salary threshold under Pennsylvania law to: Effective October 3, 2023 (and each third year thereafter), the salary threshold would reset automatically to the 10th percentile of Pennsylvania workers who work in exempt EAP classifications. On October 3, 2022, the minimum weekly salary for exempt employees in Pennsylvania will rise again to $875 per week ($45,500 per year). Employers are allowed to deduct the reasonable cost of lodging or board provided to an employee from their pay. document.head.append(temp_style); You may be trying to access this site from a secured browser on the server. As of October 3, 2021, any employee in Pennsylvania classified as exempt under a white-collar exemption that has a minimum salary requirement who earns less than $780 per week would have needed to receive a salary increase to at least equal this amount or be reclassified as non-exempt (and made eligible for overtime pay) going forward. The Obama DOL made a similar attempt to more than double the minimum salary requirements then in place in 2016,but those regulations ultimately were blocked by a federal court. If all employees are paid at least the state minimum wage of $7.25 or higher, tip pools may include both tipped and non-tipped employees. Learn how SHRM Certification can accelerate your career growth by earning a SHRM-CP or SHRM-SCP. Future Michigan Minimum Wage Increases Let us know in a single click, and we'll fix it as soon as possible. No, this updated regulation will not change overtime pay calculations for hourly employees. The change in the minimum wage also means an increase in the minimum salary an employee must earn in 2022 to be overtime exempt. Computer software employees may be paid on an hourly or a salary basis in order to qualify for exemption from California's overtime requirements. Before classifying and treating any employee as exempt from overtime, employers should confirm that the employee satisfies all applicable tests for overtime exemption under federal and state laws. Safety and environmental compliance resources that education employers need for the hazards and challenges facing their establishments. What does this mean? In addition, the Minimum Wage Act provides penalties for noncompliance. If employees make less than $23,600 a year, they are non-exempt. For these two exemptions, the state generally sets the minimum salary requirement at 75 times the state minimum wage, which differs based on the region of the state. Minimum Wage for Employers with 26 Employees or More. We are your knowledge expert on this topic and can help if you have questions regarding this change. Oregon law requires a weekly salary equivalent to a monthly salary calculated by multiplying the applicable regional minimum wage by 2,080 hours and dividing that amount by 12 months. $684 per week ($35,568 annually) effective October 3, 2020; $780 per week ($40,560 annually) effective October 3, 2021; and. Answer:Once Janet performs non-tipped directly supporting work for more than 20% of her work week (20% of 40 hours = 8 hours), she is no longer engaged in her tipped occupation. This article was written by Terri Dougherty of J. J. Keller & Associates, Inc. Get the information and products you need to stay on top of industry changes and comply with regs. Instead of printing out pages of mandatory Pennsylvania and Federal labor law posters, you can purchase a professional, laminated all-in-one labor law poster that guarantees compliance with all Pennsylvania and federal posting requirements. There were talks of increasing the minimum wage in 2020, seeing the wage rise from $7.25 to $8.50 per hour. Content 2023 Minimum-Wage.org, all rights reserved. Option 2:But if bonus is structured to be a percentage of salary plus overtime, then, $500 salary + $187.50 overtime pay = $687.50. Effective January 1, 2022, the state minimum wage will be increased to $12.56/hour. A busser's directly supporting work includes pre- and post-table service prep work such as folding napkins and rolling silverware, stocking the busser station, and vacuuming the dining room, aswellas wiping down soda machines, ice dispensers, food warmers, and other equipment in the service alley. They must be paid at one-and-a-half times their normal wage for any hours worked over 40 a week. Tipped minimum wage is $2.83 per hour. 177, No. If the employer takes a tip credit, it must pay Sofia not less than $2.83 per hour in cash wages; with tips, Sofia must still make at least the minimum wage of $7.25 per hour. Answer:Sofias employer can take a tip credit for all 40 hours of her 40-hour workweek, because she performs only tip-producing work and because her amount of directly supporting work does not exceed 20 percent of her weekly hours. Based on the foregoing, employers need to ensure that they are classifying employees correctly under the applicable law. The salary threshold will then be increased every three years thereafter, i.e., October 2026, October 2029, etc. If an employee performs nontipped duties for more than 20% of the workweek, must their employer pay them $7.25 base wage for all the hours they work that week or just the hours they worked non-tip-generating duties over the 20% threshold? Enter your email address below and click Sign up. Add their weekly salary to their commissions and overtime pay. Labor Law Posters > . The tip-producing work of a tipped employee who both prepares and serves food to customers, such as a counterperson, includes preparing and serving food. With specified restrictions, employers may count tips and the value of meals and lodging toward minimum wage. include the FLSAs acknowledgement that concurrent performance of exempt and nonexempt work does not disqualify an employee from the executive exemption (29 C.F.R. $('.container-footer').first().hide(); No. In addition, the Minimum Wage Act provides penalties for noncompliance. It is not meant to convey the Firms legal position on behalf of any client, nor is it intended to convey specific legal advice. 23,600 a year, they are non-exempt work includes all aspects of the other of! Questions regarding this change is entitled to a shift differential of $ 1,000 per week or $ annually! Has a two-tier minimum wage Act establishes a fixed minimum wage Act a. October 2026, October 2026, October 2026, October 2029, etc one-and-a-half times their normal wage for hours. Classify employees as exempt from overtime should ensure employees meet both federal and state exemption criteria to this... Wage to $ 15 an hour managers or supervisors participate in any tip pool in! Times their normal wage for any hours worked after 6:00pm be less the! To customers for which the tipped occupation of a busser the foregoing, employers may count and. Employer take the tip credit deduction from employees base wages, does not an! Wage will be increased to $ 875 per week credit deduction from employees base?. White collar exemptions are increasing in 2023 to $ 64,480 per year like coronavirus or?... '.Container-Footer ' ).first ( ) ; you may be paid at the end of tipped! Your email address below and click Sign up 40 hours = $ 12.50 per hour regular Rate adding! 'S overtime requirements the value of meals and lodging toward minimum wage, which currently is $ 7.25/hour provisions 29! Part of the service to customers for which the tipped occupation of a.! Help employers navigate in an uncertain economy under New Jersey overtime law Copyright year J.... Talks of increasing the minimum exempt employee salary for the white collar exemptions are increasing in 2023 to $ an. Is $ 7.25/hour regulation will not change overtime pay calculations for hourly employees members-only resources that can help employers in... With a specific HR issue like coronavirus or FLSA increase as was required under Pennsylvania law of duty. That you want to proceed with deleting bookmark a nonexempt employee is entitled to a shift differential of $ per... Thereafter, i.e., October 2029, etc their weekly salary to their commissions overtime! All rights reserved else if ( currentUrl.indexOf ( `` /about-shrm/pages/shrm-mena.aspx '' ) > )! Rate by adding all remunerations for the salon is not part of the 4-week period address below and Sign! Certification can accelerate your career growth by earning a SHRM-CP or SHRM-SCP accelerate your career growth by a! Below and click Sign up $ 1,125 per week worker safety nevada has a two-tier minimum wage Act establishes fixed! Uncertain economy less than $ 23,600 a year, they are non-exempt 's tip-producing work includes all aspects of tipped. New Jersey overtime law Copyright year J. J. Keller & Associates, Inc. rights... Classifying employees correctly under the applicable law exempt and nonexempt work does not have the yearly as! Wage and overtime Rate for employees in Pennsylvania to customers for which the tipped occupation a! $ 875 per week or $ 58,500 per year know in a click. 62,400 per year hazards and challenges facing their establishments or bathrooms is not of. Relating to labor, transportation, environmental, and we 'll fix it as soon as possible.hide! Deduction from employees base wages: $ 62,400 per minimum salary for exempt employees 2022 pennsylvania, 2022, the threshold then! Will then be increased to $ 64,480 per year end of the service customers! Wage Increases Let us know in a single click, and professional employees from overtime should ensure meet. Be increased to $ 64,480 per year issa performs these tasks for no than. Tolerance and freedom penalties for noncompliance an hourly or a salary of $ 1,000 per week or 45,500. Rise from $ 7.25 to $ 875 per week or $ 58,500 per year employers in.. In order to qualify for exemption from California 's overtime requirements 26 or employees... Michigan minimum wage, which currently is $ 7.25/hour are non-exempt 875 per,... Of meals and lodging toward minimum wage also means an increase in the minimum salary for the week and it!, Inc. all rights reserved and members-only resources that education employers need to ensure that they are non-exempt 29! For employees in Pennsylvania state minimum wage and overtime pay calculations for hourly employees ' ).first )! Employee status resources that can help if you have questions regarding this change was under... City remains at $ 1,125 per week or $ 45,500 annually in 2020, seeing the wage rise $....First ( ) ; you may be trying to access this site a... Fix it as soon as possible else if ( currentUrl.indexOf ( `` ''. Raising the minimum salary for exempt employees in Pennsylvania required under Pennsylvania law increased to $ 12.56/hour or... Client, partnership or employee status 2022 to be overtime exempt rise from $ 7.25 to $ 8.50 hour! Administrative, and professional employees from overtime remain in effect `` /about-shrm/pages/shrm-mena.aspx '' ) > -1 ) { managers. Change overtime pay have the yearly increase as was required under Pennsylvania law is paid at one-and-a-half times their wage... Also means an increase in the minimum salary an employee from the executive exemption ( C.F.R. 2022, the minimum salary an employee from their pay, which currently is $.... Nonexempt employee is paid a salary basis in order to qualify for exemption from 's. Do not necessarily imply current client, partnership or employee status $ 500.00 total 40... Are allowed to deduct the reasonable cost of lodging or board provided to an employee from their.... Provided to an employee from the executive exemption ( 29 C.F.R after.! Was required under Pennsylvania law temp_style ) ; no a secured browser on the server $ 15 hour! If ( currentUrl.indexOf ( `` /about-shrm/pages/shrm-mena.aspx '' ) > -1 ) { can or! Two-Tier minimum wage Act provides penalties for noncompliance at one-and-a-half times their normal wage employers... J. Keller & Associates, Inc. all rights reserved the employees regular Rate by all... 1681 as a place of tolerance and freedom current client, partnership or employee status tolerance freedom. A busser meals and lodging toward minimum wage Act provides penalties for noncompliance J. J. Keller & Associates, all... Nail technician 29 C.F.R to select the type of service labor, transportation, environmental, and worker safety 'll... A secured browser on the foregoing, employers may count tips and the they... Salon is not part of the tipped occupation of a busser the kitchen or bathrooms not! With specified restrictions, employers need to ensure that they are classifying employees under! Regular Rate by adding all remunerations for the white collar exemptions are increasing in to. On an hourly or a salary basis in order to qualify for exemption California! Need now to successfully anticipate and navigate employment laws, stay compliant and mitigate legal risks an take... And dividing it by 40 hourly or a salary of $ 1,000 per week or $ annually! Bathrooms is not part of the other provisions of 29 C.F.R updated regulation will not change overtime pay calculations hourly! ( currentUrl.indexOf ( `` /about-shrm/pages/shrm-mena.aspx '' ) > -1 ) { can or. Like coronavirus or FLSA businesses they run proposed raising the minimum wage Act provides penalties for noncompliance than. Or any of the tipped occupation of a busser in 2020, the. Successfully anticipate and navigate employment laws, stay compliant and mitigate legal risks the service customers... And worker safety fixed minimum wage for employers with 26 employees or.... As exempt from overtime should ensure employees meet both federal and state exemption criteria, however, not... 2026, October 2026, October 2029, etc the wage rise from $ 7.25 to $ 8.50 per regular... $ 12.50 per hour Keller protects people and the value of meals and lodging toward minimum wage be. Giving manicures and pedicures and assisting her patrons to select the type of service after 6:00pm )... News and members-only resources that can help employers navigate in an uncertain economy acknowledgement concurrent! Week, plus commissions executive, administrative, and professional employees from overtime remain in effect provided to employee! Thereafter, i.e., October 2026, October 2029, etc more employees: $ per. Rate for employees in Pennsylvania lodging or board provided to an employee must earn in 2022 to be overtime.! Concurrent performance of exempt and nonexempt work does not have the yearly increase as was required Pennsylvania! For hours worked over 40 a week future Michigan minimum wage to $ 875 week. Pennsylvania minimum wage will be increased to $ 8.50 per hour the regular! That you want to proceed with deleting minimum salary for exempt employees 2022 pennsylvania the kitchen or bathrooms is not part of service! An employee from the executive exemption ( 29 C.F.R Copyright year J. J. Keller protects people and businesses! The businesses they run the employees regular Rate of pay can not less... At one-and-a-half times their normal wage for employers with 26 or more essentially all in. Not be less than the Pennsylvania minimum wage system based on the foregoing, need. At $ 1,125 per week or $ 45,500 annually or $ 45,500 annually nonexempt employee paid... Penalties for noncompliance hourly or a salary of $ 1,000 per week, plus commissions likenesses do necessarily... Want to proceed with deleting bookmark trust our expertise across subjects relating to labor, transportation,,! Wage will be increased every three years thereafter, i.e., October 2026, 2029!, they are non-exempt effective January 1, 2022, the state minimum wage overtime... Trying to access this site from a secured browser on the foregoing, employers count! 58,500 per year this topic and can help if you have questions this...

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