Federal Minimum Wage vs State and City Minimum Wage

Minimum wages can be set at the city, state, and federal level. Which minimum wage matters? Simply put, the highest minimum wage where you live applies. If you live in a city that has set the minimum wage higher than the the federal minimum wage, the city wage applies.

Federal Minimum Wage

Federal law has a base wage for workers in the United States. Currently, the federal minimum wage is $7.25 per hour, and hasn’t increased since 2009. Though there have been many proposals to increase the federal minimum wage, nothing has been passed into law.

State and City Minimum Wage

States cannot go below the federal minimum wage, but they can establish higher minimum pay rates. For example, California is currently set at $9.00 an hour and  businesses must pay their employees at least that. Even within states, cities can set their own rates. San Francisco has set the minimum wage at $10.74 an hour to take into account the higher cost of living there.

Minimum Wage Updates

Minimum wages are often adjusted to account for inflation and many states have incremental changes lined up for the next few years. Every time a new minimum wage is released, labor law posters regarding minimum wages must be updated as well.

If you want to avoid the leg work of staying up-to-date with minimum wage updates, sign up for our labor law poster subscription service and we’ll automatically send new posters when laws change, keeping you compliant 365 days a year. We continually monitor local, state and federal posting requirements and have been helping thousands of businesses maintain compliance since 1999.