Arkansas Workers Get 75 Cent Minimum Wage Increase Starting on January 1, 2020

As Arkansas employers start preparing for the end of the year, it is important to keep in mind that a major change is coming to state minimum wage laws in less than four months: the Arkansas minimum wage will increase to $10 starting on January 1, 2020.

The new law will raise the minimum hourly rate incrementally, giving employers time to prepare. The schedule of upcoming wage increases is as follows:

• The minimum wage rate is currently $9.25. Employers must continue to pay the minimum wage of $9.25 from now until December 31, 2019.
• On January 1, 2020, the minimum wage increases to $10.
• On January 1, 2021, the minimum wage increases to $11.

Which Employers Must Pay the New Arkansas Minimum Wage?

Arkansas employers who have more than four employees must pay their employees $10 an hour beginning in 2020.

If you’re paying your workers a $7.25 federal minimum wage, you are not in compliance with the law. If you have four or more employees, you must pay them the Arkansas minimum wage.

What About Tipped Employees?

Tipped employees will still have a minimum hourly wage of $2.63. Under the current law, the employer has to pay an employee the difference if the employee’s tips do not equal the state minimum wage.

That won’t change much in 2020. Tipped employees will still have a minimum hourly wage of $2.63. An employer will still pay tipped employees enough money to ensure they make up the difference between $2.63 and the state minimum wage.

The Arkansas minimum wage law won’t impact other tip credit requirements.

What About Domestic Workers and Farm Workers?

The minimum wage law does not apply to workers who are considered exempt under the FLSA. This includes domestic workers, like babysitters and caregivers, people who work for the federal government and some agricultural workers.

Do Employers Need to Pay Students the State Minimum Wage?

No. If an employer hires a full-time student, they can be paid 85% of the Arkansas minimum wage when the student is working up to 20 hours a week.

How Arkansas Employers Should Prepare for the Minimum Wage Hike

Arkansas employers should be proactive about complying with the minimum wage increase, especially since failing to comply with the law could result in fines and lawsuits.

First, double-check to make sure the law applies to your business.

Second, update your minimum wage notice poster with the most updated version, which you can download on the Arkansas Department of Labor’s website.

Third, train your staff on the minimum wage increase. Make sure that everyone in human resources, payroll, accounting, and management is aware that there is a wage hike coming up. Train staff on how to explain the changes to employees.

Proper planning will help you manage the minimum wage increase efficiently.

Notice Date: 7/2019
Suggested Post Date: ASAP

Order the Complete Arkansas Poster with these latest updates to stay compliant with state labor laws. Labor Law Center continually monitors local, state and federal posting requirements and has been helping thousands of businesses maintain compliance since 1999.