The second installment of Pennsylvania’s minimum wage increase takes effect on July 1, 2007. For most employers, the Pennsylvania Minimum Wage Act increases Pennsylvania’s minimum wage as follows:
· To $6.25 per hour effective January 1, 2007.
· To $7.15 per hour effective July 1, 2007.
· To $7.25 per hour effect July 24, 2009.
There is delayed effective date for small employers. A small employer is defined as one who has an employee complement composed of the equivalent of 10 or less full-time employees. Small employers may use the following minimum wage implementation schedule:
· To $5.65 per hour effective January 1, 2007.
· To $6.65 per hour effective July 1, 2007.
· To $7.15 per hour (the regular Pennsylvania minimum wage) effective July 1, 2008.
· To $7.25 per hour (the Federal mandated minimum wage) effective July 24, 2009.
The equivalent of 10 or less full-time employees is calculated on a 40-hour workweek. A workweek is a period of seven consecutive days starting on any day selected by the employer. For example, four part-time employees who each worked 20 hours for a total of 80 hours in a workweek (4 x 20 hours) would be the equivalent of two full-time employees
Where the total employee complement hours worked in any workweek exceeds 400 hours, the employer doesn’t meet the definition. For example, five full-time employees and eight part-time employees (who worked 30 hours each during a workweek) would not qualify for this small business minimum wage. (5 x 40 hours + 8 x 30 hours = 440 hours).
An employer may be ineligible for this modified schedule even if the total number of hours is less than 400. While a 40-hour workweek often constitutes a full-time work schedule, Labor & Industry recognizes that some employees are full-time workers if they work less than 40 hours per workweek. Determining whether an employee is working full-time depends on the employer’s “customary and regular practices.” An employer’s “customary and regular practice” is the employer’s normal practice over time in the scheduling and payment of employees. Labor & Industry will closely scrutinize these practices under this modified minimum wage implementation provision.
A compliment of employees includes all employees, managers, supervisors, officers, and similar individuals employed by an employer. The owner is not considered an employee
Additional information is available at Department of Labor and Industry’s published FAQ related to the new wages.