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2019 Minimum Wage Laws: Is Your Restaurant Affected?

Posted by Allie Tetreault on 12/21/18 2:00 PM in Industry News & Trends, Restaurant Training & Hiring

12 minute read Print

2019 minimum wage

In November 2016, fast food workers went on strike and protested for a livable minimum wage. The image above is of 300 protesters gathered at Coffman Memorial Union, who called on the Minneapolis City Council to pass a $15/hour minimum wage for all Minneapolis workers. 

Now, many states and cities are inching towards that $15/hour minimum wage. On December 31 and January 1, 2019, 20 states will experience a minimum wage increase, and in some cases a tipped wage increase.

Arkansas and Missouri have now joined the list of states gradually increasing minimum wage.

In Missouri, the hourly minimum wage will increase from $7.85 to $8.60 on Jan. 1, increasing by 85 cents per year until it reaches $12 per hour in 2023. 

In Arkansas, the hourly minimum wage will increase from $8.50 to $9.25 on Jan. 1, and the state's minimum wage will rise to $11 an hour by 2021. 

Read on to see if your restaurant is affected by these new laws.

Overview of the New Restaurant Minimum Wage

The federal minimum wage is still $7.25 per hour, with a tipped wage of $2.13 per hour.

In some states, the increases are part of a phasing transition to reach a certain level, such as $15 an hour. Other states are increasing the hourly minimum wage to adjust to the annual cost of living. Click through to see details about each state.

In Washington, D.C., the minimum wage of $13.25 per hour will increase to $14.00 per hour.

2019 Minimum Wage Increases by State and City

Here’s a look at the 20 states affected by the increases on December 31 and January 1. 

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1. Alaska - $9.89 an hour. 

Note: State requires employers to pay tipped employees full state minimum wage before tips.

2. Arizona - $11.00 an hour, $8.00 an hour tipped wage. 

Employers may pay employees who regularly receive tips or gratuities a maximum of $3.00 per hour less than the minimum wage, providing the employers can prove that the employees’ tips plus wages equal at least the minimum wage rate of $11.00 for all hours worked.

3. Arkansas - $9.25 an hour, $2.63 an hour tipped wage. 

4. California$12 an hour for businesses with 26 or more employees, $11 an hour for businesses with 25 or fewer employees. 

Note: State requires employers to pay tipped employees full state minimum wage before tips.

  • Cupertino, California$15.00 an hour
  • El Cerrito, California - $15.00 an hour
  • Los Altos, California - $15.00 an hour
  • Milpitas, California -$15.00 an hour, as of July 1, 2019 
  • Mountain View, California - $15.65 an hour
  • Oakland, California - $13.80 an hour
  • Palo Alto, California - $15.00 an hour
  • Richmond, California - $15.00 an hour
  • San Jose, California -$15.00 an hour
  • San Mateo, California -$15.00 an hour for standard businesses; $13.50 an hour for nonprofits
  • Santa Clara, California -$15.00 an hour
  • Sunnyvale, California -$15.65 an hour

5. Colorado - $11.10 an hour, $8.08 an hour tipped wage.

6. Delaware - $8.75 an hour, $2.23 an hour tipped wage.

7.  Florida - $8.46 an hour, $5.44 an hour tipped wage.

8.  Maine - $11 an hour, $5.00 an hour tipped wage.

9. Massachusetts - $12 an hour, $4.35 an hour tipped wage.

10. Minnesota - $9.86 an hour for businesses with annual gross revenue of $500,000 or more; $8.04 an hour for businesses with annual gross revenue of less than $500,000. 

Note: State requires employers to pay tipped employees full state minimum wage before tips.

  • Minneapolis, Minnesota - $11 an hour for businesses 100 or fewer employees; $12.25 for businesses with more than 100 employees 

11. Missouri - $8.60 an hour, $3.93 an hour tipped wage. 

12. Montana -$8.50 an hour for businesses with gross annual sales of $110,000.

Note: State requires employers to pay tipped employees full state minimum wage before tips.

13. New Jersey$8.85 an hour, $2.13 an hour tipped wage.

14. New York - $11.10 an hour, $2.90 an hour tipped wage, as of Dec. 31, 2018. 

  • NYC - large employers (of 11 or more) - $15.00 an hour, $8.65 tipped wage for food service workers, $15.00 for fast food workers (defined below) 
  • NYC - small employers (of 10 or less) - $13.50 an hour, $8.00 tipped wage for food service workers, $15.00 for fast food workers (defined below) 
  • Long Island & Westchester - $12.00 an hour, $7.50 tipped wage for food service workers, $12.75 for fast food workers
  • Remainder of New York State - $11.10 an hour, $7.50 tipped wage for food service workers, $12.75 for fast food workers

According to the state's Department of Labor, the minimum wage increase for fast food workers applies to any employee whose job duties include customer service, cooking, food or drink preparation, delivery, security, stocking supplies or equipment, cleaning or routine maintenance. An establishment is considered a fast food restaurant if it "offers limited service where customers order and pay before eating, including restaurants with tables but without full table service and places that only provide take-out service," according to the state Department of Labor. However, the minimum wage increases only apply to restaurants that are part of a chain of 30 or more locations nationwide or in New York. 

15. Ohio - $8.55 an hour, $4.30 an hour tipped wage.

16. Oregon - $11.25 an hour, as of July 1, 2019.

17. Rhode Island - $10.50 an hour, $3.89 an hour tipped wage.

18. South Dakota - $9.10 an hour, $4.55 an hour tipped wage.

19. Vermont - $10.78 an hour, $5.39 an hour tipped wage

20. Washington state - $12.00 an hour. 

Note: State requires employers to pay tipped employees full state minimum wage before tips.

  • SeaTac, Washington: $16.09 an hour for hospitality and transportation employees
  • Seattle, Washington: $16.00 an hour for businesses with 501 or more employees that don't offer medical benefits; $15.00 an hour for businesses with 500 or fewer employees; $12.00 per hour if contributing at least $3.00 per hour toward an employee's medical benefits and/or reported tips.
  • Tacoma, Washington: $12.35 an hour

What This Means for Restaurant Employers and Workers

The National Restaurant Association has advocated that raising the tipped wage and the minimum wage would "limit hiring, increase prices, cut employee hours, or implement a combination of all three,” according to CBS News.

Of course, there are many pros and cons to raising the minimum wage. A few pros are bridging the front- and back-of-house wage gap and lowering your restaurant turnover rate. A few cons are that your restaurant may have to raise menu prices and thus reset guest expectations or cut employee hours to make up for the loss.

Solutions such as Toast can help manage labor costs through increased productivity of staff. For example: 

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  • Toast Go - With a handheld point of sale system, servers can fire orders to the kitchen from the table rather than wait in line at the point of sale system, allowing you to decrease the number of servers required for a shift. 
  • Kitchen Display System - Improve the communication between front of house and back of house, increasing productivity and potentially decreasing the number of servers required through improved productivity.
  • Kiosk - Automate the ordering and payment process, eliminating a cashier
  • Online Ordering - Displace phone orders for takeout, freeing up an employee in the restaurant to perform other duties.
  • Reporting and analytics - Ensure optimal staffing/scheduling to minimize labor costs
  • Third party scheduling integration - Lock down the time clock, ensuring on-time clock in and out and correct job code/pay rate, with a solution like 7shifts or HotSchedules

What are your thoughts on the rising minimum wage? Comment below to join the conversation!

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toast restaurant management blog

Written by: Allie Tetreault

Allie Tetreault is the Content Strategist for Toast. When she's not managing the Toast Restaurant Management blog and creating valuable resources for restaurateurs, she's belting in an a cappella group and toiling over new recipes in the kitchen. Her favorite foods are sushi and pasta -- but not together!


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