Minimum Wage by State (2026): Current Rates for All 50 States

Minimum wage rates vary by state, and restaurants must follow the highest applicable federal, state, or local requirement. The federal minimum remains $7.25 per hour in 2026, but many states require more, and tipped employees may have different minimum cash wage requirements.

For restaurant operators, knowing the rate is only the starting point—it also needs to be reflected in employee pay. Toast Payroll & Team Management connects employee hours, tips, and payroll, helping operators manage those records together as wage requirements change.

This guide covers current minimum wage rates in all 50 states, how tipped wages work, and what to check before running payroll.

Disclaimer: This article is for informational purposes only and should not be considered financial or legal advice. Minimum wage laws are subject to change and may vary by locality. Please consult official state and local government sources or a qualified professional to verify current wage rates and requirements.

What is the minimum wage?

The federal minimum wage is $7.25 per hour for covered, nonexempt employees, subject to rules for tipped workers and other permitted exceptions. When federal, state, and local requirements overlap, employers generally must pay the highest applicable minimum.

Minimum wage laws affect both employees’ earnings and restaurants’ operating costs. In Toast’s 2025 restaurant employee survey, 37% of respondents named good hourly pay as their favorite aspect of the job, making it the top response. For operators, wage increases may mean reviewing staffing plans, improving efficiency, adjusting menu prices, or reducing other expenses.

Minimum wage rates vary across the country because states take different approaches to wage policy. Some tie adjustments to inflation, while others establish increases through legislation or voter-approved ballot measures.

How often does the minimum wage increase?

There’s no single schedule for minimum wage increases in the U.S. How often wages rise depends on whether you’re looking at the federal, state, or local level.

Federal minimum wage

Changing the general federal minimum wage requires a change in federal law; it does not automatically adjust for inflation. The rate has remained at $7.25 per hour since July 24, 2009.

State minimum wage

State wage increases vary. Some states pass legislation that schedules gradual increases over several years. Others automatically adjust their minimum wage annually based on inflation or cost-of-living formulas. 

Local (city or county) minimum wage

In certain states, cities and counties can set minimum wages above the state rate. These local rates often increase on a set annual schedule as well. For restaurant operators, this means minimum wage changes can happen:

• Annually: In jurisdictions that adjust rates using inflation or cost-of-living measures.

• Through scheduled increases: When an existing law establishes a multiyear phase-in.

• When new requirements take effect: Following legislation or voter-approved measures.

Tipped employees may have separate minimum cash wage requirements, and tip-credit rules can change independently of the general minimum wage, so restaurants need to monitor both.

What does minimum wage mean for tipped workers?

Under federal law, employers that meet the requirements for taking a tip credit can pay eligible tipped employees a cash wage as low as $2.13 per hour and count up to $5.12 per hour in tips toward the $7.25 federal minimum. Employers must inform employees about the tip credit and follow applicable tip-retention and pooling rules.

If an employee’s cash wages and tips don’t reach the required minimum for the workweek, the employer must make up the difference. State and local laws may require a higher cash wage, a higher total minimum wage, or payment of the full minimum wage before tips.

Toast restaurant tipping data shows an average tip of 19.1% at U.S. full-service Toast restaurants in Q2 2026. That figure covers applicable card and digital transactions where guests added a tip, excluding cash tips and no-tip transactions

The table shows general minimum wages for covered adult employees as of September 27, 2026. Higher local or industry-specific rates may apply, and exemptions can depend on employer size, employee age, or job duties. 

Where a state has no minimum wage—or a rate below the federal minimum—employees covered by the Fair Labor Standards Act generally must receive at least $7.25 per hour.

A tipped cash wage is the amount an employer pays directly before tips. A tip credit is the permitted portion of the minimum wage that tips can satisfy; employers must meet applicable requirements and make up any shortfall.

Minimum wage exceptions

Not every state uses a single statewide rate. Oregon’s minimum wage, for example, varies by location: effective July 1, 2026, the standard rate is $15.55 per hour, the Portland metro rate is $16.80, and the nonurban rate is $14.55.

Other examples of regional or local differences include:

• New York: The 2026 minimum wage is $17.00 in New York City, Long Island, and Westchester County, compared with $16.00 elsewhere in the state.

• Maryland: Montgomery County’s minimum wage varies by employer size and exceeds Maryland’s statewide minimum.

• California: Cities including Berkeley, Emeryville, and Los Altos set local minimum wages above the statewide rate.

• Illinois: Chicago and Cook County have their own minimum wage requirements; operators should check whether the county ordinance applies in their municipality.

Where employees work—and sometimes the employer’s size—can directly affect payroll requirements. Minimum wage isn’t always one-size-fits-all, so double-check the rules for each location rather than relying only on the statewide figure.

How to stay compliant with changing minimum wage laws

Minimum wage laws aren’t static, and differences between state, city, and county requirements can make payroll more complicated. Toast Payroll & Team Management connects employee hours and tips with payroll workflows, including overtime and tip makeup. Toast Payroll customers also have access to Mineral’s HR resources for information about wage requirements and enforcement agencies.

The median payroll processing time for Toast Payroll Suite customers is 15 minutes or less — and less than 5 minutes for restaurants with 10 or fewer employees.* That means you can spend less time double-checking rates and more time running your restaurant.

"Toast Payroll has automation and guardrails in place that set us up for success. We can onboard new employees, make adjustments as needed, and have confidence that our staff is being paid accurately and on time. I couldn’t say that about any other system." = James Dumas | Owner | One Eight Bistro

Because wage laws change frequently, consult official state and local government sources to confirm current requirements.

Minimum wage by state FAQs

What is the federal minimum wage in 2026? 

The federal minimum wage is $7.25 per hour for non-tipped employees and $2.13 per hour for tipped employees, unchanged since 2009.

What state has the highest minimum wage in 2026?

Washington has the highest statewide minimum wage in 2026 of $17.13 per hour, although some local jurisdictions have higher rates.

How many states follow the federal minimum wage?

In 2026, 20 states have no general statewide minimum wage above the federal rate of $7.25 per hour, which applies to employees covered by federal minimum wage requirements.

Can cities set their own minimum wage?

Sometimes. In some states, cities are allowed to set a local minimum wage that’s higher than the state or federal rate. In other states, laws prevent cities from setting their own wage, requiring them to follow the state minimum instead.

Is minimum wage going up in 2027?

Some state minimum wages are scheduled to increase in 2027, including Rhode Island’s increase to $17.00 on January 1, while the federal minimum wage does not automatically increase each year.

How does minimum wage work for tipped employees? 

Under federal law, employers can pay tipped workers as low as $2.13 per hour using a "tip credit," where tips make up the difference to reach the standard minimum wage. If tips don't cover the gap, employers must make up the difference.

*Based on Toast internal data from 1/1/24 to 10/31/24 among restaurants using Toast Payroll. Individual results will vary.