Opinion: New minimum wage is in effect; now what?

The Missouri Division of Labor Standards has the responsibility to educate the public and investigate complaints to assure compliance with the new minimum wage law. The department is working to answer questions that have risen directly from the statutory language enacted.

The new statute changes the existing law in several ways.

The easiest points to consider are that the ballot measure raised the minimum wage in Missouri to $6.50 per hour from $5.15, effective Jan. 1. The new law also requires the state minimum wage to adjust annually beginning Jan. 1, 2008, based on changes in the Consumer Price Index.

Proposition B excludes certain Fair Labor Standards Act exemptions toward state law. Therefore, Missouri employers will be required to comply with state minimum wage requirements and FLSA.

Not every Missouri employer will be covered under the new minimum wage law. So, how do you know whether the law applies to your business? The new minimum wage law applies to Missouri retail or service businesses with annual gross sales of more than $500,000.

It is important to note that Proposition B requires Missouri employers to do more than pay a minimum wage of $6.50 per hour.

First, employers subject to the new minimum wage law will be responsible for keeping a record of certain information on employees for a period of at least three years.

In addition, a summary of wage regulations must be posted in a conspicuous and accessible place for employees to view. Minimum wage posters will soon be available to print at no charge at DOLIR’s new site, www.mominimumwage.com. The site is designed to assist employers and employees understand the new minimum wage law. The new Web site provides answers to frequently asked questions, links to ballot language and additional state and federal contact information.

Here are a few sample questions:

Q: How does the new minimum wage law apply to commission salespeople?

A: Any commission salesperson whose hours and place of employment are established and controlled by the employer is covered by the law. Any commission salesperson, whose hours and places of employment are not substantially controlled by their employer, would not be subject to the provisions of Missouri law and the $6.50 per hour rate would not apply to them.

Q: How does the new law apply to nurses?

A: There are no specific references to nurses in the new law. However, Section 290.500(3)(a) exempts bona fide professionals. Registered nurses, based on their advanced knowledge, are considered professionals and would not be subject to the provisions of the law. However, licensed practical nurses do not qualify for the professional exemption and are subject to the provisions of the law.

Q: I own a restaurant. Do I have to pay my wait staff 50 percent of the new Missouri minimum wage of $6.50 per hour if they also receive gratuities?

A: No. However, total compensation for employees in this capacity must total at least $6.50 per hour. You are required to make up the difference. If you are subject to the federal Fair Labor Standards Act you must pay them at least $2.13 per hour, regardless of the amount of tips they receive, to be in compliance with federal law. The Division of Labor Standards will look at the number of hours worked during the established workweek to determine whether an employee has been paid correctly.

Q: Are government employees required to be paid overtime at one and one-half times their regular rate for all hours worked more than 40 in a workweek?

A: The law requires that employees working longer than 40 hours in a workweek receive compensation at a rate not less than one and one-half the regular rate of compensation. There is nothing in the law that requires that government employees be paid cash as compensation for the overtime. Government employees always have received compensatory time, which is considered payment when the time off is taken or when paid in cash upon separation from employment. Since government employees will receive payment at one and one-half times their salary, use of compensatory time does not violate the provisions of Missouri’s Minimum Wage Law.

If you have a question about how the new law applies to your business, call the Missouri Division of Labor Standards at (573) 751-3403 or e-mail minimumwage@dolir.mo.gov.

Rod Chapel, director of the Missouri Department of Labor and Industrial Relations, can be reached at rod.chapel@dolir.mo.gov.