Minimum Wage Requirements in Alabama 2024

Overview of Alabama's Minimum Wage Requirements

In Alabama, there is no state-specific minimum wage law. Therefore, employers are required to adhere to the federal minimum wage of $7.25 per hour, as stipulated by the Fair Labor Standards Act. This federal minimum wage rate has been in effect since 2009. However, there are exceptions to this rule. For example, tipped workers must be paid at least $2.13 per hour.

Despite the longstanding federal minimum wage, there have been efforts to raise the minimum wage in Alabama. In 2019, state lawmakers introduced a bill proposing a gradual increase of the minimum wage to $15.00 per hour by 2024. Unfortunately, this bill did not pass. As of 2021, the average hourly wage in Alabama was $18.40, which equates to approximately $38,269.00 per year, indicating that while the minimum wage has remained static, the average wage has seen some growth.

Understanding Local Minimum Wage Variations

In Jefferson County, Alabama, for example, the minimum wage is $7.25 per hour, which is the same as the Federal Minimum Wage rate. However, for federal contractors in Jefferson County, the minimum wage is $15.00 per hour. This increase is due to a new rule from the U.S. Department of Labor, which also applies to people with disabilities and does away with the tipped minimum wage, ensuring tipped workers will be paid the full minimum wage by 2024.

In Mobile County, Alabama, the minimum wage for City of Mobile employees was increased to $15.22 per hour for those working 40 hours or less as of April 19, 2022. This wage adjustment is expected to impact approximately 300 current hourly employees and future City hires.

Minimum Wage Eligibility and Exemptions

The Fair Labor Standards Act stipulates that employers subject to its provisions must pay the federal minimum wage. This means that even though Alabama does not have a specific state minimum wage law, employers are still required to adhere to the federal standard. However, certain occupations or industries may be exempt from this minimum labor standard, as per state and federal wage and hour laws.

Some states, including Alabama, may also set subminimum rates for minors, students, or new hires. For instance, new employees under 20 years of age can be paid a training wage of $4.25 per hour for their first 90 days of employment. Moreover, tipped employees and some student workers may not be eligible for the minimum wage.

Minimum Wage Considerations and Compliance Tips

As a food business employer in Alabama, it's critical to understand minimum wage legal and compliance considerations. The basic combined cash and tip minimum wage rate is $7.25 per hour. Employers can count a maximum of $5.12 per hour in tips towards meeting the minimum wage, and the minimum cash wage that must be paid to tipped employees is $2.13 per hour.

Businesses with annual gross sales from one or more establishments that total at least $500,000 are subject to the FLSA. Also, any person who works on or handles goods that are moving in interstate commerce is individually subject to the minimum wage and overtime protection of the FLSA. Covered non-exempt workers are entitled to a federal minimum wage of not less than $7.25 per hour.

FAQs

• What is the current minimum wage in Alabama? The current minimum wage in Alabama is $7.25 per hour, which is the same as the Federal Minimum Wage rate.
• Are there any exceptions to the minimum wage in Alabama? Yes, there are exceptions. For example, tipped workers must be paid at least $2.13 per hour. Also, new employees under 20 years of age can be paid a training wage of $4.25 per hour for the first 90 days of employment.

Information Source Links

• U.S. Department of Labor
• National Conference of State Legislatures
• Alabama Minimum Wage
• Federal Minimum Wage

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