BPHR’s Director Lisa Salcido, SPHR, SHRM-SCP provides answers to your pressing HR questions.
Question: Do we pay the minimum wage of the state where our headquarters is located or the state where the employee works?
Answer: With all of the minimum wage increases happening across the country, it’s important to know how to determine which minimum wage rate applies. The federal minimum wage applies to virtually all employers and employees. Many states and some cities have their own minimum wage laws that require payment of a higher minimum wage than federal law.
Employees are entitled to the minimum wage of the state in which they work. Regardless of the location of the company’s headquarters or the state from which the employee’s work is directed and controlled, where the employee physically performs work is the location that must be considered for minimum wage.
The work could be done from an out of state satellite office, a worksite in another state or remotely from their home state, wherever the employee works would determine minimum wage. Work location applies to most other employment law also! For example, New Jersey’s Earned Sick Leave Law covers employees who perform work in New Jersey, even if the employer is located outside of New Jersey.
When an employee performs work in several locations, they may be subject to multiple minimum wage laws. The higher standard applies, so the employee is entitled to the higher of the minimum wages. When in doubt you should adhere to the minimum wage that is most beneficial to the employee.
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DISCLAIMER: The material presented on this page is for informational purposes only and does not constitute legal advice or legal opinion.