Dec 23, 2009

2010 Brings Few Changes in Minimum Compensation Rates

Employers should review compensation rates for both exempt and nonexempt employees to ensure compliance with current legal thresholds. Below are rates at the federal level, and for some states and localities, that apply to the most common job categories.

The following minimum compensation rates are effective as of January 1, 2010:

FEDERAL

Nonexempt
$7.25/hour

EXEMPT

Executive
$455/week* on salary basis

Professional or Administrative
$455/week on salary or fee basis

Computer
$27.63/hour (no change from 2009)

Highly Compensated
$100,000 total compensation (including minimum $455 minimum weekly salary or fee)

Licensed practicing medical doctor or attorney; teacher
None

Business Owner (20% minimum equity and engaged in management)
None

Outside sales
None

In the following jurisdictions, higher rates prevail as shown. Not all states are reflected.

ALASKA

Nonexempt
$7.75/hour (after 1/1/10, the minimum wage will be permanently 50 cents higher than the federal standard)

CALIFORNIA

Nonexempt
$8.00/hour
$9.79/hour (San Francisco)

EXEMPT

Executive, professional or administrative
$2,773.33/month on salary basis

Computer
$37.94/hour, $6,587.50/month or $79,050/year

Licensed Physician
$69.13/hour

COLORADO

Nonexempt
$7.24/hour (decrease from 2009)

CONNECTICUT

Nonexempt
$8.25/hour

ILLINOIS

Nonexempt
Effective July 1, 2010, new state minimum wage is $8.25/hour.

However, employers may pay new employees (first 90 days of employment) and employees under the age of 18 up to 50 cents less.

KANSAS

Nonexempt
$7.25/hour

$4.25/hour for employees under the age of 20

MAINE

Nonexempt
$7.50/hour

MASSACHUSETTS

Nonexempt
$8.00/hour

NEW YORK

Nonexempt
$7.25/hour

WASHINGTON, DC

Nonexempt
$8.25/hour

WASHINGTON STATE

Nonexempt
$8.55/hour

Outside Sales Exemption
Guaranteed salary, commission, or fee

*Equivalent amounts if paid on salary basis: $910 biweekly; $985.83 semimonthly; $1971.66 monthly; or $23,660 annualized.

To learn more about how minimum compensation rates may affect your company or if you have any questions regarding these issues, be sure to contact your employment counsel at Smith, Gambrell & Russell, LLP.


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