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This article doesn’t constitute legal advice. Please consult a lawyer or accountant in your state to learn more about minimum wage legislation as it applies to your business.
You have a lot to keep track of every day. Sales, schedules, cash flow, inventory — your list is probably a mile long. Add to that list all the laws and regulations that govern your business, which often change. One of the most talked-about nationwide is the minimum wage.
To help small-business owners in the North Star state stay up to date on Minnesota minimum wage rules, we’ve put together this quick guide for minimum wage requirements in 2024.
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What is the minimum wage in Minnesota in 2024?
For businesses categorized as small employers, the Minnesota minimum wage increased to $8.85 per hour in 2024. Small employers are any enterprises with annual gross revenues of $500,000 or less. The Minnesota minimum wage for large employers (gross annual revenues of more than $500,000) increased to $10.85.
For businesses with younger employees, there are some additional Minnesota labor laws that apply:
- The youth wage (for employees under 18) increased to $8.85 per hour in 2024.
- The 90-day training wage (for employees under 20) increased to $8.85 per hour in 2024.
It’s important to note that tipped employees are not exempt from the minimum wage in Minnesota, which is unlike the practice in many other states. Instead, state law dictates that employees must be paid at least the minimum wage per hour, plus any tips they might earn.
State law requires Minnesota’s minimum wage increase to be based on economic conditions with potential increases made on January 1 of each year. Since the Minnesota state minimum wage is adjusted each year for inflation, Minnesota will raise the minimum wage in 2024 and beyond. It’s important to note that cities like St. Paul and Minneapolis have minimum wage ordinances that may require a higher wage than the state.
What is the minimum wage in Minneapolis in 2024?
In Minneapolis, the largest city in the state, the state supreme court unanimously upheld the $15 minimum wage phased increase through 2024 for Minneapolis.
Here’s the minimum wage increase schedule for Minneapolis:
| Date | Small Business (100 employees or fewer) | Large Business (100+ employees) |
|---|---|---|
| Jan 1, 2023 | – | $15.191 |
| July 1, 2023 | $14.50 | – |
| Jan 1, 2024 | – | $15.571 |
| July 1, 2024 | $15.57 | – |
1Increases will account for inflation every January 1.
How should small business owners prepare for changes in 2024?
Here are some other steps you can take to make sure your business is ready for anything:
- Evaluate your staffing: Take a look at your hourly, weekly, and monthly sales to determine if your current staffing levels are appropriate. Based on those sales and the rest of your finances, make a plan for any future hiring. Maybe you need to add a new full-time employee each year. Or maybe your sales are seasonal and hiring contract employees during your busy seasons makes more sense.
- Hire the best: Hiring the right people is always important, but doubly so when you operate a small business. So take your time and cast a wide net when recruiting new employees. And once you have your team in place, make employee retention a priority by offering them a path to growth and development and by making your business an attractive place to work.
- Upgrade your technology: When you automate complicated, time-consuming aspects of management, like payroll, you can spend more time focusing on issues like staffing and growing your business.
Whether you want to keep up to date with Minnesota minimum wage laws, get an EIN, or learn more about COVID-19 small business resources, Square is here to help you grow your business.
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