With many states implementing multiyear minimum wage campaigns, it can be hard to stay on top of what you’re required to pay in your state.
We’re here to help you learn more about the minimum wage in Georgia, and what you can do as a small-business owner to navigate these changes.
What is the minimum wage in Georgia for 2020?
While Georgia’s state law sets the minimum wage rate at $5.15 per hour, the Federal Fair Labor Standards Act applies, meaning that most employees must earn a minimum wage of $7.25 per hour. This means that the federal minimum wage supersedes the minimum wage in Georgia.
Since the Georgia minimum wage falls under the federal minimum wage, the same federal minimum wage exceptions apply. The federal hourly minimum wage exemptions include:
Tipped employees, for whom the minimum wage is $2.13 per hour (employers may utilize a maximum tip credit of $5.12 per hour)
Employees under the age of 20, who may be paid a training wage of $4.25 per hour during the first 90 days of employment
Full-time students, who may be paid no less than 85 percent of the minimum wage in Georgia ($6.16) for up to 20 hours of work per week when school is in session.
Keep in mind that counties, cities, and towns may have their own minimum wage laws. Be sure to check what local wage laws may apply to you.
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Are there plans to change the minimum wage?
There is no indication the Georgia legislature is planning to increase the state minimum wage, so it appears that the state’s minimum wage rate will remain at the federal level.
How should small business owners prepare for possible changes to the minimum wage?
Even if changes to the minimum wage in Georgia aren’t on the horizon, it doesn’t mean you shouldn’t prepare in case they ever are. Every business is different, so there isn’t one right way to do this. Here are a few options you may want to consider:
- Audit your expenses: Review your start-up costs and make sure you’re still being smart with your money. It’s never too early to work on managing your cash flow in detail and create a hiring plan you can affordIn some cases, you may find that hiring temporary workers as needed is less expensive than taking on full-time regular staff.
- Make sure you hire and keep the right employees: Replacing an employee can cost a lot. You can decrease the total cost associated with recruiting and training when you hire (and then retain) the right people. Look for candidates with good track records, who come recommended, and who fit in with the company culture. Once the employee is onboarded, make sure you build a relationship and provide paths for employee growth; it makes it more likely that they will stay in their role.
- Update tech: Consider automating certain aspects of the work (like payroll), and find ways to reduce production costs, such as utilizing Square’s payroll features.
As always, to make sure your business is prepared and stays in compliance (such as ensuring you have an EIN) with applicable wage laws, you should discuss Georgia’s minimum wage laws with your accountant and lawyer.