UPDATE: Chicago has announced its July 1, 2018 minimum wage rates for tipped employees, which are now included below.

Employers with minimum wage, tip, and overtime allergies might dread spring, but given the few developments this month, they should only experience a mild case of May fever. On the other hand, many should expect June gloom because, although the days are becoming longer, there is limited daylight between now and when states and cities across the county begin raising their minimum wage rates on July 1.

Spring (Agenda) is in the Air: The U.S. Department of Labor (DOL) released its spring 2018 regulatory agenda. It indicated a revised white collar employee salary rule will not be proposed until January 2019, a proposed rule on tip pooling will be issued by August 2018, and a proposed rule updating regular rate requirements will be issued by September 2018.¹

The Ninth Circuit is Abuzz: The U.S. Court of Appeals for the Ninth Circuit asked the California Supreme Court to answer, among other questions, the following: “Does California minimum wage law apply to all work performed in California for an out-of-state employer by an employee who works in California only episodically and for less than a day at a time?” To date, the court has neither accepted nor rejected the Ninth Circuit’s invitation to weigh in on this issue.

The DOL asked the U.S. Supreme Court to review, and vacate, a Ninth Circuit decision that upheld an Obama-era DOL rule that, in part, prohibited tip pooling with non-tipped employees even if an employer paid tipped employees the full minimum wage and did not claim a tip credit.

Stop and Smell the New Bills: New York A. 10757 & S. 8594 propose to prohibit state labor officials from amending, altering, or eliminating the tip credit for certain food service workers. New York A. 10636 provides that, if an annual increase to the minimum wage set by the state labor department eliminates the tip credit, counties could opt out of the increase as it relates to food service workers and service employees. New York S. 8307 would establish a minimum wage rate for employers with 50 or fewer employees that would supersede, without repealing, the existing generally applicable four-tier minimum wage structure. For such employers, the minimum wage would be the rate set by the federal FLSA or the following rates, whichever is greater: on and after December 31, 2018, the New York City rate would be $13.00 per hour, the Nassau, Suffolk, and Westchester Counties rate would be $11.00 per hour, and $10.40 per hour would the applicable minimum wage in the remainder of the state; essentially, for these employers the bill would freeze the applicable minimum wage rate at current levels.² Additionally, the bill proposes to have these rates be the minimum wage for employees between the ages of 15 and 20, regardless of an employer’s size.

In Bloom (What Passed at Least One House): Currently, New York employers may be entitled to claim a minimum wage reimbursement tax credit if they employ certain students³ in New York State that are paid at the state minimum wage. S. 6793 proposes to require that an eligible employee be paid no more than the minimum wage plus 50 cents. The credit equals the total hours worked by the employee during the taxable year at such rate, multiplied by the applicable tax credit rate for that year, which the bill keeps at $1.35.

Weed Pulling (Vetoed Bills): Vermont Governor Phil Scott (R) vetoed SB 40, which proposed to increase the state minimum wage beginning January 2019 with preset annual updates through 2024 and annual updates each subsequent year. To override the veto, a two-thirds vote from both legislative houses is required.

Spring Flings (Bills that Wilted Away & Won’t Flower Again): California AB 2482 would have created a flexible scheduling exception to state daily overtime requirements that would have allowed a non-exempt employee to work up to 10 hours per workday without being paid overtime, if various other requirements were satisfied.

Colorado HB 1368 proposed repealing the state’s preemption law and granting local governments the authority to enact minimum wage laws.

Kansas HB 2316 sought to increase the state minimum wage in 2018, 2019, and 2020, at which point it would have reached $15.00 per hour. Kansas HB 2647 aimed to repeal an existing preemption statute that prohibited local laws requiring employees to be paid more than the state minimum wage.

Spring Forward to Fall (Ballot Measure Update): The Arkansas Attorney General rejected the summary for a proposed ballot measure that seeks to increase the state minimum wage and allow local minimum wage laws. However, the Arkansas Supreme Court ordered the AG to either approve it or submit a more acceptable version, and the AG chose the former. The ballot measure’s proponents now have until July 6 to collect sufficient signatures to have voters decide the matter at the November 2018 election.

Proponents of a statewide minimum wage increase ballot measure submitted their completed petition, with signatures, to the Michigan Secretary of State. State legislators have 40 session days to adopt or reject the proposal. If rejected, the state legislature can propose a competing ballot measure to also be placed before Michiganders at the November 2018 election.

The Missouri Secretary of State received ballot initiative petition 2018-204, which proposes to increase the state minimum wage, beginning January 1, 2019. The Secretary must now confirm that the submitted petition contains the required amount of valid signatures. If it does, the proposal will be put before Missouri voters during the November 2018 election.

Surf’s (and Wages) Up: Below we quickly summarize state- and local-level changes to the minimum wage, and minimum cash wage and maximum tip credit for tipped employees, which will occur on July 1, 2018.We will continue to monitor and report on minimum wage and overtime developments as they occur.