In accordance with New Jersey Bill A-15, the turn of the year will bring significant wage increases across all industries. Effective January 1, 2021, New Jersey’s general minimum wage will increase to $12 per hour.
For employees that are compensated through tips, per piece produced, or subject to other exemptions based on industry, the following specific wage increases will apply:
- Base wage for tipped employees: $4.13 per hour
- Employers with five or fewer employees: $11.10 per hour
- Seasonal employers: $11.10 per hour
- Agricultural employers: $10.30 per hour
- Pay-per-piece rate: $10.30 per hour
- Direct care staff at long-term care facilities: $15 per hour
These changes are a part of a gradual increase to bring the state minimum wage to $15 an hour by 2024. The bill behind it (A-15), was signed into effect on February 4th, 2019 by Governor Phil Murphy. While the general minimum wage is set to reach $15 per hour by 2024, small businesses with six or fewer employees, seasonal businesses, and agricultural employers will reach $15/hour at a more gradual pace. The graph below outlines the incurred and anticipated changes to New Jersey’s minimum wage.
For complete details on wage exemptions and the Minimum Wage Law (P.L.2019, c.32) check out the New Jersey Business & Industry Association. To learn how these changes could effect your business in the short and long run, our dedicated accountants are here to help.