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Minnesota Overtime Laws: A Complete Guide

For workers across the nation, the federal Fair Labor Standards Act (FLSA) requires that employers pay fairly and count every hour of work properly. The FLSA also guarantees most employees overtime wages, at time-and-a-half, for the extra work they put in.

But some states have instituted more “generous” wage and hour laws, regulations that entitle the majority of workers to higher wages for their labor.

Minnesota is one of them, but only in certain circumstances.

Wage & Overtime Pay Laws In Minnesota

Minnesota law outlines different minimum wages, depending on the size of the business you work for.

Minimum Wage Laws

For workers at “small” employers, the current state minimum is identical to the federal minimum wage: $7.25 per hour.

This wage applies to “youth” workers, under the age of 18, and “trainees,” too, people who are just starting out in a new field. Under Minnesota law, employees under 18 and trainees are currently entitled to $7.25 an hour, no matter how big their employer is.

But the minimum wage changes for the majority of people working for what the state considers “large” employers.

Do I Work For A Large Employer?

While many sources define a business’ size based on the number of its employees, Minnesota doesn’t care about that.

Size in Minnesota is based on how much money a business pulls in, its annual gross revenue:

Annual gross revenue – “raw” income, how much customers actually pay for goods and services, before taking out expenses.

If an employer makes $500,000 or more in annual gross revenues, they must pay workers at least $9.00 an hour. Employers who make less than that are required to pay at least $7.25.

For large employers, there’s no excuse for not paying workers covered by the state’s wage and hour law $9.00 an hour. When a state minimum wage is different from the FLSA’s minimum, the Act says employers have to pay covered workers the higher rate.

To learn more about large companies in Minnesota, check out this infosheet from the state’s Department of Labor & Industry.

Minnesota’s Minimum Wage Is Changing August 1, 2016

Minnesota’s minimum wage will automatically increase to $7.75 per hour on August 1, 2016. For workers at large employers, the minimum will rise to $9.50 an hour.

Pay careful attention to your paychecks (or cash if you’re paid off the books; wage and hour laws protect everyone, regardless of how you’re paid) in August. It’s your employer’s responsibility to stay on top of this change. If they fail to increase your hourly wage after August 2016, they’re stealing from you.

To find the 6 most common wage and hour violations, click here.

No Tip Credits Allowed

For employees who regularly receive tips, some states allow employers to take a “tip credit,” essentially lowering their wage obligations below the minimum. The FLSA allows this, too.

Minnesota does not.

No matter how much you make in tips, all covered employers have to pay at least the applicable minimum wage. And unless you’re part of a valid tip pool, those tips are your property.

If a Minnesota employer is reducing your wage in light of how much you make in tips, you are the victim of wage theft and have every right to demand the money you’ve earned.

Minnesota Overtime Laws

Unlike the state’s minimum, Minnesota’s explicit overtime laws are not as “generous” as those enshrined in the FLSA. But again, since the more generous law takes precedence over the less generous one, more workers than not should be entitled to overtime pay at one-and-one-half their “regular rate” for hours worked over 40 in a week.

Employees in Minnesota who are not covered by the FLSA are entitled to overtime wages after working 48 hours in a workweek.

To learn if you’re job is covered by the FLSA, click here.

Who’s Not Covered By Minnesota’s Wage & Hour Laws?

Some employees are considered “exempt” from the state’s minimum wage and overtime employees. These workers are not entitled to the state’s wage and hour protections, and most won’t be covered by the FLSA, either.

Here’s a basic list of exempt workers:

  • outside salespeople: Minnesota defines these employees as people who “conduct[…] no more than 20 percent of their work on the premise of the employer.”
  • Salespeople, mechanics and auto parts sellers at car dealerships, but only employees who work on commission, or some other incentivized basis
  • Some agricultural workers
  • Some seasonal workers at carnivals, circuses, fairs and ski areas

For a more detailed look at employees who may be exempt under Minnesota’s Fair Labor Standards Act, take a look at Statute 177.23, subdivision 7.

But the vast majority of Minnesota’s workers are covered, either by the state’s specific laws, the FLSA or both.

Do You Deserve Back Pay?

Many workers are shocked to learn that they’re being underpaid. But they shouldn’t be.

Employers frequently break state and federal wage and hour laws, stealing money straight from their employees’ pockets. Whether intentional or not, wage and overtime violations are theft, plain and simple.

Contact the experienced overtime pay attorneys at WageAdvocates.com to find out if you’re making all the money you’ve earned.