All workers in Ohio are entitled to receive an hourly Minimum Wage rate according to Ohio Labor Laws and the Fair Labor Standards Act (FLSA). This Minimum Wage requirement covers most employers in the state, and provides special rules for tipped employees, minors, certain exemptions and exceptions, as well as recordkeeping requirements.
Updated: January 8, 2024
The current 2024 Ohio Minimum Wage is $10.45 per hour. The minimum wage went into effect on 01/01/2024 and is an increase of 3.47% above the previous 2023 Ohio Minimum Wage of $10.10.
There are special rules and considerations for tipped employees, minor employees, and employees of certain size businesses.
In November 2006, the Constitutional Amendment (II-34a) was passed by Ohio voters announcing that Ohio minimum wage shall increase on January 1 each year by the rate of inflation. These increases are tied to the Consumer Price Index (CPI-W) for urban wage earners and clerical workers over the 12-month period prior to September of each year.
Under Ohio State Minimum Wage Law, Ohio Minimum Wage for 2024 is $10.45 per hour for most employees at businesses with annual gross receipts of more than $385,000 per year after Jan. 1, 2024.
Ohio businesses whose annual gross receipts are $385,000 or less may pay employees a minimum wage equal to that of the federal minimum wage. Currently, the federal minimum wage is $7.25 per hour.
In order to process payroll in Ohio, it is crucial that employers understand Ohio minimum wage.
The minimum wage in Ohio for tipped employees is $5.25 per hour (plus tips) as of 01/01/2024.
Ohio employers who decide to use a tip credit provision are responsible for ensuring that tipped employees receive at least the minimum wage, when such a wage is combined with the tip credit amount. Employers must otherwise make up the difference to stay in compliance.
In Ohio, any employee who customarily and regularly receives over $30 per month in tips is considered a tipped worker.
Important to note, is that tipped worker does not just refer to occupations such as servers.
In Ohio, employers at any business may choose to pay minors under the age of 16 a sub-state minimum wage rate. This rate is equal to that of the federal minimum wage.
As such, the minimum wage in Ohio for minors is $7.25 per hour.
The following individuals are exempt from Ohio Minimum Wage Law:
In Ohio, a sub-minimum wage may be paid, as provided in the rules and regulations set forth by the Director of the Ohio Department of Commerce (ODOC).
Ohio employers may choose to pay a sub-minimum wage rate if the earning capacity of an individual is affected or impaired by physical or mental deficiencies or injuries.
In order to do so, an employer must obtain one of the following licenses:
The ODOC Director, under ORC Chapter 4111, may authorize one of these special licenses for payment of less than the applicable minimum wage if deemed appropriate. Such wages shall be commensurate with other paid, non-impaired workers for the same type, quality, and quantity of work performed.
The Ohio sub-minimum wage law was created with the intent to prevent employers from avoiding hiring individuals with disabilities, due to fear of having to pay state minimum wage to such an individual.
In addition to maintaining compliance when processing payroll, Ohio employers have a few responsibilities regarding Ohio minimum wage.
First, Ohio employers must post the Ohio Minimum Wage Law Poster in a conspicuous and easily accessible location.
Ohio employers must also keep certain records regarding payroll.
Under Ohio Minimum Wage Law, employers must keep the following records for each employee on file:
Such records must be kept on file for at least three years, and must be available for inspection or copying at any reasonable time by the Director of the Ohio Department of Commerce. Employers may not prevent, inhibit, or delay such action.
Ohio payroll is a bit more complicated than just having to adhere to federal minimum wage or a standard state minimum wage rate for that matter.
Employers need to understand who is covered by Ohio Minimum Wage Law, what's required of them, and what opportunities there are to pay lower rates than the standard state minimum.
Businesses struggling with Ohio payroll processing and Ohio labor law compliance may want to reach out to an Ohio Payroll Services Company for help.
To learn more about how PayBridge is helping countless businesses with their payroll processing in Ohio, contact us today.