| As business owners, you are all aware of the recent | | | | responsible for adjusting the employee's pay |
| vote to raise the state minimum wage to $6.75 per | | | | accordingly. Under the new statute, employers may |
| hour, per Arizona voter approval of Proposition 202. In | | | | pay $3.00 per hour less than the state minimum wage |
| addition, the new law mandates annual wage | | | | ($3.75 per hour). Arizona Restaurant Association was |
| adjustments according to increases in the cost of living | | | | a big advocate in fighting against the raise in minimum |
| (CPI). As an Arizona Human Resources Consultant, I | | | | wage hike. |
| am working with clients to inform and educate on the | | | | RECORD KEEPING |
| new regulations and impact on businesses in the | | | | Proposition 202 requires new measures in record |
| community. | | | | keeping requirements. The Equal Pay Act and the Fair |
| Most businesses will be required to comply with the | | | | Labor Standards Act both require retention of payroll |
| new state statue, however there are limited | | | | record information for three years; the new provisions |
| exceptions, including any person who is employed by a | | | | necessitate retaining records for four years. |
| parent or sibling, "casual" babysitters, the Arizona state | | | | IMPACT ON BUSINESSES |
| government, the federal government, employees who | | | | Offsetting costs may be possible by passing it along to |
| regularly receive tips (may be paid a minimum of 3.75 | | | | consumer. Some business may need to assess their |
| hour), and businesses that have less than $500,000.00 | | | | current workforce and reductions may be in order. |
| in gross annual revenue and that are exempt from the | | | | Businesses may consider automating processes that |
| state minimum wage law. | | | | may result in cost savings. Outsourcing will likely |
| OVERTIME | | | | become a significant cost saving measure. |
| The increase in wages will obviously effect overtime | | | | IMPACT ON WORKFORCE |
| pay, whereas one who earns $6.75 per hour, will earn | | | | As low wage ($5.15 to $6.75 per hour) earners will be |
| $10.13 per hour for hours worked over 40 in a | | | | impacted, thusly so will workers receiving wages in |
| workweek This change will effect the ways in which | | | | excess of $6.75 per hour. Known as the "ripple effect," |
| employers manage overtime of non-exempt staff. | | | | Theoretically, all workers should experience a positive |
| Perhaps this encourages an emphasis on work/life | | | | impact with regard their pay. Negative impacts may |
| balance and reminds us the 40-hour workweek as | | | | also arise from loss of jobs, higher income taxes and |
| originally defined by the Fair Labor Standards Act of | | | | increased cost of products. |
| 1938. | | | | Since the passage of Proposition 202, there has been |
| TIPPED EMPLOYEES | | | | much to be said on both the positive and negative |
| Currently, tipped employees are paid a minimum of | | | | impact of raising the state minimum wage. |
| $2.13 per hour plus tips, which must equate to at least | | | | Nevertheless, Arizona business owners and their |
| minimum wage in a workweek. When reported wages | | | | employees are likely to face significant changes in the |
| are less than minimum wage, the employer is | | | | coming months. |