Many states increased the minimum wage in 2020, but Hawaii was not one of them. That said, the state has made some changes to its minimum wage over the years. For example, Hawaii recently raised its minimum wage for federal contract workers. Some residents may feel these changes are needed because Hawaii is the most expensive place to live in the U.S., with average expenses up to 66% higher than anywhere on the mainland.
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2020 Minimum Wage in Hawaii: $10.10 per hour
By state law, the minimum wage rate in Hawaii for 2020 is $10.10 per hour. This rate went into effect on January 1, 2018; it was an increase of 85 cents from the previous rate of $9.25 per hour in 2017, and was the final increase in a series of increases that began in 2015.
Unlike some states that have increased the minimum wage, such as California, New Jersey, and Washington, Hawaii doesn’t make any exceptions in 2020 for small employers when it comes to paying the full minimum rate. Small employers and large employers alike must pay employees at least $10.10 per hour.
That said, Hawaii defers to federal regulations under the Fair Labor Standards Act (FLSA), which allows some exceptions for certain employees. As a Hawaii resident, your employer doesn’t have to pay you minimum wage if:
- You earn tips (see “Tipped” section below);
- You’re a white-collar worker who earns a salary (see “Overtime” section below);
- You’re a full-time student who earns at least 85% of the minimum wage working for a qualifying business that has obtained a certificate from the Department of Labor; organizations that qualify for the Full-Time Student Program include colleges and universities, retail and service stores, and agricultural operations;
- You’re under the age of 20 and you haven’t been employed for more than 90 calendar days;
- You’re a student learner no younger than 16 participating in a high school vocational education program, in which case the employer can pay you 75% of the minimum wage;
- You’re a seasonal worker, short-term agricultural worker, casual babysitter or working in elder care, or if you work casually for someone to whom you’re closely related;
- You work for a nonprofit child welfare business, school, or camp;
- You’re a contractor who is self-employed in the gig economy; or, you’re a federal contractor, in which case you must get paid at least $10.80 per hour for any work you do in any state, including Hawaii;
- You’re a golf caddie.
Read on to find out how Hawaii figures the minimum wage for tipped workers.
Tipped: $9.35 per hour
Tipped workers can expect to make $9.35 per hour before tips in Hawaii. The state also accepts tip credits, meaning the employer can apply an employee’s earned tips, up to a certain point, towards the minimum wage requirement.
The state’s tip credit notice looks complicated, but, essentially says that the employer can apply tip credits if the employee earns more than $20 per month in tips. Under the law, a tipped employee must earn a total of at least $17.10 per hour including wages and tips. If the employer earns at least $7.75 per hour in tips, the employer can pay them $9.35 per hour in wages. In order to meet the $17.10 minimum, employers must pay a higher wage than $9.35 if the employee earns less than $7.75 per hour in tips.
Full-time employees who earn minimum wage and work a total of 40 hours in a week will take home $404 before taxes.
Full-time employees who earn minimum wage, work 40-hour workweeks, earn paid time off for vacations, and earn holiday pay when their employer isn’t open for business on holidays will take home $21,008 in a year before taxes.
Overtime: $15.15 per hour
Employees who work for more than 40 hours in a week will earn $15.15 for each hour worked over 40, which is consistent with the federal requirement of overtime pay equalling 1.5 times the minimum wage. Employees who work for more than 8 hours in a day on state and public construction projects earn overtime pay for every hour worked over 8; they also earn overtime for any hours worked on weekends and state holidays.
If you’re a salaried executive, administrative, professional, supervisory, outside sales, or computer employee — or you earn at least $2,000 per month in salary — you’re exempt from the overtime law. Employers can provide compensatory pay instead of overtime, but it’s not required by law.
Hawaii Minimum Wage Increase News
There are currently no concrete plans to raise the minimum wage in Hawaii. Although a bill proposing a $15 minimum wage has been discussed, it was tabled in 2019. According to MIT’s living wage calculator, which calculates the cost of living in Honolulu County, HI, the typical expenses for a single adult require a wage of at least $16.46 per hour; this would equal an annual income of $34,246.
Hawaii’s minimum wage is far from meeting the living wage requirement in Honolulu County, but Payscale reports that the average hourly rate of pay in Hawaii is $18.80. As of this writing, Hawaii’s unemployment rate is one of the lowest in the nation, at 2.6%.
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