Of course, the states do not make it easy. Only 12 states including Texas, Indiana, Idaho, Maryland, North Carolina, North Dakota, Oklahoma, South Dakota, Virginia, Montana, Nebraska and Utah will increase the state minimum wage on July 24, 2009 when the new federal rate of $7.25 per hour is introduced. Most of these states have legislation that ties the state minimum wage to the federal rate.

On July 1 2009, ILLINOIS will increase to $8.00 and again next year Jul. 1, 2010 to $8.25.
Also on July 1 2009, KENTUCKY will increase to $7.25, ahead of the feds.

Be sure to Update your Division settings first and then you can use the Mass Assign Raises to get all your sub-minimum and minimum wage employees in compliance.

More states are available here or please consult your local DOL for the most updated news.

Are you in compliance? PayMaster Pro’s payroll program enforces all minimum wage rules and correctly calculates overtime for tipped employees even when they work multiple jobs.

Arizona will increase from $6.90 to $7.25 per hour.
Colorado will increase from $7.02 to $7.28 per hour.
Missouri will increase to $7.05 per hour. Tipped employees will increase to $3.525 per hour.
Ohio will increase to $7.30 and $3.65 for tipped employees.
Oregon will increase from $7.95 to $8.40 per hour
Vermont will increase from $7.68 to $8.06 per hour. Tipped employees will increase from $3.72 to $3.91 per hour.
Washington will increase from $8.07 per hour to $8.55 per hour.

Arizona will increase from $6.90 to $7.25 per hour.
Colorado will increase from $7.02 to $7.28 per hour.
Oregon will increase from $7.95 to $8.40 per hour
Vermont will increase from $7.68 to $8.06 per hour. Tipped employees will increase from $3.72 to $3.91 per hour.
Washington will increase from $8.07 per hour to $8.55 per hour.

A group of rural business owners is suing the state over its minimum wage law adopted by Colorado voters in 2006. The constitutional amendment, known as Amendment 42, adjusts the minimum wage annually as the cost of living goes up.

In January, the minimum wage jumped to $7.02 for non-tipped workers, $4 for tipped workers, higher than the federal minimum of $6.55 and $2.13 respectively. Colorado’s minimum wage is projected to go up again in January to $7.28 and $4.26.

The actual increase is based on the consumer price index used for Colorado. But the Bureau of Labor Statistics that produces the consumer price index does not have a CPI for Colorado. Instead it uses the index for the Denver/Boulder/Greeley metro statistical area.

As restaurants in particular feel the pinch of rising food, energy and labor costs, the lawsuit filed Aug. 21 in Denver District Court alleges it’s unfair to use Denver/Boulder and Greeley’s CPI to set wages for areas as disparate as Fort Collins, Grand Junction, Salida, La Junta, Gunnison and Pueblo.

Our members are having a difficult time because of a combination of factors, including the economy, minimum wage increases, increases in food and gas, Herman said. It says the amendment unfairly targets restaurants who employ tipped workers. Tips have already gone up, the lawsuit argues, because of higher prices charged by restaurants to compensate for higher food and labor costs.

The vicious circle of inflation will occur each year with higher prices caused by hikes in labor and food costs, which will cause tips to go up, which will force higher prices, and on and on, the lawsuit argues. As a result of Amendment 42, the plaintiffs have been forced to raise prices, decrease staff hours, terminate workers and decrease or eliminate employee benefits, the lawsuit argues.

The Let Justice Roll Living Wage Campaign announced the crusade with support from various denominations, including American Baptist Churches USA, the Episcopal Church, Religious Action Center of Reform Judaism, the Jewish Council for Public Affairs, Muslim American Society Freedom Foundation, Presbyterian Church (USA) and the Christian social justice group Sojourners.

The July 24 minimum wage raise is so little, so late that workers will still make less than they did in 1997, adjusting for the increased cost of living, and way less than in 1968. The new $6.55 minimum wage is lower than the 1997 minimum wage, which is worth $6.88 in 2008 dollars, and way lower than the inflation-adjusted $9.86 minimum wage of 1968. For full-time workers that translates into $20,509 a year at the 1968 rate, compared with just $13,624 at the hourly rate of $6.55.

$10 in 2010 will bring the minimum wage closer to the value it had in 1968, a year when the unemployment rate was a low 3.6 percent. It will bring the minimum wage closer to the “minimum standard of living necessary for health, efficiency and general well-being of workers” promised by the Fair Labor Standards Act establishing the minimum wage 70 years ago.

Democratic state Controller John Chiang said Monday it would take at least six months to reconfigure the state’s payroll system to issue blanket checks at the federal minimum wage of $6.55 per hour, though Schwarzenegger insists such a change should occur this month.

Experts say Chiang isn’t joking when he describes the state’s payroll system as a computing relic on par with vacuum tubes and floppy disks.

“It’s an example of a number of computer systems in which the state made a large investment decades ago and has been keeping it going the last few years with duct tape,” said Michael Cohen, director of state administration with the Legislative Analyst’s Office.

The Republican governor signed an executive order last week recommending the cut to minimum wage for most permanent state workers and terminating 10,133 temporary and part-time employees. He believes the state must take drastic steps to preserve cash over the next two months as the state continues to operate without a budget 36 days into the new fiscal year.

Chiang reiterated Monday that he will ignore the order and issue full paychecks to state workers. He disputes Schwarzenegger’s legal interpretation of a 2003 California Supreme Court decision, which the governor said mandates that the state pay only minimum wage to employees until a budget is passed.

But even if the governor’s legal reasoning proves to be sound, Chiang said, the state cannot logistically retool its payroll system in a matter of weeks as the governor has asked. And if the change eventually were made, Chiang said it would take an additional nine to 10 months to issue back pay to employees when the budget is approved.

“Pragmatically, we just can’t get the system to work in a timely manner for us to implement payment of minimum wage,” Chiang said.

Fred Klass, chief operating officer for Schwarzenegger’s Department of Finance, testifying Monday in a Senate hearing, challenged Chiang’s description of his logistical hurdles.

“We have not been provided with the evidence that would show us that this is an impossibility, nor does it answer the question of why aren’t we working on this for next time,” Klass said.

“To some degree, it’s not the point,” he added. “The point is the law needs to be adhered to, and the governor is saying we need to follow the law. And if the controller is saying it’s inconvenient, I think the controller needs to explain why inconvenience is a reason to ignore the law.”

The state payroll system is based on the COBOL, or Common Business Oriented Language, programming language – a code first introduced in 1959 and popularized in the 1960s and 1970s.

“COBOL programmers are hard to come by these days,” said Fred Forrer, the Sacramento-based CEO of MGT of America, a public-sector consulting firm. “It’s certainly not a language that is taught. Oftentimes, you have to rely on retired annuitants to come back and help maintain the system until you’re able to find a replacement.”

Forrer said the system has tens of thousands of lines of code, so it is time-consuming to find and replace salaries for each job classification on an individual basis.

Cohen said other states have moved faster to modernize their payroll systems, though it’s also common for states to cling to their antiquated computers well beyond their scheduled life.

In Illinois, the state minimum wage increased from $7.50 to $7.75 per hour.  Credit for tips may not exceed 40% of the applicable minimum wage.

Michigan’s minimum wage also increased from $7.15 to $7.40.   Tipped employees make $2.65 making the state tip credit $4.75.

The West Virginia minimum wage increased 70 cents from $6.55 to $7.25 per hour.

In Kentucky the minimum wage increased 70 cents from $5.85 to $6.55 per hour.  Tipped employees make $2.13 making the state tip credit $4.42.

The Nevada minimum wage increased 52 cents from $6.33 to $6.85 per hour.