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May 2023: New York Minimum Wage Expected to Increase Again

17 May


Update Applicable to:

All New York employers regardless of size.  In previous years, the minimum wage was tied to an employer’s number of employees, but that provision has now been removed.

What happened?

New York Governor Kathy Hochul announced an agreement with legislative leaders for the FY2024 New York State Budget on April 27, 2023.  Notably, the deal includes legislation that would increase the state minimum wage rate beginning January 1, 2024, for the next three years and index the minimum wage to the consumer price index thereafter.

What are the details?

The Fiscal Year 2024 New York State Budget (the “Budget”) includes a multi-year plan to increase the State’s minimum wage.  The Budget legislation signed by Governor Hochul on May 3, 2023, provides for increases to the minimum wage rate as follows:

Effective DateNew York City, Long Island, and WestchesterRemainder of New York State
January 1, 2024$16.00$15.00
January 1, 2025$16.50$15.50
January 1, 2026$17.00$16.00

The minimum wage in New York is currently split into two state regions:

  1. “Downstate,” which includes New York City, Westchester, Nassau and Suffolk counties, and
  2. “The remainder of the state,” which includes the remainder of New York State and is often referred to as the “Upstate minimum wage rate.”

This legislation, unlike prior New York minimum wage increases, does not distinguish rates based upon employer size or downstate county.  As of January 1, 2027, the minimum wage will be based on the Consumer Price Index for Urban Wage Earners and Clerical Workers (“CPI-W”) for the Northeast Region. The budget legislation clarifies that the State will suspend its minimum wage increases in the event of certain economic conditions. 

There will be no change to exempt status thresholds. Thus, the exempt status thresholds remain as follows:

Size/Location of EmployerSalary Threshold
New York City, 11 or more employees$1,125 per week ($58,500 per year)
New York City, 10 or fewer employees$1,125 per week ($58,500 per year)
Long Island and Westchester, regardless of size of employer$1,125 per week ($58,500 per year)
Remainder of the New York State, regardless of employer size$1,064.25 per week ($55,341 per year)

For more information, please see the links below:

Governor’s Announcement, Video, and Budge Highlights

Bill: S4006C

Law Firm Summaries/Opinions: Article 1, Article 2

What do employers need to do?

Employers will need to review the above links and make any necessary budgetary preparations and adjustments in order to ensure compliance with the new increases as of the start of a payroll period that includes January 1, 2024.

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This communication is intended solely for the purpose of conveying information. The present post might incorporate hyperlinks directing readers to websites managed by third-party entities. The inclusion of any links within this communication is meant to serve as points of reference and could encompass opinion articles from various law firms, articles from HR associations, official websites, news releases, and documents of government agencies, and other relevant third-party sources. Vensure has no authority over these external websites and bears no responsibility for their content. Furthermore, Vensure does not endorse the materials present on these websites. The contents of this communication should not be interpreted as legal advice or as a legal standpoint concerning specific facts or scenarios. Nor should it be deemed an exhaustive compilation of facts potentially pertinent to federal, state, or local laws. It is strongly advised that employers solicit legal guidance from an employment attorney when undertaking actions in response to any legal updates provided. This is due to the possibility of future alterations occurring in federal, state, and local laws, regulations, as well as the directives and guidelines issued by governing agencies. These changes may transpire at any given time, potentially rendering certain portions of the content within this update void or inaccurate.

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