Puerto Rico Passes Minimum Wage Increase Law
Update Applicable to:
All employers in Puerto Rico.
On September 21, 2021, Governor Pierluisi signed the Puerto Rico Minimum Wage Act (House Bill 338, Act 47-2021) into law.
What are the details?
The law, effective January 1, 2021, supersedes the lower federal minimum wage beginning 2022 and creates the “Minimum Wage Review Board” to periodically review and potentially increase minimum wage every two years. The law will automatically increase to $8.50 per hour on January 1, 2022, and to $9.50 per hour on July 1, 2023, for all employees covered by the Fair Labor Standards Act. It is scheduled to increase to $10.50 per hour on July 1, 2024, unless the new Minimum Wage Review Board provides otherwise.
The minimum wage increase applies to non-exempt employees covered by the federal Fair Labor Standards Act (FLSA).
Puerto Rico’s minimum wage will not apply to the following:
- Agriculture workers
- Administrators, executives, and professionals
- Employees covered by a collective bargaining agreement establishing a higher wage.
- Governmental employees, including the government’s executive agencies, legislative and judiciary branches, municipalities, and instrumentalities, but excluding employees of public corporations and other public entities that operate as private corporations.
For more information, please see the links below:
What do employers need to do?
Employers should review the new law’s information and their current payroll policies to make applicable updates and comply with the law once it is effective.