Effective September 1, 1997, the minimum wage will increase from $4.75 per
hour to $5.15 per hour. For employees being paid hourly, it is easy to ensure
compliance by verifying that their hourly rate is at least equal to the new
minimum. For salaried employees in entry level positions, ensuring compliance
takes a little more effort.
To determine the hourly rate of a salaried employee, you need to divide the
employee's salary by the number of hours it is intended to compensate. For
example, to determine the hourly rate for an employee whose normal work schedule
is 40 hours per week you would divide a biweekly salary by 80, an annual salary
by 2080, and a monthly salary would first be multiplied by 12 and then divided
by 2080.
To meet the new minimum wage, an employee would have to receive a salary of
$412.00 biweekly, $892.67 monthly, or $10,712.00 annually. If the basis for the
salary is something other than a 40-hour work week, you will need to adjust the
calculations accordingly.
If any employees are being paid on a fixed salary for a variable work
schedule, which is the payment basis for employees paid by the
"half-time" method for overtime payment, the actual regular or hourly
rate can vary from week to week. For salaried employees in entry level
positions, the employee's regular rate would need to be increased to minimum
wage in any week in which enough hours were worked to drop the regular rate
below the minimum wage. To determine regular rate for these employees, divide
the weekly salary by the number of hours actually worked.
Finally, be sure that you are displaying the posters representing the current
minimum wage as required by the Department of Labor. These should be displayed
in locations that would normally be seen by employees in carrying out their
normal duties. If you need copies of these posters, they can be obtained from
the District Offices of the Department of Labor's Wage
and Hour Division. The Texas offices are located in Dallas at (214)
767-6294, San Antonio at (210) 229-4515, and Houston at (713) 750-1682.