Minimum Wage

In his 2013 State of the Union, President Barack Obama suggested raising the federal minimum wage to $9.00 per hour.  Connecticut lawmakers were unwilling to wait for Congress to act (or not to act) on the President’s proposition.   This week, Connecticut legislators passed a measure that will raise the state minimum wage from $8.25 per hour to $9.00.  Connecticut Governor Dannel Malloy applauded the legislation and is expected to sign it.  The state already has one of the highest minimum wage rates in the country.

The 9 percent increase does not take effect overnight.  It is phased out over the next two years.  The state minimum wage will rise to $8.70 on January 1, 2014 and then leap to $9.00 a year later on January 1, 2015.  Still, employers who are paying employees less than $9.00 per hour will need to prepare for the future.

State lawmakers did throw a small bone to employers of hotel and restaurant staff and bartenders.  These employers are allowed to “credit” tips earned by these workers against minimum wage requirements.   State law currently allows employers to take an 11 percent tip credit for bartenders and a 31 percent tip credit for hotel and restaurant employees, as long as the tips bump their hourly earnings above $8.00 per hour.   This means employers must pay bartenders at least $7.34 per hour and hotel and restaurant employees $5.69.  The minimum wage bill increases the “tip credit” percentages, which allows employers to continue to pay these employees their current minimum wage.  Tip credits can be a headache for employers in the service industry, particularly trying to figure out which employees qualify for the credit.  Check out the Connecticut Department of Labor’s guidance on gratuities for more information.

Personnel Files

The Connecticut legislature also passed a bill that calls for significant changes to the state Personnel Files statute, which governs employee access to personnel records.  The bill is also expected to be signed by Governor Malloy.

The biggest takeaway for employers is they will now be required to provide employees with a copy of any disciplinary documentation within one day of imposing such discipline.  The law also requires that employers state on any disciplinary documentation, termination notice or performance evaluation that the employee has the right to submit a written statement disagreeing with the contents of the document.

In addition, under the current law, employees have a right to inspect their personnel files within a “reasonable time” after requesting review in writing.  The revised law gives current employees an opportunity to inspect within seven business days.  Former employees are given ten days.  Employees will also be entitled to a copy of their file.

Violations of the personnel file statute are punishable by fines.  Unless vetoed by Governor Malloy, the changes will go into effect on October 1, 2013.