How Many States Use the Federal Minimum Wage of $7.25?

Twenty states use the federal minimum wage of $7.25 as their effective wage floor. Thirteen have state laws that set the rate at exactly $7.25, five have no state minimum wage law at all, and two (Georgia and Wyoming) have state rates below $7.25 that federal law overrides for most workers.1Office of the Law Revision Counsel. 29 USC 206 – Minimum Wage

The 13 States With a $7.25 State Law

These states have passed their own minimum wage statutes and set the number at exactly the federal figure: Idaho, Indiana, Iowa, Kansas, Kentucky, New Hampshire, North Carolina, North Dakota, Oklahoma, Pennsylvania, Texas, Utah, and Wisconsin.2U.S. Department of Labor. State Minimum Wage Laws

The dollar amount matches the federal rate, but having a state law on the books matters. Workers can file wage complaints through state agencies and state courts, not just federal channels. A few of these states also have automatic linkage to the federal rate. Pennsylvania’s Minimum Wage Act of 1968, for example, requires the state minimum to rise by the same amount and on the same date as any future federal increase, with no new state legislation needed.3Pennsylvania General Assembly. Act of Jan 17, 1968, PL 11, No 5 Cl 43 – Minimum Wage Act of 1968 If Congress raises $7.25, these states move with it.

The 5 States With No Minimum Wage Law

Alabama, Louisiana, Mississippi, South Carolina, and Tennessee have never enacted a state minimum wage law.2U.S. Department of Labor. State Minimum Wage Laws Workers covered by the Fair Labor Standards Act get $7.25 by default, not by state choice.

All five have also passed preemption laws barring cities and counties from setting their own local minimum wages. There is no state or local mechanism to lift the wage floor above $7.25 in these states. Federal action is the only path.

Georgia and Wyoming: State Rates Below the Federal Floor

Both Georgia and Wyoming set their state minimum wage at $5.15 per hour.2U.S. Department of Labor. State Minimum Wage Laws For most workers, the lower state number is irrelevant. Under 29 U.S.C. ยง 218, employers must pay whichever rate is higher, and a lower state rate cannot undercut the federal floor.4Office of the Law Revision Counsel. 29 USC 218 – Relation to Other Laws

The $5.15 state rate can matter only for a narrow group: workers who fall outside FLSA coverage entirely, such as some employees of very small, purely local businesses. For everyone else in these two states, the effective minimum is $7.25.

Who the $7.25 Federal Rate Actually Reaches

In the seven states with no effective state wage law (the five without any law plus Georgia and Wyoming), FLSA coverage is what stands between a worker and no legal wage floor at all. The federal minimum applies through two paths.

Those paths reach most workers, but not all. An employee at a small, purely local business in one of the five no-law states could have no legal minimum wage at all. In Georgia or Wyoming, the same worker would fall back on the $5.15 state rate. The situation is uncommon, but real.

Workers Who Can Be Paid Less Than $7.25

Even where $7.25 is the floor, federal law permits lower cash wages for certain workers if specific conditions are met.

Tipped Employees

An employer can pay a tipped employee (one who regularly receives more than $30 per month in tips) a cash wage as low as $2.13 per hour.7Office of the Law Revision Counsel. 29 USC 203 – Definitions The employer takes a tip credit of up to $5.12, and tips must bring the worker’s total hourly pay to at least $7.25. If tips fall short in any workweek, the employer has to cover the gap.8U.S. Department of Labor. Minimum Wages for Tipped Employees The employer must tell the worker about the tip credit in advance, and employees must keep all their tips (managers and supervisors cannot share in them).

Youth Training Wage

Workers under 20 can be paid $4.25 per hour during their first 90 consecutive calendar days on the job. The clock counts calendar days, not days worked, and the regular minimum kicks in on the worker’s 20th birthday no matter how long they’ve been employed.9U.S. Department of Labor. Fact Sheet 32 – Youth Minimum Wage – Fair Labor Standards Act

Workers With Disabilities

Under Section 14(c) of the FLSA, certain employers holding special certificates from the Department of Labor can pay subminimum wages to workers whose disabilities affect their productivity for the work being performed. Certificates must be renewed every one to two years, and the Department can revoke them for violations.10U.S. Department of Labor. Fact Sheet 39A – FLSA Section 14(c) Certificate Application Policies and Procedures

What You Can Do if You’re Paid Less Than $7.25

In the five no-law states, enforcement runs almost entirely through federal channels. The Department of Labor’s Wage and Hour Division investigates complaints.11U.S. Department of Labor. Minimum Wage

An underpaid worker can recover back wages plus an equal amount in liquidated damages, effectively doubling what was shortchanged. You can file a private lawsuit, or the Secretary of Labor can bring the action on your behalf.12U.S. Department of Labor. Fair Labor Standards Act Advisor – Enforcement Under the Fair Labor Standards Act Employers who willfully or repeatedly violate the minimum wage face civil money penalties of up to $2,515 per violation under current inflation-adjusted figures.13U.S. Department of Labor. Civil Money Penalty Inflation Adjustments Willful violations can also be prosecuted criminally, with fines up to $10,000 and up to six months of imprisonment, though imprisonment requires a prior FLSA conviction.14Office of the Law Revision Counsel. 29 USC 216 – Penalties In the 13 states with parallel $7.25 laws, state enforcement gives you a second avenue for the same complaint.