Issue 2
Issue 2 – Increase in State of Ohio Minimum Wage and Other Mandated Employer Record-Keeping Requirements
As you know, on November 7, 2006, Ohio citizens voted and 57% agreed to an increase in Ohio’s minimum wage law. But what exactly does that mean? COSE and GCP delegates have worked tirelessly to ensure that the rules for compliance are as clear and pro-business as possible.
When does the new law take effect?
The new rules become effective January 1, 2007.
What exactly does this mean?
Issue 2, does the following:
Mandates that every employer shall pay their employees a wage rate of not less than six dollars and eighty-five cents ($6.85) per hour beginning January 1, 2007.
Furthermore, every September, beginning in 2007, this state minimum wage rate shall be increased effective the first day of the following January by the rate of inflation for the twelve month period prior to that September according to the consumer price index (CPI)or its successor index for all urban wage earners and clerical workers for all items as calculated by the federal government rounded to the nearest five cents.
Are any employees exempt from this new requirement?
The amendment exempts employees under the age of 16 and employees of businesses whose gross receipts of the previous year were $250,000 or less.That gross receipts figure will be indexed to inflation in the same way as the minimum wage rate is.Employees in these two groups will be paid the minimum hourly rate set by the federal Fair Labor Standards Act (FLSA)—currently $5.15 per hour.
If an employee is paid tips, and the tips and hourly rate EXCEED the minimum wage set by the amendment, an employer may pay that employee NO LESS than ½ the new wage rate ($3.43 per hour).
Family members who are employees in a family owned and operated business.
Employees with physical and or mental disabilities IF the employer has a state license to pay a lower rate.
Under the implementing legislation, all the exemptions that are articulated in the FLSA would also apply in Ohio with respect to the new minimum wage rate.(i.e. volunteer firefighters, seasonal employees of amusement/recreational establishments, organized camps, newspaper delivery over 16 years of age).
New reporting rules:
At the time of hire an employer shall provide to an employee, the employer's name, address, telephone number, and other contact information and update such information when it changes.
An employer shall maintain a record of the name, address, occupation, pay rate, hours worked for each day worked and each amount paid an employee for a period of not less than three years following the last date the employee was employed.
On and after January 1, 2007, the employer must maintain the records required by the bill for three years from the date the hours were worked by the employee.(R.C. 4111.14(F)(3).)
The aforementioned information shall be provided without charge to an employee or person acting on behalf of an employee upon request.
Implementation specifies that an employer is not required to keep records of "hours worked for each day worked" for employees who are employed as outside salespersons compensated by commissions or employed in a bona fide executive, administrative, or professional capacity as such terms are defined in the FLSA.(R.C. 4111.14(F)(4).)
What happens if an employer doesn’t comply?
The new law allows for action taken against employers for not maintaining records or providing the information based on the rules above.