Minimum Wage Increases Will Occur in 27 States in 2023

person A.J. Johnson today 12/30/2022

In 2023, 27 states will have new minimum wage rates. The federal minimum wage remains unchanged at $7.25 and applies in 20 states. It was last raised on July 24, 2009.

Affordable housing managers responsible for determining the income of applicants and residents need to be aware of state and local minimum wage laws in order to ensure the most accurate possible projection of income.

States with Minimum Wage in Excess of Federal $7.25 per Hour (as of 1/1/23) - unless noted otherwise, the minimum wage for tipped employees is $2.13

  • Alaska: $10.85 (AK does not have a different rate for tipped employees).
  • Arizona: $13.85; $10.85 for tipped employees.
  • Arkansas: $11.00; $2.63 for tipped employees.
  • California: $15.50 - applies to all employers.
  • Colorado: $13.65; $10.63 for tipped employees. Colorado cities have the ability to set higher minimums, but so far only Denver has done so. The minimum wage for Denver will be $17.29 on January 1, 2023. Tipped employees in Denver will have a minimum wage of $14.27.
  • Connecticut: $15.00 (effective July 1, 2023).
  • Delaware: $11.75. The minimum wage for tipped employees is $2.23.
  • District of Columbia: $16.10. Tipped employees - $5.35.
  • Florida: $11.00; $7.98 for tipped employees. Note: the minimum wage will increase to $12 per hour on September 30, 2023, reaching $15 by 2026.
  • Hawaii: $12.00. Tipped employees - $10.10.
  • Illinois: $13.00; $7.80 for tipped employees. The youth minimum wage for youth working less than 650 hours per year is $10.50.
  • Maine: $13.80; $6.90 for tipped employees.
  • Maryland: $12.80 for small employers (14 or fewer workers); $13.25 for all other employers; $3.63 for tipped employees.
  • Massachusetts: $15.00; $6.75 for tipped employees.
  • Michigan: $10.10; $3.84 for tipped employees.
  • Minnesota: $10.59 - this is the rate for large employers (employers with $500,000 or more gross revenue). Small employers have a minimum wage of $8.63 per hour.
  • Missouri: $12.00; $6.00 for tipped workers.
  • Montana: $9.95, for both tipped and non-tipped employees.
  • Nebraska: $10.50.
  • Nevada: $11.25 for employees who are not offered health insurance. $10.25 for employees with health insurance (effective July 1, 2023).
  • New Jersey: $14.13 (large employers - six or more employees); $12.93 (small employers); $5.27 for tipped employees.
  • New Mexico: $12.00; $3.00 for tipped employees.
  • New York: $14.20 statewide; $11 for hospitality, non-fast food, resort service; $8.80 for hospitality, non-fast food, general service; $14.50 for hospitality- fast food; ($15.00 in New York City).
  • Ohio: $10.10 (large employers with $323,000 or more in gross receipts); $7.25 (small employers); $5.05 for tipped employees.
  • Oregon: $13.50 (Portland, $14.75 on July 1) - effective July 1, 2022, ($12.50 for nonurban counties). This will increase on July 1, 2023, based on inflation.
  • Rhode Island: 13.00; tipped employees are $3.89.
  • South Dakota: $10.80; $5.40 for tipped employees.
  • Vermont: $13.18; $6.59 for tipped employees.
  • Virginia: $12.00.
  • Washington: $15.74.
  • West Virginia: $8.75

To the best of my knowledge, this list is accurate as of the end of 2022. However, property operators should confirm the minimum wages in the states and localities in which the property is located. Keep in mind that a resident may work in a locality (or even a state) that differs from the property location. For this reason, managers should be aware of minimum wages in adjacent and nearby localities.

Certain occupations are exempt from federal minimum wage laws, but states have their own exemptions. Anytime an applicant or resident reports or has a verification of income that is less than the federal or state minimum wage, managers should follow up with employers to determine the reason. That reason should be documented in the file.

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Dealing with Drug Use Without Violating Fair Housing Law

Drug users are not a protected class under either federal or state fair housing laws. Drug abuse may result in criminal activity, violence, and property destruction. However, drug and alcohol dependency are also considered diseases and may be considered "disabilities under fair housing laws. While all properties should have anti-drug policies, it is important that those policies be developed and administered in a way that does not violate fair housing law. This article is intended to assist housing operators in walking the line between the protection of residents and property from illegal drug use and violating the rights of the disabled. Background Fair housing law prohibits discrimination based on disability, which is defined as "a physical or mental impairment that substantially limits one or more major life activities. The law also protects persons with a record of having such an impairment, or who are regarded as having such an impairment. 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According to HUD Handbook 4350.3, former drug users protected by the FHA ban on disability discrimination include an individual who (i) has successfully completed a supervised drug rehabilitation program or has otherwise been successfully rehabilitated and is no longer engaging in illegal drug use; (ii) is currently participating in a supervised drug rehabilitation program and is no longer engaging in such use; or (iii) is erroneously regarded as engaging current illegal drug use. Note regarding alcohol use: FH law does not distinguish between former and current alcohol use the way it does with drug use. This is because, under federal law, alcohol use is legal. Alcoholism is just like any other disability that is protected by fair housing law and applies to applicants or residents who are currently addicted to alcohol and have no desire to stop drinking. (2) The second caveat is "the Direct Threat Exception. The FHA provides no protection to individuals with or without disabilities who present a direct threat to the persons or property of others. Thoughts on Pre-Admission Drug Testing A requirement that all applicants submit to drug testing prior to admission is probably legal since it detects current, rather than past drug use. With that being said, I do not recommend such a requirement. The costs of drug testing will almost certainly outweigh the benefits. You will also have to be consistent in requiring that all provisionally accepted applicants pass a drug test as a condition of occupancy - not just applicants you suspect may be using illegal drugs. Also, while usually accurate, drug testing is not foolproof. Finally, rejecting an applicant on the basis of a drug test may result in lawsuits over privacy issues and how the tests were administered. Keep in mind that it is likely that your competitors will not be doing drug testing, putting you at a competitive disadvantage. It s just not worth it! Reasonable Anti-Drug & Alcohol Policies are Acceptable Rules relating to drug and alcohol use that are generally acceptable include banning residents from: Dealing, manufacturing, or distributing drugs or engaging in illegal drug-related activity; Keeping large quantities of illegal drugs in their apartment; Using drugs or being intoxicated in common areas; and/or Allowing their families, visitors, or guests to commit any such violations. Don t Ask About Past Drug Use Former drug use is a disability, and you are generally not permitted to ask applicants if they are disabled (the exception to this is housing specifically for the disabled). The FHA regulations (24 CFR 100-202) permit the asking of questions to determine whether an applicant: Is a current illegal abuser or addict of a controlled substance; and/or Has ever been convicted of the illegal manufacture or distribution of a controlled substance. While these questions are permitted, they must be asked of all applicants. What About Current Use of Legally Prescribed Medical Marijuana? 37 states and the District of Columbia allow for the use of medically prescribed marijuana. Owners can certainly ban the use of recreational marijuana on a property, but what about marijuana that is legally prescribed by a physician? While not specifically addressed in the FHA, the legislative history that HUD, courts, and tribunals rely on to interpret the Act makes it clear that the exclusion of current illegal drug users does not apply to individuals who use otherwise controlled substances that are legally prescribed by a doctor. In the report of the House of Representatives, it states, "the exclusion does not eliminate protection for individuals who take drugs defined in the Controlled Substances Act for a medical condition under the care of, or by prescription from a physician. The Report goes on to say, "use of a medically prescribed drug clearly does not constitute illegal use of a controlled substance. However, for a tenant s medical marijuana use to be protected: The marijuana must be legally prescribed by a physician for a medical condition authorized by the law; The tenant must use the marijuana only for the prescribed condition; The tenant must use the marijuana only in his or her own apartment and not in common areas; The tenant may not possess (or cultivate) more than the maximum amount the law permits; and The tenant must not sell or distribute the marijuana to anybody else. So, how can marijuana be legal in some states and illegal under federal law? The fact is, there is no such thing as "legal marijuana. The use of marijuana, both medical and recreational, is illegal under federal law, and federal law supersedes state law. Many states have passed laws legalizing marijuana within their own boundaries, but people who use, manufacture, and distribute marijuana in those states are breaking federal law. The reason these folks are not being prosecuted is that the federal government has an enforcement policy that has instructed U.S. attorneys not to enforce marijuana prohibitions against states with legalization statutes as long as the state program follows certain criteria designed to prevent the financing of terrorism and organized crime, diversion of marijuana to minors and states where the use is not legal, and other activities harmful to national health and security. In 2014, a Michigan federal court ruled that a state law legalizing medical marijuana did not bar a federally assisted housing community from evicting a tenant for use of medical marijuana. The marijuana was prescribed by the resident s doctor for multiple sclerosis. The court indicated that while the use may have been legal under state law, it was still illegal under federal law. The court did say that whether the resident should actually be evicted was for state courts to determine [Forest City Residential Management, Inc. v. Beasley, December 3, 2014]. Current Alcohol Use is not an Issue Management should never ask applicants or residents about current alcohol use. Both former and current alcohol dependency are considered disabilities under the FHA. While questions about current drug use are permitted, questions about current alcohol use are not. Verification of No Current Drug Use You may be entitled to ask applicants or tenants who claim they have recovered from drug use to provide evidence from a third party that they are not current users of illegal drugs. Such evidence could include verification from a: Reliable drug treatment counselor or program administrator; and/or A probation or parole officer. There are four questions that should never be asked of applicants: Have you ever used illegal drugs? Have you ever been arrested for manufacturing or distributing illegal drugs? Ever you ever had a drinking problem? Do you currently have a drinking problem? However, you may ask if someone is a current user of illegal drugs or if they have been convicted of manufacturing or distributing illegal drugs. Applicants Should Not be Rejected Because They are Alcoholics or Former Drug Users Assuming that an alcoholic or former drug user will be bad for your property is a generalized stereotype based on a disability - and, is illegal. Each applicant is entitled to an individual assessment relating to eligibility, and assumptions based on preconceived notions should be avoided. In other words, simply being a current or former alcoholic and/or former drug user is not grounds to exclude or evict. A Direct Threat Allows for the Exclusion of Substance Abusers Persons who are a direct threat to the property or other people are not protected by the FHA. But, how do you know if a person poses a direct threat? Subjective beliefs, generalized stereotypes, and speculation about substance abusers are not enough. According to a HUD/DOJ statement on the subject, the assessment must be based on "reliable objective evidence, such as current conduct or a recent history of overt acts. In Wirtz Realty Corporation v. Freund, 721 N.E. 2d 589 (ILL. App. 1999), an Illinois court found that a landlord was justified in evicting a tenant under the "direct threat defense. The landlord evicted the tenant for engaging in erratic and dangerous behavior. The tenant urinated in the elevator, threatened to kill a neighbor, and threw a lit cigarette and coke can at the doorman, as well as other incidents. He said it was due to mental disorders and sued the landlord under the FHA. Guidance from HUD and DOJ indicates that landlords should perform a direct threat assessment, and consider: The nature, duration, and severity of the risk of injury; and The probability that injury will actually occur. When looking at a recent history of overt acts (such as those outlined in the Wirtz case above), the landlord must take into account whether the individual has received intervening treatment or medication that has eliminated the direct threat. The landlord may ask the individual to document how the circumstances have changed and why he or she no longer poses a direct threat. Based on court cases, it is clear that the mere potential or threat of harm may be enough to constitute a direct threat, even if no actual harm is done. As long as the threat to other people is objective, severe, and real, landlords don t have to wait until the tenant actually hurts someone to use the "direct threat exception. This point is well made in Foster v. Tinnea, So.2d 782. In this case, a Louisiana court ruled that a tenant with severe brain damage due to an auto accident was a direct threat to other tenants based on his potential for harm rather than any harm he had actually inflicted. He had had altercations with other tenants, chased kids with a knife, listened to loud and vulgar music, and made inappropriate sexual comments to tenants. The Direct Threat Defense Does not Eliminate the Possibility of a Reasonable Accommodation Individuals who pose direct threats are still entitled to reasonable accommodations to the point of undue hardship. So, before deciding to reject an applicant or evict a resident, management must consider whether there are any reasonable accommodations that may be made to eliminate the direct threat. Of course, this assumes that a request for such accommodation has been made, either by the resident/applicant or someone acting on their behalf. If such requests are made, landlords are entitled to request verification from a healthcare provider, social worker, or other reliable third parties that the treatment plan will be effective in eliminating the direct threat, as well as assurances that the tenant will comply with its terms. Bottom Line - while current drug users are not protected under fair housing laws, former drug users who have successfully completed or are currently in a rehab program and are no longer engaging in the illegal use of drugs are protected. Requests for reasonable accommodations from former drug users should always be considered and except in the case of a demonstrable direct threat, reasonable accommodations that will allow former drug users to live at a property should generally be granted.

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