Minimum Wage by State: Updated for 2025

These changes reflect growing calls for wage increases, with studies showing that approximately 80% of Americans support a federal minimum wage of $12 or more.

For business owners and managers, keeping track of evolving wage and labor laws can be challenging. Ensuring your business complies with these regulations is essential not only for avoiding legal trouble but also for maintaining a satisfied and fairly compensated workforce.

This guide will help you navigate the minimum wage changes across different states for 2025.

Federal Minimum Wage for 2025

2025 Basic Minimum Wage Combined (per hour): $7.25

For tipped employees:

• Maximum Tip Credit: $2.13
• Minimum Wage Rate: $5.12
• 2025 Basic Minimum Wage Combined (per hour): $7.25

Minimum Wage by State 2025

Alabama

2025 Basic Minimum Wage Combined (per hour): $2.13 ($7.25)*

Overtime Pay Required After 40 Hours per Week

For tipped employees:

• Maximum Tip Credit: $0 (no tip credit allowed; employers must ensure tipped employees receive at least the full federal minimum wage of $7.25)
• Minimum Wage Rate: $2.13 (direct wage paid to tipped employees)

*Alabama doesn’t have a state minimum wage. The federal minimum wage of $7.25 applies.

Alaska

2025 Basic Minimum Wage Combined (per hour): $11.91

Overtime Pay Required After 8 Hours per Day and 40 Hours per Week

For tipped employees:

• Maximum Tip Credit: $0 (no tip credit allowed; tipped employees must receive the full minimum wage)
• Minimum Wage Rate: Not applicable (tipped employees receive the full minimum wage)

*Premium pay is relevant only for employers with over 4 employees.

Arizona

2025 Basic Minimum Wage Combined (per hour): $14.75

Overtime Pay Required After 40 Hours per Week

For tipped employees:

• Minimum Wage Rate: $11.35 (the minimum tipped wage when combined with the tip credit)
• Maximum Tip Credit: $3.00

Arkansas

2025 Basic Minimum Wage Combined (per hour): $11.00

Overtime Pay Required After 40 Hours per Week

For tipped employees:

• Minimum Wage Rate: $8.37 (the minimum tipped wage when combined with the tip credit)
• Maximum Tip Credit: $2.63

California 

2025 Basic Minimum Wage Combined (per hour): $16.50

Overtime Pay Required After 8 Hours per Day and 40 Hours per Week

For tipped employees:

• Maximum Tip Credit: $0 (California does not allow tip credits; employers must pay the full minimum wage)
• Minimum Wage Rate: $16.00 (tipped employees must be paid the same minimum wage as non-tipped employees)

Premium pay applies for time and a half over an 8-hour workday and double time over a 12-hour workday. If an employee works 7 consecutive days, the first 8 hours are paid at time and a half, and over 8 hours are paid double time.

Some cities and counties have higher minimum wages than the state’s rate.

Colorado

2025 Basic Minimum Wage Combined (per hour): $14.81

Overtime Pay Required After 12 Hours per Day and 40 Hours per Week

For tipped employees:

• Minimum Wage Rate: $11.40 (the minimum tipped wage when combined with the tip credit)
• Maximum Tip Credit: $3.02

Connecticut 

2025 Basic Minimum Wage Combined (per hour): $16.35

Overtime Pay Required After 40 Hours per Week

For tipped employees:

• Maximum Tip Credit for Hotels and Restaurants (excluding bartenders): $8.62
• Maximum Tip Credit for Bartenders: $6.77
• Minimum Wage Rate for Hotels and Restaurants (excluding bartenders): $7.07
• Minimum Wage Rate for Bartenders: $8.92

For hotels and restaurants, the 7th consecutive day of work requires time and a half pay rate.

Delaware 

2025 Basic Minimum Wage Combined (per hour): $15.00

Overtime Pay Required After 40 Hours per Week

For tipped employees:

• Minimum Wage Rate: $3.73 (the minimum tipped wage when combined with the tip credit)
• Maximum Tip Credit: $9.52

District of Columbia 

2025 Basic Minimum Wage Combined (per hour): $18.00

Overtime Pay Required After 40 Hours per Week

For tipped employees:

• Minimum Wage Rate: $10.00 (the minimum tipped wage when combined with the tip credit)
• Maximum Tip Credit: $8.00

Florida

2025 Basic Minimum Wage Combined (per hour): $13.00 ($14.00 effective September 30, 2025)

Overtime Pay Required After 40 Hours per Week

For tipped employees:

• Minimum Wage Rate: $9.98 (the minimum tipped wage when combined with the tip credit)
• Maximum Tip Credit: $3.02

Georgia

2025 Basic Minimum Wage Combined (per hour): $7.25 (federal minimum wage applies)

Overtime Pay Required After 40 Hours per Week

For tipped employees:

• Minimum Wage Rate: $2.13 (direct wage for tipped employees)
• Maximum Tip Credit: $0 (Georgia does not allow a tip credit below the federal minimum)

Hawaii

2025 Basic Minimum Wage Combined (per hour): $14.00

Overtime Pay Required After 40 Hours per Week

For tipped employees:

• Minimum Wage Rate: $13.00 (the minimum tipped wage when combined with the tip credit)
• Maximum Tip Credit: $1.00

Idaho

2025 Basic Minimum Wage Combined (per hour): $7.25 (unchanged, federal minimum wage applies)

Overtime Pay Required After 40 Hours per Week

For tipped employees:

• Minimum Wage Rate: $3.35 (direct wage for tipped employees)
• Maximum Tip Credit: $3.90

Illinois 

2025 Basic Minimum Wage Combined (per hour): $15.00

Overtime Pay Required After 40 Hours per Week

For tipped employees:

• Minimum Wage Rate: $8.40 (the minimum tipped wage when combined with the tip credit)
• Maximum Tip Credit: $5.60 (40% of applicable minimum wage)

Indiana

2025 Basic Minimum Wage Combined (per hour): $7.25 (unchanged, federal minimum wage applies)

Overtime Pay Required After 40 Hours per Week

For tipped employees:

• Minimum Wage Rate: $2.13 (direct wage for tipped employees)
• Maximum Tip Credit: $5.12

Iowa

2025 Basic Minimum Wage Combined (per hour): $7.25 (unchanged, federal minimum wage applies)

Overtime Pay Required After 40 Hours per Week

For tipped employees:

• Minimum Wage Rate: $4.35 (direct wage for tipped employees)
• Maximum Tip Credit: $2.90 (40% of applicable minimum wage)

Kansas

2025 Basic Minimum Wage Combined (per hour): $7.25 (unchanged, federal minimum wage applies)

Overtime Pay Required After 40 Hours per Week

For tipped employees:

• Minimum Wage Rate: $2.13 (direct wage for tipped employees)
• Maximum Tip Credit: $5.12

Kentucky

2025 Basic Minimum Wage Combined (per hour): $7.25 (unchanged, federal minimum wage applies)

Overtime Pay Required After 40 Hours per Week and on the 7th Consecutive Day

For tipped employees:

• Maximum Tip Credit: $5.12
• Minimum Wage Rate: $2.13 (direct wage for tipped employees)

Louisiana

2025 Basic Minimum Wage Combined (per hour): $7.25 (federal minimum wage applies)

Overtime Pay Required After 40 Hours per Week

For tipped employees:

• Minimum Wage Rate: $2.13 (direct wage for tipped employees)
• Maximum Tip Credit: None (Louisiana follows federal guidelines, but does not have its own tip credit)

Maine

2025 Basic Minimum Wage Combined (per hour): $14.65

Overtime Pay Required After 40 Hours per Week

For tipped employees:

• Minimum Wage Rate: $7.08 (the minimum tipped wage when combined with the tip credit)
• Maximum Tip Credit: $7.08 (50% of applicable minimum wage)

Maryland

2025 Basic Minimum Wage Combined (per hour): $15.00

Overtime Pay Required After 40 Hours per Week

For tipped employees:

• Maximum Tip Credit for Companies With 15 or More Employees: $9.62
• Maximum Tip Credit for Companies With 14 or Fewer Employees: $9.17
• Minimum Wage Rate for Companies With 15 or More Employees: $5.38
• Minimum Wage Rate for Companies With 14 or Fewer Employees: $5.83

Employees under 18 years old may be paid 85% of the minimum hourly wage.

Massachusetts

2025 Basic Minimum Wage Combined (per hour): $16.00

Overtime Pay Required After 40 Hours per Week

For tipped employees:

• Minimum Wage Rate: $7.25 (the minimum tipped wage when combined with the tip credit)
• Maximum Tip Credit: $8.75

Michigan

2025 Basic Minimum Wage Combined (per hour): $12.48 (effective February 21, 2025)

Overtime Pay Required After 40 Hours per Week

For tipped employees:

• Maximum Tip Credit: $6.26
• Minimum Wage Rate: $4.07 (the minimum tipped wage when combined with the tip credit)

Employees aged 16-17 can be paid 85% of the minimum wage.

Minnesota

2025 Basic Minimum Wage Combined (per hour): $11.13

Overtime Pay Required After 48 Hours per Week

For tipped employees:

• Maximum Tip Credit: None (Minnesota does not allow a tip credit)
• Minimum Wage Rate: $10.85 (tipped employees receive the same minimum wage as non-tipped employees)

Employees under 18 may be paid $8.85 per hour regardless of company size.

Mississippi

2025 Basic Minimum Wage Combined (per hour): $7.25 (adheres to federal minimum wage)

Overtime Pay Required After 40 Hours per Week

For tipped employees:

• Minimum Wage Rate: $2.13 (direct wage for tipped employees)
• Maximum Tip Credit: $5.12

Missouri

2025 Basic Minimum Wage Combined (per hour): $13.75

Overtime Pay Required After 40 Hours per Week*

For tipped employees:

• Maximum Tip Credit: $6.15 (50% of the state minimum wage)
• Minimum Wage Rate: $6.15 (the minimum tipped wage when combined with the tip credit)

*Premium pay for seasonal amusement or recreation businesses is required after 52 hours.

Montana

2025 Basic Minimum Wage Combined (per hour): $10.55 (adjusted for inflation for businesses with gross annual sales exceeding $110,000)

Overtime Pay Required After 40 Hours per Week

For tipped employees:

• Maximum Tip Credit: Not applicable (no tip credit)
• Minimum Wage Rate for businesses with gross annual sales exceeding $110,000: $9.20
• Minimum Wage Rate for businesses with gross annual sales under $110,000: $4.00

Nebraska

2025 Basic Minimum Wage Combined (per hour): $13.50

Overtime Pay Required After 40 Hours per Week

For tipped employees:

• Minimum Wage Rate: $3.63 (the minimum tipped wage when combined with the tip credit)
• Maximum Tip Credit: $8.37

Nevada

2025 Basic Minimum Wage Combined (per hour) for employers that provide health insurance: $11.25

2025 Basic Minimum Wage Combined (per hour) for employers that do not provide health insurance: $12.25

Overtime Pay Required After 40 Hours per Week

For tipped employees:

• Minimum Wage Rate: $11.25 (for employers that provide health insurance) / $12.25 (for employers that do not provide health insurance)
• Maximum Tip Credit: None (Nevada does not allow a tip credit)

New Hampshire

2025 Basic Minimum Wage Combined (per hour): $7.25 (federal minimum wage applies)

Overtime Pay Required After 40 Hours per Week

For tipped employees:

• Minimum Wage Rate: $3.26 (direct wage for tipped employees)
• Maximum Tip Credit: $3.99

New Jersey

2025 Basic Minimum Wage Combined (per hour) for businesses with over 6 employees: $15.49

Overtime Pay Required After 40 Hours per Week

For tipped employees:

• Maximum Tip Credit: $8.87
• Minimum Wage Rate: $6.26 (the minimum tipped wage when combined with the tip credit)

The minimum wage for seasonal workers and employers with fewer than 6 employees is $11.90.

New Mexico 

2025 Basic Minimum Wage Combined (per hour): $12.00

Overtime Pay Required After 40 Hours per Week

For tipped employees:

• Minimum Wage Rate: $3.00 (direct wage for tipped employees)
• Maximum Tip Credit: $9.00

New York 

2025 Basic Minimum Wage Combined (per hour): $16.50

Overtime Pay Required After 40 Hours per Week

For tipped employees:

• Maximum Tip Credit (Food Service): Varies by city
• Minimum Wage Rate (Food Service): Varies by city

Additional rules:

• Employers must provide 24 hours of consecutive rest each week for security guards, firefighters, engineers, and workers in the hospitality industry.
• Employees receive 1 additional hour of pay at the minimum wage rate when working over 10 hours (often referred to as the “spread of hours” rule).

North Carolina

2025 Basic Minimum Wage Combined (per hour): $7.25 (unchanged, federal minimum wage applies)

Overtime Pay Required After 40 Hours per Week

For tipped employees:

• Maximum Tip Credit: $5.12
• Minimum Wage Rate: $2.13 (direct wage for tipped employees)

Premium pay is required after 45 hours a week for seasonal amusement or recreational establishments.

North Dakota

2025 Basic Minimum Wage Combined (per hour): $7.25 (federal minimum wage applies)

Overtime Pay Required After 40 Hours per Week

For tipped employees:

• Maximum Tip Credit: $2.39
• Minimum Wage Rate: $4.86 (direct wage for tipped employees)

North Dakota doesn’t have a state minimum wage. Federal law applies.

Ohio

2025 Basic Minimum Wage Combined (per hour): $10.70

Overtime Pay Required After 40 Hours per Week

For tipped employees:

• Minimum Wage Rate: $5.33 (the minimum tipped wage when combined with the tip credit)
• Maximum Tip Credit: $5.12

Oklahoma

2025 Basic Minimum Wage Combined (per hour): $7.25 ( federal minimum wage applies)

Overtime Pay Required After 40 Hours per Week

For tipped employees:

• Minimum Wage Rate: $2.13 (direct wage for tipped employees)
• Maximum Tip Credit: $5.12

Oregon

2025 Basic Minimum Wage Combined (per hour): Standard rate $14.70

Portland Metro: $15.95

Non-urban Rate: $13.70

Overtime Pay Required After 40 Hours per Week

For tipped employees:

• Maximum Tip Credit: None (Oregon does not allow a tip credit)
• Minimum Wage Rate: Follows the respective regional minimum wage for non-tipped employees.

Additional Information:

• Premium pay is required after 10 hours a day in nonfarm canneries, driers, or packing plants, and in mills, factories, or manufacturing establishments (excluding sawmills, planing mills, shingle mills, and logging camps).

Pennsylvania

2025 Basic Minimum Wage Combined (per hour): $7.25 (federal minimum wage applies)

Overtime Pay Required After 40 Hours per Week

For tipped employees:

• Minimum Wage Rate: $2.83 (direct wage for tipped employees)
• Maximum Tip Credit: $4.42

Rhode Island

2025 Basic Minimum Wage Combined (per hour): $15.00

Overtime Pay Required After 40 Hours per Week

For tipped employees:

• Maximum Tip Credit: $9.11
• Minimum Wage Rate: $4.89 (the minimum tipped wage when combined with the tip credit)

Time and a half pay rate is required on Sundays and holidays.

South Carolina

2025 Basic Minimum Wage Combined (per hour): $7.25 (federal minimum wage applies)

Overtime Pay Required After 40 Hours per Week

For tipped employees:

• Maximum Tip Credit: Not applicable (follows federal rules, which allow a tip credit)
• Minimum Wage Rate: $2.13 (direct wage for tipped employees)

No state minimum wage law; federal law applies.

South Dakota

2025 Basic Minimum Wage Combined (per hour): $11.50

Overtime Pay Required After 40 Hours per Week

For tipped employees:

• Minimum Wage Rate: $6.22 (the minimum tipped wage when combined with the tip credit)
• Maximum Tip Credit: $4.98

Tennessee

2025 Basic Minimum Wage Combined (per hour): $7.25 (federal minimum wage applies)

Overtime Pay Required After 40 Hours per Week

For tipped employees:

• Maximum Tip Credit: Not applicable (follows federal rules)
• Minimum Wage Rate: $2.13 (direct wage for tipped employees)

Tennessee does not have a state minimum wage; federal law applies.

Texas

2025 Basic Minimum Wage Combined (per hour): $7.25 (unchanged, federal minimum wage applies)

Overtime Pay Required After 40 Hours per Week

For tipped employees:

• Minimum Wage Rate: $2.13 (direct wage for tipped employees)
• Maximum Tip Credit: $5.12

Utah

2025 Basic Minimum Wage Combined (per hour): $7.25 (unchanged, federal minimum wage applies)

Overtime Pay Required After 40 Hours per Week

For tipped employees:

• Maximum Tip Credit: $5.12
• Minimum Wage Rate: $2.13 (direct wage for tipped employees)

Federal law applies. Utah does not have a separate state minimum wage. 

Vermont 

2025 Basic Minimum Wage Combined (per hour): $14.01

Overtime Pay Required After 40 Hours per Week

For tipped employees:

• Maximum Tip Credit: $6.39 (50% of the state minimum wage)
• Minimum Wage Rate: $7.28 (the minimum tipped wage when combined with the tip credit)

Applicable to employers of 2 or more employees.

Virginia

2025 Basic Minimum Wage Combined (per hour): $12.41

Overtime Pay Required After 40 Hours per Week

For tipped employees:

• Minimum Wage Rate: $11.37 (when combined with the tip credit)
• Maximum Tip Credit: $2.13

Washington

2025 Basic Minimum Wage Combined (per hour): $16.66

Overtime Pay Required After 40 Hours per Week

For tipped employees:

• Maximum Tip Credit: None (Washington does not allow tip credits; employers must pay the full minimum wage)

West Virginia

2025 Basic Minimum Wage Combined (per hour): $8.75*

Overtime Pay Required After 40 Hours per Week

For tipped employees:

• Maximum Tip Credit: $6.13 (70% of the applicable minimum wage)
• Minimum Wage Rate: $2.62 (direct wage for tipped employees)

*Applicable to employers of 6 or more employees.

Wisconsin

2025 Basic Minimum Wage Combined (per hour): $7.25 (federal minimum wage applies)

Overtime Pay Required After 40 Hours per Week

For tipped employees:

• Minimum Wage Rate: $2.33 (direct wage for tipped employees)
• Maximum Tip Credit: $4.92

Wyoming

2025 Basic Minimum Wage Combined (per hour): $7.25 (federal minimum wage applies)

Overtime Pay Required After 40 Hours per Week

For tipped employees:

• Minimum Wage Rate: $2.13 (direct wage for tipped employees)
• Maximum Tip Credit: $5.12

Which states increased their minimum wage in 2025?

State	New Minimum Wage	Effective Date
Alaska	$11.91 per hour	January 1, 2025
Arizona	$14.70 per hour	January 1, 2025
California	$16.50 per hour	January 1, 2025
Colorado	$14.81 per hour	January 1, 2025
Connecticut	$16.35 per hour	January 1, 2025
Delaware	$15.00 per hour	January 1, 2025
Florida	$14.00 per hour	September 30, 2025
Illinois	$15.00 per hour	January 1, 2025
Maine	$14.65 per hour	January 1, 2025
Maryland	$15.00 per hour	January 1, 2025
Michigan	$12.48 per hour	February 21, 2025
Minnesota	$11.13 per hour	January 1, 2025
Missouri	$13.75 per hour	January 1, 2025
Montana	$10.55 per hour	January 1, 2025
Nebraska	$13.50 per hour	January 1, 2025
New Jersey	$15.49 per hour	January 1, 2025
New York	$16.50 per hour	January 1, 2025
Ohio	$10.70 per hour	January 1, 2025
Oregon	$14.70 per hour	July 1, 2025
Rhode Island	$15.00 per hour	January 1, 2025
South Dakota	$11.50 per hour	January 1, 2025
Vermont	$14.01 per hour	January 1, 2025
Virginia	$12.41 per hour	January 1, 2025
Washington	$16.66 per hour	January 1, 2025

What is Tip Credit and How Does it Work?

Tip credit is a provision in US labor law that allows employers to pay tipped employees a lower direct cash wage, as long as their tips make up the difference to meet or exceed the standard minimum wage. This concept primarily applies in industries like restaurants and hospitality, where employees regularly earn tips.

Here’s how it works:

1. Tipped minimum wage: Employers are allowed to pay tipped employees less than the regular minimum wage, known as the tipped minimum wage.
2. Tip credit: The difference between the tipped minimum wage and the regular minimum wage is called the “tip credit.” Employers claim this credit toward the full minimum wage requirement.
3. Meeting minimum wage: Employees’ total earnings, including tips, must meet or exceed the regular minimum wage. If tips are not enough to cover the difference, the employer must make up the shortfall to ensure the employee earns at least the minimum wage.

For example, under federal law, the minimum wage is $7.25 per hour, and the tipped minimum wage is $2.13. The employer can claim a tip credit of $5.12. If an employee does not receive enough tips to reach $7.25 per hour, the employer must pay the difference.

Minimum Wage by State FAQs 

Is the federal minimum wage set to increase in 2025?

No. Since 2009, the federal minimum wage rate has stayed at $7.25 and there are no concrete plans to increase it in 2025.

Which states follow the federal minimum wage?

12 states do not have state minimums and therefore follow federal law ($7.25/hour):

• Alabama
• Louisiana
• Mississippi
• New Hampshire
• North Carolina 
• North Dakota
• Pennsylvania
• South Carolina
• Tennessee
• Texas
• Utah 
• Wisconsin

Make Payroll Easy With The Best Time Tracking Software

When paying employees hourly, it’s important to track their hours worked, both, to stay compliant with laws, and to ensure employees are being paid according to hours worked and not only hours scheduled. Using an employee management app, like Connecteam, can help business owners do just that. 

Business owners of all industries use Connecteam’s employee time clock and employee scheduler. Using the time clock, business owners are notified when their employees are clocking in and out and, most importantly, can track employee hours for payroll.

Connecteam’s scheduling features automatically spot errors and highlight them for managers so problems can be solved before publishing the schedule. These problems can range from double booking employees to mistaken overtime. 

The scheduling and time clock features allow you to stay on top of all payroll expenses and comply with labor laws. 

The Bottom Line on Minimum Wage

State laws are constantly changing, and it’s vital to stay compliant with government regulations. This guide is relevant for 2025. Always research your state and county minimum wage laws before setting your employee pay rates.