Understanding Hawaii Minimum Wage: Key Changes and Insights for 2024

Hawaii implemented minimum wage laws that reflect fair pay to all workers and equitable labor practices as the state's commitment. For instance, a retail worker at a Honolulu grocery store can now expect improved wages and overall financial protections that help in managing the cost of living with the fair labor standards that are decided and implemented.

The changes are indeed about the numbers in payment and maintaining the working environment employees receive. It helps people adapt to changes faster and overcome economic challenges in no time.

Let's break down everything about Hawaii's minimum wage law.

Ready to learn how Hawaii's new law will shape the future of work in 2024?

Let's dive in.

History and Overall Records Of Hawaii Wages

If you look at the record, Hawaii's minimum wage reflects unique challenges as an island with a high cost of living.

The First Steps: 1942 and Beyond

First, Hawaii's wage law was introduced in 1942 at $0.25 per hour. Gradually, wages increase as per the state's ever-rising cost of living.

A Pivotal Change in 2014

In 2014, Hawaii passed a law that raised the minimum Wage to around $10.10 per hour by 2018. While it was witnessed clearly, the cost of living was very high, so even this amount did not work; it barely worked for 4 years. 

So, if we calculate, minimum wage workers earned around $21,000 per year, whereas the required Wage was $27.44 per hour to at least afford the basic needs.

Let's look at the record of minimum wage in Hawaii over the years, which has shown that no matter what, it has stuck to the commitment of moderately increasing and paying the workers effectively.

Minimum Wage Rates in Hawaii

On January 1, 2024, Hawaii's minimum Wage is $14 per hour. It is represented under Act 114 of the sessions laws of Hawaii 2022. The state laws aim to ensure a fair amount to employees and workers and direct the high cost of living across multiple islands. 

The minimum Wage is applied equally to all places, including Oahu, Maui, Kauai, and Kalawao, so consistency is maintained.

Hawaii Minimum Wage vs. Federal Minimum Wage

The Federal Minimum Wage is $7.25 per hour, and it has been unchanged since the year 2009 by theFair Labor Standards Act (FLSA). It has become difficult for some workers to commit and work dedicatedly. Hawaii's minimum wage laws are here to protect the workers and provide a quality living life.

State Minimum Wage

Various regional variations and living costs have been recognized in the economic factors where many states have enacted minimum wage laws, which are higher than the general federal rate. State-level mandates provide the surety to workers to afford the higher cost areas to receive a required wage.

California's minimum Wage was $15.50 per hour, which increased to $ 16 on January 1uary, 2024. Similarly,Gerogia's minimum Wage has been $15.5 per hour to date.

Tip Credit and Total Earnings

There are multiple types of jobs where employers can be tipped. Jobs like hospitality have a maximum chance of utilizing a tip credit of $1.25 per hour in the current year (2024). Tips and total earnings include exceeding $7, above the standard Wage.

Here is the situation:

Applicable minimum Wage of $ 12.00 per hour

• Employee receives more than $ 20 per month in tips, allowing tip credit to be used

• The employee worked 30 hours per week and received $ 255.00 in tips for the week

• The employer pays the tipped employee $11.00 per hour ($12.00 minimum wage less $1.00 tip credit)

Exceptions and Special Case Wage Calculation

Hawaii state minimum Wage is $14 per hour in 2024, but certain exceptions and special cases are applied. Exceptional cases and their wage calculation are governed and managed by state and federal regulations and are included in the Fair Labor Standards Act. 

It ensures that employers covered by these laws are aligned and paid fairly.

Federal Exemptions

There are high-authorized exceptions that do not follow Hawaii's minimum wage law, but they are conducted through federal guidelines. These roles often include the senior authority such as;

• Managers and senior executives
• Computer and IT professionals
• Salesperson and business executive

State Exemptions

Hawaii's minimum wage laws outline specific exemptions that include a particular category of people, and that include;

• Full-time students employed by their schools in limited on-campus roles.
• Volunteers are working for nonprofit organizations.
• Alternative pay structures cover state government employees.
• Vocational programs and sheltered workshops for disabled individuals.
• Casual domestic services such as babysitting and house cleaning workers.
• Caretakers for the elderly or infirm in the employer's home.
• House parents employed by charitable homes.
• Individuals working for immediate family members.

Industry-Specific Lower Minimum Wage

Specific industries have a lower minimum wage than the standard rate:

• Agricultural workers typically earn $10.50 per hour.
• Coffee harvesters and workers of related farm activities.
• Seasonal youth camp employees working at nonprofit, religious, or charitable camps.
• Taxi drivers, golf caddies, and fishing industry workers.

Overtime Wage Rules In Hawaii

Overtime pay is for every type of worker and employee. It is strictly stated under the Hawaii Law. If an individual has worked over 40 hours in one week, the overtime is calculated at 1.5 times their regular rate.

Who's Exempt?
Not all employees have overtime coverage. Some role exemptions include:

• Executives and administrative officers.
• Farmworkers.
• Some computer professionals, daily Overtime in Special Cases

Although Hawaii doesn't usually require daily overtime, some public works construction projects mandate overtime pay for employees working more than 8 hours daily. With this information, employees and employers can better understand and maintain compliance with Hawaii's overtime laws.

Special Cases

Additional categories with unique pay rules include:

• Apprentices and learners in certified training programs may receive reduced wages during training.
• Employees working on ships, vessels, or in the Merchant Marine.

Regardless of these exceptional cases, no workers in Hawaii are paid less; it is not legal according to a federal standard minimum wage of $7.25 per hour. Employers should be aligned with state law, manage labor costs, and stick to a fair compensation rate to protect workers and employee retention.

Future Wage Increases: Chances and Possibilities

The record we have seen initially clearly shows that Hawaii believes in paying fair wages to workers. It gradually increases according to the cost of living. 

The Minimum Wage will increase to $16 per hour and $18 per hour in 2028.

It is simple: these further increase employees' financial stability, ensuring that the cost and standard of living are matched. 

There is no doubt that the Wage will not be increased. Companies manage the payroll system promptly and stay updated. Takes care of the payroll and the hiring process.

This updated pay standard exemplifies Hawaii's proactive approach to creating a fair and sustainable labor environment.

What are the Best Practices For Employers In Hawaii For Wage Law Compliance?

Many employers stay current with Hawaii's wage law, as it is crucial to avoid penalties and ensure smooth financial operations in the business.

We have listed down some of the best practices that will help you to stay compliant in the workforce by simply following the laws;

1. Understand Hawaii Minimum Wage Laws

• Familiarize yourself with the current Hawaii minimum wage law, including the standard and tipped employee rates.
• Keep track of further increases scheduled for 2024 and beyond.
• Review exemptions and specific regulations under both state and federal guidelines. Remember, the federal minimum Wage of $7.25 per hour is the absolute minimum.

2. Accurately Track Time

• Use a robust timekeeping system to record all hours worked, including regular and overtime.
• As session laws mandate, ensure records are detailed and stored for at least six years.

3. Streamline Payday Procedures

• Provide clear pay stubs detailing gross pay, deductions, and net pay for every pay period.
• Pay employees on time, and if terminated, ensure wages are issued no later than the next business day.

4. Follow Overtime Requirements

• Employees will be paid 1.5 times more if they have worked 40+ hours in a single week. 
• Understand exemptions for roles like executives, administrative staff, and confident professionals.

5. Prepare for Pay Transparency

• With Hawaii's Pay Transparency Law effective January 1, 2024, employers must disclose salary ranges upon request during hiring. Update your pay structure to align with this requirement.

6. Leverage Technology

• Use payroll software to simplify compliance. Automated systems help track labor costs, ensure accurate calculations, and reduce errors.

Employers can effectively navigate Hawaii's wage laws, manage labor costs, and maintain a compliant and efficient workplace by focusing on these critical areas.

Staying up-to-date with wage compliance does not always have to be complicated; it can get simpler. 

Book your demo today with our payroll experts, and get the process done in more straightforward and meaningful ways!

FAQs

What is Hawaii's minimum wage in 2024?

The minimum Wawagen Hawaii 20in 24 is $14.00 per hour.

How does the minimum Wage in Hawaii compare to the federal minimum wage rate?

The minimum Wage in Hawaii is far higher than the federal minimum Wage of $7.25 an hour.

Is the tip credit minimum wage rate as high as the non-tip credit minimum wage rate?

Tipped employees may be paid a lower base wage, provided their tips bring the total hourly earnings to $14.00 an hour.

How does Hawaii calculate overtime pay?

Overtime is calculated as one and half times the regular wage of an individual if worked 40+ hours per week.