Yearly, Ohio’s minimal wage rises primarily based on inflation. With each minimal wage improve, small enterprise house owners want to verify their payroll is updated and compliant in addition to accounting for elevated labor prices of their funds. 

Unintentionally paying your individuals the mistaken wage can depart your small business open to expensive fines and lawsuits — and also you’ll threat dissatisfied workers and a nasty fame.

Our final information will let you know the whole lot it’s good to find out about Ohio minimal wage 2024. We’ll present you how you can keep on high of minimal wage modifications so you’ll be able to keep away from nasty surprises and really feel assured you’re paying your individuals correctly. 

Understanding Ohio minimal wage for tipped and non-tipped workers 

In accordance with the Ohio Division of Commerce, the present minimal wage throughout Ohio for non-tipped workers is $10.45 per hour, as of January 1, 2024. That’s an $0.35 improve from 2023’s minimal wage fee. The minimal wage applies to workers of companies with annual gross receipts of greater than $385,000 per yr.

It is a little totally different for “tipped workers” — categorised as staff who commonly earn greater than $30 monthly in suggestions, like servers, bartenders, and hairdressers. The minimal hourly wage for tipped staff in Ohio is $5.25 in 2024 (up from $5.05 final yr).

Although tipped workers may be paid a decrease money wage, employers must be sure that their staff’ suggestions and base pay add as much as an hourly common of not less than $10.45 throughout the pay interval. If not, employers are answerable for topping up their paycheck. 

Which means it’s additional vital for small enterprise house owners in service or different tipped industries to maintain monitor of suggestions in addition to wages. Payroll instruments like Homebase could make the method easy with tip scarcity calculation capabilities that robotically complement staff’ wages after they fall brief on suggestions. 

Exceptions to Ohio minimal wage 2024 

All companies with gross receipts of over $385,000 per yr should pay Ohio’s minimal wage. Nonetheless, SMBs who make much less have an exemption below Ohio regulation: they will pay the present federal minimal wage of $7.25 per hour as a substitute. 

There are additionally exemptions for various classes of workers. 

Some key exemptions embody: 

• Workers below the age of 16






• Folks employed as babysitters or live-in companions, if their duties are carried out within the employer’s residence and don’t embody housekeeping






• Employees inside family-owned and operated companies who’re relations of the proprietor






• Individuals who voluntarily present charitable providers in hospitals or well being establishments totally free






• Workers at youngsters’s camps or leisure areas which are run by non-profit organizations

A sub-minimum wage fee may additionally be paid in circumstances the place it will keep away from hardship and lack of employment alternatives for these with psychological or bodily disabilities, however this should adjust to the laws of the Director of the Ohio Division of Commerce. 

Minimal wage modifications

On January 1, 2024, Ohio’s minimal wage elevated to $10.45 hourly for non-tipped workers and $5.25 per hour for tipped workers, in response to the Ohio Division of Commerce.

The exemption threshold for companies will even be increased: the brand new minimal wage solely applies to workers of corporations who gross greater than $385,000 per yr.  

The regulation behind this pay improve is a 2006 Constitutional Modification in Ohio that ties the state minimal wage to the Client Value Index for the earlier yr. That implies that wages rise yearly primarily based on inflation.

There are additionally initiatives in sure cities in Ohio encouraging employers to pay wages increased than the present minimal. For instance, the Metropolis of Cleveland has partnered with One Honest Wage to supply sure companies, like eating places and low outlets, a grant to pay their workers extra.

Additional time pay necessities 

On high of the bottom minimal wage, Ohio employers should pay additional time — at 1.5 occasions the common hourly fee — to workers for any hours over 40 they work in a single week.

There’s an exception to this for companies with lower than $150,000 in gross receipts. 

As all small companies know, additional time prices can creep up quickly — particularly if your organization depends on shift work. 

Let’s say your restaurant rosters workers on a 2-2-3 schedule, the place some weeks, groups will work 5 12-hour shifts in every week. 

That’s a complete of 60 hours labored within the week (5 days x 12 hours every day). 

The primary 40 hours are paid on the common fee of $10.45 per hour, totaling $418.00. However the remaining 20 hours are calculated at time-and-a-half, which quantities to $15.67 per hour in Ohio. You’ll find yourself paying $313.50 in additional time, and $731.50 for this 40-hour week. 

To keep away from mounting prices, you’ll need to both take a unique strategy to worker scheduling or plan for these labor prices. 

In addition to deliberate shift work, small enterprise house owners want to remain on high of sudden additional time prices on account of last-minute schedule modifications or cowl.

Posting & Recordkeeping Necessities

Along with paying the authorized minimal and additional time wages, Ohio employers should adjust to particular posting and recordkeeping guidelines. 

At every office or job website, companies are required to show the newest official Ohio Minimal Wage poster revealed by the Ohio Division of Commerce’s Division of Industrial Compliance — this modifications every year with updates to the minimal wage.

Employers should additionally hold clear payroll information for not less than three years, exhibiting the title, tackle, occupation, and fee of pay for every particular person worker, in addition to a full document of their hours labored per day and week and the way a lot they had been paid for every pay interval. 

Failing to satisfy these documentation requirements can set off fines and investigations, so it’s essential that small companies select the fitting system to hold monitor of payroll. 

Tricks to adjust to Ohio minimal wage 

Staying compliant with evolving Ohio labor legal guidelines and minimal wage guidelines takes effort as a small enterprise proprietor. However non-compliance means risking monetary penalties, lawsuits, harm to your fame, and dissatisfied workers. 

Right here’s how you can keep away from violations and make minimal wage compliance a precedence: 

• On the finish of the yr, word new minimal wage charges that can come into impact in January. Set calendar reminders so that you don’t overlook. 

• Obtain and submit the most recent official Ohio Minimal Wage poster earlier than January 1 every year to obviously talk authorized charges to workers — and adjust to the regulation.

• Earlier than minimal wage will increase take impact, replace your payroll programs, timekeeping instruments, and accounting software program. Instruments like Homebase can warn you when there’s a change and robotically replace your payroll primarily based on related labor legal guidelines. 

• Evaluate all workers classifications to be sure to’re accurately making use of minimal wage charges primarily based on components like worker age, tipped standing, and hours labored.

• Preserve thorough payroll information exhibiting hours labored, fee of pay, and additional time earnings for each worker as proof of compliance.

• In addition to monitoring hours, monitor suggestions earned by servers, hosts, hair stylists, and different tipped workers. Guarantee their suggestions reliably mix with decrease base pay to satisfy or exceed the total minimal wage.

Really feel assured you’re compliant with Homebase

Managing minimal wage can get difficult with so many modifications at play. For small enterprise house owners who’re already time-stretched, staying on high of all of the totally different laws can really feel overwhelming. 

However you don’t should go it alone. Homebase helps small companies like yours simplify payroll and compliance.

Right here’s how: 

Computerized payroll calculations: Homebase calculates hours, breaks, additional time, and PTO when your workers clock in and clock out. That every one will get synced with payroll that can assist you keep away from errors.

Detailed information: Homebase tracks hours labored, pay charges, and additional time particulars for each worker. Detailed wage statements present safety in case of an audit or lawsuit.

Proactive compliance alerts: Homebase sends well timed notifications of upcoming minimal wage and regulation modifications so that you at all times keep present — and when you have any questions, you’ll be able to discuss to an HR professional to straighten issues out. 

With Homebase as your payroll and compliance companion, you’ll be able to really feel certain you’re paying your individuals pretty and precisely.