Webinar Recap: Midyear 2025: Minimum Wage Updates and Trends

Illinois 

Chicago will see its minimum wage climb to $16.60 per hour and its tipped employee minimum wage increase to $12.62 on July 1, 2025. This change aligns with the city’s multi-year plan to gradually raise tipped employees until they ultimately eliminate the tipped employee wage.  

Maryland 

Maryland’s Montgomery County will be raising its minimum wage rates for large, mid-size and small employers. By July 1, 2025, minimum wages for large employers will be $17.65, mid-size employers must pay minimum wages of $16.00 per hour, and small employers must pay minimum wages of $15.50 per hour. Tipped employee wages in the County remain at $4.00.  

Minnesota

St. Paul, Minnesota’s minimum wage changes impact only small employers with 6-100 employees and micro employers with 5 or fewer employees. Small employers must pay at least $15.00 per hour starting July 1, 2025 and micro employers must pay $13.25 per hour. 

Oregon 

Oregon will implement its scheduled regional minimum wage hikes as part of its unique three-tier structure: 

• Metro-area workers (Portland and surrounding cities) will earn at least $16.30 per hour. 

• Standard areas, covering much of the state, will see wages rise to $15.05 per hour. 

• Nonurban, rural areas will have a minimum wage increase to $14.05 per hour. 

The tipped employee wage matches the standard minimum wage in all three regions. 

What Jurisdiction’s Minimum Wage Rates are NOT Updating July 1, 2025?

As Holle indicated, there are four jurisdictions that usually update their minimum wage rates on July 1 that are not updating their rates this year. 

The City of Malibu, California announced their minimum wage indexed increase will be suspended for one year (2025-2026) in support of businesses impacted by the effects of the Palisades Fire. The city’s minimum wage will remain at $17.27. 

The standard minimum wage in Cook County, Illinois will remain at $15.00 per hour and the tipped employee minimum wage will remain $9.00 per hour . Holle indicates that the agency did not explain why, however she opines that arguably this is because the local rates, adjusted for inflation, remain lower than the state rates (the county uses the higher of the two rates as the official county rate).  

Nevada’s minimum wage rate will not increase this July and will remain at $12.00 per hour. 

And finally, Puerto Rico’s minimum wage will remain at $10.50 per hour. 

Federal & State Exempt Salary Update

Holle indicated that the federal exempt salary threshold level has been impacted by a federal Texas court which vacated the 2024 final rule impacting the nation. The court indicated the Department of Labor (DOL) exceeded their authority. As Holle indicated, the ruling “strikes the final rule” and the U.S. DOL is now applying the $35,568 annual exempt salary threshold level. 

Alaska has an update to its exempt salary threshold level and is increasing it to $54,080 annually, effective July 1, 2025.  

Federal Contractor Updates

Minimum Wage:  In the section covering federal contractor updates Holle stated, “it should be no surprise to anyone listening there have been a quite a large amount of executive orders signed by the Trump Administration … and that includes updates for federal contractors, specifically minimum wage rates.” 

The federal contractor minimum wage has been impacted by Executive Order 14236 which rescinded a prior executive order 14026 that increased federal contractor minimum wage to $17.75 for contracts entered into on and after Jan. 30, 2022. However, there are no changes to the federal rule requiring $17.75 minimum wage. As Holle indicates, “we are at a wait and see basis” now regarding the federal contractor minimum wage as even though the executive order 14236 rescinded the increased wage, the federal rule is still in place requiring the rate of $17.75 for federal contractors. 

Discussing Pay – executive order 14173 rescinds executive order 11246 issued by President Lyndon Johnson in 1965 which protects applicants and employees of federal contractors from discrimination due to inquiring about, disclosing or discussing their compensation or the compensation of other applicants or employees. Like the federal contractor’s minimum wage, there are federal regulations that still exist regarding anti-discrimination related to discussing compensation for federal contractors. However, the DOL has indicated these laws are not high priority on their enforcement schedule. 

Pay Ranges in Job Postings: Executive order 14148 rescinded an executive order requiring pay transparency and inclusion of pay ranges in job postings. Federal contractors at this time are not required to include pay ranges in job postings. 

Minimum Wage News and Developments

Finally, Holle ended the webinar with several recent minimum wage news. 

• Specifically, she provided an overview of the saga in Michigan regarding their minimum wage law. On Feb. 21, 2025 Michigan passed SB 8 making last minute changes to the state’s new minimum wage law that was set to take effect on the same day. The minimum wage increase on Feb. 21, 2025, remains unchanged at $12.48. However, future increases are moved back to Jan. 1. The schedule also hits $15.00 a full year earlier in 2027. Senate Bill 8 also revises the tipped employee wage schedule so that it no longer gradually eliminates the tipped credit over the next several years. Instead, the tipped employee wage gradually increases each year by a percentage of the minimum wage until it is 50% of the minimum hourly wage rate in 2031.  

• The D.C. Council adopted the Tipped Minimum Wage Increase Clarification Emergency Amendment Act of 2025. If signed by the mayor, it would delay the tipped employee wage increase scheduled July 1, 2025 to Oct. 1, 2025. The mayor is expected to sign this by July 3, 2025 to help reduce the financial burden on restaurants.  

• The Missouri state legislature passed HB 567 which would remove the state’s minimum wage annual increases based on the CPI-W percentage increase that are scheduled to begin on Jan. 1, 2027. It is currently on the Governor’s desk and employers should keep an eye on this bill and whether or not the Missouri Governor signs it. 

• In addition to the above, Holle also provided detailed information on further legislation to watch impacting minimum wage in the states of Colorado, Illinois, Oklahoma, Rhode Island, Vermont, and Washington,  

Final Thoughts

Whether you are an employer, an employee, or someone who follows economic trends, understanding these updates is crucial for staying ahead of the curve. If you are impacted by these changes, now is the time to adjust, implement, and prepare for what lies ahead.  

Employers with locations in the above states should review and confirm that they are in compliance with the new minimum wage rate requirements effective on July 1, 2025. In addition to the state minimum wage increases, employers should be on the lookout for upcoming updates to the GovDocs Minimum Wage Rate Guide for the latest local wage rates, as well as our Employment Law News blog that provides the corresponding minimum wage poster updates.