Redpath Insights


Minneapolis Minimum Wage Updates

by Heather Larson, CPP

February 23, 2018 โ€” Employers with employees working within Minneapolis city limits have additional employer obligations for minimum wage requirements.  Effective January 1, 2018, the first phase of the Minneapolis Minimum Wage Ordinance went into effect (Minneapolis Code of Ordinances Title 2, Chapter 40, Article IV).

The ordinance sets a new hourly minimum wage standard for work performed in Minneapolis. For all other employers with employees working outside of Minneapolis, the Minnesota Minimum wage is $7.87 an hour if annual sales are less than $500,000 or $9.65 an hour if sales are greater than $500,000.

What Employers need to know:

Step 1: Do you have non-exempt hourly employees performing services in Minneapolis?  If yes, see the following. If no, itโ€™s still best practice to review your hourly employeeโ€™s rates for compliance at the state and federal levels.

Items to consider:

  1. What if employees based outside of Minneapolis pass through without making work related stops? A: The minimum wage does not apply to these workers.
  2. What if an employee based outside of Minneapolis works within Minneapolis on an occasional basis? A: If the employee works more than 2 hours within the City in a particular week, the employee must be paid at least the minimum wage for the time worked within the City.
  3. Does the ordinance apply to an employer who isnโ€™t located in Minneapolis but has an employee performing services in Minneapolis? A: Regardless of where the employer is located, if the work performed by the employee is within the City for at least 2 hours in a work week, the Cityโ€™s minimum wage must be applied.

Step 2: Determine business size for minimum wage thresholds. See the source link below to determine business size.

Step 3: Follow the ordinance rules to pay minimum wage accordingly and be mindful of the increased rates each year thereafter.  Below is a chart from the City of Minneapolis:


Here is a chart of Minneapolis minimum wage changes over time.
Minimum Wage Chartโ€”City of Minneapolis, MN.


Image Source: City of Minneapolis

Additional information regarding the ordinance can be found through the following City of Minneapolis links:

If you have any questions about this ordinance, please contact Heather Larson at Redpath and Company.

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Heather Larson, CPP

Heather Larson, CPP

Heather Larson, CPP is a payroll manager focusing on non-attest services including bookkeeping, compiled financials, liquor and sales tax, and 1099 filings. Most of her time is spent working with business owners on a day to day basis to maintain their books, and help with payroll record keeping and processing, and assisting with general business processes.