Facts About the Florida Minimum Wage Increase

In case you haven’t heard, the Florida minimum wage increase is going into effect as of September 30th. Since this multi-year plan was announced, there have been a lot of questions swirling around. Today, we’re going to take a look at a few simple facts about the increase, how it’s expected to impact the community, and how Vested HR’s Professional Employer Organization services can help offset the additional labor costs involved.

Let’s start with some important facts:

Amended in 2020

During the 2020 election, Florida voters approved Amendment 2, which changed the state’s constitution to gradually increase the minimum wage each year. While it’s possible there may be legal challenges to the amendment even though it’s already kicked in, there hasn’t been much of an uproar that might suspend it.

Two Levels of Pay

There are basically two levels of pay: tipped workers and non-tipped workers. Most people will be covered by the latter, which means that their minimum wage will go up to $11 an hour on September 30th, 2022. For tipped workers, such as bartenders and servers, the rate will increase to $7.98 per hour.

Yearly $1 Increase

As it stands now, this minimum wage increase will tick up by $1 an hour each year until reaching $15 as of September 30th, 2026. Unless another amendment is approved, the minimum wage will then switch back to an annual inflation adjustment in 2027, which is how it’s been operating since 2004.

The Effect of the Florida Minimum Wage Increase

Many businesses have been weary of in the Florida minimum wage increase because they’re already dealing with low profit margins. This fear has worsened over the past year as we’ve seen increases in the prices of goods and services which have affected businesses of all sizes.

That being said, economists believe that the minimum wage increase will actually boost the economy because it will give workers more spending money, which typically translates to an increase of patronizing businesses.

How Vested HR Can Help Offset the Wage Increase

Even though the Florida minimum wage increase may result in increased spending, this isn’t likely to happen right away. In the interim, Vested HR can help you offset the increase.

Here is what we plan to do with existing or future clients who are concerned:

Evaluate Current Package

If you’re an existing client, the first thing we’ll do is take a look at the details of your current employee benefits package. We’ll go over items such as our PEO HR servicespayroll services, workers’ compensation, etc. and see if switching to another package might be called for. Don’t worry – we’ll make sure that you don’t make any changes that may negatively impact your employees or business.

Reduce Backend Costs

The next thing we’ll do is analyze your backend costs and see if any of them could be reduced. Depending on the situation, this could include cutting administration fees, lowering workers’ comp fees, and perhaps putting you on a pay-as-you-go workers’ comp benefit. These reductions may not always be substantial but they could help even things out.

Focus on Business Growth

Too often, businesses see something like a minimum wage increase and they start making changes that focus on the short-term. Yes, it’s true that you need to be thinking about the next six months or 12 months, but we’re in this for the long haul, so we’re especially interested in long-term business growth. Our team will work closely with you to help initiate a business plan that will not only offset the minimum wage, but make sure you use it to your advantage whenever possible.

Waiving Start-Up Fees

Even though we’re focused on the long-term, there is a short-term solution that we’ve initiated. From now until October 1st, 2022, Vested HR is waiving all start-up fees for our PEO services.

This is our way of helping out new clients who are concerned with the minimum wage increase and looking for a quick way to offset some of the additional cost. If you miss this opportunity, that’s okay. There will be plenty of other ways for us to assist new and existing clients in the future.

Contact Vested HR for Assistance with the Florida Minimum Wage Increase

Vested HR offers the very best in PEO HR solutions that will help your business run more smoothly. If you have any questions about the Florida minimum wage increase or would like to know the benefits of PEO, reach out to us today at (727) 474-2114 to schedule a free consultation.