9/26/2006
Arkansas Minimum Wage Increases October 1st
by Kathryn Peacock, Center Director, UAM College of Technology - McGehee SBDC
Most employers have been accustomed to compliance with the federal minimum wage standard, currently $5.15 per hour. The federal standard has historically exceeded the state minimum wage rate.
Effective October 1, 2006 the new Arkansas minimum wage rate of $6.25 per hour (up from $4.75 per hour) will apply. Overtime at time-and-a-half ($9.38) applies to work performed in excess of 40 hours per work week.
Businesses with more than four employees must pay at least $6.25 per hour for work performed on and after October 1st.
Exceptions include:
• Executive, administrative or professional employees
• Outside commission paid salesmen
• Students working in a bona fide vocational training program
• Students working in the school they attend
• Most farm laborers
• Independent contractors
• Employees of the United States
Employers should be careful about classifying workers as executive, administrative, or professional workers “exempt” from the law or classifying workers as independent contractors. Stiff penalties can result.
Information and the required Arkansas Department of Labor Poster can be accessed at
http://www.arkansas.gov/labor/laws_regs/minimum-wage_overtime.html
Paying higher wages calls for more careful cash flow planning. Register here for Managing Your Cash Flow at the Dumas Public Library, October 31st from 1-4pm
http://asbdc.ualr.edu/training/mcgehee.asp
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