MARTINSBURG, W.Va. — Increasing the minimum wage in West Virginia could have some unintended consequences on employers in the state, according to a Martinsburg attorney.
State lawmakers passed a bill recently raising the minimum wage by $1.50 over the next two years. If signed into law by Gov. Earl Ray Tomblin, the minimum wage will go from $7.25 to $8.00 beginning Jan. 1, 2015 and increase to $8.75 in 2016.
Attorney Brian Peterson with the law firm Bowles Rice LLP said in a conference call with reporters Tuesday the bill also includes some definition changes that will impact overtime laws. He said the new state law would trump federal overtime exemptions that 80 percent of West Virginia employers currently fall under.
“The overtime exemptions that people in our state have been living under for many, many years are all going to be changed because the federal law doesn’t preempt the state law,” Peterson said.
If the governor signs the bill (HB 4283) those overtime changes would take effect June 6 for employers with more than six workers, even though the increase in the minimum wage won’t kick in until January.
Peterson said there are only 19 exemptions in the state’s overtime law but more than 50 in the federal law. He said changing the overtime laws would make state less competitive as it tries to recruit certain employers who offer high-tech jobs. He said computer-related jobs are exempt under the federal overtime rules but not the state rules, which haven’t been changed since 1982.
“These are very high paying jobs and those are the kind of jobs we want to attract to the state,” Peterson said. “But if they can’t have those folks exempt under our overtime rules then they might want to locate someplace else.”
Peterson also said the new overtime language would introduce a “new level of legal compliance” for employers. He said municipalities with professional fire departments would also be impacted. He said right now overtime doesn’t begin for those working 24-hour shifts for fire departments until the 54-hour worked during a particular week. He said the minimum wage bill would cause overtime to kick-in at the 41st hour or before the firefighter’s second shift is over.
“I don’t know how (municipalities) are going to handle that,” Peterson said.
Peterson did admit employers might be forced to cut back on the hours of full-time workers and hire more part-time employees to abide by the new overtime definition.
“It could have that effect, yes. That would be one way to avoid overtime—would be to hire more workers and that is a possibility,” he said.
Peterson works in the Bowles Rice Labor and Employment Group.