H.B. 256

1

MINIMUM WAGE PROVISIONS
2 2007 GENERAL SESSION
3 STATE OF UTAH
4 Chief Sponsor: Neil A. Hansen
5 Senate Sponsor: ____________
6
7 LONG TITLE
8 General Description:
9 This bill modifies minimum wage provisions.
10 Highlighted Provisions:
11 This bill:
12 . increases the minimum wage to at least $7.25 per hour and each year based on
13 inflation;
14 . addresses review of minimum wages by the Labor Commission;
15 . deletes the exemption for persons covered by the Federal Fair Labor Standards Act;
16 and
17 . makes technical changes.
18 Monies Appropriated in this Bill:
19 None
20 Other Special Clauses:
21 This bill takes effect on July 1, 2007.
22 Utah Code Sections Affected:
23 AMENDS:
24 34-40-102, as last amended by Chapter 151, Laws of Utah 2003
25 34-40-103, as last amended by Chapter 375, Laws of Utah 1997
26 34-40-104, as last amended by Chapter 151, Laws of Utah 2003
27

28 Be it enacted by the Legislature of the state of Utah:
29 Section 1. Section 34-40-102 is amended to read:
30 34-40-102. Federal law -- Definitions.
31 (1) This chapter and the terms used in [it] this chapter, including the computation of
32 wages, shall be interpreted consistently with the Fair Labor Standards Act, 29 U.S.C. Sec. 201
33 et seq., [the Fair Labor Standards Act of 1938,] as amended, to the extent that [act] the Fair
34 Labor Standards Act relates to the payment of a minimum wage.
35 (2) As used in this chapter:
36 (a) "Cash wage obligation" means an hourly wage that an employer pays a tipped
37 employee regardless of the tips or gratuities a tipped employee receives.
38 (b) "Commission" means the Labor Commission.
39 (c) "Consumer Price Index" means the consumer price index for the United States city
40 average of urban wage earners and clerical workers, or a successor index using all items as
41 determined by the United States Department of Labor.
42 [(c)] (d) "Division" means the Division of Antidiscrimination and Labor in the
43 commission.
44 [(d)] (e) "Minimum wage" means the state minimum hourly wage for adult employees
45 as established under this chapter, unless the context clearly indicates otherwise.
46 [(e)] (f) "Tipped employee" means an employee who customarily and regularly
47 receives tips or gratuities.
48 Section 2. Section 34-40-103 is amended to read:
49 34-40-103. Minimum wage -- Commission to review and modify minimum wage.
50 (1) (a) [The] Effective July 1, 2007, and subject to Subsection (3), the minimum wage
51 for all private and public employees within the state shall be [$3.35] the greater of:
52 (i) $7.25 per hour[.]; or
53 (ii) the federal minimum wage as provided in the Fair Labor Standards Act, 29 U.S.C.
54 Sec. 201 et seq.
55 [(b) Effective April 1, 1990, the minimum wage shall be $3.80 per hour.]
56 [(2) (a) After July 1, 1990, the commission may by rule establish the minimum wage or
57 wages as provided in this chapter that may be paid to employees in public and private
58 employment within the state].

59 [(b) The minimum wage, as established by the commission, may not exceed the federal
60 minimum wage as provided in 29 U.S.C. Sec. 201 et seq., the Fair Labor Standards Act of
61 1938, as amended, in effect at the time of implementation of this section.]
62 [(c) The commission:]
63 [(i) may review the minimum wage at any time;]
64 [(ii) shall review the minimum wage at least every three years; and]
65 [(iii) shall review the minimum wage whenever the federal minimum wage is
66 changed.]
67 (b) Effective January 1, 2009, and on each following January 1, the minimum wage for
68 all private and public employees within the state shall be the greater of:
69 (i) the adjusted minimum wage calculated under Subsection (2); or
70 (ii) the federal minimum wage as provided in the Fair Labor Standards Act, 29 U.S.C.
71 Sec. 201 et seq.
72 (2) The commission shall calculate the adjusted minimum wage as follows:
73 (a) for January 1, 2009, the commission shall calculate by no later than October 1,
74 2008, the adjusted minimum wage by increasing to the nearest cent $7.25 by a percentage equal
75 to the positive annual change, if any, in the consumer price index for the 12-month period
76 ending on August 30, 2008; and
77 (b) beginning for January 1, 2010, the commission shall calculate by no later than the
78 immediately proceeding October 1, the adjusted minimum wage by increasing to the nearest
79 cent the adjusted minimum wage in the year that the calculation is being made by a percentage
80 equal to the positive annual change, if any, in the consumer price index for the 12-month
81 period ending on August 30 in the year the adjusted minimum wage is being calculated.
82 (3) The commission may by rule provide for separate minimum hourly wages for
83 minors.
84 Section 3. Section 34-40-104 is amended to read:
85 34-40-104. Exemptions.
86 (1) The minimum wage established in this chapter does not apply to:
87 [(a) any employee who is entitled to a minimum wage as provided in 29 U.S.C. Sec.
88 201 et seq., the Fair Labor Standards Act of 1938, as amended;]
89 [(b)] (a) outside sales persons;

90 [(c)] (b) an employee who is a member of the employer's immediate family;
91 [(d)] (c) companionship service for persons who, because of age or infirmity, are
92 unable to care for themselves;
93 [(e)] (d) casual and domestic employees as defined by the commission;
94 [(f)] (e) seasonal employees of:
95 (i) nonprofit camping programs[,];
96 (ii) religious or recreation programs[,]; and
97 (iii) nonprofit educational and charitable organizations registered under Title 13,
98 Chapter 22, Charitable Solicitations Act;
99 [(g)] (f) an individual employed by the United States of America;
100 [(h)] (g) any prisoner employed through the penal system;
101 [(i)] (h) any employee employed in agriculture if the employee:
102 (i) is principally engaged in the range production of livestock;
103 (ii) is employed as a harvest laborer and is paid on a piece rate basis in an operation
104 that has been and is generally recognized by custom as having been paid on a piece rate basis in
105 the region of employment;
106 (iii) was employed in agriculture less than 13 weeks during the preceding calendar
107 year; or
108 (iv) is a retired or semiretired person performing part-time or incidental work as a
109 condition of the employee's residence on a farm or ranch;
110 [(j)] (i) registered apprentices or students employed by the educational institution in
111 which they are enrolled; or
112 [(k)] (j) any seasonal hourly employee employed by a seasonal amusement
113 establishment with permanent structures and facilities if:
114 (i) the other direct monetary compensation from [tips, incentives, commissions,
115 end-of-season bonus, or other forms of pay] the following is sufficient to cause the average
116 hourly rate of total compensation for the season of seasonal hourly employees who continue to
117 work to the end of the operating season to equal the applicable minimum wage [if]:
118 (A) tips;
119 (B) incentives;
120 (C) commissions;

121 (D) end-of-season bonus; or
122 (E) other form of pay; and
123 (ii) the seasonal amusement establishment:
124 [(i)] (A) does not operate for more than seven months in any calendar year; or
125 [(ii)] (B) during the preceding calendar year [its] has average receipts for any six
126 months of that year [were] that are not more than 33-1/3% of its average receipts for the other
127 six months of that year.
128 (2) (a) Persons with a disability whose earnings or productive capacities are impaired
129 by age, physical or mental deficiencies, or injury may be employed at wages that are lower than
130 the minimum wage, provided the wage is related to the employee's productivity.
131 (b) The commission may establish and regulate the wages paid or wage scales for
132 persons with a disability.
133 (3) The commission may establish or may set a lesser minimum wage for learners not
134 to exceed the first 160 hours of employment.
135 (4) (a) An employer of a tipped employee shall pay the tipped employee at least the
136 minimum wage established by this chapter.
137 (b) In computing a tipped employee's wage under this Subsection (4), an employer of a
138 tipped employee:
139 (i) shall pay the tipped employee at least the cash wage obligation as an hourly wage;
140 and
141 (ii) may compute the remainder of the tipped employee's wage using the tips or
142 gratuities the tipped employee actually receives.
143 (c) An employee shall retain all tips and gratuities except to the extent that the
144 employee participates in a bona fide tip pooling or sharing arrangement with other tipped
145 employees.
146 (d) In accordance with Title 63, Chapter 46a, Utah Administrative Rulemaking Act, the
147 commission shall by rule establish the cash wage obligation [in conjunction with its review of
148 the minimum wage under Section 34-40-103 ].
149 Section 4. Effective date.
150 This bill takes effect on July 1, 2007.

Legislative Review Note
as of 1-2-07 1:06 PM

Office of Legislative Research and General Counsel