The federal minimum wage of $7.25 per hour applies to covered nonexempt workers in states that haven't established higher rates. This rate has remained stagnant for 17 years, making it the longest period without an increase since the minimum wage was established in 1938. Workers in states without higher minimums earn just $15,080 annually working full-time at this rate.
Which States Have Higher Minimum Wages in 2026
Thirty-two states plus Washington D.C. have minimum wages above the federal rate as of 2026. Washington state leads with $16.28 per hour, followed by California at $16.00 for employers with 26+ employees. Massachusetts ($15.00), Connecticut ($15.00), and New York ($15.00 statewide, higher in NYC) round out the top-paying states.
Several states tie their minimum wage to inflation through automatic annual adjustments. These include Arizona ($14.35), Colorado ($14.42), Maine ($14.15), and Oregon ($14.20 standard rate). This indexing helps workers maintain purchasing power as living costs rise year over year.
City and County Minimum Wage Laws That Exceed State Rates
Many cities and counties have established minimum wages higher than their state requirements. Seattle leads major cities at $18.69 per hour for large employers, while San Francisco requires $18.07 per hour. New York City mandates $15.00 per hour minimum, significantly higher than the state's general rate.
These local ordinances often include different rates based on employer size, benefits provided, or worker tips received. Some jurisdictions also have separate rates for airport workers, hotel employees, or other specific industries. Workers should check their specific city or county requirements, as local laws typically supersede state minimums when higher.
Tipped Worker Minimum Wage Rates Across America
The federal tipped minimum wage remains $2.13 per hour in 2026, provided tips bring total earnings to $7.25 hourly. Seventeen states require employers to pay the full state minimum wage before tips, including Alaska ($11.73), California ($16.00), and Washington ($16.28). These "one fair wage" states eliminate the separate tipped minimum entirely.
In states using the federal tipped minimum, employers must make up the difference if tips don't reach the regular minimum wage threshold. However, wage theft in the restaurant industry remains common, with many tipped workers experiencing violations of this "tip credit" rule according to Department of Labor investigations.
Upcoming Minimum Wage Increases Scheduled for 2026
Several states have minimum wage increases taking effect at different points throughout 2026. Florida's rate increases to $12.00 per hour on September 30, 2026, continuing its path toward $15.00 by 2028. Illinois reaches $15.00 per hour for non-tipped workers on January 1, 2026, completing its multi-year phase-in.
Maryland's minimum wage increases to $15.00 per hour for all employers starting January 1, 2026, while small employers (14 or fewer employees) had been paying $14.00. Rhode Island's minimum wage rises to $15.00 per hour on January 1, 2026, after gradual increases from previous years. These scheduled increases affect millions of workers across these states.
How Federal and State Minimum Wage Laws Work Together
When federal and state minimum wage laws differ, employers must pay whichever rate is higher. The Fair Labor Standards Act establishes the federal floor, but states retain authority to set higher standards for workers within their borders. This dual system means minimum wage workers' pay varies dramatically based on geographic location.
Federal law covers employees of enterprises with annual gross volume of sales of $500,000 or more, plus individual workers engaged in interstate commerce. State laws often have broader coverage, including smaller businesses and additional worker categories. Some states also provide stronger enforcement mechanisms and penalty structures than federal law.
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