The Delaware minimum wage ensures that workers across the state earn a fair and livable income. It’s not just about meeting the legal minimum; it’s about creating a foundation for financial stability for employees in all industries. For employers, understanding and keeping up with these wage laws is crucial for staying compliant and creating a positive workplace culture.
This guide is here to break it all down for you. We’ll cover the current Delaware minimum wage, any upcoming changes you should be aware of, specific rules for tipped employees, and who these laws apply to. Whether you’re an employer working to get payroll right or an employee curious about your rights, this article has everything you need to navigate Delaware’s wage laws with confidence. Let’s get started!
U.S. Minimum Wage Framework
Before we answer the question “What is the minimum wage in Delaware?”, let’s start with the basics: How minimum wage works in the U.S.
The minimum wage in the United States is a complex system with multiple tiers, each set by a different level of government: federal, state, and municipal. This progressive approach aims to ensure that workers across the country receive a fair wage in line with local economic conditions.
Federal Minimum Wage
As the baseline, the federal minimum wage is the lowest hourly rate that employers are legally allowed to pay their employees. It is set by the Fair Labor Standards Act (FLSA) and was last raised in 2009 to $7.25 per hour. This rate, which ensures that employers comply with a basic level of compensation regardless of their location or industry, is significantly lower than the median hourly wage of all workers in the United States ($35.00 per hour).
State Minimum Wages
Recognizing regional variations in local economies and the cost of living, there are also many state minimum wage laws that set the threshold higher than the federal rate. These state-level mandates ensure that workers in higher-cost areas receive a wage that reflects their cost of living. For example, the minimum wage is $12.30 per hour in Missouri, $12.00 per hour in Hawaii, and $16.28 per hour in Washington State (the highest rate in the country). Delaware also has its own state minimum wage, as we will see in the next section.
Municipal Minimum Wages
To further address regional economic environments, some cities and counties have implemented local minimum wage mandates that are higher than both federal and state rates. This approach ensures that workers in urban centers, where the cost of living is often higher, receive a wage that reflects their specific environment.
Variations by Industry
Finally, in addition to regional differences, the minimum wage can also vary based on industry. For example, the minimum wage for tipped employees in the service industry is typically lower than the minimum wage for non-tipped employees. This is because many states expect tipped employees to receive a significant portion of their income from tips.
History of the Delaware Minimum Wage
Over the years, Delaware has steadily raised its minimum wage to keep up with the cost of living and ensure fair pay. What started as a mirror of federal standards has grown into a state-specific approach designed to better support local workers and businesses. These increases reflect Delaware’s commitment to helping employees build financial stability while giving employers the tools to stay competitive.
Delaware Minimum Wage Timeline
Here are the most notable updates to the Delaware minimum wage since it was first established in 1968.
- 1968. Delaware established its own state minimum wage at $1.25 per hour. This aligned with the federal rate at that time.
- 1972. The state increased the Delaware minimum wage to $1.60 per hour, continuing to match the federal rate.
- 1976. The Delaware minimum wage increased to $2.30 per hour. This rate remained unchanged until 1988.
- 1988. Another increase to $3.35 per hour.
- 1996. Raised to $4.65 per hour. This was the first time the Delaware minimum wage dropped lower than the federal rate.
- 1998. The state raised the minimum wage again to $5.25 per hour.
- 2000. Raised to $5.65 per hour. This was the first time the Delaware minimum wage surpassed the federal limit.
- 2007. Only a slight increase in 2007 to $6.65 per hour. This brought the state back in line with the federal minimum wage rate.
- 2008. The minimum rate was raised again the following year to $7.15 per hour.
- 2009. Once again the Delaware minimum wage was aligned with the federal rate of $7.25 per hour. The federal minimum wage rate has not increased since 2009. This means that the state’s minimum wage has been higher than the federal limit for almost 16 years now.
- 2014 – 2024. There were a number of further increases over the next decade, including $9.25 per hour in 2019, and $11.75 per hour in 2023. The current Delaware minimum wage stands at $13.25 per hour.
Current Delaware Minimum Wage Rates
So, what is the minimum wage in Delaware?
As of January 1, 2024, the Delaware minimum wage is $13.25 per hour. This rate applies to most workers across the state, ensuring they receive the same baseline pay. It’s an increase from last year’s $11.75, reflecting Delaware’s efforts to provide fair wages and keep up with rising living costs.
Employers must pay this rate to eligible employees, maintain accurate records, and ensure payroll is correct. Mistakes or non-compliance can lead to penalties, so staying informed is crucial. This minimum wage covers most workers in Delaware and helps promote fairness in the workplace.
Eligible employees include:
- Full-time and part-time workers
- Temporary or seasonal workers
- Employees working in most industries, including retail, hospitality, and healthcare
- Employees working in cities and counties across Delaware
- Workers who are 18 years or older
Are there any Municipal Minimum Wage Rates in Delaware?
In Delaware, there are no separate minimum wage rates for different cities or towns. The state sets one standard rate that applies to everyone, no matter where they work in the state. This makes it easier for businesses to follow the law because they don’t have to worry about different rates in different places. All workers in the state are covered by the same minimum wage rules (unless they are exempt).
Delaware Minimum Wage: Exemptions
While Delaware’s minimum wage law covers most employees, certain exemptions apply. These exemptions are typically based on job type or how an employee is compensated. It’s important to understand who is exempt from Delaware minimum wage laws, as these rules can vary.
Here’s everything you need to know.
Delaware Minimum Wage for Tipped Workers
Tipped workers in Delaware, like waitstaff, bartenders, and hotel workers, have special rules under the state’s minimum wage law. Employers can pay these workers a lower base wage of $2.23 per hour. However, their total earnings, including tips, must meet or exceed the state’s minimum wage of $13.25 per hour. If tips don’t cover the difference, the employer must pay the remaining amount to ensure the worker receives the full minimum wage. Employers must keep a record of all tips and ensure workers earn at least the minimum wage when tips are combined with their base pay.
Additional Delaware Minimum Wage Exemptions
Delaware minimum wage laws also provide exemptions for certain types of workers. These employees are not entitled to the same minimum wage protections due to the nature of their work or compensation structure.
Here are the main exemptions:
- Employees in agriculture
- Employees in domestic service in or about private homes
- Employees of the United States Government
- Outside commission-paid salespeople
- Bona fide executives, administrators, and professionals
- Employees engaged in fishing and fish processing at sea
- Volunteer workers (for educational, religious, or non-profit organizations)
- Junior camp counselors employed by non-profit summer camp programs
- Inmates participating in Department of Correction programs
Are There Any Upcoming Changes to the Delaware Minimum Wage?
In 2021, Governor John Carney signed legislation to raise the state’s minimum wage to $15 per hour by 2025. This decision was made to help workers keep up with the rising cost of living and ensure fair wages across the state.
The first step in this plan took place on January 1, 2024, when the minimum wage increased to $13.25 per hour. The next increase is scheduled for January 1, 2025, when the minimum wage will rise to $15.00 per hour. The minimum cash wage will remain at $2.23 per hour for tipped workers.
The gradual rise in the minimum wage gives businesses time to adjust their budgets and make necessary changes to their payroll systems. It also helps workers manage the increasing costs of housing, food, and other essentials.
By 2025, Delaware will join at least 20 other states that have raised or are in the process of raising their minimum wage to $15 per hour. States like California, New York, Illinois, and Colorado are already on track to reach this wage level. This trend reflects a growing movement to address the rising cost of living and promote fair compensation. Employers in Delaware should prepare for these changes and ensure they remain compliant with the new wage laws as they are implemented.
Additional Delaware Wage Laws
Aside from the Delaware minimum wage, the state has a number of additional wage laws that employers need to understand as these can have an impact on an employee’s wages.
Let’s explore these additional Delaware wage laws in a bit more detail so you can make sure your employee handbook meets all requirements.
Overtime Pay
Delaware follows the federal standard for overtime, which requires employers to pay 1.5 times the regular hourly rate (time and a half) for hours worked beyond 40 in a week. For example, if an employee received the Delaware minimum wage rate of $13.25 per hour, you must pay them $19.88 per hour for every hour of overtime. This applies to all non-exempt employees under the FSLA. Exempt employees, who typically hold executive, administrative, or professional positions, are not entitled to overtime pay.
Child Labor Laws
Delaware’s child labor laws protect minors by regulating their working hours, conditions, and the types of work they can perform. Minors under the age of 16 can work only limited hours: no more than 4 hours on school days and 18 hours during a school week. During non-school periods, they can work up to 8 hours per day, 40 hours per week.
Children 16 and older have fewer restrictions, but they still cannot work in hazardous environments. Employers must adhere to these laws to avoid penalties and ensure the safety and well-being of young workers.
Meal and Rest Breaks
Delaware law does not require employers to provide meal or rest breaks. However, if an employer offers breaks lasting 20 minutes or less, they must pay employees for that time. This aligns with federal break laws. For longer breaks, such as meal breaks, employers do not need to pay employees.
Although breaks are not mandatory, it is helpful for employers to set clear policies and communicate them to employees. This ensures consistency and helps avoid misunderstandings.
Wage Payment and Deductions
According to Delaware’s Wage Payment and Collection Act, employers must pay employees at least twice a month. Employers must also provide itemized pay statements that show wages earned, the pay period, and any deductions, such as taxes, insurance, or other withholdings. These statements help employees understand how their pay is calculated and what deductions are made. Employers must ensure that the pay statements are clear and accurate to avoid confusion.
The Act also requires employers to keep accurate records of wages, hours worked, and deductions for at least three years. This helps employers comply with wage laws and ensures transparency in wage payment practices.
Final Paychecks
According to the Delaware Department of Labor, when an employee quits, resigns, is discharged, suspended, or laid off, the employer must pay all earned wages on the next regularly scheduled payday. This final payment can be made through the usual pay channels or by mail if requested by the employee. Employers should ensure that the final paycheck is complete and accurate to prevent issues after the employee’s departure.
Equal Pay for Equal Work
Delaware’s Wage Payment and Collection Act also ensures that employers pay employees fairly for similar work. It requires employers to pay the same wage for similar tasks done under similar conditions, regardless of gender. Employers can only pay different wages if they are based on factors like experience, education, or seniority. This law, which aligns with the federal Equal Pay Act, helps prevent gender-based wage gaps and promotes pay parity in the workplace.
Pay Transparency
Delaware law prohibits employers from asking job applicants about their salary history during the hiring process. This helps prevent pay discrimination based on past earnings. Instead, employers should base compensation on the applicant’s experience, skills, and the responsibilities of the role.
Best Practices for Delaware Wage Law Compliance
If you are an employer in Delaware, then you must comply with all state wage laws, including Delaware’s recordkeeping and minimum wage requirements. To avoid legal penalties and maintain smooth operations, employers should adopt best practices that streamline all payroll, timekeeping, and recordkeeping processes.
Factorial’s software offers comprehensive solutions that can help businesses comply with all state regulations efficiently:
- Accurate payroll management. Ensure all employees are paid the correct Delaware minimum wage, including overtime, using automated payroll systems like Factorial’s payroll software, which can adjust for Delaware’s minimum wage increases and tip credits.
- Track hours accurately. Use Factorial’s timekeeping tools to track employee start and stop times, total hours, breaks, and overtime, ensuring you comply with Delaware’s break, time tracking and recordkeeping requirements.
- Simplify recordkeeping. Factorial stores payroll and employee time records digitally for three years or more, ensuring easy access for audits or inspections by the Delaware Department of Labor.
- Generate compliant pay stubs. Automatically generate pay stubs that detail hours worked, wages earned, deductions, and overtime pay, complying with Delaware wage statement requirements.
- Real-time updates. Finally, keep your business up to date with Delaware wage laws through Factorial’s system, which is regularly updated to reflect new legislation and wage adjustments.
By leveraging Factorial’s comprehensive payroll and HR features, businesses in Delaware can stay compliant with the state’s evolving wage and hour laws, including the Delaware minimum wage, while minimizing manual errors and administrative burdens.
