Today, July 1st 2020, Chicago’s minimum wage goes up. The increase marks the second stage of a plan to incrementally reach $15.00/hour by 2021. The BACP published full rules on their website; here are the essential details:

What is the Minimum Wage in Chicago?

The minimum wage used to be $13.00 across the board. The rules taking effect today (July 1st, 2020) introduce a little more nuance. The minimum wage now depends on the size of your business; businesses with a workforce over a certain size pay a little bit more.

  • Tiny (Fewer than 4 workers): $10.00 (was $9.25; Chicago’s rules don’t address employers of this size, so we assume that Illinois’s minimum applies)
  • Small (4 – 20 workers): $13.50
  • Large (21 or more workers): $14.00
  • Youth workers: $10.00 (was $8.00)

What is the Minimum Wage for Tipped Workers?

The numbers above apply to non-tipped workers. But don’t forget, servers, bartenders, and other tipped workers have historically received a lower minimum, and this still holds true. Their tips, the theory goes, compensate for their lower wages. The increase seems especially timely, with bars and restaurants restarting dine-in service as Chicago enters Phase 4 of reopening. As with non-tipped workers, businesses must pay a different amount depending on how many workers they have:

  • Tiny (Fewer than 4 workers): $6.00 (was $5.55; Chicago’s rules don’t address employers of this size, so we assume that Illinois’s minimum applies)
  • Small (4 – 20 workers): $8.10 (was $6.40)
  • Large (21 or more workers): $8.40 (was $6.40)
  • Youth workers: $6.00

Don’t Forget to Make Up The Difference!

Employers! If your tipped worker’s wages plus tips do not equal at least the minimum wage, you are responsible for paying them the difference! This was true before, and it remains true.

Overtime

The rules also dictate minimum overtime pay. When an employee works more than 40 hours in a calendar week, they’re entitled to at least 1.5 times the City’s new minimum.

For non-tipped workers

  • Tiny (Fewer than 4 workers): $15.00 (was $13.90; Chicago’s rules don’t address employers of this size, so we assume that Illinois’s minimum applies)
  • Small (4 – 20 workers): $20.25
  • Large (21 or more workers): $21.00
  • Youth workers: $15.00

For tipped workers

  • Tiny (Fewer than 4 workers): $9.00 (was $8.35; Chicago’s rules don’t address employers of this size, so we assume that Illinois’s minimum applies)
  • Small (4 – 20 workers): $15.40
  • Large (21 or more workers): $15.15
  • Youth workers: $0.00

When Will Chicago’s Minimum Wage Increase Again?

Per Chicago’s municipal code, the next wage increase is scheduled for July 1st, 2021.

 

If you still have questions, email us! You can also look for answers in resources from the BACP and Department of Labor, though it may take some digging: