Connecticut Minimum Wage Laws & Compliance Guide

Connecticut takes a proactive approach to wage policies, ensuring pay rates grow alongside economic shifts. Employers must stay on top of annual adjustments to remain compliant and prevent payroll errors. With new updates in place for 2025, understanding wage laws is more important than ever.

The state uses a structured formula tied to the employment cost index, making Connecticut's minimum wage one of the most adaptive in the country. These adjustments directly impact payroll planning, employee earnings, and overall compliance efforts.

Here's a breakdown of the current minimum wage in Connecticut, who qualifies for the updated rate, and the legislative framework driving these changes.

Current Connecticut Minimum Wage

• Connecticut's minimum wage increased to $16.35 per hour on January 1, 2025.

• This hourly rate applies to most workers, with exceptions for specific roles like agricultural laborers and outside sales representatives as defined by labor regulations.

• The increase resulted from Public Act 19-4, signed by Governor Ned Lamont, which ties annual wage adjustments to the U.S. Department of Labor's employment cost index.

Upcoming Changes to Connecticut's Minimum Wage

Connecticut adjusts minimum wage annually using a precise formula tied to the U.S. Department of Labor's employment cost index. This approach ensures wage increases are directly aligned with changes in labor costs for the prior year.

Each year, the state's labor commissioner reviews the employment cost index data for the 12-month period ending June 30. By October 15, the commissioner announces any upcoming changes. These adjustments are effective January 1 of the following year, giving employers and payroll teams a clear timeline to prepare.

For example, as of January 1, 2025, the minimum wage rose by $0.66. The employment cost index increased by 4.2% during the 12-month review period, bringing the previous hourly rate of $15.69 up to $16.35.

This predictable, data-driven system allows businesses to plan payroll updates while increasing wages in proportion to broader economic trends.

Overtime Pay Requirements in Connecticut

Connecticut law requires employers to pay overtime at a rate of 1.5 times an employee's regular hourly wage for any hours worked beyond 40 in a single workweek. This standard applies to hourly employees who do not qualify for exemptions.

Overtime pay is not required for hours worked in a single day unless an employer and employee have a written agreement. Similarly, there is no automatic requirement to pay overtime for work performed on weekends or holidays unless an employment contract outlines that obligation.

Certain job roles are not eligible for overtime pay under Connecticut regulations. These include:

1. Agricultural workers: Employees engaged in farming or similar activities fall under the exemption from overtime pay.

2. Executive, administrative, and professional employees: Salaried workers in these categories, as defined by the labor commissioner, do not qualify for overtime.

3. Outside sales representatives: Employees whose primary responsibilities involve sales conducted away from the employer's business location are excluded from overtime pay requirements.

Employers must carefully evaluate job duties to determine whether an employee is exempt or non-exempt from overtime. Misclassifying employees can result in legal and financial consequences. Accurate record-keeping is also mandatory under state law, including documentation of daily and weekly hours worked. This ensures employers can verify compliance with overtime regulations and resolve disputes effectively.

Exceptions and Specific Rates

Connecticut’s minimum wage laws outline specific rates for certain workers, including minors and tipped employees. Employers must apply these rates accurately to avoid noncompliance and payroll errors.

• Minors (Under 18): Workers under 18 can be paid a reduced hourly rate during the first 90 days of employment. The allowable rate is 85% of the standard minimum wage, which totals $13.90 per hour as of 2025. After the 90-day period, employers must increase the pay to the full minimum wage of $16.35 per hour. This reduced rate is strictly limited to the initial employment period and cannot extend beyond the ninety-day threshold.

• Tipped Employees: Workers who regularly receive tips, such as bartenders and restaurant staff, are subject to different cash wage requirements. Employers may pay a reduced base wage, provided that tips bring the total earnings to meet or exceed the standard hourly minimum of $16.35.

• Hotel and Restaurant Staff: Waitstaff and other tipped employees in restaurants and hotels must receive a minimum cash wage of $8.62 per hour. The total earnings, including tips, must equal or surpass $16.35 per hour. If tip earnings fall short, the employer must make up the difference, ensuring compliance with the state's standard minimum wage.

• Bartenders: Bartenders have a lower cash wage requirement, set at $6.77 per hour, due to typically higher tip earnings. The rule remains the same—total compensation, including tips, must reach at least $16.35 per hour. Any shortfall in tipped earnings must be supplemented by the employer.

Employers must accurately track hours worked, base wages, and tip income for all tipped employees. Connecticut law requires clear documentation to ensure that total earnings meet required thresholds. Payroll systems and wage records should reflect precise calculations to avoid penalties or disputes during audits.

Minimum Wage Record-Keeping Requirements for Connecticut Employers

Connecticut employers must follow strict guidelines for documenting employee time and wage information. Every record must be accurate, detailed, and kept onsite for no less than three years. Proper record-keeping ensures compliance with statewide labor requirements and protects against potential disputes or penalties.

The following items must be included in each employee's file:

• Full Name and Residential Address: Record the legal name and current home address of the employee.

• Job Title: Clearly state the role or position held by the employee within the organization.

• Hours Worked: Track the exact hours worked each day and week, including the start and end times for all shifts. Time must be computed to the nearest 15-minute increment to meet state standards.

• Wages Paid: Document the regular hourly, daily, or weekly earnings for each pay period. Overtime wages must also be listed as a separate line item.

• Adjustments to Pay: Note any additions or deductions, such as taxes, benefit contributions, bonuses, or garnishments, with clear explanations for each adjustment.

• Total Compensation Per Pay Period: Provide a final total of all wages paid to the employee after adjustments.

For employees aged 16 to 18, employers must keep working certificates on file. These documents prove that the individual is legally authorized to work under state labor laws. Employers must retain these certificates for as long as the minor remains employed.

Organized and up-to-date records are non-negotiable. Regularly review employee files to ensure completeness and accuracy. Using a reliable system to record and store information simplifies compliance and reduces the likelihood of errors during audits or inspections.

Wage Payment and Termination Requirements in Connecticut

Employers in Connecticut must provide written new hire paperwork specifying pay rates, scheduled work hours, and payroll frequency to every new hire. This written notice ensures employees fully understand how and when they will be compensated before they begin work. Employers should also communicate any policies or practices related to wages, such as overtime or bonus structures, in writing or through a clearly posted notice.

When an employee's job ends, the timing of the final paycheck depends on the reason for termination.

• Voluntary Resignation or Layoff: If an employee resigns or is laid off, the employer must issue the final paycheck on the next regular payday. This rule applies regardless of whether the payday falls days or weeks after the employee's last working day.

• Discharge: Employees who are fired must receive their final paycheck no later than the next business day. This accelerated timeline ensures immediate payment of any outstanding wages owed.

Connecticut law strictly prohibits withholding wages unless a deduction falls under one of the following categories:

1. Legal Requirements: Mandated deductions include taxes, wage garnishments, and court-ordered child support. These withholdings are non-negotiable and must comply with applicable laws.

2. Employee Consent: Deductions for items such as insurance premiums, retirement contributions, or loan repayments are allowed if the employee provides written authorization. The signed consent must specify the amount and purpose of the deduction.

3. Employer-Sponsored Plans: Contributions to medical or retirement plans offered by the employer may be deducted with prior employee approval.

Employers must document every deduction made from an employee's paycheck and ensure records are accurate. Unauthorized withholdings or failure to pay wages on time can result in penalties, legal action, or both. Reviewing payroll systems regularly helps employers maintain compliance and avoid costly errors.

Penalties for Minimum Wage Violations in Connecticut

Non-compliance with Connecticut's minimum wage or overtime laws can lead to significant financial and legal consequences. The Connecticut Department of Labor (DOL) investigates reported violations and ensures employers are held accountable for improper pay practices.

Employers found in violation must repay all unpaid wages owed to employees. Back pay includes the full difference between what was paid and the lawful minimum wage or overtime rate during the period of non-compliance. This repayment ensures employees receive the compensation they were entitled to but did not receive.

Civil penalties are assessed for each wage violation. The fines are calculated based on the extent and frequency of the offenses. For example, repeated failures to meet minimum wage requirements may result in larger penalties compared to isolated incidents. These fines are in addition to any back pay owed.

Legal fees are often part of the financial burden for non-compliant employers. If the Connecticut DOL pursues legal action, employers may be required to cover court costs and attorney fees incurred during the enforcement process. This adds to the overall expense of failing to follow wage laws.

Employers who intentionally underpay employees or disregard labor regulations may face harsher repercussions, including reputational damage and further legal action. Regular audits of payroll practices and meticulous record-keeping can help businesses avoid these penalties while ensuring compliance with state wage laws.

Determining Exempt vs. Non-Exempt Status for Salaried Employees in Connecticut

Classifying salaried employees as exempt or non-exempt in Connecticut requires precision and attention to legal requirements. Exempt employees do not qualify for overtime pay, but this status is only lawful if specific criteria are satisfied. Employers must base decisions on job responsibilities and pay structure, not assumptions or job titles.

To qualify as exempt, an employee's primary job duties must align with one of the following categories:

1. Executive Roles: The employee must manage a business, department, or subdivision. Regular supervision of at least two full-time employees is required. Authority over hiring, firing, or making recommendations that carry significant weight in employment decisions is also mandatory.

2. Administrative Roles: The work must support management or general business operations. Tasks should involve discretion and independent judgment on important business matters, such as developing workflows or analyzing operational policies.

3. Professional Roles: The job must require advanced knowledge in a specialized field, typically gained through prolonged study or education. Examples include roles in law, engineering, or creative industries where original, inventive work is performed.

Salary requirements also play a key role in determining exempt status. Employees must receive a fixed, predetermined salary that meets or exceeds the minimum threshold established by law. Pay cannot fluctuate based on the number of hours worked or the quality of the employee's output.

Failure to properly classify employees can lead to steep penalties, including back pay for unpaid overtime. Employers should regularly review job descriptions and duties to verify compliance. Using clear documentation during this process ensures accurate classification and protects against disputes or enforcement actions.

Final Thoughts for Connecticut Employers

Navigating the complexities of Connecticut's minimum wage laws can be challenging, but staying informed and proactive is key to maintaining compliance and avoiding costly penalties. We're here to help you streamline your payroll processes, ensure accurate record-keeping, and stay up-to-date with the latest wage regulations. Book a demo with us today to discover how our comprehensive HR solutions can simplify compliance and empower your business to thrive.