Act 114 Mandates Incremental Raises Leading to $18 per Hour by 2028

In a move aimed at enhancing the financial well-being of workers, the Hawaiʻi State Department of Labor and Industrial Relations (DLIR) has announced a scheduled increase in the minimum wage. Effective January 1, 2024, the minimum wage will rise to $14 per hour, as mandated by Act 114, Session Laws of Hawaiʻi (2022). This legislative initiative aims to progressively raise the minimum wage to $16 per hour by January 1, 2026, and $18 per hour by January 1, 2028.

Jade T. Butay, DLIR Director, emphasized the underlying purpose of the minimum wage law, stating, “The minimum wage rate is a floor designed to protect workers against unduly low pay, safeguarding the health, efficiency, and general well-being of workers.”

Alongside the overall minimum wage increase, the tip credit will also see adjustments starting January 1, 2024. Tipped employees will be eligible to receive $1.25 below the minimum wage, and this credit will further increase to $1.50 below the minimum wage beginning January 1, 2028. Employers may apply the tip credit, ensuring that the combined amount employees receive from the employer and in tips is at least $7.00 more than the prevailing minimum wage.

These changes underscore the state’s commitment to providing fair compensation for its workforce, with the incremental adjustments reflecting a strategic approach towards bolstering economic well-being.