## North Carolina minimum wage ### Standard minimum wage $7.25/hour (matches federal). ### Tipped employees $2.13/hour with tip credit. ## How federal and state minimum wage interact When state and federal minimums differ, the **higher** number wins: - **Federal Fair Labor Standards Act (FLSA)** sets the floor at $7.25/hour (unchanged since 2009) - **State minimum** can be higher (most are now) - **City/county minimums** can be higher still (Seattle, NYC, San Francisco, DC) - **Industry-specific minimums** can be higher (CA fast-food $20, healthcare workers tiered) Employers must pay whichever is highest and applicable. ## Tipped workers — how the tip credit works Federal law and many states allow employers to pay a sub-minimum cash wage IF tips bring the worker up to the full minimum. The mechanics: 1. Employer pays the cash wage (e.g., $2.13 federal) 2. Worker receives tips 3. If cash + tips reach minimum wage, the employer met its obligation 4. If cash + tips fall short, employer must make up the difference **No-tip-credit states** (CA, NV, MN, MT, OR, WA, AK, and DC after 2027) require the full minimum wage as cash regardless of tips. Tips are pure additional income. ## Overtime Federal law (FLSA) requires overtime — 1.5x regular rate — for hours over 40 in a week (with many exemptions). Some states add daily overtime: - **California** — 1.5x after 8 hours/day; 2x after 12 hours/day (and after 8 hours on the 7th day) - **Alaska, Nevada, Colorado** — daily overtime at 8 or 12 hours - **Other states** — follow federal weekly-only standard ## Common exemptions Not every worker is entitled to minimum wage and overtime. Major federal exemptions: - **Executive, administrative, and professional employees** — must meet duties test AND salary threshold ($684/week federal as of 2024; $1,128/week starting 2025 if reinstated) - **Outside sales employees** - **Independent contractors** (real ones — misclassification is a major source of wage disputes) - **Certain agricultural and seasonal workers** - **Some computer professionals** - **Volunteers, interns, students** (with limits) Misclassification of employees as exempt or as contractors is one of the most common wage-and-hour violations. ## Recovering unpaid wages If you've been paid less than minimum wage or denied overtime, you can recover: - **Back wages** — what you should have been paid - **Liquidated damages** — equal to back wages (effectively doubles recovery) - **Attorney's fees** — winners' fees come from the employer (FLSA fee-shifting) - **Civil penalties** — additional in some states Statute of limitations is typically 2 years (3 for willful violations). ## What you should do Wage-and-hour cases are routinely brought on contingency by employment attorneys — you usually don't pay anything out of pocket. Most North Carolina employment attorneys offer free initial consultations. The Department of Labor (federal) and North Carolina's state labor agency also accept complaints and investigate. --- *This guide is general information about North Carolina law as of early 2026 and is not legal advice. Minimum-wage figures change frequently — most states have annual indexing or scheduled increases. Talk to a licensed North Carolina employment attorney or check your state's labor agency for the current rate.*