New York Minimum Wage 2026: NYC, Downstate, and Statewide Rates

New York has one of the most complex minimum wage structures in the country. Rather than a single statewide rate, the state divides employers into regional tiers — with New York City and the surrounding downstate counties commanding a higher hourly minimum than the rest of the state. For employers operating in multiple regions, or those with workers who travel between locations, understanding these regional differences is critical to staying compliant.

This guide covers every detail you need for 2026: regional rates, the CPI-based annual adjustment mechanism, tip credit rules, salary thresholds for exempt employees, fast food worker provisions, posting requirements, and the penalties you face if you get it wrong.

1. 2026 Minimum Wage Rates by Region

Effective January 1, 2026, New York’s minimum wage rates are split into two tiers based on geography:

Previously, New York City had a separate, higher tier from the downstate suburbs. As of 2024, the NYC and downstate suburban rates were unified — meaning NYC, Nassau, Suffolk, and Westchester all share the same minimum wage of $16.50/hr in 2026.

How New York Compares to the Federal Minimum Wage

The federal minimum wage remains at $7.25 per hour and has not changed since 2009. New York’s rates are more than double the federal floor. In all cases, when a state minimum wage is higher than the federal rate, the higher state rate applies. Employers in New York must follow the state (and regional) rate.

2. Annual CPI Increases

New York’s minimum wage is no longer set by one-time legislative action. Under the state’s indexed adjustment mechanism, the minimum wage increases annually based on changes in the Consumer Price Index (CPI) — specifically, the CPI for Urban Wage Earners and Clerical Workers (CPI-W) for the Northeast region.

How It Works

• Each year, the New York State Department of Labor reviews the CPI-W data from the U.S. Bureau of Labor Statistics.
• The percentage change in the CPI-W from the prior year determines the size of the minimum wage increase.
• The new rate takes effect on January 1 of each year.
• There is no cap on the annual increase amount, and no provision for a decrease — if the CPI is flat or negative, the minimum wage stays the same.

Historical Rate Progression

Note that the CPI-based mechanism means rates can increase by different amounts each year. In periods of high inflation, the jump may be significant. Employers should treat the minimum wage as a moving target, not a fixed number.

3. Tip Credits and Service Workers

New York’s tip credit rules are significantly more restrictive than the federal FLSA rules, and employers frequently misunderstand them — which leads to costly wage violations.

The Key Rule: No Tip Credit Below Minimum Wage

Under federal law (FLSA), employers can pay tipped workers a cash wage as low as $2.13/hr, as long as tips bring total compensation to at least the federal minimum wage of $7.25/hr. New York is very different.

How the Tip Credit Works in New York

New York allows a limited tip credit — but only for specific industries and only under strict conditions:

• Hospitality industry (hotels and restaurants): Employers may take a tip credit, but the cash wage paid plus tips must equal or exceed the applicable minimum wage. The tip credit cannot be used to bring total compensation below the minimum wage floor.
• Service employees (non-hospitality): Different tip credit allowances may apply under the applicable Wage Order, but the same principle holds — total compensation must meet or exceed the full minimum wage.
• No tip pooling with non-tipped employees: Tips cannot be shared with managers, supervisors, or employees who do not customarily receive tips.

Cash Wage Minimums for Tipped Workers (2026)

Note: The exact cash wage and tip credit amounts are set by the applicable Wage Order and are subject to change with each annual minimum wage adjustment. Always verify current figures with the New York Department of Labor.

4. Salary Exempt Threshold

In addition to the hourly minimum wage, New York sets a minimum salary threshold for employees classified as exempt from overtime under the executive and administrative exemptions. This threshold is higher than the federal FLSA salary threshold — and, like the minimum wage, varies by region.

Why This Matters

To classify a salaried employee as “exempt” from overtime, the employee must:

1. Perform duties that meet the executive, administrative, or professional exemption tests, and
2. Earn a salary at or above the applicable threshold.

If the employee’s salary falls below the threshold, they must be treated as non-exempt and paid overtime (1.5x their regular rate for hours over 40 per week), regardless of their job duties.

2026 Salary Exempt Thresholds

These thresholds are tied to the minimum wage and adjust accordingly when the minimum wage increases. As the minimum wage rises with CPI adjustments, expect salary exempt thresholds to increase as well.

5. Fast Food Workers

New York has historically imposed additional minimum wage rules for fast food workers — employees of fast food establishments that are part of a chain with 30 or more locations nationwide.

Current Status

The fast food worker minimum wage was originally set to phase in at a higher rate than the standard minimum wage. As of 2026, the fast food minimum has converged with the standard NYC/downstate rate. However, there are important nuances:

• Scheduling protections: Fast food workers in NYC have additional “Fair Workweek” protections, including advance scheduling requirements and “premium pay” for schedule changes made with less than 14 days’ notice.
• Just cause protections: Fast food workers in NYC are covered by “just cause” termination rules, meaning employers need a legitimate reason to discharge an employee after a probationary period.
• No tip credit: Fast food establishments generally do not involve tipped workers, so the tip credit rules are not applicable.

6. Posting and Notice Requirements

New York requires employers to inform employees about their wage rates and related rights in multiple ways:

Workplace Posting Requirements

• Minimum Wage poster: Every employer must display the current New York State Minimum Wage poster in a conspicuous location where employees can easily see it. The poster is available free from the NY Department of Labor.
• Language requirements: The poster must be displayed in English and in any other language spoken by at least 5% of the workforce. The DOL provides translated versions.
• Industry-specific Wage Order summaries: Depending on the industry (hospitality, building service, farm labor, etc.), employers must also post the applicable Wage Order summary.

Wage Theft Prevention Act (WTPA) Notice

Under New York’s Wage Theft Prevention Act, employers are also required to provide each new employee with a written wage notice at the time of hire that includes:

• The employee’s rate of pay (hourly, salary, piece rate, etc.)
• Overtime rate of pay (if applicable)
• How the employee is paid (weekly, biweekly, etc.)
• The employer’s name, address, and phone number
• Any allowances taken as part of the minimum wage (tip credit, meal credits, etc.)
• The regular payday

The notice must be signed by the employee and retained by the employer for six years. Templates are available from the NY DOL in multiple languages.

7. Penalties for Non-Compliance

New York takes minimum wage violations seriously, and the penalties for non-compliance are among the steepest in the country:

Civil Penalties

• Unpaid wages: Employers must pay all back wages owed plus interest.
• Liquidated damages: In addition to back wages, employers can be assessed 100% liquidated damages — effectively doubling the amount owed to the employee.
• WTPA notice penalties: $50 per workday per employee for failure to provide the required wage notice, up to a maximum of $5,000 per employee.
• Wage statement penalties: $250 per workday per employee for failure to provide accurate pay stubs, up to $5,000 per employee.

Criminal Penalties

• First offense: Misdemeanor charge — up to one year in jail and fines up to $20,000.
• Second offense within six years: Felony charge — potential prison time and fines up to $20,000.
• Willful failure to pay wages: Can be prosecuted as larceny under New York Penal Law.

DOL Enforcement Actions

The New York Department of Labor investigates wage complaints and conducts audits. They can:

• Order payment of back wages and damages directly
• Assess civil penalties administratively
• Refer cases to the Attorney General for prosecution
• Publish the names of violating employers

8. Frequently Asked Questions

Does the New York minimum wage apply to all workers?

The minimum wage applies to virtually all employees in New York, including part-time, temporary, and seasonal workers. Limited exceptions exist for certain student workers, some non-profit employees, and workers with disabilities under special certificates issued by the DOL. Independent contractors (1099 workers) are not covered by minimum wage laws, but misclassification carries serious penalties in New York.

What if my employee works in multiple regions?

If an employee works in more than one region during a pay period (for example, some days in NYC and some days in Albany), the employee should be paid at least the applicable minimum wage for each hour worked in each location. Many employers simplify this by paying the higher rate for all hours.

Do I have to pay the New York minimum wage to remote workers?

Generally, the minimum wage is based on where the employee performs the work. If a remote worker lives and works in a downstate county, the downstate rate applies — even if your company is based upstate or out of state.

When does the 2027 minimum wage rate get announced?

The New York DOL typically publishes the next year’s minimum wage rate in the fall, usually September or October. The new rate takes effect January 1. Check the NY DOL website for announcements.

Can I pay a lower “training wage” for new employees?

New York does not have a general “training wage” or “youth subminimum wage” provision like some states. All covered employees must be paid the full applicable minimum wage from their first day of work.

What about salaried employees — does the minimum wage apply?

Yes. When converted to an hourly equivalent, a salaried non-exempt employee’s pay must equal or exceed the minimum wage for every hour worked. For exempt employees, the salary threshold (not the hourly minimum wage) is the controlling standard.

Are there local minimum wages higher than the state rate?

Unlike some states (California, for example), New York’s regional minimum wage tiers are set at the state level. Individual cities and counties within New York do not set their own minimum wages above the state-mandated regional rates.