July 24, 2008 — The minimum wage in the territory went up to $6.55 an hour on Thursday, a 6.5 percent increase over the previous $6.15 in the Virgin Islands. But for workers on the mainland, the figure represents a hike of almost 12 percent.
That's because the V.I. rate was 30 cents higher than the national minimum wage, thanks to action by the Legislature in 2005.
Sandra Rey, senior research analyst at the V.I. Labor Department, said that the territory's employers must comply with the new federal law even though it is higher than the figure set by the Legislature.
There are no figures available on the number of minimum wage workers in the territory.
"It cuts across the board," Rey said, indicating that workers in the service and retail industries were those most likely to receive minimum wage.
However, Rey acknowledged that there are probably workers who fall through the cracks because they are in the Virgin Islands illegally and/or work in the underground economy.
Labor Department spokesman Jeanna Boschulte said that the department has received calls from people asking about the minimum wage.
"They have to comply," she said.
Employers who fail to pay the minimum wage will face penalties when they file their income tax returns because the Internal Revenue Service checks on such matters, Rey said. She said the Labor Department has no way to assess penalties for employers who fail to comply.
This is the second phase of three increases mandated by the U.S. Congress when it passed the Fair Minimum Wage Act of 2007. In July 2007, the federal minimum wage rose to $5.85 an hour. On July 24, 2009, it will increase to $7.25 an hour.
According to a press release from the U.S. Labor Department, employers are required to post a notice explaining the Fair Minimum Wage Act.
For questions about the new minimum wage, call the Labor Department at 776-3700 on St. Thomas and 692-9685 on St. Croix.
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