Topics on this page

• Minimum Wage
• Overtime
• When should I be paid?
• Why does my employer take money out of my paycheck?
• Must I file a tax return?
• Living Wage Law
• Equal Pay for Equal Work Act
• Secure Wage

 

Minimum Wage

The minimum wage is the lowest wage an employer can pay an employee. Effective January 1, 2024, Maryland’s minimum wage will be $15.00/hour for all employers. 

The minimum wage for 2023 varies based on the number of employees:

Employers with 15 or more employees

• January 1, 2023 – December 31, 2023: $13.25/hour 
• Beginning January 1, 2024: $15.00/hour 

Small employers (14 or fewer employees)

• January 1, 2023 – December 31, 2023: $12.80/hour 
• Beginning January 1, 2024: $15.00/hour 

Employees under 18 - Employers can pay employees who are under 18 years old at a minimum wage rate of 85% of the state minimum wage.

Read the law: Md. Code, Labor and Employment § 3-413

Tipped Employees - Employers may pay “tipped employees” (employees regularly earning more than $30 per month in tips) a lower wage, not less than $3.63 per hour in most of the state. An employer can only pay this tipped minimum wage where the employee earns enough in tips to bring his or her average hourly wage to the state minimum wage. Employers must supplement any deficiencies to bring the employee to the minimum wage level.

Read the law: Md. Code, Labor and Employment § 3-419

Exemptions - Some people are exempt from the state minimum wage law (though they may still be covered by the federal minimum wage law). Employees who are not entitled to the Maryland minimum wage include:

• Immediate family members of the employer;
• Certain agricultural employees;
• Executives, administrative, and professional employees;
• Volunteers for educational, charitable, religious, and non-profit organizations;
• Employees under 16 who are working less than 20 hours per week;
• Outside salespeople;
• Employees paid on commission;
• Employees enrolled as trainees as part of a public school special education program;
• Non-administrative camp employees;
• Employees of drive-in theaters;
• Certain food-packing or horticultural employees; and
• Certain employees in cafes, drive-ins, drugstores, restaurants, taverns, or other similar establishments that have annual gross incomes of $400,000 or less.

Read the law: Md. Code, Labor and Employment § 3-403

Local Laws - Your county or city may have its own minimum wage, which can be higher than the state's minimum wage. Check your local county or municipality's laws to learn more.

Federal Minimum Wage - The federal minimum wage is $7.25 per hour and applies to employers that operate in interstate commerce, which means they have business or contacts that cross state boundaries, or have contracts with the United States government.

Read the law: U.S. Code, Title 29 § 206

 

Overtime

Employees who are paid by the hour should generally be paid “time and a half” for each hour they work over 40 hours per week. This is known as “overtime pay.” Example: If your pay is $10 per hour, you should be paid $15 per hour for every hour of overtime, which is every hour you work over 40 hours in a week.

Under 16 Years Old - Youth under 16 years old must not work more than 40 hours per week.

Exceptions - Some agricultural workers get overtime pay only after working 60 hours in a week. Certain employees (e.g.,those who work in bowling establishments or are engaged primarily in the care of individuals and who are aged, sick, or disabled and reside in places other than hospitals) receive overtime pay only after working 48 hours in a week.

Under Maryland law, you may not be eligible for overtime pay (though you may still be protected by federal laws) if:

• you are exempt from state minimum wage laws;
• you work at certain amusement parks or swimming pools;
• you work for a not-for-profit concert promoter, legitimate theater, music festival, music pavilion, or theatrical show;
• you are a driver for an employer engaged in the business of operating taxicabs;
• you work for a rail or motor carrier regulated by the federal government (see U.S. Code, Title 49 §§ 10501, 13501, and 31502); or
• you are a mechanic, parts-person, or salesperson primarily selling automobiles, trucks or farm equipment.

Read the law: Md. Code, Labor and Employment §§ 3-211, 3-415, 3-420

 

When should I be paid?

Employers in Maryland must pay their employees at least every two weeks or twice every month. However, an employer may pay an administrative, executive, or professional employee on a less frequent schedule.

Read the Law:  Md. Code, Labor and Employment § 3-502

 

Why does my employer take money out of my paycheck?

Employers must make certain deductions from your paycheck to pay for your federal, state, and local income taxes as well as taxes under the Federal Insurance Contributions Act (“FICA”), which pays for your future Social Security and Medicare benefits. Employers and employees split the costs of FICA taxes, with employers and employees each paying half.

When you start a job, you are given a W-4 form. If you complete the W-4 correctly, the right amount of taxes should be taken out of your paychecks.

 

Must I file a tax return?

It is a good idea to file your tax return each year. Most employees are required to file tax returns before April 15 every year. The Internal Revenue Service (“IRS”) does not require people with low incomes, like many youth, to file tax returns. Even if you have a low income, you should still file a return as you may be entitled to a refund. Some low wage workers may also receive an Earned Income Tax Credit. If you're not sure whether you should file a tax return, talk with a tax professional.

 

Living Wage Law

Maryland law requires certain employers who contract with the state government to pay their employees a “Living Wage.” The amount of the Living Wage depends on the county where you actually work. The Living Wage is:

• $15.13 per hour in Montgomery County, Prince George’s County, Howard County, Anne Arundel County, Baltimore County, and Baltimore City; and
• $12.11 per hour in all other areas in the state of Maryland. If the living wage rate is below the state minimum wage, the minimum wage prevails and employees must be paid the higher figure.

These amounts are in effect until September 27, 2023. The amounts in effect starting September 28, 2023, are:

• $16.13 per hour in Montgomery County, Prince George’s County, Howard County, Anne Arundel County, Baltimore County, and Baltimore City; and
• $11.36 per hour in all other areas in the state of Maryland. If the living wage rate is below the state minimum wage, the minimum wage prevails and employees must be paid the higher figure.

Note that certain counties, such as Montgomery County and Baltimore City, have their own living wage laws for employers who contract with those local governments, and this can be a higher amount.

Who is covered under the Living Wage Law? You are covered if your employer has a contract with the state of Maryland and fits into certain categories. There are some exceptions. Your employer must pay you the Living Wage if:

1. the employer has a contract or a subcontract with the state of Maryland,
2. the services are valued at $100,000 or more (or $500,000 or more if the employer has 10 or fewer employees), AND
3. you spend at least half of your time working on the work covered by the contract.

Who is not covered under the Living Wage Law? Even if your employer has a state contract for $100,000 or more, you are not covered if any of the following are true:

• you are under the age of 17;
• you will work less than 13 consecutive weeks for the duration of the contract;
• you spend less than half of your normal work schedule doing work required by the contract;
• your employer has fewer than 10 employees and the contract is for less than $500,000;
• the living wage requirement conflicts with the requirements of a federal program;
• your employer is a public service company or a nonprofit organization;
• the contract is between units of state government or between a unit of state government and a county or Baltimore City; or
• the contract is for services needed to prevent or respond to an imminent threat to the public.

How do I find out if my employer has a state contract (and how much the contract is)? For more information regarding the Living Wage Law or to report a violation, contact the Maryland Department of Labor.

Can the Living Wage be changed? The Maryland's Commissioner of Labor and Industry reviews the Living Wage every year and may adjust the amount depending on the cost of living in the Washington-Baltimore metropolitan area. An employer may reduce the Living Wage amount (by no more than 50 cents) to account for employer contributions to a deferred compensation plan or health insurance premiums for the employee.

Read the Law: Md. Code, State Finance and Procurement §§ 18-101, 18-102, 18-103

 

Equal Pay for Equal Work Act

The Equal Pay for Equal Work Act provides wage related protections to employees. An employer may not discriminate between employees by paying individuals of one sex or gender identity a different wage for the same work. 

The Act also provides protections to employees to discuss their wages with other employees. The Act states that an employer:

• may not prohibit employees from asking about, discussing, or telling other employees their wages
• cannot require an employee to sign a document that prevents the employee from discussing their wages with other employees.
• may not punish employees for discussing wages
• must provide a wage range for the position if an applicant for the job requests the range

Read the Law: Md. Code, Labor and Employment § 3-304.1, 3-304.2

 

Secure Wage

Some employees at a "heightened security interest location" are entitled to a separate minimum wage. There are many types of jobs that are excluded, including retail and restaurant workers. For more details, see the Read the Law citation below.

"Heightened security interest locations" are BWI Marshall Airport and Pennsylvania Station in Baltimore.

• January 1, 2022 – December 31, 2022: $13.50/hour 
• January 1, 2023 – December 31, 2023: $14.25/hour 
• January 1, 2024 – December 31, 2024: $15.00/hour
• January 1, 2025 – December 31, 2025: $16.00/hour 

Read the Law: Md. Code, Labor and Employment § 3-1601