The state’s minimum wage is set to go up again on Jan. 1, rising to $17.00 per hour in New York City, Westchester, and Long Island, while the rest of the state will see an increase to $16.00 per hour. This adjustment of 50-cents per hour is part of a planned series of increases that began three years ago. Annual increases beginning in 2027 will be indexed to the rate of inflation. That rate is to be determined using the Consumer Price Index for Urban Wage Earners and Clerical Workers for the Northeast Region.
Effective Jan. 1, New York’s minimum wage for service workers in New York City, Long Island and Westchester such as hat-check or nail salon personnel also is $17 per hour but with employers given a $2.85 credit to reflect tips the employee receives and the employer having to contribute only $14.15 to make a $17 minimum wage. In the rest of the state the employer pays a $13.30 cash wage and takes a $2.70 tip credit to total $16.
Employers must ensure the employee’s total earnings (cash wage from the employer plus tips) meets the full minimum wage for their region; if not, the employer pays the difference.
“From the tip of Montauk to Niagara Falls, this increase reflects our promise to put money back in New Yorkers’ pockets and uplift our hard workers,” Gov. Kathy Hochul said. “By continuing these investments and indexing wages to inflation, we’re making sure New Yorkers can keep up with rising costs by taking home more money.”
According to New York State Department of Labor Commissioner Roberta Reardon, “With costs rising, this increase is crucial for workers looking to make ends meet.”
An agreement was struck between Hochul and the State Legislature in 2023 to boost the minimum wage for the three years that followed, increasing at the fixed rate of 50-cents per hour. Starting in 2027, the minimum wage will increase annually at a rate determined by the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) for the Northeast Region.
According to the state’s Department of Labor, an employer that violates the Minimum Wage Law is subject to criminal prosecution and penalties. Action may also be taken in civil court. The commissioner of labor may require an employer to pay minimum wage underpayments and liquidated damages plus interest and civil penalties up to 200% of the unpaid wages.
The Massachusetts Institute of Technology’s Living Wage Calculator, as updated through Feb. 2025, shows that a single adult would need to earn $32.85 an hour as their living wage working full-time in order to avoid poverty in New York City. The MIT calculator shows that when working a full-time schedule of 2,080 hours per year the individual would gross $68,328 against expected living costs of $68,337. The calculator’s expected costs include $31,371 for housing, $12,200 for taxes, $6,801 for food, $4,380 for medical, $3,925 for transportation, $1,559 for internet and mobile phone, and $8,101 in other expenses. The federal poverty level for 2025 in the contiguous states was $15,560.
