Virginia minimum wage increases Jan. 1 2025
Minimum wage increases to $12.41
FAIRFAX, Va. - Starting Jan. 1, 2025, Virginia's minimum wage will rise from $12.00 per hour to $12.41 per hour. This increase fulfills a provision in legislation passed in 2020 and is part of a broader plan to reach $15.00 per hour by 2026.
"This wage increase is a critical step toward ensuring fair compensation for Virginia workers," lawmakers said when the phased plan was initially approved.
The new wage is calculated by increasing the minimum wage rate for 2024 by a percentage of the current rate equal to the change in the Consumer Prince Index. The CPI-U in December 2023 was 3.4%. The new wage of $12.41 is a 3.4% increase from $12.00 an hour.
Other laws in effect in Virginia Jan. 1 2025
'Ethnic Origin' now a protected class
The Virginia Human Rights Act has been expanded to prohibit discrimination, harassment or retaliation based on an employee's ethnic origin, defined as the ancestry of a particular ethnic group.
According to the Virginia General Assembly, this addition strengthens protections for employees, ensuring that everyone is treated fairly and respectfully in the workplace. Employers must update their policies and training programs to include this new category.
Beneficial ownership reporting
Under the federal Corporate Transparency Act, certain businesses would have to submit Beneficial Ownership Information Reports (BOIR) to the Financial Crimes Enforcement Network (FinCEN) by January 1, 2025. The report would've required details about individuals with substantial control or a 25% ownership stake in the business. However, a U.S. District Court in Texas imposed a nationwide injunction on BOI reporting under the Corporate Transparency Act, which means neither may be enforced, and reporting companies don't have to comply with the CTA's January 1, 2025 deadline. The Department of Justice entered a notice of appeal in the case in early December.
DOL salary threshold rule nullified
In a significant legal development, a federal court has vacated a Department of Labor (DOL) rule that would have raised the salary threshold for exempt employees under the Fair Labor Standards Act. While the first phase of increases went into effect on July 1, 2024, the U.S. District Court for the Eastern District of Texas struck down the rule in November 2024.
As a result, the planned Jan. 1, 2025, increase is now void, and the July 2024 changes are no longer enforceable. Employers are advised to consult legal counsel to determine how to proceed.
As Virginia residents and employers navigate these changes, compliance with the new laws will ensure smooth transitions and avoid penalties. For more details, visit relevant state or federal agency websites.