Minimum wage: who is covered and how to collect what you are owed

It is the minimum wage law in force in Puerto Rico. Its declared public policy is to adjust the minimum wage to workers’ cost of living, on the principle that no worker be below the poverty level, that every worker have enough income to cover their basic needs, and to ensure progress and improvement in living standards; the state minimum must be reviewed periodically and adjusted to the rise in the cost of living, and that is the objective metric governing the Commission’s determinations. The law defines "worker" or "employee" as every person who performs any art, trade, employment or labor under another’s orders or for another’s benefit, for compensation of any kind or an express or tacit promise of it — and that definition does not include independent contractors.

Workers covered by the federal Fair Labor Standards Act, with the exclusions the law itself lists for the state increases: agricultural industry workers; employees of government agencies, instrumentalities, municipalities, the Judicial Branch and the Legislative Branch; and Administrators, Executives and Professionals as defined by Regulation Number 13 of the Minimum Wage Board. Independent contractors fall outside the definition of worker. Tipped employees are covered by their own rule.

• Being a worker or employee under the law: someone performing work under another’s orders or for another’s benefit for compensation. Independent contractors are not included.Verified against the official source
• Not falling under one of the exclusions from the increases: agricultural industry, government or municipal employment, Judicial or Legislative Branch, and the Regulation 13 Administrators, Executives and Professionals.Verified against the official source

• Your pay stubs, with hours worked and the rate paid: the difference owed is what you claim.
• If you receive tips, the record of what you earned: tips plus the federal tipped minimum must reach this law’s minimum wage.

1. 1

   Step 1: Confirm the current rate before calculating

   The law set a schedule — $8.50 an hour on January 1, 2022, $9.50 on July 1, 2023 and $10.50 on July 1, 2024 — but the law itself adds "unless the Minimum Wage Evaluating Commission issues a mandatory decree varying it". Also, the federal minimum applies automatically to workers covered by federal law, and the state one prevails while it is higher. So the first step is to confirm the current rate with the Department of Labor or the Commission: do not assume the last number you read is still today’s.

2. 2

   Step 2: Check whether you fall in one of the exclusions

   The increases this law sets apply to workers covered by the Fair Labor Standards Act, except those in the agricultural industry and employees of government agencies, instrumentalities, municipalities, the Judicial Branch and the Legislative Branch. They also do not apply to the so-called Administrators, Executives and Professionals as defined by Regulation Number 13 of the Minimum Wage Board. And mind the classification: this law’s definition of worker does not include independent contractors, so if you were classified as a contractor but work under the employer’s orders and for their benefit, the classification is the first thing to discuss.

3. 3

   Step 3: If you work for tips, do the full math

   The rule the law sets: employees who receive tips are entitled to the federal minimum wage in force for such workers, which added to tips must reach at least the minimum wage this law establishes or the mandatory decree approved. That is, tips do not replace the minimum: they complete it. If the sum falls short, the difference is owed.

4. 4

   Step 4: Calculate double: the difference plus an equal amount

   This is the remedy and it is worth reading slowly: every worker or employee who receives for their work compensation below that prescribed in this Act, in a collective agreement or in an individual employment contract has the right to collect, by civil action, the difference owed up to the full amount of the compensation due, for wages or any other benefit, plus an amount equal to what was left unpaid as additional compensation, plus the costs, expenses, interest and attorney fees of the proceeding, and no agreement to the contrary stands in the way of any of it. That last phrase matters: an agreement where you waived does not take the right away.

5. 5

   Step 5: You can claim as a group or ask the Secretary to sue

   The law opens two doors beyond the individual suit. First, the claims of several or all workers against a common employer for work performed at the same establishment, business or site may be joined in a single action. Second, the Secretary of Labor may sue on their own initiative, or at the request of one or more interested workers, and on behalf of and for the benefit of one or more in similar circumstances, for payment of any sum owed for wages, additional compensation, interest, costs, expenses and attorney fees. Claims may proceed by ordinary action or by any wage claim procedure established in other laws.

6. 6

   Step 6: Know what happens to a non-complying employer

   Any person who as employer, administrator, officer, agent, employee or manager violates, refuses to comply with, or neglects compliance with any provision of this Act, decree or regulation in force, shall be punished with a fine of no less than five hundred ($500) and no more than five thousand ($5,000) dollars at the Court’s discretion; on a repeat offense, no less than five thousand ($5,000) and no more than ten thousand ($10,000). They also incur civil liability for a sum equal to double the amount of the damages caused to the employee, and if the adjudicator cannot determine the amount of harm, they may impose compensation of no less than $500 and no more than $5,000. An employer who denies the Secretary access to work sites or to payrolls and records faces a fine of up to $600, and $1,500 on a repeat offense.

The Department of Labor and Human Resources enforces the law: the Secretary, personally or through authorized agents, may investigate working conditions, inspect books, payrolls and records, seek injunctions, and sue on workers’ behalf. The Minimum Wage Evaluating Commission, attached to the Department and made up of seven people — two for workers, two for employers, two economists and the Secretary, who chairs it — is the one that may set a higher state minimum by decree. Civil actions are heard at the Court of First Instance, Superior Division.

• Assuming the law’s scheduled figure is the current one: the Commission may vary it by mandatory decree.
• Forgetting the federal rate prevails when higher: the state one governs while it is the higher of the two.
• Believing tips replace the minimum: tips plus the federal tipped minimum must reach this law’s minimum.
• Not claiming the additional equal amount: the remedy is the difference PLUS an equal sum, with costs, interest and fees.
• Accepting that a signed agreement takes the right away: the law expressly says no agreement to the contrary stands in the way.
• Claiming only while still employed: the civil action does not depend on your still working there.
• Not checking your classification: if you were called an independent contractor but work under the employer’s orders, that is discussed first.
• Going alone when several coworkers are in the same position: claims against a common employer may be joined in a single action.

These are the government pages this guide is based on.

• Departamento del Trabajo y Recursos Humanos (DTRH)

  Departamento del Trabajo

  bvirtualogp.pr.gov