January 2021, Massachusetts
For the year 2021 the State and Federal Governments have announced the following changes affecting employers and employees:
- Minimum Wage: Massachusetts minimum wage will increase from $12.75 per hour to $13.50 per hour. This increase continues the changes in the minimum wage in Massachusetts with the ultimate goal of provided a $15.00 an hour minimum wage in 2023. Also, the tip wage has been increased to a minimum of $5.55 per hour from $4.95 per hour. The Federal minimum wage continues to be $7.25 per hour; however, President Biden has recommended to Congress it be increased to $15.00 per hour.
- Retail Sunday Rate: In accordance with the Grand Bargain dealing with the increase in the minimum wage, the Commonwealth has further reduced the retail Sunday and certain holiday premium rates to 1.2 times the regular rate of pay for employees working on those days. The rate will be reduced next year to 1.1 and then to 1.0 in 2023.
- Internal Revenue Service Standard Mileage Rate: The IRS reduced the standard mileage rate from $.575 per mile in 2020 to $.56 per mile in 2021.
- Social Security Maximum Taxable Base: The Social Security Administration has increased the maximum taxable base from $137,700 in 2020 to $142,800 for 2021.
- 401(k) or 403(b) Contribution Limits for 2021: An employee may contribute up to $19,500 per year, and employees 50 or older may also contribute an additional $6,500 per year. This is an increase of $500 over 2020 amounts in both categories.
With one of the most experienced labor and employment practices in the region, Seder & Chandler attorneys have extensive knowledge in all areas of labor law and employer/employee relations. Clients range from large corporations and universities to small retailers and service firms—public, private, union and non-union employers.
D.M. Moschos, Of Counsel
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Phone: (774) 243-9959