Minimum wage raised in WV could cost some employers thousands - WVVA TV Bluefield Beckley WV News, Weather and Sports

Minimum wage raised in WV could cost some employers thousands

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CHARLESTON, W.Va. (WVVA) -- Gov. Earl Ray Tomblin has signed a bill raising minimum wages in West Virginia.

The bill will raise the current $7.25 an hour minimum wage to $8 on Jan. 1, 2015, and again to $8.75 the following year.

While this may help those people struggling to pay bills on the current rate, financial experts are concerned about an overtime provision that is unaccounted for in the new law as it stands right now.

Critics question the hidden costs of the new law, saying the bill prevents 80 percent of the state's employers from using federal overtime exemptions. Tomblin says it affects employers of seasonal employees, police, and nursing home staff, who would be paid for overtime when they were exempt before.

Financial experts tell WVVA this could hit many employers-- including municipalities-- right where it counts...their labor budget.

"Say they now have to start paying overtime fees," said Dr. Elaine Scott, a business professor at Bluefield State College and certified financial planner. "That's going to increase their budgets a lot. So unless they've found a way to fund those increases, these municipalities are going to have a hard time. They're going to have to find the money somewhere else, or they're going to have to cut services."
Tomblin says the oversight could cost cities hundreds of thousands of dollars. He met with legislative leaders to discuss ways to fix the problem.

Before signing the bill Tuesday, Tomblin said he believed it contained unintended consequences.
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