Virginia Minimum Wage: Rates and Employer Rules

One January a restaurant owner in Richmond called me because his bookkeeper had spotted something ugly in the first payroll run of the year. Six servers and two dishwashers were still on the old hourly rate. The state minimum had moved on January 1, the payroll file had not, and two weeks of underpayment were already out the door.

That mistake is easy to make in Virginia because the number keeps moving. For two years it moved by inflation, announced each summer for the following January. Then the General Assembly put fixed steps back into the statute, so the next two increases are already known amounts on known dates. That is good news: you can budget them now instead of waiting for an announcement.

This page covers one thing, the Virginia wage floor: the current rate, the increases already on the calendar, tip credit math, exemptions and the steps to take each January, in the order a payroll question actually arrives. For overtime, leave, hiring paperwork and everything else the Commonwealth requires, the Virginia HR compliance guide is the broader reference.

FirstHR exists because small teams without an HR person carry this whole load themselves. The rate, the tip credit math and the paperwork that proves you applied both all land on the same person in a company that size, usually the owner.

The Virginia Minimum Wage Rate

The Virginia minimum wage is $13.75 per hour, effective January 1, 2027 (until then, $12.77 per hour, in force since January 1, 2026), and $15.00 per hour, effective January 1, 2028. All three amounts are written into Va. Code section 40.1-28.10, which requires every employer to pay the greater of the state rate or the federal rate.

The rate applies to most employees working in Virginia, whether they are full-time, part-time or temporary. Headcount does not matter. A two-person shop is covered on the same terms as a two-hundred-person one, which is a real difference from Virginia rules such as workers compensation and discrimination coverage that switch on at a threshold.

The $12.77 figure started as an inflation adjustment. The Commissioner of Labor and Industry announced it on July 29, 2025, taking the 2025 rate of $12.41 and adding the 2.9 percent rise in the Consumer Price Index for all urban consumers (CPI-U). Legislation enacted in 2026 then copied that number into the statute and added fixed steps after it.

The flat stretch in the middle of that table trips people up when they look up an older figure. The rate sat at $12.00 from January 1, 2023 through the end of 2024. The 2020 act had also written in $13.50 and $15.00 steps, but they were conditional on the General Assembly reenacting them (passing them a second time) by July 1, 2024, and that reenactment failed.

When it failed, the statute's fallback took over: $12.00 adjusted by the 3.4 percent CPI-U rise gave $12.41 for 2025. The history is not trivia. Virginia wage claims reach back three years, so a claim filed now can touch hours worked in 2023 and 2024, and back pay is calculated at the rate in force then.

The Next Scheduled Increases

The Virginia minimum wage becomes $13.75 per hour on January 1, 2027 and $15.00 per hour on January 1, 2028. The first step is 98 cents above the 2026 rate, and the second adds a further $1.25. Governor Spanberger signed the bills on April 9, 2026, and the amounts are now in the Code.

Because these are fixed amounts rather than inflation adjustments, no summer announcement precedes them. Employers who spent past years waiting for the Commissioner to publish a number can skip that step for the next two cycles and put the dates straight into the compensation plan.

Annual indexing returns after the $15.00 step. The Commissioner sets the adjusted rate for 2029 by October 1, 2028, and by October 1 every year after that, using the CPI-U increase for the most recent calendar year. The statute says the adjustment can never be below zero, so the wage floor holds steady rather than falling if prices stall.

The budget arithmetic is simple and worth doing early. Moving one full-time employee from $12.77 to $15.00 costs $2.23 an hour, or about $4,638 a year at 2,080 hours, before payroll taxes. A crew of eight at the floor is roughly $37,000 of additional annual wage cost phased across two Januaries.

Tipped Employees and the Tip Credit

Virginia allows a tip credit. A tipped employee can be paid a cash wage as low as $2.13 per hour, provided tips bring total earnings to at least the Virginia minimum for every hour worked. The Department of Labor and Industry states this plainly in its rate announcement, pointing to the Fair Labor Standards Act for the $2.13 cash floor and to Virginia law for the total.

The mechanics sit in Va. Code section 40.1-28.9. A tipped employee is one who customarily and regularly receives more than $30 a month in tips. The employer determines the amount credited, and the employee can challenge that amount by establishing actual tips with clear and convincing evidence. An employee who is barred by law from soliciting tips cannot be classified as tipped at all.

Notice what the table does to your risk. The cash wage stays frozen while the credit widens, so each increase makes tips carry more of the total. In a slow week that gap is the employer's to fill, and the shortfall is calculated per workweek, not averaged across a month. Federal notice rules for taking the credit still apply.

The federal table agrees with the state arithmetic. The US Department of Labor lists Virginia at a $2.13 minimum cash wage against a $10.64 maximum tip credit in its state tipped wage table, effective July 1, 2026. Two agencies, one number, so a lower cash wage is not defensible from either direction.

City and County Rates

No Virginia city or county sets its own minimum wage for private employers. There is one statewide rate, which means a business with locations in Roanoke, Richmond and Virginia Beach runs the same wage floor in all three. That is one fewer thing to track than employers face in states with local ordinances.

Two contract-based exceptions exist, and neither is a general wage law. A locality can require higher pay from companies that hold its own service contracts: Alexandria does this through a living wage ordinance covering contractors providing services on city-owned or city-controlled property.

Public works contracts are the second exception. Public works contracts over $250,000, whether awarded by a state agency or by a locality that has adopted a prevailing wage ordinance, carry prevailing wage rates determined by the Commissioner under Va. Code section 2.2-4321.3. The $250,000 floor applies to the whole section, so a local contract at or below it is excluded just as a state one is. No such rate may fall below the federal Davis-Bacon rate for the same work.

The cross-border case is the one that catches Northern Virginia employers. Under D.C. Code section 32-1003(b-1), staff who perform at least 2 hours of work in the District for you in a workweek are owed the DC minimum wage for each of those hours. For that time, DC wage law governs regardless of where your office sits.

The rate in Virginia Beach, Richmond and other Virginia cities

It is $13.75 in every one of them from January 1, 2027 ($12.77 until then), and $15.00 from January 1, 2028. Virginia Beach, Richmond, Norfolk, Chesapeake and Arlington all run on the same statewide floor, because Virginia gives localities no authority to set a separate wage minimum for private employers. The city on your address line changes nothing about the number you owe an hourly employee.

What a city does change is the market rate. Most of the Virginia Beach and Richmond employers I have worked with pay hourly staff above the floor, because that is what filling the shift costs. Treat the state rate as the compliance number and set the hiring number from what employers near you actually post.

Who Is Exempt From the State Rate

Virginia exempts workers mostly by category rather than by industry, and the exemptions sit in the definition of employee in Va. Code section 40.1-28.9. There is no fast food carve-out and no healthcare carve-out. Home care providers are named as included, so home health and personal care staff are covered.

The one true industry exemption is agriculture, and it is ending. Farm laborers and farm employees are excluded from the state act only until January 1, 2027. From that date the same wage floor that covers a retail clerk covers a farm crew, which for many Virginia growers is the biggest payroll change of the decade.

One trap deserves its own paragraph. Exempt from the Virginia act does not mean exempt from federal law. A worker excluded from the state definition may still be covered by the federal wage floor, and the two systems have to be checked separately.

A further exclusion covers certain workers with disabilities employed under a special federal certificate issued before July 1, 2023. That exclusion disappears from the statute on July 1, 2030, at which point those workers move onto the standard Virginia rate.

Youth and Training Wages

Virginia has no separate youth rate. Instead, anyone under 16 falls outside the state act entirely, so the federal wage floor governs that work. Federal law also allows a youth opportunity wage of $4.25 per hour for employees under 20 during their first 90 consecutive calendar days, under 29 U.S.C. 206(g).

Virginia does have a training wage. Va. Code section 40.1-28.10(A)(2) sets the floor at the greater of the federal minimum wage or 75 percent of the Virginia minimum for a person enrolled in an established employer on-the-job or other training program lasting no more than 90 days. The catch sits in the same provision: the program has to meet standards set by regulations adopted by the Commissioner.

Round the training wage up, never down. Seventy-five percent of $13.75 is $10.3125, so from January 1, 2027 $10.32 is the safe number and $10.31 is a shortfall. Before paying anyone at this level, confirm with the Department of Labor and Industry that your training program qualifies, because a program that falls short of the regulatory standard leaves you owing the full rate.

The Poster Requirement

Virginia does not require a minimum wage poster. The Department of Labor and Industry lists the Virginia Minimum Wage Notice under optional state posters and publishes a fresh English and Spanish version for each calendar year. The federal Fair Labor Standards Act poster, WH Publication 1088, is on the required federal list and every covered employer must display it.

Post the optional notice anyway. It costs nothing, it answers the question employees ask most often in January, and it is evidence that the current rate was communicated. Swap it for the new version each year, the same week you update payroll.

The rule with teeth is on the pay statement. Va. Code section 40.1-29 requires a paystub or online statement every payday showing the rate of pay, gross wages and the amount and purpose of every deduction, with enough detail for the employee to check the math.

The statement must also list hours worked for anyone paid hourly or on a salary below the federal exempt threshold. Keep those records for three years. After an increase, the paystub is what proves the new rate was applied on the right date.

Virginia Against the Federal Floor

The federal minimum wage is $7.25 per hour and has not moved since July 2009, per the Department of Labor federal rate history. Virginia’s rate sits $6.50 above it from January 1, 2027 and $7.75 above it once the $15.00 step lands on January 1, 2028. The statute settles any conflict in one line: employers pay the greater of the state rate or the federal rate.

In practice the federal number matters in Virginia only for workers the state act excludes. For them, the federal floor is the one that applies wherever federal law covers the work.

What to Do Each Time the Rate Rises

Treat every January 1 as a small project with a December deadline. The work is not complicated, but it touches payroll, tip credit math, offer letters and the break room wall, and skipping any one of them is how an owner ends up making the call I described at the top of this page.

Overtime moves with the base rate as well, because the regular rate of pay is the starting point for the premium. If most of your crew sits at or near the floor, model the overtime cost alongside the base increase rather than after it.

What Underpayment Costs

The fine written into the Virginia Minimum Wage Act is trivial, between $10 and $200 for a knowing and intentional violation. The real exposure is the civil claim, because Va. Code section 40.1-28.12 sends minimum wage cases into the remedies in Va. Code section 40.1-29.

Under those remedies an employee can sue alone, jointly, or as a collective action on behalf of similarly situated workers. A court that finds unpaid wages must award the wages, an equal amount again as liquidated damages, prejudgment interest at 8 percent and reasonable attorney fees. Where the failure to pay was knowing, the award is triple the wages due, and claims reach back three years.

Virginia added one narrow defense on July 1, 2026. In a wage action filed on or after that date, the court or the Commissioner awards no additional damages or penalties if the employer shows it acted in good faith on reasonable grounds. The defense is open only to an employer that paid all withheld wages within 14 days of being notified.

Employees can also file a wage complaint with the Department of Labor and Industry rather than going to court, and the Commissioner has authority to investigate, subpoena records and issue orders. Whichever route an employee takes, your cheapest protection is the December routine above: a payroll file that changes on January 1 and a paystub that shows it did.

Frequently Asked Questions